[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
THE STATE OF HIGHER EDUCATION:
HOW STUDENTS ACCESS AND
FINANCE A COLLEGE EDUCATION
=======================================================================
HEARING
before the
SUBCOMMITTEE ON HIGHER EDUCATION,
LIFELONG LEARNING, AND COMPETITIVENESS
COMMITTEE ON
EDUCATION AND LABOR
U.S. House of Representatives
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
HEARING HELD IN WASHINGTON, DC, MARCH 8, 2007
__________
Serial No. 110-8
__________
Printed for the use of the Committee on Education and Labor
Available on the Internet:
http://www.gpoaccess.gov/congress/house/education/index.html
__________
U.S. GOVERNMENT PRINTING OFFICE
33-656 PDF WASHINGTON : 2007
---------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government
Printing Office Internet: bookstore.gpo.gov Phone: toll free (866)
512-1800; DC area (202) 512-1800 Fax: (202)512-2250 Mail: Stop SSOP,
Washington, DC 20402-0001
COMMITTEE ON EDUCATION AND LABOR
GEORGE MILLER, California, Chairman
Dale E. Kildee, Michigan, Vice Howard P. ``Buck'' McKeon,
Chairman California,
Donald M. Payne, New Jersey Ranking Minority Member
Robert E. Andrews, New Jersey Thomas E. Petri, Wisconsin
Robert C. ``Bobby'' Scott, Virginia Peter Hoekstra, Michigan
Lynn C. Woolsey, California Michael N. Castle, Delaware
Ruben Hinojosa, Texas Mark E. Souder, Indiana
Carolyn McCarthy, New York Vernon J. Ehlers, Michigan
John F. Tierney, Massachusetts Judy Biggert, Illinois
Dennis J. Kucinich, Ohio Todd Russell Platts, Pennsylvania
David Wu, Oregon Ric Keller, Florida
Rush D. Holt, New Jersey Joe Wilson, South Carolina
Susan A. Davis, California John Kline, Minnesota
Danny K. Davis, Illinois Bob Inglis, South Carolina
Raul M. Grijalva, Arizona Cathy McMorris Rodgers, Washington
Timothy H. Bishop, New York Kenny Marchant, Texas
Linda T. Sanchez, California Tom Price, Georgia
John P. Sarbanes, Maryland Luis G. Fortuno, Puerto Rico
Joe Sestak, Pennsylvania Charles W. Boustany, Jr.,
David Loebsack, Iowa Louisiana
Mazie Hirono, Hawaii Virginia Foxx, North Carolina
Jason Altmire, Pennsylvania John R. ``Randy'' Kuhl, Jr., New
John A. Yarmuth, Kentucky York
Phil Hare, Illinois Rob Bishop, Utah
Yvette D. Clarke, New York David Davis, Tennessee
Joe Courtney, Connecticut Timothy Walberg, Michigan
Carol Shea-Porter, New Hampshire
Mark Zuckerman, Staff Director
Vic Klatt, Minority Staff Director
------
SUBCOMMITTEE ON HIGHER EDUCATION,
LIFELONG LEARNING, AND COMPETITIVENESS
RUBEN HINOJOSA, Texas, Chairman
George Miller, California Ric Keller, Florida,
John F. Tierney, Massachusetts Ranking Minority Member
David Wu, Oregon Thomas E. Petri, Wisconsin
Timothy H. Bishop, New York Cathy McMorris Rodgers, Washington
Jason Altmire, Pennsylvania Virginia Foxx, North Carolina
John A. Yarmuth, Kentucky John R. ``Randy'' Kuhl, Jr., New
Joe Courtney, Connecticut York
Robert E. Andrews, New Jersey Timothy Walberg, Michigan
Robert C. ``Bobby'' Scott, Virginia Michael N. Castle, Delaware
Susan A. Davis, California Mark E. Souder, Indiana
Danny K. Davis, Illinois Vernon J. Ehlers, Michigan
Mazie Hirono, Hawaii Judy Biggert, Illinois
C O N T E N T S
----------
Page
Hearing held on March 8, 2007.................................... 1
Statement of Members:
Altmire, Hon. Jason, a Representative in Congress from the
State of Pennsylvania, prepared statement of............... 1
Hinojosa, Hon. Ruben, Chairman, Subcommittee on Higher
Education, Lifelong Learning, and Competitiveness.......... 2
Prepared statement of.................................... 12
Making Opportunity Available report: ``Hitting Home:
Quality, Cost, and Access Challenges Confronting Higher
Education Policy''..................................... 3
Keller, Hon. Ric, Ranking Minority Member, Subcommittee on
Higher Education, Lifelong Learning, and Competitiveness... 12
Prepared statement of.................................... 14
Statement of Witnesses:
Breneman, David W., dean and professor, Curry School of
Education.................................................. 16
Prepared statement of.................................... 18
Internet link to the National Center for Public Policy
and Higher Education report: ``Measuring Up 2006''..... 19
Merisotis, James, president, Institute for Higher Education
Policy..................................................... 25
Prepared statement of.................................... 27
Soifer, Don, executive vice president, Lexington Institute... 33
Prepared statement of.................................... 34
Wiener, Ross, vice president for program and policy,
Education Trust............................................ 19
Prepared statement of.................................... 21
Internet link to Education Trust report: ``Promise
Abandoned: How Policy Choices and Institutional
Practices Restrict College Opportunities''............. 47
THE STATE OF HIGHER EDUCATION:
HOW STUDENTS ACCESS AND
FINANCE A COLLEGE EDUCATION
----------
Thursday, March 8, 2007
U.S. House of Representatives
Subcommittee on Higher Education,
Lifelong Learning, and Competitiveness
Committee on Education and Labor
Washington, DC
----------
The subcommittee met, pursuant to call, at 10:37 a.m., in
Room 2175, Rayburn House Office Building, Hon. Ruben Hinojosa
[chairman of the subcommittee] presiding.
