*****************MANDATORY TO RUN BOX WITH THIS STORY — MANY OF THESE DETAILS ARE NOT IN THE STORY *************************
President Obama’s proposals
• Implement a new college rating system that evaluates colleges on affordability, average tuition and student loan debt, graduation and transfer rates, and the average earning of graduates.
• Allocate federal financial aid based on the rating.
• Give students attending highly rated schools larger grants and more affordable student loans.
• Encourage colleges to expand offerings, including three-year accelerated degrees and online courses.
• Require colleges with high dropout rates to disburse student aid over the course of a semester rather than in a lump sum, ensuring that students who drop out do not receive funds for time they are not in school.
• Start a “pay-as-you-earn” program that caps student loan repayment at 10 percent of monthly income.
• Give colleges a “bonus” based on the number of graduates who received Pell Grants to encourage enrollment of low- and moderate-income students.
• Expand “Race to the Top” competition with a $1 billion prize for states that make significant changes in higher education policies while also keeping tuition costs low.
What’s next
The president wants to implement the new rating system before the 2015 school year. The system itself does not require Congressional approval, but using the new system as a basis for determining federal funding would require legislative approval, which could come as committees begin working on a new five-year Higher Education Authorization bill. Obama seeks to have the entire strategy implemented by 2018. Although the administration could unilaterally implement the rating system now, Education Secretary Arne Duncan said the department would first seek input from members of Congress.
Targeting the soaring cost of higher education, President Barack Obama on Thursday unveiled a broad new government rating system for colleges that would judge schools on their affordability and perhaps be used to allocate federal financial aid.
But the proposed overhaul faced immediate skepticism from college leaders who worry the rankings could cost their institutions millions of dollars, as well as from congressional Republicans wary of deepening the government’s role in higher education.
The president, speaking to a student-heavy crowd of 7,000 at the University at Buffalo, said he expected pushback from those who have profited from the ballooning cost of college. But he argued that with the nation’s economy still shaky and students facing increasing global competition, making college affordable is “an economic imperative.”
“Higher education cannot be a luxury,” Obama said during the first stop on a two-day bus tour through New York and Pennsylvania. “Every American family should be able to get it.”
Republicans on Capitol Hill weighed in quickly with criticism. Lamar Alexander of Tennessee, the top Republican on the Senate Health, Education, Labor and Pensions Committee, cast the proposal as government overreach and suggested a state-by-state approach would be preferable.
“Washington needs to be careful about taking a good idea for one state and forcing all 6,000 institutions of higher education to do the exact same thing, turning Washington into a sort of national school board for our colleges and universities,” Alexander said.
For colleges and universities, millions of federal aid dollars could be on the line if schools are downgraded under the government rating system. However, if colleges line up against the idea of tying ratings to federal aid, the proposal would face nearly impossible odds. Almost all members of Congress have colleges or universities in their districts, and a coordinated effort to rally students and educators against the plan would probably kill it quickly.
“This is extraordinarily complicated stuff, and it’s not clear we have the complete data or accurate data,” said Molly Corbett Broad, the president of the American Council on Education that represents colleges and universities in Washington.
From Buffalo, Obama climbed aboard his armored black bus for a road trip that was to take him through western and central New York as well as northeastern Pennsylvania over two days
The education proposals are part of the broader economic agenda Obama has been pitching across the country this summer. The tour is aimed at building public support for his economic policies ahead of fiscal fights with Congress this fall.
The rising cost of college has increasingly become a burden for many Americans. According to administration figures, the tuition costs at public, four-year universities has tripled over the last 30 years and average student loan debt stands at $26,000.
Over the past five years, the tuition sticker price at public four-year colleges is up 27 percent beyond overall inflation, according to a College Board survey. At private schools, the average student’s cost has risen 13 percent beyond overall inflation.
There has been little consensus among policymakers on how to curb college costs. While Obama’s proposal could give colleges an incentive to slow increases, it could also add massive reporting requirements that could be a burden on schools already struggling to make ends meet.
The new rating system does not require congressional approval, and the White House is aiming to have it set up before the 2015 school year. Obama does, however, need support from Congress in order to use the ratings as a basis for parceling out federal financial aid.
About the Author
