House Higher Education Act reauthorization bill introduced

By Katie Brown, December 04, 2017

On Friday, House Education and Workforce Committee Chairwoman Virginia Foxx, introduced the Promoting Real Opportunity, Success, and Prosperity through Education Reform (PROSPER) Act. If signed into law, this bill would be the first reauthorization of the Higher Education Act (HEA) since 2008.

The bill embodies many of Chairwoman Foxx’s priorities, including the consolidation of federal student aid, the expansion of apprenticeships and the reconfiguration of the Federal Work Study program. The bill also includes a number of provisions intended to reduce federal regulations on higher education institutions, including elimination of the gainful employment rule and statutory limitations. Unlike the bipartisan Perkins Act reauthorization bill passed by the House earlier this summer, the PROSPER Act is being advanced as a party-line measure without Democratic co-sponsors, which means that bill would have little chance of advancing through the Senate as drafted. 

While the PROSPER Act takes some important steps to address the evolving needs of 21st century students, educators and community partners, the bill falls short of helping working adults enter the postsecondary education system and misses key opportunities to bring businesses and other stakeholders to the higher education conversation. National Skills Coalition will look to work with policymakers over the coming months to advance HEA reauthorization, building on the strengths of the PROSPER Act while seeking to ensure that any final bill is consistent with the Community College Compact outlined in our Skills for Good Jobs agenda and our broader HEA reauthorization recommendations.  

Key elements of the PROSPER Act include:

  • Gainful employment (Title I, Section 104) – The PROSPER Act eliminates the Gainful Employment (GE) rule—a regulation put in place by the previous Administration aimed at weeding out bad actors in the for-profit education space. To hold career education programs accountable, the rule ties federal student aid funds to student outcomes using a debt-to-earnings metric.

    Despite legal action against the Department of Education by several for-profit colleges, the rule went into full effect last year; with the first full set of career program outcomes set to be released in January 2018. However, Secretary DeVos has consistently vowed to overhaul the rule with support from House and Senate Republicans including Chairwoman Foxx, who has remained a consistent critic of GE. Many higher education advocates have voiced concern over the impending elimination of the rule, citing a loss protection and transparency for students attending poor-performing career education programs.

  • Secretarial Authority Prohibitions (Title I, Section 116) – This new measure places strong prohibitions on the Secretary of Education to prevent her from exceeding her authority. Specifically, this bill bars her from issuing definitions for higher education terms that are inconsistent with the law, or adding requirements on institutions and states that are not explicitly authorized by law. These provisions are similar to the secretarial authority prohibitions set forth in the Every Student Succeeds Act (the law governing K-12 education) and the Strengthening Career and Technical Education for the 21st Century Act (the House-passed Perkins Act reauthorization bill.)

    Additional legal restrictions on the authority of the Secretary of Education have been met with concern by various stakeholders, including civil rights groups, student advocates and several legislators. These groups believe in the importance of protecting the role of the Secretary as it relates to the quality of education programs, safeguarding the rights of students and intervening in state and local matters when appropriate. In fact, a disagreement over the scope of secretarial authority provisions is thought to be stalling the consideration of a Perkins Act reauthorization bill in the Senate.

  • Information Sharing through a College Dashboard Website (Title I, Section 121) – The Act contains language that directs the Secretary of Education to develop a college dashboard website, displaying detailed information about various higher education institutions; including:

    • Number of students enrolled;
    • Student to faculty ratio;
    • Percentage of degree-seeking or certificate-seeking undergraduate students enrolled at the institution who obtain a degree or certificate within the appropriate time window, as well as the percentage of those who do not;
    • The median earning of students who obtained a certificate or degree, both in the 5th and 10th years following their graduation; and
    • Federal student debt incurred by students at the institution.

The College Dashboard takes some steps to provide information that would help students and their families make informed decisions about postsecondary education. However, the data displayed on the Dashboard may fail to represent a complete picture of student outcomes. For example, the earnings data would only include graduates who received financial aid under Title IV.