Present: Representatives Hinojosa, Wu, Bishop, Altmire,
Courtney, Scott, Davis of California, Davis of Illinois,
Keller, McKeon, Foxx, Castle, Ehlers, and Biggert.
Staff present: Tylease Alli, Hearing Clerk; Denise Forte,
Director of Education Policy; Gabriella Gomez, Senior Education
Policy Advisor (Higher Education); Lamont Ivey, Staff
Assistant, Education; Thomas Kiley, Communications Director;
Ann-Frances Lambert, Administrative Assistant to Director of
Education Policy; Danielle Lee, Press/Outreach Assistant;
Ricardo Martinez, Policy Advisor for Subcommittee on Higher
Education, Lifelong Learning and Competitiveness; Stephanie
Moore, General Counsel; Lisette Partelow, Staff Assistant,
Education; Rachel Racusen, Deputy Communications Director;
Julia Radocchia, Education Policy Advisor; Robert Borden,
General Counsel; Kathryn Bruns, Legislative Assistant; Steve
Forde, Communications Director; Jessica Gross, Deputy Press
Secretary; Taylor Hansen, Legislative Assistant; Amy Raaf
Jones, Professional Staff Member; Jim Paretti, Workforce Policy
Counsel; Linda Stevens, Chief Clerk/Assistant to the General
Counsel; and Sally Stroup, Deputy Staff Director.
Chairman Hinojosa [presiding]. A quorum is present. The
hearing of the subcommittee will come to order.
Pursuant to Committee Rule 12, any member may submit an
opening statement in writing which will be made part of the
permanent record.
[The prepared statement of Mr. Altmire follows:]
Prepared Statement of Hon. Jason Altmire, a Representative in Congress
From the State of Pennsylvania
Thank you, Mr. Chairman, for holding this important hearing today
on how students access and finance higher education.
I would like to extend a warm welcome to today's witnesses. I thank
all of you for taking the time to be here and I look forward to hearing
from you.
College access and affordability are the keys to ensuring America
is competitive in the global economy. Unfortunately, in recent years,
the United States has lagged, when compared to other industrialized
countries, in the percentage of young adults enrolled in college and in
the proportion of those students who graduate from college. The
National Center for Public Policy and Higher Education's report,
``Measuring Up 2006: The National Report Card on Higher Education''
found that among 27 industrialized nations, the United States has
fallen to fifth in the percentage of young adults enrolled in college
and has dropped to sixteenth in the proportion of those students who
graduate.
I am concerned that our nation is not doing enough to provide
access to higher education to those who can not afford it and is not
adequately ensuring that college students graduate with degrees. I am
proud to say that this Congress has already taken two important steps
towards improving college accessibility. We passed the College Student
Relief Act, which will cut interest rates on student loans from 6.8% to
3.4% over the next five years, and we voted to increase the maximum
Pell Grant by $260 to $4,310.
These were necessary first steps and I look forward to working with
the Committee to continue to improve student access and affordability
to higher education.
Thank you again, Mr. Chairman. I yield back the balance of my time.
______
I now recognize myself, followed by my good friend and
colleague, Ranking Member Ric Keller, for an opening statement.
Welcome to the first hearing of the Subcommittee on Higher
Education, Lifelong Learning and Competitiveness. This is the
first of a series of hearings that we will hold on the
reauthorization of the Higher Education Act.
