Draft HEA Reauthorization Would Nix Some Loan Forgiveness, Nip Some of Secretary’s Authority

DC Shuttle …

House Ed and Workforce Releases Draft HEA Reauthorization. Republican leadership of the U.S. House Committee on Education and the Workforce released a bill that would reauthorize the federal law governing higher education, the Higher Education Act of 1965. The “Promoting Real Opportunity, Success, and Prosperity through Education Reform (PROSPER) Act,” H.R. 4508, was introduced by the Committee’s chair, Rep. Virginia Foxx (R-NC), and Rep. Brett Guthrie (R-KY), chair of the Higher Education and Workforce Development subcommittee. The proposal would revamp the federal student loan program by putting caps on borrowing and eliminating some loan-forgiveness programs. The bill calls for a “one grant, one loan, and one work-study system.” The bill reauthorizes the Pell Grant program through fiscal year 2024 and requires institutions to disburse the grants to students on a weekly or monthly basis. The bill streamlines the six loans currently available into the new Federal ONE Loan Program with one unsubsidized loan for undergraduates, for graduates and for parents. The proposal would require colleges that receive institutional aid to meet a completion rate threshold. The plan calls for simplification of the Free Application for Federal Student Aid, the FAFSA. The legislation would reform the federal work-study program, allowing students to use federal student aid for shorter-term programs. It also allows students to use Pell Grants for shorter-term programs. The bill would repeal some rules and regulations and would reduce the authority of the Secretary of Education. The Committee published a summary of the bill and fact sheet. Read more about the legislation in The Chronicle of Higher Education and Inside Higher Ed.

Senate Tax Bill Contains Education Provisions. The U.S. Senate amended and passed H.R 1, the Tax Cuts and Jobs Act, with many provisions that would affect the way families pay for higher education. The bill includes a tax on endowments for private institutions that have assets of $500,000 per full-time student. The Senate passed an amendment which increased that threshold from $250,000. One of the other few amendments to pass Friday night was a proposal from Sen. Ted Cruz (R-TX) that would expand the tax benefits of 529 college savings plans to money used for K-12 education, including private school or homeschooling. The Senate originally added a new tax on royalties on logos, though that has now been taken out of the bill. Many educators are worried that changes to the standard deduction and new caps on state and local tax deductions will reduce charitable giving. Read more about the education provisions in Inside Higher Ed or the Washington Post.

HELP Committee Holds Hearing on FAFSA Simplification. The Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing on FAFSA simplification. HELP Committee Chair Lamar Alexander (R-TN) has also sponsored legislation to pare down the number of questions on the FAFSA. During the hearing, Alexander said he and Sen. Michael Bennet (D-CO) are close to completing a bill that would cut down the FAFSA form from 108 questions to 15 to 25 questions, according to Bloomberg. U.S. Education Secretary Betsy DeVos praised the suggested simplification while also releasing a FAFSA app for consumers.

We publish the DC Shuttle each week featuring higher ed news from Washington collected by the New England Council, of which NEBHE is a member. This edition is drawn from the Higher Education Update in the Council’s Weekly Washington Report of Dec. 4, 2017. For more information, please visit: www.newenglandcouncil.com.



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