New England Board of Higher Education » federal education policy

DC Shuttle: Loan Rate Bill on to WH; Workforce Reauthorization Trudges Ahead; Info From For-Profits Deemed Inconsistent

John O. Harney — Tue, 06 Aug 2013 15:26:20 +0000

Student loan interest rate bill sent to president. On Wednesday, the House approved the Bipartisan Student Loan Certainty Act (H.R. 1911) by a vote of 392 to 31. The Senate passed the legislation the previous week and the bill is headed to the president, who has endorsed the legislation, for approval. The bill would modify how interest rates on federal student loans are set, tying interest rates to market rates, with loan interest rates fixed for the period of the loan. The bill would apply to all loans, except Perkins loans, issued on or after July 1, 2013. Interest rates would be pegged to the 10-year Treasury note, plus 2.05% for subsidized and unsubsidized portions of undergraduate loans, 3.6% for graduate loans and 4.6% for PLUS loans. The maximum rate would be capped at 8.25% for undergraduate loans, 9.5% for graduate student loans, and 10.5% for PLUS loans. The bill calls for a broader government study of college costs, at the request of Education Committee Chair Tom Harkin (D-IA). Harkin has suggested the rates could be revisited as Congress begins to address the reauthorization of the Higher Education Act, saying the results of the proposed study on college costs would provide important context. The Congressional Budget Office "scores" the proposal at about $700 million.

Workforce Investment Act approved by Senate panel. On Wednesday, the Senate Health, Education, Labor and Pensions Committee approved a renewal of the Workforce Investment Act (WIA), the federal law that governs workforce training, by a vote of 18 to 3. The bill (S. 1356) would overhaul a broad range of job-training programs at community colleges, which haven't been updated in 15 years. The measure would reauthorize the 1998 Workforce Reinvestment Act which expired in 2003. Under the bill, states would submit a single plan detailing their workforce development and training efforts, and use a single set of performance indicators to evaluate program success. A 2011 Government Accountability Office (GAO) report found that 44 of the 47 federal job-training programs that exist under current law overlap in some way. The two-year sector seems to support the legislation. It faces an unclear future, however, in part because the House passed a much different job training bill earlier this year. The House-passed bill (H.R. 803) would consolidate 35 employment and training programs into one fund that would serve as a single source of support for employers and job seekers. Funding for those programs would be merged into a block grant to the states.

Audit of financial transparency of for-profits. Financial information that for-profit colleges submit to the U.S. Department of Education is inconsistent and generally not helpful, according to an audit by the department's Office of Inspector General. For-profits provide financial statements to the department as a requirement of their participation in federal financial aid programs but those statements lack transparency, the audit found, because the presentation of instruction and marketing costs is not consistent across institutions. The audit reports, "We determined that the audited financial statements that proprietary schools submitted to the department under 34 C.F.R. § 668.23 generally did not provide transparent information because the presentation of instruction and marketing expenses was not consistent across schools. We concluded that the financial information reported by schools is generally not useful to the department for purposes of identifying how schools spent their funds or making meaningful comparisons of financial information across schools participating in the Title IV, Higher Education Act programs."

As a member of New England Council, we publish the DC Shuttle each week featuring higher ed news from Washington. This edition is drawn from the Council's Weekly Washington Report Higher Education Update, of Aug. 5, 2013.

Founded in 1925, the New England Council is a nonpartisan alliance of businesses, academic and health institutions, and public and private organizations throughout New England formed to promote economic growth and a high quality of life in the New England region. The Council's mission is to identify and support federal public policies and articulate the voice of its membership regionally and nationally on important issues facing New England. For more information, please visit: www.newenglandcouncil.com.