I am looking forward to working with the members of the
subcommittee and all of the stakeholders to develop legislation
that will fulfill the promise of the Higher Education Act for
the 21st century.
There is a growing concern that as a nation we are losing
our competitive edge. We know from experience that investing in
higher ed is one of our primary tools for sharpening that
competitive edge.
After World War II we opened the doors of college far and
wide to returning soldiers, rich, poor, black, white or
Hispanic. Our nation became smarter, stronger and richer as a
result of this egalitarian investment in education.
In 1965 president Lyndon Baines Johnson signed into law the
Higher Education Act, which expanded our national commitment to
broad access to higher education. Again, our economic
prosperity and capacity for innovation grew as a result of this
investment.
Yesterday, however, the study entitled, ``Hitting Home:
Quality, Cost and Access Challenges Confronting Higher
Education Today,'' was released by Jobs for the Future. This
quantifies the scale of our challenge in higher education.
The report found that by year 2025 just to keep pace with
our international competitors, the United States would need to
produce an additional 15.6 million college graduates. That
translated into another 781,000 degrees per year or a 37
percent increase over current production.
There are no two ways about it. That is a tall order. We
have not aligned our support for higher education to reflect
this reality. We are shortchanging our next generation of
college students. Hispanic and African American students will
account for most of the growth in our traditional college-aged
population, yet we know that nationally only half of these
students are graduating from high school. Only 1 in 5 is
college ready.
Many of our families do not understand financial aid for
the college process. A recent survey conducted by the Tomas
Rivera Policy Institute in California found that more than half
of the Hispanic parents and only 43 percent of young adults
could not name a single source of college financial aid.
Certainly we can do better.
Overcoming these barriers of preparation and financial aid
awareness is simply not enough to ensure college success. We
know that cost is a major obstacle. The Advisory Committee on
Student Financial Assistance estimates that in 2003 more than
170,000 college-qualified low-income students did not enroll in
any college at all because of financial barriers. Moreover, we
know that just getting into college is not enough. The benefits
of higher education come with degree completion. Too many of
our students are not making it through to graduation.
The 110th Congress has already made a down payment on
improving access and affordability. We have passed legislation
reducing interest rates on subsidized student loans, ensuring
all students have equal access to the maximum Pell Grant,
regardless of whether they attend low-cost institutions, and
providing the first increase in over 4 years to the Pell Grant,
boosting the maximum grant to $4,310, which is a $260 increase.
This is real progress, but we are just getting started.
Clearly, we need to expand access and success in higher
education on a much larger scale than ever before. The
reauthorization of the Higher Education Act is our opportunity
to do that.
Our distinguished panel today will help us think about how
to get this job done. Thank you for joining us, and I am
looking forward to your testimony.
Before concluding, I want to ask for unanimous consent that
a copy of the report that I mentioned in my opening remarks be
made a part of this hearing today. Hearing no objection, it
shall be done.
[The report follows:]
Hitting Home: Quality, Cost, and Access Challenges
Confronting Higher Education Today
An initiative of Lumina Foundation for Education
[March 2007; by Travis Reindl]
The United States needs to increase its production of postsecondary
education degrees and reduce gaps in achievement among racial and
socioeconomic groups. Otherwise, the country will not be able to meet
workforce needs,maintain international economic competitiveness, and
improve the quality of life for all Americans.
If current production patterns in postsecondary education persist,
the nation will face a significant ``degree gap'' that puts it at a
disadvantage relative to other leading developed nations. In fact, the
size of this gap--the difference between degrees produced in the United
States and those produced by nations who are among our top
competitors--could reach almost 16 million degrees by 2025, according
to new data prepared for the Making Opportunity Affordable initiative.
To close the gap, the nation's colleges and universities will need
to increase the annual rate of degree production by more than 37
percent. This estimate--prepared by the National Center for Higher
Education Management Systems--focuses on top degree producing nations
who are members of the Organisation for Economic Cooperation and
Development and does not include India and China, whose degree
production is also rising rapidly.
According to the new data, closing the gap will require the
nation's colleges and universities to ensure that minority groups, non-
traditional-age college students, and students from low-income
backgrounds achieve the same levels of attainment that we see today
among white and Asian Americans, traditional-age college students, and
wealthier students. Simply reaching the current attainment levels of
white students will depend on about 10.6millionmore people of color
earning postsecondary degrees by 2025 than do so today. Paying for this
level of expansion in postsecondary education will demand
implementation of a two-fold agenda:
Introducing a new public investment strategy that includes
growth in funding and a much sharper focus on expanding capacity and
bolstering productivity in the delivery of higher education;
Encouraging higher education systems and institutions to
be more cost-effective and collaborative with K-12 education in order
to enhance student access and success, further contain costs, and
introduce additional productivity improvements.
