When President Obama outlined his higher education agenda in Buffalo last week, commentators tuned out the beat of war drums (this time against Syria) and began dissecting the president's plan on the college front. The overriding question: Can the new models conceived of by consultants and think tanks over the past decade—and now advanced by the president—work to lower cost without sacrificing quality?

Following are some of the commentaries that emerged after the president unveiled his plans.

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Sequestration on education. Sequestration remains the greatest concern for education funding in the immediate future. State school board leaders went on the offensive last week to highlight the threat to education. Education funding has not been the focus of fiscal cliff discussions and is largely swept into the larger picture when discussing sequestration. The administration estimates an 8% to 9% cut across the board if sequestration goes into effect, which would mean a $4 billion reduction in education spending. Deborah Rigsby of the National School Board Association said that public education systems would be forced into larger class sizes, fewer course offerings, four-day school weeks, fewer extracurricular activities, less access to intervention programs and teacher layoffs. Schools do not function on the federal fiscal calendar, allowing them to defer cuts to programs until the 2013-14 school year, but officials say they are already planning for those budgets and 2013 funding will affect their schools. A July report by the Senate Health Education, Labor and Pensions Committee said that sequestration would mean a $2.7 billion cut in federal funding in FY2013 for Title I grants for low-income school districts, special education state grants and Head Start.  

Few education initiatives likely as administration defends policy. The reelection of President Obama has education enthusiasts buzzing about the outlook for the next four years, but insiders think education policy might be in for lurching progress in Obama's second term in office. The most recent reauthorization of the Elementary and Secondary Education Act (ESEA) was No Child Left Behind (NCLB) under President Bush, and schools have fallen way off those standards. An aide to House Speaker John Boehner (R-OH) pointed out that those standards were not intended to last 10 years and ESEA was overdue for reauthorization. The Obama administration has been unable to find consensus on reauthorization and instead has chosen a path that allows the administration to influence new standards without congressionally approved reauthorization. The Department of Education (DOE), under Obama, has approved waivers to states that proposed alternative standards. The waivers excuse those states from the standards of NCLB, but only if new standards are found satisfactory to the federal government. The DOE has encouraged the adoption of common core standards although other standards have met approval. While this approach first seemed temporarily necessary to address encroaching deadlines, it has become the totality of the administration's approach during the first term. It is now possible that these waivers and deadlines could dominate education policy debate during Obama's second term. Many lawmakers are calling for the reauthorization of ESEA and had hopes that could happen in Obama's second term. For now, the administration will need to focus on defending the changes it has already made, and on the looming deadlines it approved for states. It will also have its hands full working for continued to support of federal financial aid and research funding during a time of budget cuts. A recent American Enterprise Institute forum gave a gloomy forecast for progress. A recent article by Inside Higher Ed was similarly pessimistic.

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 Nov. 19, 2012.

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.

President Obama's proposed FY 2013 budget would encourage community college partnerships with employers, target student aid for colleges that restrain tuition prices, and increase overall spending on U.S. Education Department programs by 2.5% to nearly $70 billion. That would be the largest percentage increase for any domestic department in the president's proposed federal budget for FY 2013, which begins in October 2012.

It is a budget proposal overshadowed by lingering economic woes and paralyzing partisan debates over deficits, tax breaks for the rich, and future investments. Still, the president found room for five key higher education changes, as The Huffington Post summarized.

• Obama unveiled the Community College to Career Fund which would invest $8 billion over the next three years to fuel partnerships between community colleges and employers. Administered by the departments of Education and Labor, the initiative would aim to train 2 million workers for "middle-skill" positions in high-growth industries such as healthcare and advanced manufacturing. Georgetown University economists have noted that about one-third of workers with an associate degree earn higher wages than peers with a bachelor’s degree, and one-fourth of workers with a one-year certificate earn more than peers with a bachelor’s. The president's plan would exclude for-profit colleges from this type of funding, which Inside Higher Education noted, "almost guaranteed to draw protest from a sector that already feels persecuted by the Obama administration."