DC Shuttle: Many Progressives Wary of Senate-Approved Loan Rate, GOP Ed Reforms

John O. Harney — Mon, 29 Jul 2013 15:17:57 +0000

Senate approves student loan interest rate bill. On Wednesday, the Senate approved the Bipartisan Student Loan Certainty Act by a vote of 81 to 18. House leadership has promised swift approval of the legislation, with a vote in the House likely this week. The bipartisan proposal would tie interest rates on undergraduate subsidized and unsubsidized Stafford loans to the 10-year Treasury note plus 2.05 percentage points for undergraduates, and plus 3.6 percentage points for graduate loans. This translates into an interest rate of approximately 3.86% for undergraduate students for the coming year, higher than the 3.4% rate that lapsed on July 1, but certainly more manageable than the current 6.8% rate. Graduate students would have access to loans at 5.4%, and parents would be able to borrow at 6.4%. The interest rates would apply retroactively to loans taken out since July 1, 2013. The compromise does include caps on interest rates for these loans—8.25% for undergraduate students, 9.5% for graduate students and 10.5% for PLUS loans for parents. The compromise proposal also calls for a broader government study of college costs, at the request of Education Committee Chair Tom Harkin (D-IA). Harkin did suggest the rates could be revisited as Congress begins to address the reauthorization of the Higher Education Act, saying the results of the proposed study on college costs would provide important context. Harkin said Wednesday that "this discussion will continue" next year when the Higher Education Act comes up for reauthorization. The Congressional Budget Office estimates the value of the proposal at about $700 million. Sixteen Democrats voted against the bill. The plan does not address the $1 trillion in student loan debt that already exists. It does not address the growing cost of a college degree. It does not reduce the billions of dollars in profit they say that the government earns from these loans. And it establishes a rate-setting system that will probably lead to higher rates. "My colleagues who support this proposal say that it will lower interest rates on loans for this year—and that's all that matters," said Sen. Elizabeth Warren (D-MA). "Now, that's the same thing credit card companies said when they sold zero-interest credit cards, and it's the same thing subprime mortgage lenders said when they sold teaser-rate mortgages. In all of these cases, the bill comes due." Warren introduced an amendment with Sen. Jack Reed (D-R.I.) that would cap the new interest rates at the current rates. That amendment failed. So too did an amendment introduced by Sen. Bernard Sanders (I-Vt.) that would have authorized the new rates for just two years.

Democrats resist House education bill. Democrats and the Obama administration lashed out against the GOP proposal to reform national education policy and change the provisions of No Child Left Behind. Education Secretary Arne Duncan said the bill "marks a retreat from high standards for all students and would virtually eliminate accountability for the learning of historically underserved students—a huge step backward for efforts to improve academic achievement." Senate Democratic leadership said it would not consider the bill in the Senate. On July 19, the House passed the Student Success Act (H.R. 5). The bill, a departure from the policies of No Child Left Behind, would reduce the federal role in public education and cede back to states decisions about how to deal with failing schools, how and whether to evaluate teachers, and how to spend much of the money sent by Washington to educate poor, disabled and non-English-speaking students. The bill would eliminate the current accountability system, called adequate yearly progress, and would allow states to develop their own academic standards in reading, math and science, and leave to their discretion whether to set standards for other subjects. The bill also would allow states to identify their poorest-performing schools and let local districts develop their own strategies for improving them. The bill consolidates multiple programs into a Local Academic Flexible Grant, which would allow states and school districts to support their own priorities. The proposal would prohibit the education secretary from pushing for states to adopt the common core standards. The White House issued a veto threat against the bill on July 17. In the Senate, the Health, Education, Labor and Pensions Committee approved its own reauthorization bill (S. 1094) on June 12.

DC Shuttle: Loan Deal Reached, NCLB Weakened, E-Rate Boosted

John O. Harney — Mon, 22 Jul 2013 15:19:49 +0000

Student loan deal reached. A bipartisan group of senators announced a compromise on the Stafford Loan interest rates. Senator Tom Harkin, chair of the Health, Education, Labor and Pensions committee and Sens. Tom Carper (D-DE) Tom Coburn (R-OK), Joe Manchin (D-WV) and Angus King (I-ME) also participated in the announcement at the Capitol. According to reports, the White House also backs the measure. Majority Leader Harry Reid (D-NV) vowed "quick" action on the bill, which is expected to be voted on in the next week. The bipartisan proposal would tie interest rates on undergraduate subsidized and unsubsidized Stafford loans to the 10-year Treasury note plus 2.05 percentage points for undergraduates, and plus 3.6 percentage points for graduate loans. This translates into an interest rate of approximately 3.86% for undergraduate students for the coming year, higher than the 3.4% rate that lapsed on July 1, but certainly more manageable than the current 6.8% rate. Graduate students would have access to loans at 5.4%, and parents would be able to borrow at 6.4%. The interest rates would apply retroactively to loans taken out since July 1, 2013. The compromise does include caps on interest rates for these loans—8.25% for undergraduate students, 9.5% for graduate students and 10.5% for PLUS loans for parents. The compromise proposal also calls for a broader government study of college costs, at the request of Chair Harkin. Harkin did suggest the rates could be revisited as Congress begins to address the reauthorization of the Higher Education Act, saying the results of the proposed study on college costs would provide important context.