This will require states and institutions to set goals for quality,
cost, and access, and to establish metrics for measuring progress.
States and institutions also must institute multi-tiered strategies to
address these challenges. These strategies include: strengthening
inter-institutional collaboration through comprehensive approaches to
articulation and transfer; focusing resources on core academic
priorities; streamlining student transitions from K-12 to postsecondary
education; promoting timely degree completion; and redesigning academic
programs to improve student results while reducing cost. While there
have been some examples of state and institutional action in these
areas, this action has not been comprehensive, coordinated, or
sustained. But those states and institutions that have moved forward to
adopt these changes have seen promising results.
The multi-year Making Opportunity Affordable initiative aims to
provide research, tools, and support to help states and institutions
transform how they deliver postsecondary education to serve more
students without reducing quality. By introducing more cost-effective
approaches, states and their higher education systems can reinvest in
access and quality improvements. Support for the initiative has been
provided by Lumina Foundation for Education.
1. Changing workforce demands
A recent study by the Bureau of Labor Statistics indicates that
high-skill jobs that require advanced learning will make up almost half
of all job growth in the United States.While low-skill jobs will
continue to grow, the rapid expansion of high-skill work is an
indication of the nation's shift from manufacturing and farming toward
a more service- and information-based economy. In fact, jobs requiring
an Associate's degree or beyond will increase at faster rates than jobs
requiring less than an Associate's degree between now and 2014 (see
Figure 1). The minimum level of education required in high growth
fields is also likely to increase in the years ahead, which could widen
the gap.
High educational attainment correlates with state economic strength
and high income. A dozen states (California, Connecticut, Colorado,
Delaware, Illinois, Maryland,Minnesota, New Hampshire, New Jersey, New
York, Virginia, and Washington) have both high levels of personal
income per capita and high percentages of working-age adults with four-
year degrees. Only three states have high per-capita income and low
educational attainment: Alaska, Michigan, and Nevada, all with
economies tilted toward high-wage industries requiring lower levels of
education.
2. Underlying problems
In many ways the United States is doing better and worse when it
comes to higher education. The nation's higher education system has
historically been the strongest in the world, and by some measures
still is. The number of students pursuing degrees is at an all-time
high. Academic preparation for college-level work is improving.
College-going rates are holding steady despite double-digit tuition
increases.
But these signs of success mask deeper problems. The percentage of
our population earning college degrees is stagnating, because a larger
proportion of young people are not entering or not progressing through
postsecondary education. Low-income and minority students--the segments
of the population growing most rapidly--are not succeeding at rates
equivalent to their growth. Meanwhile, rising expenditures by students
and taxpayers are not resulting in better learning, which points to a
dangerous ``productivity gap.''
Changing Demographics. The number of students attending higher
education institutions has grown dramatically recently, but the
composition of that population is changing along with that of the
population as a whole. According to the U.S. Census Bureau, the
percentages of African Americans and Latinos from 18 to 44 years old
will rise by about 30 percent between 2000 and 2025, an increase of
about 10 million people. Meanwhile, as the white population ages, the
percentage of white adults from 18 to 44 will decline by 6.1 percent, a
drop of 4.4 million. Among 18- to 24-year-old white young adults, the
population will drop 9.6 percent. So the United States must
dramatically increase degree production while more effectively serving
groups who typically have not succeeded at the same rates as whites.
Rising Costs and Prices. The costs of providing higher education
and the prices paid by students and their families have increased
substantially. Even when adjusted for inflation, tuition and fees have
risen 24 percent at four year public universities over the past five
years and 32 percent over the past decade, according to Trends in
College Pricing 2006, a study conducted by the College Board. The
report reveals that tuition and fees at private institutions have risen
11 percent in the past five years and 25 percent in the past decade in
inflation-adjusted dollars. Meanwhile, public two-year institutions
have done a better job limiting price increases, but even their tuition
and fees have risen 22 percent in the past decade when adjusted for
inflation (see Figure 2).
The result has been that lower- and middle-class families are
having a harder time paying for college. More poor16.6% students are
staying away, and large percentages of students face heavy debt as they
enter the workforce. According to the American Association of State
Colleges and Universities, today two out of three students who attend
public colleges and universities graduate with debt, and the average
borrower owes $17,250 in student loans. Ten years ago, the average
student borrower attending a public college or university graduated
owing $8,000 in student loans after adjusting for inflation.