* The proposed budget would increase funding for Pell Grants for low-income students and ask Congress to stop an interest-rate hike on student loans that was scheduled to go into effect.

• As the president promised in his State of the Union address, the plan would change the formula to distribute so-called "campus-based aid"—Supplemental Educational Opportunity Grants (SEOG), Perkins Loans and Federal Work-Study funds—to reward institutions for enrolling and graduating relatively higher numbers of lower-income (Pell Grant-eligible) students, offering relatively lower net tuition prices and restraining tuition growth.

• A new $5 billion grant program would help schools attract, train and retain high-quality teachers. Governing magazine opined that "the reforms would include making colleges of education more selective, improving professional development programs, tying pay to performance and revamping tenure standards."

• Information Week reported that the White House proposed $140.8 billion for R&D. The proposed federal portfolio of basic and applied research is $64 billion, an increase of 3.3%, over what was spent last year—and the proposal for non-defense R&D is $64.9 billion, a 5% boost. The budget also provides $3 billion to science, technology, engineering and mathematics (STEM) education.

For more details of the president's proposed budget for higher education, see The Chronicle of Higher Education.

In the rancorous times, Obama's proposals were met, of course, with both praise and criticism.

The criticism ranged from a reader comment to The Huffington Post: "Why is the federal government even involved in funding education? They have no constitutional mandate to regulate or fund education. They only education the federal government should be funding is for federal employee training, troops via the GI bill, and research projects done at universiti­es. Part of the reason education costs have spiraled out of control is that universiti­es became so dependent on outside funding."

To the wonkishly thoughtful: The University of New Hampshire's daily The New Hampshire editorialized, "On the surface, UNH would be at a disadvantage compared to other schools, since it receives such miniscule financial support from the state. New Hampshire already had the lowest per-capita spending on higher education before the state legislature cut the expenditure by 50%  last year. A federal program that failed to take this fact into its algorithm would only further UNH's disadvantage and make it harder for the university to remain competitive."

New England's public and private two- and four years colleges continue to charge higher prices than the U.S. average, according to new data posted to the Financing Higher Education section of NEBHE's Trends & Indicators. To view the latest updates to our Higher Education Financing section, visit Trends & Indicators: Continually Updated Stats on New England’s Education and Economy.

Meanwhile. the Obama administration released more details on the president’s ideas for tackling rising college costs. The White House proposals include:

• Changing the formula used to distribute Supplemental Educational Opportunity Grants (SEOG), Perkins Loans and Federal Work-Study funds to reward institutions for enrolling and graduating relatively higher numbers of Pell-eligible students, offering relatively lower net tuition prices and restraining tuition growth.

• The Race to the Top for College Affordability and Completion competition would offer incentives to states to align standards for exiting K-12 exit and entering postsecondary education, revamp state higher education funding strategies and maintain adequate levels of funding for higher education.

The percentage of students receiving Pell Grants has increased in recent years. Between 2006-07 and 2009-10, the number of Pell Grant recipients attending New England public postsecondary institutions increased 51%. The average Pell Grant awards granted to these students has also represented a growing share of average tuition and mandatory fees during this period.

On Wednesday, President Obama announced a new proposal to ease the burden of student loan debt. The "Know Before You Owe" initiative will allow students with multiple government-backed loans to consolidate them into one loan under the federal Direct Loan program with an interest rate reduction of 0.25% to 0.5%. The administration estimated that about 5.8 million students could be eligible for loan consolidation. The new initiative would also accelerate the easing of income-based loan repayments. Income-based loans restrict repayment to 15% of a student's disposable income; the new initiative would reduce the repayment to 10%  in January 2012, rather than 2014, as currently scheduled. In addition, any students with federal student loans in 2012 and at least one of the previous four years would have any remaining debt forgiven after 20 years instead of 25 years under current law. President Obama said that giving student borrowers more money for home ownership, small business startups, or retirement will "give the economy a boost." Education and student advocates hailed the proposal as a boon to the approximately 36 million Americans currently paying off student loans. However, some experts have pointed out that it may not be enough to make up for the doubling of student loan interest rates, set to take effect in July 2012. Read a blog post on the "Know Before You Owe" initiative from Education Secretary Arne Duncan and Domestic Policy Advisor Melody Barnes at the White House website.