House ESEA reauthorization. The House passed the Student Success Act (H.R. 5) by a 221 to 207 vote, with no Democrats voting in support. The bill, a departure from the policies of No Child Left Behind, would reduce the federal role in public education and cede back to states decisions about how to deal with failing schools, how and whether to evaluate teachers, and how to spend much of the money sent by Washington to educate poor, disabled and non-English-speaking students. The bill would eliminate the current accountability system, called adequate yearly progress, and would allow states to develop their own academic standards in reading, math and science, and leave to their discretion whether to set standards for other subjects. The bill also would allow states to identify their poorest-performing schools and let local districts develop their own strategies for improving them. The bill consolidates multiple programs into a Local Academic Flexible Grant, which would allow states and school districts to support their own priorities. The proposal would prohibit the education secretary from pushing for states to adopt the "Common Core" standards. The House adopted by voice vote an amendment that would delay implementation of the bill's new Title II funding formula until the Education Department determines that the formula would not reduce funding for schools serving high percentages of students in poverty. It also adopted, by voice vote, an amendment stating that if there is not enough funding to award grants to run an effective direct student services program, states would be required to prioritize awards to local educational agencies with the greatest number of neglected, delinquent or migrant students, English learners, at-risk students and Native Americans. The White House on Wednesday issued a veto threat against the bill. In the Senate, the Health, Education, Labor and Pensions Committee approved its own reauthorization bill (S. 1094) on June 12.

E-Rate. The Senate Commerce, Science and Transportation Committee held a hearing on broadband in schools and libraries. The Federal Communication Commission (FCC) E-Rate program has worked since 1996 to connect schools and libraries to the Internet at speeds of at least 100 megabits per second. Newly elected Senator Edward Markey (D-MA) was named to the Commerce, Science and Transportation Committee, and expressed support for the program and emphasized the need for expanding and evolving its use. The FCC is scheduled to address the issue at its next public meeting on July 19.

DC Shuttle: SCOTUS Ruling Suggests Colleges Can Continue to Use Diversity as Admissions Tool for Now; Congress May Revisit Loan Rate Debate After Recess; US Spends Most on Ed

John O. Harney — Mon, 01 Jul 2013 16:22:52 +0000

Supreme Court affirmative action ruling. On Monday, the Supreme Court released a ruling in the case of Fisher v. University of Texas at Austin. The 7-1 decision was indecisive, remanding the case for reconsideration in the lower courts and directing lower courts to use "strict scrutiny" in affirmative action cases. The result of the ruling is that schools will continue to be able to use diversity as a tool in accepting students, as they have since the 2003 Supreme Court ruling. While schools may continue to consider race in admissions, the ruling says they must set a high standard for using affirmative actions programs. The Supreme Court chose not to rule in the specific case, sending the case back to the lower court for further argument. That result does little to address the debate over affirmative action, allowing current practices to continue but not guaranteeing their acceptance into the future, and has led to claims of victory from both side of the debate. Writing for the majority, Justice Anthony Kennedy said that race can be a factor in college admissions, but that courts should use a more rigorous standard when evaluating a specific program. When considering race in admissions, schools must show that they have a compelling interest in promoting diversity and that the specific program is narrowly tailored to serve that interest. The case was the first heard at the beginning of this court session, almost eight months ago, and the long wait for a decision has led to speculation that the decision was a compromise that leaves the question open for further debate and later reconsideration.