Rising prices are the tip of the iceberg. The amount of money that
colleges and universities spend to provide education to their students
is rising faster than consumer prices and health care costs. Over the
past decade, the Higher Education Price Index has increased
significantly faster than the nation's Consumer Price Index, which
measures the relative cost of a typical basket of goods and responds to
changes in the economy as a whole. According to data from the
Commonfund Institute, the past decade has seen the HEPI rise 31
percent, including an 18 percent increase in the last five years alone.
Meanwhile, the CPI has risen 22 percent and 12 percent, respectively.
There are disagreements about the causes of these cost increases,
and some experts argue that universities cannot control spending growth
because funding is always needed to improve quality. The Making
Opportunity Affordable initiative is investigating the real patterns of
spending in higher education and has found evidence that cost increases
are not inevitable. Institutions can control costs and maintain access
and quality if they do a better job of targeting resources to programs
that benefit students. A new study to be released by the initiative
later this year will provide new information on what is driving up
costs.
In the past, colleges have avoided coming to terms with cost
management by seeking new revenues--in the form of private fundraising
and student tuition increases--rather than changing practices. This
promotes what Charles Miller, chairman of the U.S. Secretary of
Education's Commission on the Future of Higher Education, has called
``a top-line structure with no real bottom line.'' The revenue chase
cannot continue. State appropriations for higher education are failing
to keep pace with enrollment increases and inflation. Legislatures have
increased funding for higher education by an average of 3 percent
annually in recent years, but have many competing priorities. States
also are facing large structural deficits--service demands in excess of
available revenues--that could limit resources available to address
these challenges. Private giving is highly variable and cannot be
relied on by higher education as a budget balancer.
The public is beginning to push back against constant tuition
hikes, raising questions about whether college is worth it and whether
colleges are doing the best they can to enable students to attend. More
than two-thirds of Americans (68 percent) believe that colleges and
universities could reduce their costs without hurting the quality of
the institutions, according to a 2004 Chronicle of Higher Education
poll.
Quality. How well are students doing? Our understanding of student
knowledge and skills comes from national studies, which indicate that
the mathematical proficiency and document/prose literacy of college
graduates have not improved and, in some cases, actually have declined
over the past decade. Adults with college degrees dropped 11 points in
prose literacy and 14 points in document literacy between 1992 and
2003, according to the National Assessment of Adult Literacy. A 2005
study by American Institutes for Research revealed that 20 percent of
U.S. college students completing four-year degrees--and 30 percent of
students earning two-year degrees--have only basic quantitative
literacy skills. According to the study,more than 75 percent of
students at two-year colleges and more than 50 percent of students at
four-year colleges score below the literacy proficiency level. They
lack the skills to perform complex literacy tasks, such as comparing
credit card offers with different interest rates or summarizing the
arguments of newspaper editorials.
In addition, structural forces make it difficult for states and
institutions to focus on these issues in a sustained way. State funding
cycles promote reactivity and crisis management rather than thoughtful
planning. Also, many states and institutions do not fully understand
why costs are rising, in what areas they are rising, and what tools or
knowledge will help them determine what to do.
As a result of changing demographics, rising costs and prices, the
erosion of quality, and these structural forces, we are losing ground
in helping to ensure that all Americans can attend college at a cost
the nation and its families can afford.
3. The degree gap
According to the analysis of OECD data, the U.S. deficit in degree
attainment poses a serious threat to the nation's economic well-being.
Other highly competitive nations are improving the quality of the
education they provide their young people, while also radically
increasing the capacity of the systems that serve them. These nations
have overtaken the United States' long-time position as the world
leader in degree production relative to population as a whole.
Today seven nations (Belgium, Canada, Ireland, Japan, Norway, South
Korea, and Sweden) lead the United States in degree attainment (see
Figure 3). More than half of Japanese and Canadian 25- to 34-year-olds,
for example, have a Bachelor's or Associate's degree, while only 4 in
10 Americans in this age group have earned postsecondary degrees.
We are losing ground to other nations largely because of relatively
low college completion rates. Although the United States still ranks in
the top five in the proportion of young people who attend college, it
ranks 16th in the proportion who actually finish, according to the
National Center on Public Policy and Higher Education's Measuring Up
2006 report. While estimates vary, American universities award about 18
degrees for every 100 full-time students enrolled. The leading nations
(Japan, Portugal, and the United Kingdom) award about 25 degrees. So
these nations are experiencing more positive returns on their
investments in higher education.
