Following the release of a Private Student Loans Report by the Consumer Financial Protection Bureau (CFPB) on July 20, the Senate Banking, Housing and Urban Affairs Subcommittee on Financial Institutions and Consumer Protection held a hearing Tuesday to address ballooning private student loan debt. Democrats on the Committee suggested regulation of the private student loan market was necessary and even said they would consider one of the report's recommendations allowing student borrowers to discharge debt in bankruptcy. Sen. Richard Durbin (D-IL) has introduced the Fairness for Struggling Students Act (S. 1102) that would allow borrowers to discharge student loan debt in bankruptcy, but Republicans on the Committee expressed concern with that idea and with new regulations. Also in the wake of the CFPB report, the Department of Education released a "shopping sheet" on Tuesday that the Obama Administration developed with help from the CFPB. The "shopping sheet" is a model financial aid letter that the administration believes will increase transparency in the student loan process. The letter is intended to "help students understand the type and amount of aid they qualify for and easily compare aid packages offered by different institutions," according to the Education Department. Education Secretary Arne Duncan said he hoped pressure from students, parents and peer institutions would push colleges to adopt the standardized financial aid letter but added that he anticipated resistance from many schools.

On July 22, it was reported that the New Hampshire Board of Education plans to submit a waiver application to the Department of Education for an exemption from the standards of the No Child Left Behind Act (NCLB). According to New Hampshire Deputy Commissioner of Education Paul Leather, the state would submit an application during the third round of submissions, due in September, with the hope of having it enacted for the next school year. Though the state Board of Education had issued a statement in February saying it did not intend to apply for a waiver, Leather explained that subsequent discussions with federal officials led New Hampshire to believe there would be flexibility regarding the provisions of a waiver. Federal waiver requirements stipulate that approved applications will include teacher evaluations applicable to all districts. In New Hampshire, teacher accountability systems are determined by each district. The newly reported proposal would allow New Hampshire to establish recommended guidelines for teacher evaluations that would not need to be implemented.

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 July 30, 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.

The Consumer Financial Protection Bureau (CFPB) announced March 5 that it will now accept complaints from borrowers about problems with their private student loans. These problems could include difficulty with taking out a loan, repaying an existing loan or handling a loan which has gone into default. Under the Dodd-Frank financial reform law, the CFPB has the authority to oversee private, non-bank issuers of student loans. The CFPB's announcement coincided with a new report from the Federal Reserve Bank of New York on total outstanding debt. According to the report, U.S. student loan debt has reached $870 billion, more than the total credit card debt ($693 billion) and total outstanding car loan debt ($730 billion).

On Thursday, the House Veterans Affairs Subcommittee on Economic Opportunity held a hearing to consider a slew of bills, including three dealing with veterans' education benefits. The first bill (H.R. 3483) would increase the tuition benefit cap for students attending out-of-state public colleges to $17,500—the same as the cap on in-state private colleges—under the Post-9/11 G.I. Bill. The Congressional Budget Office estimates that between 25,000 and 35,000 veterans currently attend out-of-state public colleges. The second bill (H.R. 4057) would direct the Department of Veterans Affairs (VA) to develop a proposal requiring colleges to provide information and counseling to prospective students and to be more responsive to student feedback. Currently, veterans must opt in to receive counseling, and few do. Information from state oversight agencies on academics, accreditation, recruiting practices and job placement rates would also be collected and made public under the bill. The final bill (H.R. 4052) would require the secretary of Veterans Affairs to recognize colleges offering "superior services" to veterans based on criteria including graduation rates. Federal graduation rate statistics have been criticized for including only first-time, full-time students, excluding many "nontraditional" students who attend community and for-profit colleges in disproportionate numbers. New legislation (S. 2179) introduced Thursday by Sen. Jim Webb (D-VA) requiring institutions to meet Education Department eligibility requirements for federal student aid in order to receive aid from the military tuition assistance program and the G.I. Bill would also fall heavily on for-profit colleges.

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 March 12, 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.

As part of the Campaign to Cut Waste, the Obama administration cut erroneous Pell Grant payments to 2.7% in 2011, the lowest it has been since 2005. White House officials estimate that reform measures saved $300 million in overpayment through the Pell Grant student aid program. The 2011 payment errors totaled $1 billion, approximately the same as the payment errors for 2010, but an increase in the volume of the Pell Grant program resulted in the decrease from 3.1%  to 2.7%. Administration officials said that a Department of Education reform undertaken in 2010 which permitted students applying online for federal student financial aid to transfer their income information directly from the Internal Revenue Service's (IRS) website reduced errors and simplified the application process. Additional reductions in improper payments are expected as more students use the online system.

The Consumer Financial Protection Bureau (CFPB) put out a request for information from students, lenders and institutions of higher education on private student loans. Created by the 2010 financial regulatory reform law, the CFPB has jurisdiction to oversee consumer lending, and is currently collecting information for a report for Congress on private student loans. Special adviser to the Secretary of the Treasury and de facto head of the CFPB Raj Date said that "the private student-loan market is one of the least-understood consumer-credit markets. ... It has been operating in the shadows for too long." Areas of inquiry within the study include how and where students find information on private loans, how they decide between loans and how much to borrow, and what resources are available to reduce the chances that a student incur an unsustainable amount of debt or default on their loans.

The House Education and Workforce Committee's Subcommittee on Early Childhood, Elementary and Secondary Education held a hearing on setting standards for effective research programs in the context of reauthorizing the Elementary and Secondary Education Act (ESEA). In his opening statement, Subcommittee Chair Duncan Hunter (R-CA) applauded the Institute of Education Sciences (IES), the research arm of the Department of Education, for its What Works Clearinghouse, which provides "a central and trusted source of scientific evidence of what works in education." He added that education research helps identify programs which are not helping students to succeed, and which may not merit continued federal funding. Congressman Rush Holt (D-NJ) said that he plans to reintroduce legislation that he originally submitted during Congress' last session to improve data and instruction at the school-district level. Several education advocates suggested that holding a hearing on research best practices--instead of a more divisive issue within the ESEA reauthorization discussion like teacher accountability and evaluations--signals that the House is in no hurry to move toward a comprehensive reauthorization bill as the Senate has done.

From the New England Council's Weekly Washington Report Higher Education Update, Nov. 21, 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.