Student loan interest rates double. Congress recessed for the Fourth of July, leaving town without agreeing to a means to stop student loan interest rates from doubling today to 6.8%. Congress is expected to come up with a solution after the recess and apply it retroactively. There was fanfare in the closing days of the session with dueling press conferences held to introduce new proposals that were largely symbolic as leadership from both parties admitted they had not reached a deal in time to stop the rate hike. On the Senate floor, Minority Leader Mitch McConnell (R-KY) objected to a request for unanimous consent from Sen. Jack Reed (D-RI) to consider a bill (S. 1238) that would extend the current 3.4% interest rate for one year. Sen. Reed then objected to a similar request from Sen. McConnell to consider a bill introduced Thursday that would tie interest rates to the 10-year treasury note plus 1.85% for subsidized and unsubsidized undergraduate Stafford loans. Under that proposal, introduced with bipartisan sponsorship, the interest rate would be fixed for the life of a loan and borrowers would be permitted to consolidate their loans and cap repayments at 8.25%. While the Congressional Budget Office (CBO) has estimated the bill would reduce the deficit by $1 billion over 10 years, the proposal has been met with opposition from Democrats that would prefer a cap at the outset of the loan. On Tuesday, the Senate Banking, Housing and Urban Affairs Committee held a hearing on private student loan regulation. At the hearing, witnesses warned that allowing the interest rate to double might send borrowers to the private loan market, where it is more difficult to restructure loans. Federal regulators testified that they were continuing to urge private lenders to be more flexible with restructuring and thought there was room for new options despite some concerns that have held up their implementation thus far. Committee Chair Tim Johnson (D-SD) asked regulators to be on guard for changes in the market resulting from changes to federal student loans.

OECD education report. On Tuesday, the Organization for Economic Cooperation and Development (OECD) released a report, Education at a Glance 2013, which details American education practices and results in comparison to those of other developed countries. The report said that the U.S. spends more than other developed nations on its students' education each year, with parents and private foundations picking up more of the costs. The report finds that American teachers make more than their counterparts around the globe, but that salaries have risen at a slower rate in the U.S. In 2010, the U.S. pent more than $11,000 per elementary student and more than $12,000 per high school student. When factoring in other postsecondary school costs, the U.S. spends $15,171 on each person in the system, the most of any country in the report. The average OECD nation spent $9,313 per person. In 2010, the U.S. spent 7.3% of its gross domestic product on education. The share of public spending accounted for 70% of all education spending, with parents paying 25% and private funds contributing the rest. For postsecondary education, 36% of education spending comes from the public, a stark contrast with most other developed nations that publicly fund a greater percentage of postsecondary education such as college and vocational training.

DC Shuttle: Teacher Quality Under Scrutiny on Capitol Hill

John O. Harney — Mon, 24 Jun 2013 13:57:22 +0000

House committee OKs ESEA reauthorization. On Wednesday, the House Education and the Workforce Committee approved a proposed reauthorization to the Elementary and Secondary Education Act (ESEA) by a vote of 23 to 16. The bill, the Student Success Act (H.R. 5), introduced by Committee Chair John Kline (R-MN), would consolidate most federal funding into one block grant. The proposal would eliminate the current accountability system and allow states to develop their own academic standards and assessments. The legislation "reduces the federal role in education by returning authority for measuring student performance and turning around low-performing schools to states and local officials" according to a summary by the committee leadership. The bill eliminates the federal Adequate Yearly Progress (AYP) metric, streamlines the data reporting that states and school districts must issue and distribute in annual report cards, eliminates more than 70 existing elementary and secondary education programs and removes all "Maintenance of Effort" (MOE) requirements. The bill rewrites the main teacher-quality program in favor of the development and implementation of local- and state-driven teacher-evaluation systems and limits the authority of the secretary of education over decisions in the classroom. The bill must be approved by the House Finance Committee before it can be considered by the full House.

Lawmakers close to deal on student loan interest rates. Ongoing negotiations to reach an agreement to avert the doubling of federally subsidized student loan interest rates on July 1 are reportedly producing a compromise proposal in the Senate. The agreement would peg the rates to the 10-year Treasury bill and include a cap on how high rates could climb. Majority Whip Richard Durbin (D-IL) said several details still need finalizing, including specifying a percentage above the 10-year Treasury bill that would be added to the rates. The House passed a bill (H.R. 1911) May 23 that was very similar to the proposal outlined by President Obama but was criticized by Democrats for not including a cap. House Speaker John Boehner (R-OH) wrote a letter to the president on Thursday calling on him to urge Democrats in Congress to move forward with negotiations.