As other countries ratchet up access and attainment, American Baby
Boomers, the best-educated workers in history, are retiring and being
replaced in the workforce by young people who possess less knowledge
and weaker skills than the current generation. In fact, the United
States and Germany are alone among OECD nations in this respect: The
percentage of their workers ages 25-34 who have a postsecondary degree
is actually smaller than the percentage of Baby Boom workers ages 45-54
with such a degree.
For the first time, researchers have examined the extent of the gap
in degree attainment between the United States and the rest of the
world and its consequences. A new report, based on data analysis
conducted for Making Opportunity Affordable by NCHEMS, will be released
in May. This report, The Degree Gap, estimates that the United States
will need to produce 15.6 million more Bachelor's and Associate's
degrees beyond currently expected levels if the nation is to keep up
with its best performing peers--781,000 additional degrees per year
between now and 2025, an increase of 37 percent over the current pace
of degree production. According to the report, only eight states and
the District of Columbia are on pace to meet this ambitious goal. But
even states on course to close the gap will do so only by more
effectively serving a growing population of historically
underrepresented racial and ethnic groups. Some states will have to
more than double the numbers of young people who obtain college degrees
by 2025. This could have severe fiscal consequences, but states that
take on the challenge could see tremendous economic benefit (see Figure
4).
However one looks at the problem, the United States has miles to go
to eliminate racial and ethnic disparities in degree production,
strengthen the domestic workforce to meet demand for higher skills and
knowledge, and remain internationally competitive. Colleges and
universities will have to ensure that minority groups achieve at the
same levels as white and Asian Americans, and earn about 10.6 million
more postsecondary degrees by 2025 than would be the case given current
circumstances (see Figure 5).
4. What needs to be done
The magnitude of the challenge indicates that business as usual is
unacceptable. The solution combines two approaches: a) sustained
investment in higher education; and b) redesigned institutional
practice and public policy to promote greater cost-effectiveness,
informed by new knowledge and metrics.
A national agenda for redesigning the higher education system
should include several crucial elements. Consumers and the federal
government must continue to advocate broader access, improved
productivity, and better quality in postsecondary education. Much of
the heavy lifting, however, needs to come from state policymakers and
higher education decision-makers to:
Set goals for quality, cost, and access, and establish metrics for
measuring progress. Development of strategic plans and public agendas
at the campus, system, and state levels demands goals and metrics that
address resource use in relation to student results. Because much of
the data and information essential to this work are not currently
available or widely used, the Making Opportunity Affordable initiative
will make significant investments in creating and testing these tools.
Pursue multiple strategies for meeting these goals, including:
Strengthening inter-institutional collaboration through comprehensive
approaches to articulation and transfer to reduce repeat course-taking
and student attrition. Florida has taken the lead in addressing these
concerns by ensuring that most community college graduates will be
deemed to have met all general education requirements and will be
guaranteed admission into the upper division (junior status) of a state
university. State institutions also abide by a uniform system of course
numbering, and the state offers a Web site that provides unbiased
advising about postsecondary opportunities. Some states have initiated
joint degree programs to fully utilize existing investments. North
Dakota offers a joint program in nursing in which course delivery moves
from campus to campus, with many institutions participating, allowing a
needed program to be offered on a periodic basis in sparsely populated
areas without the typical inefficiencies associated with providing
expensive programs in rural communities.
Focusing resources on core academic priorities
A few states, such as Ohio and Virginia, have instituted
productivity reviews that identify undersubscribed majors at all public
institutions and reallocate public funds away from those majors if they
fall below a designated threshold. The Illinois Priorities Quality and
Productivity initiative in the mid-1990s pursued this goal by providing
a common set of data about individual program performance to
institutions. After providing the data, the Illinois Board of Higher
Education left the decision about which programs to eliminate up to the
institutions so long as they improved institutional performance within
established guidelines.
Streamlining student transitions to reduce rework and
attrition
This includes offering accelerated learning options (e.g., Advanced
Placement/International Baccalaureate, dual/concurrent enrollment,
Early College High Schools) and early intervention programs to boost
student preparation. In California, the 11th grade standards test
serves as a barometer of readiness for courses in the California State
University system, giving students early warning about their college
preparation. Washington's Running Start program reaches about 10
percent of high school juniors and seniors in the state. Running Start
students who transfer their credits to four-year institutions complete
Bachelor's degrees with an average of 33 fewer state-supported credits
than other students, resulting in lower net costs for both the student
and the state. Once in college, Running Start students also appear to
perform as well as, and in some cases better than, their peers.
Promoting timely degree completion to create increased
capacity for new enrollment
New York's Bundy Aid program, for example, rewards private
institutions for graduating New York State residents, providing strong
incentives for ensuring degree completion. Western Governors University
uses test-out provisions and other institutions use College Level
Examination Program scores to allow qualified students to advance
faster.