The House Committee on Education and the Workforce's Subcommittee on Higher Education and Workforce Training held a hearing Tuesday on the Education Department's continuing transition from some bank-based loans to administering 100% of government-backed loans through the federal Direct Loan program. Subcommittee Chair Virginia Foxx (R-NC) cited an Oct. 13 security breach on the Direct Loan Servicing Center's borrower website as evidence that the program is not adequately protecting students' financial and personal information. During the seven-minute breach, users were able to see other borrowers' repayment histories and bank routing numbers. A federal student aid official acknowledged the site disruption as well as other customer service concerns in a notice posted the following day. Student-aid administrators who testified at the hearing noted that their workload has increased since the transition to direct lending, because they are "doing most of the work that customer-service representatives used to do at the banks and guarantee agencies." Office of Federal Student Aid chief operating officer James Runcie enumerated several strategies taken to smooth the transition, including the installment of a "chief customer experience officer" to oversee customer advocacy and protections. He also conceded that student loan default rates have risen since the change, which Chair Foxx attributed to a loss of financial education services for student borrowers. Several of the panel's Democrats credited economic and unemployment factors for the default increase, and argued that the transition has been much smoother than program critics had projected.

From the New England Council's Weekly Washington Report Higher Education Update, Oct. 31, 2011. NEBHE is a member of the Council and publishes this column each week.

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.

The debt-ceiling deal signed by President Obama last week will cut over $900 billion in federal funding over the next 10 years. Yet even in an extremely budget-conscious atmosphere, members of Congress singled out the Pell Grant program for an increase in funding to guarantee college access for low-income students. Under the terms of the new law, the Pell program would receive $10 billion in FY 2012 and $7 billion in FY 2013, for a total of $17 billion. While this funding still leaves a $1.3 billion projected shortfall if the maximum grant level is to be preserved at its current level of $5,550, the funding in the debt-ceiling law will go a long way toward ensuring college access for the 9.4 million students across the country who depend on Pell Grants for college education. Ending in-school subsidies for interest on graduate student loans will save $18.1 billion and ending financial incentives for on-time student loan payments will save $3.6 billion. The $21.6 billion total over 10 years will pay for the Pell Grant funding and reduce the deficit by the remaining $4.6 billion.

Many in the higher education community, and the broader business community, have urged Congress not to sacrifice programs that contribute to our economic well-being in the name of fiscal responsibility. An educated workforce is fundamental to our national economic competitiveness, and New England’s institutions of higher education play a critical role in developing a highly skilled and innovative workforce. Higher education is also an economic driver in its own right, providing jobs and generating over $100 billion in New England alone. Maintaining robust funding for Pell Grants ensures that colleges don’t have to decide between turning away students and cutting jobs.

While Pell Grants and other education programs may face more stringent cuts as the deficit-reduction committee works its way toward an additional $1.2 trillion in funding reduction, there is hope that this initial $17 billion for Pell Grants signals a continuing commitment to preserving college opportunities and supporting the nation’s institutions of higher education.

As a member of New England Council, we publish the DC Shuttle each week featuring higher ed news from Washington. Because Congress recessed following the debt-ceiling vote last week, the Council will not publish its Weekly Washington Report Higher Education Update this week. But because the debt-ceiling deal made special provisions for the Pell Grant program, the Council put together this update for our Aug. 8 DC Shuttle.

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.