More time allowed for waiver states on teacher evaluations. On Tuesday, the Department of Education (DOE) announced in a letter that it would allow extra time on teacher-evaluation standards for some states that have been granted waivers from the requirements of No Child Left Behind (NCLB). Thirty eight states and the District of Columbia have been granted waivers from NCLB provisions by DOE in exchange for replacement rubrics proposed by the states. Those proposals needed approval from DOE and included new systems for teacher evaluations. In response to concern from many states, DOE announced it would allow states to postpone using student growth on state tests as a factor in personnel decisions for up to one additional year, until the 2016-17 school year. States will have to make their case in applications for the new flexibility, and DOE will approve the plans on a case-by-case basis.

Report on teacher-training programs. On Tuesday, the National Council on Teacher Quality released a report on the quality of the 1,430 education programs that prepare the nation's K-12 teachers. The results were not positive, claiming that the country's institutions are failing to adequately train the 200,000 people who become teachers each year. Part of a $5 million project funded by major U.S. foundations, the report has been endorsed by education secretaries in 21 states, but some universities and education experts said the review was incomplete and inaccurate.

DC Shuttle: Harkin Proposes Student Accountability Systems

John O. Harney — Tue, 18 Jun 2013 00:50:26 +0000

ESEA reauthorization approved by committee. At a Senate Committee on Health, Education, Labor and Pensions (HELP) markup on Tuesday, lawmakers considered the Senate Democrats' proposal, the Strengthening America's Schools Act, to reauthorize the Elementary and Secondary Education Act (ESEA). A bill (S. 1094) introduced by Committee Chair Tom Harkin (D-IA) advanced by a party-line vote of 12-10 despite opposition from Republicans who are weary of creating a "national school board" and placing too much power in the hands of the federal government. Senate Majority Leader Harry Reid (D-NV) promised to bring the bill to the floor once the calendar permits. The reauthorization of ESEA is now six years overdue. With attempts to overhaul the massive K-12 federal education law having failed to gain approval in Congress, 37 states (as well as the District of Columbia) have been approved by Secretary of Education Arne Duncan for waivers that exempt them from honoring exigent requirements instituted under the last reauthorization, No Child Left Behind Act (NCLB). While these waivers have provided states with much-needed flexibility, they are often viewed as being an informal, temporary arrangement that is not a substitute for new legislation. Harkin's bill signals a departure from an unpopular provision in NCLB that requires states to develop an accountability system, called Adequate Yearly Progress, to ensure that all students are proficient in math and reading by 2014. Instead, school districts would have more flexibility to create personalized student accountability systems and emphasizes increasing "access and equity"' among students. Additionally, the bill would require evaluation systems for teachers and principals and interventions to assist failing schools. Harkin's bill also reconstructs the model for school funding by ensuring that local and state resources per student for Title I schools are equal to or greater than the average local and state funds per student in non-Title I schools. Committee members passed an amendment offered by Sen. Elizabeth Warren (D-MA), which would require the Education Department to establish a model demonstration program to explore the effectiveness of programs that increase students' access to postsecondary education. Led by Ranking Member Lamar Alexander (R-TN), Republicans have introduced their own version, the Every Child Ready for College or Career Act, which includes proposals that will likely gain support in the House. "Our goal is to move forward with competing discussions, move the bill to the floor in whatever form it comes out of committee," Alexander said Wednesday.

Senate and House reject student loan interest rate bills. With student-loan interest rates set to double from 3.4% to 6.8% on July 1, lawmakers are pushing for the adoption of different proposals which would stop the rate hike but have not come to agreement on an approach. On Thursday, the Senate declined to consider legislation (S. 953) introduced by Sen. Jack Reed (D-RI) which would keep the rate constant for two years, giving Congress time to negotiate a permanent solution. Identical legislation (H.R. 1595) introduced in the House by Rep. Joe Courtney (D-CT) hasn't moved out of the Education and the Workforce Committee but Democrats have petitioned for its consideration. Sen. Tom Coburn (R-OK), who objected to consideration of the bill in the Senate, has introduced legislation (S. 1003) that would tie rates to the Treasury note rate plus 3%. That structure is similar to the president's proposal. The administration's proposal would tie student loan interest rates to the 10-year Treasury note and add 0.93 percent for the subsidized portion of the loan, 2.93% for the unsubsidized portion and 3.93% for graduate loans. Coburn said he would work with Reed to bring the president's proposal to the floor for consideration. On May 23, the House passed a GOP bill (H.R. 1911) that would peg the interest rate to the 10-year Treasury note rate, plus 2.5% for the subsidized and unsubsidized portion of the Stafford loan and plus 4.5% for graduate loans. Those rates would be capped at 8.5% and 10.5%, respectively, and would be calculated annually.