Redesigning academic programs to improve student results
while reducing cost
Institutions don't need to tie up several faculty members to teach
introductory courses in high-demand subject areas. A recent pilot study
by the National Center for Academic Transformation found that 25 of 30
institutions that redesigned a popular course by making smart use of
technology and engaging professors as tutors, rather than lecturers,
improved learning outcomes, while reducing cost by an average of 37
percent. Later in 2007, the National Center for Public Policy and
Higher Education will release a detailed report for the initiative on
effective practices to promote lower cost, equitable access, and higher
quality and productivity among states and institutions.
We are at a crucial turning point. The U.S. economy is still
strong, and has the potential to remain strong into the future. The
nation's workforce is one of the most highly skilled and productive in
the world, and can stay that way. But this will happen only if the
country makes strategic choices about how we prepare today's
workforce--and the workforce of 20 years from today.
The structural changes necessary to put the system on track to meet
the attainment benchmark will require breaking with tradition, on many
levels, and recentering institutions on their core missions.
Higher education in the United States successfully addressed the
economic, demographic, and technological challenges of the 19th and
20th centuries, educating new Americans in the Industrial Age,
educating the ``greatest generation'' in the post-WWII era, and opening
doors to women and minorities in more recent times. The development of
land grant colleges, the expansion of higher education made possible by
the GI Bill, and the establishment of community colleges reduced
disparities in opportunity created a workforce able to satisfy the
demands of the state and local economies, and they drove innovation
that resulted in continuous economic growth and improvements in the
quality of life and standard of living for almost all Americans.
States, institutions, and the nation must make no less a commitment to
confront the new global challenges of the 21st century, acting boldly
to expand opportunity and produce the talent the nation needs at a cost
taxpayers and students can afford.
______
Chairman Hinojosa. With that, I yield to my good friend and
ranking member Ric Keller of the great state of Florida for his
statement.
[The statement of Mr. Hinojosa follows:]
Prepared Statement of Hon. Ruben Hinojosa, Chairman, Subcommittee on
Higher Education, Lifelong Learning, and Competitiveness
Good Morning. Welcome to the first hearing of the Subcommittee on
Higher Education, Lifelong Learning and Competitiveness.
This is the first of a series of hearings that we will hold on the
reauthorization of the Higher Education Act. I am looking forward to
working with the Members of the subcommittee and all of the
stakeholders to develop legislation that will fulfill the promise of
the Higher Education Act for the 21st century.
There is a growing concern that, as a nation, we are losing our
competitive edge. We know from experience that investing in higher
education is one of our primary tools for sharpening that competitive
edge.
After World War II, we opened the doors of college far and wide to
returning soldiers--rich, poor, black, white or Hispanic. Our nation
became smarter, stronger and richer as a result of this egalitarian
investment in education.
In 1965, President Johnson signed into law the Higher Education
Act, which expanded our national commitment to broad access to higher
education. Again, our economic prosperity and capacity for innovation
grew as result of this investment.
Yesterday, the study ``Hitting Home: Quality, Cost, and Access
Challenges Confronting Higher Education Today'' was released by Jobs
for the Future. This quantifies the scale of our challenge in higher
education. The report found that by the year 2025, just to keep pace
with our international competitors, the United States would need to
produce an additional 15.6 million college graduates. That translates
to another 781,000 degrees per year or a 37 percent increase over
current production. There are no two ways about it--that is a tall
order. We have not aligned our support for higher education to reflect
this reality.
We are shortchanging our next generation of college students.
Hispanic and African American students will account for most of the
growth in our traditional college aged population. Yet, we know that
nationally, only half of these students are graduating from high school
on time. Only one in five is college-ready.
Many of our families do not understand financial aid or the college
process.
A recent survey conducted by the Tomas Rivera Policy Institute
found that more than half of Hispanic parents and 43 percent of young
adults could not name a single source of college financial aid.
Certainly, we can do better.
Overcoming these barriers of preparation and financial aid
awareness is simply not enough to ensure college success. We know that
cost is a major obstacle.
The Advisory Committee on Student Financial Assistance estimates
that in 2003, more than 170,000 college-qualified low-income students
did not enroll in any college at all because of financial barriers.
Moreover, we know that just getting into college is not enough. The
benefits of higher education come with degree completion. Too many of
our students are not making it through to graduation.