  • Expanding Access to In-Demand Apprenticeships (Title II, Sections 201 and 202) – The PROSPER Act repeals Title II of the HEA, which is the only federal initiative focused on strengthening higher education-based teacher preparation, and replaces it with a new apprenticeship grant program. This program authorizes the Secretary to issue grants on a competitive basis for a minimum of 1 year and a maximum of 4 years, to partnerships between businesses and educational institutions that are working to provide work-based learning opportunities for students. These grants, authorized at a funding level of $183,204,000, will require a 50% match from the grantee. Students must be able to complete these work-based learning programs in two years or less, and they must result in a recognized postsecondary credential upon completion.

    Making valuable work-based learning opportunities more accessible for students is a worth-while cause—one that is consistent with the recommendations set forth in NSC’s Community College Compact. However, this section should be strengthened to ensure equity among small, mid-sized and large businesses when it comes to the ability to participate in this well-intentioned grant program. Additionally, this new title should call for some level of engagement from the Department of Labor, considering their evolving role in expanding apprenticeships.

  • Federal Pell Grants (Title IV, Section 401) – Perhaps one of the most controversial provisions of the PROSPER Act is the comprehensive restructuring of student aid programs. The bill converts the various loan, grant, and work study options that are currently available to students to help finance their education, to one grant program, one loan program and one Work-Study program. The bill would largely consolidate existing loan programs into a single federal ONE loan program, eliminating the current Federal Direct Loan Program, the Perkins Loan program, and others, A federal aid overhaul has been a longtime priority of the Chairwoman, and is an attempt to make the college application process more straightforward for students and their parents. However, consolidation of current loan, grant and work study programs has been met with criticism by stakeholders who are concerned that these changes will result in less access to aid for current and future learners.

    In addition to a major transformation of the way federal student aid is administered and repaid, the PROSPER Act makes changes to the eligibility provisions attached to Pell funding. Under current law, only students enrolled in a program of study that require at least 600 clock hours and 15 weeks of instruction are eligible for Pell assistance. This limitation excludes non-traditional students who may be looking to upskill through high-quality, short-term programs—an issue that has long been recognized by NSC. The PROSPER Act aims to address this issue in Title IV, Section 481, by defining a Pell-eligible program as one that is at least 300 clock hours over 10 weeks of instruction. This title also expands Pell eligibility to competency-based programs, or those that measure student achievement through the demonstration of their skills rather than the amount of time they spend in a classroom.

    While these provisions take steps to recognize the evolution of higher learning, as currently drafted the bill does little to ensure that short-term programs are aligned with the needs of employers and industry partners. As such, NSC believes that a more effective way to accommodate the needs of non-traditional students while ensuring that short-term programs recognized under the HEA are of high-quality, is to include language from the JOBS Act in any reauthorization bill. The JOBS Act, introduced by Senators Kaine (D-VA) and Portman (R-OH) earlier this year, aims to accomplish the following:

    • Expands Pell Grant eligibility to students enrolled in short-term skills and job training programs that are at least 150 clock hours of instruction time over a period of at least 8 weeks;
    • Ensures that short-term programs provide training that is recognized as valuable by employers and/or industry partnerships;
    • Equips students with licenses, certifications or credentials that meet the hiring requirements of multiple employers in the field for which the job training is offered; and
    • Encourages institutions to ensure that short-term programs are aligned with broader career pathways and basic skills instructions where appropriate.
  • Ability to Benefit Students (Title IV, Section 485) –  The PROSPER Act modifies the requirements for the “ability-to-benefit” provision, which allows students who did not receive a high school diploma (or its recognized equivalent), or who did not complete a secondary school education in a home-school setting, to be eligible for Title IV financial aid. Under current law, AtB students must be enrolled in an eligible “career pathway” program, and may demonstrate their “ability to benefit” from postsecondary education through completion of 6 credit hours or equivalent coursework, passing an independent examination, or other processes identified by a state.