DC Shuttle: Still Wrestling with Student Loan Interest; No Child Left Behind

John O. Harney — Mon, 10 Jun 2013 13:42:47 +0000

Student loan rates. The Senate rejected two proposals to extend low interest rates on student loans after they expire on July 1. Without legislation, interest rates will double from 3.4% to 6.8% with the expiration of the one-year fix put in place last summer. Movement to proceed with a Senate Democratic bill (S. 953) to extend the current 3.4% fixed interest rate for two additional years was rejected by a vote of 51-46. The Senate also considered, and rejected by a vote of 40-57, cloture on a Senate Republican measure (S. 1003) which would set the interest rate for all loans at the 10-year Treasury note plus 3%. Savings generated from the plan would be used for deficit reduction, and Republicans have pointed out that the proposal is similar to that of President Obama. Numerous legislative proposals remain, including a House-passed Republican bill (H.R. 1911) which would also avert the rate hike by shifting to a market-based variable rate pegged to the 10-year Treasury note. The bill passed the House 221-198 on May 23. The House bill would peg interest rates to the 10-year Treasury note rate plus 2.5 percentage points for the subsidized and unsubsidized portions of undergraduate loans and plus 4.5 percentage points for graduate loans. Those rates would be capped at 8.5% and 10.5%, respectively, and the interest rates would be calculated yearly. The White House plan would peg interest rates to the 10-year Treasury note rate plus 0.93% for the subsidized portion and 2.93% for the unsubsidized portion. It would modify the loan for graduate students to 3.93% above the 10-year Treasury note. The rates would remain fixed for the life of a borrower's loan, as opposed to being recalculated yearly, and there would be no cap. Another Senate Democratic proposal (S. 909) would set rates every year based on the 91-day Treasury bill, plus a percentage determined by the Education secretary. Under the plan, interest rates for subsidized Stafford loans would be capped at a maximum of 6.8%, and rates for unsubsidized Stafford and graduate student loans would be capped at a maximum of 8.25%. Lawmakers on both sides of the aisle have said they are committed to continuing negotiation and passing legislation before the July 1 deadline.

Harkin introduces ESEA reauthorization. Sen. Tom Harkin (D-IA) introduced a bill (S. 1094) that would update the Elementary and Secondary Education Act (ESEA), making changes to the previous reauthorization, known as No Child Left Behind. The 2001 No Child Left Behind law expired in 2007. Harkin's bill is designed to give school districts more flexibility in creating personalized student accountability systems and evaluation systems for teachers and principals and in intervening to improve failing schools. The legislation also includes language that would require states to expand early childhood education initiatives, such as guidelines for what children should know and be able to do prior to kindergarten entry to reduce gaps in school readiness, as well as incentives for states to provide full-day kindergarten if they don't already. The bill largely mirrors legislation approved during the previous Congress by the Health, Education, Labor and Pensions Committee, which Harkin chairs. While No Child Left Behind was criticized for being strict and standardized, its data-collection provisions have been met with some praise and are expanded in this bill. Harkin's bill would require school districts to continue separating student achievement data across subgroups to highlight any potential disparities and expand the categories to include gender and English proficiency. The bill also includes a provision that would alter the way funding is dispersed for the Title 1 program for school districts that serve low-income students. The provision would ensure that local and state resources per pupil for Title 1 schools are equal to or greater than the average combined local and state funds per pupil in non-Title 1 schools. The Obama administration's waiver program has freed 37 states and the District of Columbia from many of the requirements in the current No Child Left Behind law's accountability system. Harkin's bill takes that into consideration by allowing a state to continue to use its Education Department-approved accountability system. Unlike last year's bill, the bill Harkin introduced Tuesday includes language requiring states and local school districts to develop their own teacher-evaluation system. The bill would write into law the Obama administration's signature competitive education grant program, Race to the Top, which was created with funding from the economic stimulus program and has been funded by appropriators since then, though it has never been written into law. It also writes into law another competitive grant program, Investing in Innovation, created with stimulus funding. The Committee on Health, Education, Labor, and Pensions is scheduled to markup Harkin's proposal on Tuesday. Among others, Senators Christopher Murphy (D-CT), Bernard Sanders (D-VT) Elizabeth Warren (D-MA) and Sheldon Whitehouse (D-RI) have signed on to cosponsor the bill.

