House Defense Bill Offends For-Profit Colleges

By The New England Council

DC Shuttle …

House Adds Amendments to Defense Act Targeting For-Profit Universities. The U.S. House of Representatives passed an amendment to its version of the National Defense Authorization Act for the 2020 fiscal year that would increase the Pentagon’s scrutiny of for-profit colleges. The amendment would require the U.S. Department of Defense (DOD) to audit for-profit colleges that enroll military members and veterans and fail to meet the financial responsibility standards of the Higher Education Act. In addition, the DOD would need to create a public online list of how much each university receives from its Tuition Assistance (TA) program. Passing 251 to 178, the amendment received support from the majority of House Democrats and 20 House Republicans. Proponents of the bill believe it to be an important step in increasing oversight of for-profit universities who take advantage of the TA program’s exclusion from the 90/10 federal loan cap. Outspoken critic of the for-profit sector and sponsor of the amendment, Rep. Donna Shalala (D-FL), said in recent remarks that the amendment will give “duty service members access to valuable information, so that they may utilize their benefits at institutions that will provide the highest quality education and allow them to reach their goals.” Many for-profit colleges have pushed back on the amendment, including proprietary schools who claim to feel unfairly targeted by the bill. While the House has passed the amendment, it is not included in the Senate’s version of the defense bill and will now be managed by a conference committee. Read more in Education Dive.

Expanding the Investigation of DeVos’s Emails. House Oversight Committee Chair Elijah Cummings (D-MD) announced he is expanding the investigation into Education  Secretary Betsy DeVos’s use of personal email. Cummings sent DeVos a letter demanding she turn over all her personal account emails related to official government business. The House Oversight Committee’s concerns stem from the findings of an Office of the Inspector General report from May of this year. “New information has now come to light indicating that you violated the requirement in the Federal Records Act to forward these emails to your official account within 20 days and violated the requirement in the Freedom of Information Act (FOIA) to produce relevant records in response to public requests,” wrote Cummings in the letter. Education Department Press Secretary Liz Hill claimed the demands to be “nothing more than political grandstanding.” Read more in The Hill.

Senator Warren Introduces College Student Hunger Act. Senator Elizabeth Warren (D-MA) and Rep. Al Lawson (D-FL) introduced a bill to address hunger on college campuses. The College Student Hunger Act aims to address college food insecurity by enabling more access to the Supplemental Nutrition Assistance Program (SNAP) and requiring the federal government, states and universities to take a more prominent and proactive role on the issue. “As more and more students struggle to afford college and take on a mountain of student loan debt, nearly one-in-three college students cannot even afford basic necessities like food,” Warren said in a statement. The bill was created as a response to the Government Accountability Office report which found more than 40 percent of college students face food insecurity. Read more in the The Hill. The New England Journal of Higher Education also reported in April on how SNAP could address student hunger.

Income-Share Agreement Legislation Introduced in the Senate. A bipartisan piece of legislation in the Senate was introduced outlining a legal framework for income-share agreements (ISAs). ISAs are a recently emerging college finance model in which the university fronts a portion of a student’s enrollment costs in exchange for a share of their paychecks for a period after graduation. The legislation lays out specific guidelines: individuals would not pay more than 20% of their income, those who earn less than 200% of the federal poverty line are exempt from payments, and repayment cannot exceed a 30-year period. Advocates of ISAs claim they offer students with a low-risk source of financing for their education. Critics believe the agreements amount to debt as they are often layered over federal and private loans. This college financing model has resurfaced with the U.S. Department of Education recently suggesting it may pilot one. Read more in Education Dive.

Cyberattack Targets Colleges. The Department of Education issued a technology security alert to 62 colleges and universities affected by a widespread cyberattack. A vulnerability of the Ellucian Banner system, used by over 1,400 universities, was exploited by the attackers and allowed them to gain access to colleges’ enrollment and admission systems. The department reported that within 24 hours of the cyberattack, thousands of fake student accounts were created. Steps for the affected colleges to take were outlined in the department’s security alert.

Loan Default Sharing Legislation Introduced in Senate. Sen. Josh Hawley (R-MO) introduced a bill to require universities to be financially responsible if a graduate defaults on their college loans. The legislation would require colleges to repay 50% of the balance of any defaulted loans that students borrowed in order to attend their institution. The bill would also prevent universities from increasing their tuition costs to undertake the financial responsibility of defaulted loans. “[American students and workers] shouldn’t have to further enrich colleges by taking on a mountain of debt in order to get a good-paying job,” Hawley said. Colleges and universities have pushed back on such legislation, reasoning that they can only provide a valuable education and cannot predetermine whether students will be able to repay their loans and therefore should not be held to such a high standard of financial responsibility.

Rahm Emanuel Op-Ed: High School Credit Offers Solution to Diploma Divide. Former Mayor of Chicago Rahm Emanuel wrote an op-ed piece in Politico endorsing the expansion of advanced placement and international baccalaureate programs in high schools as a solution to student debt. Emmanuel wrote that “focusing exclusively on student debt is the wrong approach—it attacks the problem at the wrong time and in the wrong place.” Emanuel believes shifting the policy focus to secondary education would bridge the diploma divide that “separates privileged communities from those struggling to get ahead and break one of the most powerful drivers of economic and racial inequality in America more effectively than anything we can do in college alone.” High school students provided with accessible college credit opportunities “could potentially move through college more expeditiously, and enter the workforce months or even years earlier,” he writes.

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 July 22, 2019. For more information, please visit:


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