PROSPER eliminates the language requiring students to enroll in a career pathway program, and authorizes AtB only through completion of six credit hours or equivalent coursework. NSC  is concerned that the  elimination of the career pathway requirement may limit student  access to counseling and support services that can help them identify and attain their academic and career goals.

  • Federal Work-Study (Title IV, Part C) – In a push to improve the existing Federal Work Study  (FWS) Program, which finances part-time employment for students to help cover the cost of their education, the PROSPER Act increases the authorized FWS funding level from $1.1 billion to $1.7 billion for FY 2019-2024. The act also eliminates the requirement that institutions spend 7% of their FWS on supporting students who are participating in community service projects and replaces it with an increased focus on work-based learning opportunities.

Additionally, under the PROSPER Act, the current FWS funding formula would shift from one that abides by historical funding levels to one that directs more money to schools that enroll a high number of Pell-eligible students. The measure also aims to provide more flexibility to institutions by lifting the existing 25% cap on private sector employment—a change that is intended to place more students in jobs that relate to their programs of study.

  • Repeals (Title IV, Sections 406, 451 and 461 ) – The PROSPER Act eliminates a number of HEA programs, including:
    • Public Student Loan Forgiveness Program (PSLF)
      • PSLF provides federal student loan forgiveness to individuals who choose to work in the public service sector for at least 10 years after graduating from a program of higher education.
      • An estimated 553,000 individuals in the public service sector would be eligible to apply for loan forgiveness under this program starting from October 2017.

    • Revised Pay as You Earn (REPAYE)
      • Released in 2015 by the Education Department, this new income-driven repayment plan aims to increase the pool of borrowers eligible to have their monthly payments capped at 10% of their discretionary income. An estimated 5 million individuals are currently eligible for this repayment option.
    • Income-Based Repayment (IBR)
      • Available since 2009, IBR is the most widely available income-driven repayment plan for federal student loans.
    • Academic Competitiveness Grants (ACG)
      • ACGs are awarded to first-and second-year undergraduates who completed a rigorous high school curriculum, as defined by the Department of Education.
      • These grants have not been available since the 2011-2012 financial aid award year due to government spending cuts.
    • Federal Supplemental Educational Opportunity Grants (SEOG)
      • SEOG is a federal assistance grant reserved for college students with the greatest financial need—roughly 81% of students who receive SEOG come from families earning less than $30,000 per year.
      • SEOG provides approximately $732 million in additional grant aid to nearly 1.6 million students.
    • Leveraging Educational Assistance Partnership Program (LEAP)
      • Provides grants to states to assist them in providing need-based grants and community service work study assistance to eligible postsecondary students.
      • LEAP grants have not been funded by the federal government since 2011.
    • Robert C. Byrd Honors Scholarship Program
      • The Byrd Honors Scholarships were established in 1985, providing scholarships to high school seniors who showed promise of continued excellence in postsecondary education.
      • Funding for the scholarship was eliminated for the 2011-2012 school year and has not been reinstated.
    • TEACH Grants (prohibits new grants from being made after January 30, 2018)
      • TEACH Grants provide up to $4000 per year to student who agree to teach for 4 years at an elementary school, secondary school, or educational service agency that serves students from low-income families.
    • William D. Ford Federal Direct Loan Program
      • Direct Loan is the largest federal student loan program.
      • Through this program, schools can receive 4 types of loans (Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans, and Direct Consolidation Loans) which are then disbursed to eligible students.
    • Federal Perkins Loan Program
      • Perkins Loans are low-interest federal student loans for undergraduate and graduate students with exceptional financial need.
      • For the past few years, the program has made loans to about 500,000 students per year.

NSC is concerned that a number of these repeals will adversely affect students in need of financial aid—negatively impacting access and equity in higher education. We hope that Congress will consider increasing investments to ensure that working adults and non-traditional students have the resources they need to succeed in postsecondary education programs.