Alexander and Kline introduce ESEA reauthorization. Sen. Lamar Alexander (R-TN), Ranking Member of the Senate Health, Education, Labor and Pensions Committee, introduced an alternative proposal to reauthorize the Elementary and Secondary Education Act, known in its current form as No Child Left Behind. The bill (S. 1101) would give states and local school districts more control over how they spend federal education dollars by consolidating the law's various programs into two large block grants. House Education and the Workforce Chair John Kline (R-MN) introduced similar legislation (H.R. 5) in the House, which would consolidate most funding into one block grant, and scheduled a June 19 markup. The proposals would eliminate the current accountability system and allow states to develop their own academic standards and assessments.

STEM education hearing. The House Committee on Science, Space and Technology held a hearing on STEM education policy. Lawmakers agreed that the government should be doing more to promote STEM education. The Obama administration has proposed reorganizing 226 programs at a dozen agencies as way to better target $3 billion worth of STEM education investments. The proposal, contained in the administration's 2014 budget request, would concentrate resources at three agencies; the Department of Education for elementary and secondary school programs, the National Science Foundation (NSF) for undergraduate and graduate programs, and the Smithsonian Institution for informal and public science activities. In opposition to the president's proposal, lawmakers from both parties also agreed on concerns related to the proposal, including the reduced funding for STEM education programs at NASA, the National Institutes of Health (NIH), the Department of Energy (DOE), and the National Oceanic and Atmospheric Administration.

DC Shuttle: Grants Would Connect Schools, Employers, Colleges in STEM; U.S. Report Shows Degrees Rose

John O. Harney — Tue, 28 May 2013 17:35:47 +0000

STEM education. On Thursday, Rep. Bill Foster (R-IL) introduced the 21st Century STEM Competitive Jobs Act, cosponsored by Representatives Joe Courtney (D-CT), Elizabeth Esty (D-CT), Joe Kennedy (D-MA), Jim Langevin (D-RI), Jim McGovern (D-MA), Anna Eshoo (D-CA), Carolyn Maloney (D-NY), Gloria Negrete McLeod (D-CA), Jared Polis (D-CO), Tim Ryan (D-OH) and Louise Slaughter (D-NY). The bill would support collaboration between schools and employers in order to help prepare students for careers in high-demand technical fields. The legislation would provide competitive grants to school districts that connect students and their coursework with future employers. To receive a grant, a school district would need to work with a local, regional or national employer and an institution of higher education to develop the curriculum and program metrics. Every program would need to include an internship or apprenticeship component, and be dual-credit so that students receive both high school and college credit for their coursework. On Wednesday, the Senate Committee on Small Business and Entrepreneurship held a hearing on STEM education and the development of a high-skilled American workforce.

U.S. education data. On Thursday, the U.S. Education Department released The Condition of Education 2013. Published annually by the National Center for Education Statistics, the data showed that enrollment in higher education institutions has gone down slightly in the last year (by 1.6%), but the number of degrees awarded has increased (by 5.1%). The report also presents data on tuition levels and student debt.

House passes student loan rate bill. On Thursday, the House passed the Smarter Solutions for Students Act (H.R. 1911) by a vote of 221 to 198. The bill would tie the interest rate on federal student loans to market rates. Without Congressional action, the interest rates on Stafford Loans are set to double on July 1 to 6.8%. The Smarter Solutions for Students Act would set the interest rate at the 10-year Treasury note rate plus 2.5 percentage points for undergraduate loans and plus 4.5 percentage points for graduate loans. Those rates would be capped at 8.5% and 10.5%, respectively, and the interest rates would be calculated yearly. Republican supporters of the bill said that it would allow students to access low rates when they are available, while many Democrats argue that it would leave students susceptible to drastic rate increases. Four Democrats voted in favor of the measure, while eight Republicans voted against it. The White House issued a veto threat against the bill Wednesday.

