Republicans in both the House and the Senate have recently released a slew of new legislation focused on reforming higher education.
In the Senate, Republicans announced the Lowering Education Costs and Debt Act, which itself comprises a bundle of five bills.
The College Transparency Act (CTA) is a bipartisan bill that aims to remove the student unit record ban, which prevents the government from matching data in all of its various databases. For example, earnings data from the IRS cannot be matched at an individual level with education data from the Department of Education. This ban keeps students, parents, the public, and even institutions relatively ignorant of educational outcomes. Without it, we could begin to identify which colleges and universities provide the greatest benefits to which students. Maintaining the ban forces us to continue living in an informational ghetto, where sketchy, input-based rankings, like those of U.S. News and World Report, dominate.
The Understanding the True Cost of College Act, introduced by Sen. Chuck Grassley (R-IA), “would require colleges to use uniform financial aid offer forms and develop standard definitions that would be used in all financial award letters.” This is important because over 90% of colleges and universities lie to or mislead students about their net cost of attendance.
The Informed Student Borrower Act, introduced by Sens. Steve Daines (R-MT) and Bill Cassidy (R-LA), would provide more information about student loans to potential borrowers. Interestingly, students would have to manually select the size of the loan they would like to take out (currently, they have to opt out of taking the maximum loan for which they are eligible). Behavioral nudges like these can have a dramatic effect on choices, so this is a novel and worthwhile idea to try.
The Streamlining Accountability and Value in Education (SAVE) for Students Act, introduced by Sen. John Cornyn (R-TX), would consolidate student loan repayment options to two choices: the standard, ten-year repayment plan and a slightly revised REPAYE program. But, importantly, the bill would also limit borrowing at programs with low earnings, defined as undergraduate programs where graduates earn less than a high school graduate, and graduate programs where graduates earn less than a bachelor’s degree graduate. This is similar to the Biden administration’s plan to utilize an earnings floor in its gainful employment regulations, but in a vast improvement, Sen. Cornyn’s bill would cover all higher education programs, rather than selectively target for-profit and certificate programs.
The Graduate Opportunity and Affordable Loans (GOAL) Act, introduced by Sen. Tommy Tuberville (R-AL), would end the Grad PLUS loan program (a great idea), allow schools to reduce the maximum loan amount (also a good idea), and establish different loan limits for graduate students using the Stafford loan program.
Over in the House, Reps. Burgess Owens (R-UT), Lisa McClain (R-MI), and Virginia Foxx (R-NC) have introduced the Federal Assistance to Initiate Repayment (FAIR) Act. The act would replace existing income-driven repayment plans with a new option that would drop time-based forgiveness, automatically enroll financially struggling borrowers, and prevent balances from ballooning by waiving some unpaid interest.
Rep. Owens also introduced the Accreditation for College Excellence (ACE) Act, which would outlaw political litmus tests in accreditation by prohibiting “accreditors from assessing an institution’s commitment to any ideology, belief, or viewpoint for the purposes of receiving accreditation for HEA funding.”
While not perfect, all of these bills have the potential to improve higher education. This flurry of activity also indicates that, in the words of Beth Akers, congressional Republicans “have really stepped up to the plate in a big way with reforms that would meaningfully improve our broken system of higher education finance.”