DC Shuttle: Congress Hears Ed Regs Are “Costly, Vague, Complicated or Unnecessary” … Proposes More

John O. Harney — Mon, 20 May 2013 13:51:23 +0000

Student loan interest rates. On Thursday, the House Education and the Workforce Committee approved legislation (H.R. 1911) by a vote of 24-13 that would tie the interest rate on federal student loans to market rates. The interest rates on Stafford Loans are set to double on July 1 to 6.8%. The bill, the Smarter Solutions for Students Act, would set the interest rate at the 10-year Treasury note rate plus 2.5 percentage points for undergraduate loans and plus 4.5 percentage points for graduate loans. Those rates would be capped at 8.5% and 10.5%, respectively, and the interest rates would be calculated yearly. Republican supporters of the bill said that it would allow students to access low rates when they are available, while many Democrats argue that it would leave students susceptible to drastic rate increases. The committee rejected a substitute amendment by Joe Courtney (D-CT) that would have kept interest rates on subsidized loans at 3.4% for two years in order to find an alternate solution. The committee also rejected an amendment by John Tierney (D-MA) that would have tied federal student loan interest rates to the primary credit interest rate charged by Federal Reserve banks. The Senate may act on one of those proposals as early as this week, suggesting that the House and Senate may clash on the issue as they have in recent years. On Tuesday, Sens. Jack Reed (D-RI), Tom Harkin (D-IA) and Majority Leader Harry Reid (D-NV) introduced legislation, the Student Loan Affordability Act (S. 953), that would freeze rates at current levels for two years, paid for by closing tax loopholes. The bill would limit the use of tax-deferred retirement accounts as an estate planning tool, close a corporate offshore tax loophole by restricting "earnings stripping" by expatriated entities and close an oil and gas industry tax loophole by treating oil from tar sands the same as other petroleum products.

GAO study on higher ed regs. On Friday, the Government Accountability Office (GAO) released a study showing that experts say federal regulations for higher education are too burdensome. The GAO held meetings with education experts, trade association representatives, researchers and school officials who said that education regulations were "costly, vague, complicated or unnecessary." One of the greatest concerns was the difficulty in calculating how much federal assistance money should be returned to the Department of Education when a student drops out of school early. Respondents also cited disclosure requirements for student enrollment, graduation rates, cost of attendance and student crime.

DC Shuttle: Congress Scrutinizes Colleges’ Unrelated Biz Income; Takes Interest in Loan Rates

John O. Harney — Mon, 13 May 2013 14:43:58 +0000

Rewriting K-12 law. On Tuesday, the House Committee on Education and the Workforce held a hearing on state and local accountability systems for education. Chair John Kline (R-MN) outlined four Republican priorities for rewriting the nation’s K-12 education law, known as the Elementary and Secondary Education Act (ESEA) or No Child Left Behind: restore local control, reduce the federal footprint, improve teacher effectiveness, and empower parents.

College tax compliance. On Wednesday, the House Ways and Means Committee's Oversight Subcommittee held a hearing on the Internal Revenue Service (IRS) colleges and universities compliance project. The hearing addressed a report by the IRS called the Colleges and Universities Compliance Project Final Report. Lawmakers said they were disturbed that the report found a high degree of noncompliance on unrelated business income, revenue earned by nonprofit organizations in ways that are not directly related to their missions. An IRS witness told the panel that the universities most scrutinized were not a representative sample but constituted beginning research into the matter.

Warren's first bill would hold down student loan rates. On Wednesday, first-term Sen. Elizabeth Warren (D-Mass.) introduced her first bill (S.897) which would stop the student loan interest rate from doubling to 6.8% in July 1. The bill directs the Federal Reserve to provide money to the Education Department to loan out for federal student loans at the same rate as banks can borrow money through the Federal Reserve's discount window.

Student loan rate bill introduced in the House. On Thursday, House Education and the Workforce Committee Chair Kline and subcommittee on Higher Education and Workforce Training Chair Virginia Foxx (R-NC) introduced the Smarter Solutions for Students Act (H.R. 1911). The bill would require interest rates for all federal student loans to be based on the 10-year Treasury note, plus 2.5%. The bill would cap rates at 8.5%. Kline pointed out that the proposal is similar to President Obama's. The president's proposal does not include a cap. Republican leadership has previously suggested their student loan rate legislation would go through Kline's committee and the bill may soon be considered by the full House. The bill would apply to loans starting July 1.