The 110th Congress has already made a down payment on improving
access and affordability. We have passed legislation reducing interest
rates on subsidized students loans, ensuring all students have equal
access to the maximum Pell grant--regardless of whether they attend
low-cost institutions, and providing the first increase in over 4 years
to the Pell grant, boosting the maxim grant to $4310--a $260 increase!
This is real progress, but we are just getting started. Clearly, we
need to expand access and success in higher education on a larger scale
than ever before. The reauthorization of the Higher Education Act us
our opportunity to do that.
Our distinguished panel today will help us think about how to get
this job done. Thank you for joining us. I am looking forward to your
testimony.
With that, I yield to my good friend and ranking member, Ric Keller
of the great state of Florida.
______
Mr. Keller. Well, thank you, Chairman.
And, Chairman Hinojosa, as this is our first subcommittee
hearing in the new Congress, let me personally congratulate you
on your chairmanship. I look forward very much to working
closely with you over the next 2 years on the very important
issues this panel addresses, from college access to job
training and everything else in between.
I would also like to welcome all of our witnesses and thank
all of you for taking the time to come and testify before the
subcommittee today.
The issue of student access to college and ways in which
students are financing their college education are important
ones to me. Pell Grants and student loans helped me to go to
college.
We have seen substantial increases in federal financial aid
since 2000. For example, Pell Grant funding is up 80 percent
from $7.6 billion in 2000 to $13.7 billion today. The maximum
award since 2000 has increased from $3,300 to $4,310 today. And
these increases have made it possible for an additional million
and a half students to receive Pell Grants since 2000.
On top of this dramatic influx in new aid, my colleagues on
the Education and Labor Committee have tried to move the
national dialogue about higher education beyond just federal
spending to get to the heart of what I believe is the real
problem, why costs are rising so dramatically and what we can
do to stabilize this trend.
With that goal in mind, we held over 30 hearings,
considered several bills and passed a reauthorization of the
Higher Education Act in the House in the form of H.R. 609, the
College Access and Opportunity Act.
The last point I believe is the crux of this decision, what
is causing the cost of higher education to sky rocket and what
can be done to slow down or reverse this dangerous trend.
According to the most recent College Board report, over the
last 5 years there was a 35 percent increase in tuition and
fees at 4-year public colleges. This increase is higher than
any other 5-year increase since the 1976-1977 year. For private
4-year institutions, that number was 11 percent
Unfortunately, the sky rocketing cost of tuition minimizes
the positive impact of our increases in important financial aid
programs, such as Pell Grants, so earlier this year the full
committee's ranking member, Congressman McKeon, and I,
introduced H.R. 472, the College Affordability and Transparency
Act, which was adopted from the affordability provisions in
H.R. 609.
Our bill aims to provide more information to students, not
just about college tuition prices but about net price, which we
define as the amount the student must pay after the grant aid
is subtracted from tuition. This is a measure and a concept I
am hopeful we will have the opportunity to discuss more as the
reauthorization process moves forward.
I will also be introducing the One Stop Student Financial
Aid Information Act of 2007 in the coming days, which will make
it easier for students and parents to learn more about their
financial aid options for college by providing all this
information on one easy to access Web site.
What I am most interested in learning here today is what
the other partners in higher education are doing. I am
interested in learning more about how states are treating
higher education and whether states are doing their part to
ensure that their citizens are able to achieve the dream of a
college education.
I am also interested in hearing more about what is being
done in the elementary schools and high schools to make sure
students are academically prepared to attend college. And,
finally, I am interested in hearing what institutions are doing
to make sure that their costs do not continue to spiral out of
control.
Before I conclude, I would like to thank our witnesses once
again for agreeing to testify before the subcommittee today,
and I look forward to the beneficial dialogue that I am sure
will take place here today.
With that, I yield back, Mr. Chairman.
[The statement of Mr. Keller follows:]
Prepared Statement of Hon. Ric Keller, Senior Republican Member,
Subcommittee on Higher Education, Lifelong Learning and Competitiveness
Chairman Hinojosa, as this is our first subcommittee hearing in the
new Congress, let me congratulate you on your chairmanship. I look
forward to working closely with you over the next two years on the very
important issues this panel addresses, from college access to job
training and everything in between. I'd also like to welcome all of our
witnesses and thank all of you for taking the time to come and testify
before the Subcommittee today.
The issue of student access to college and ways in which students
are financing their college education are important ones to me. Pell
Grants and student loans helped me go to college.
We've seen substantial increases in federal financial aid since
2000. For example, Pell Grant funding is up 79%, from 7.6 billion in
2000 to 13.6 billion today. The maximum award since 2000 has increased
from $3,300 to $4,310 today. And these increases have made it possible
for an additional million and a half students to receive Pell Grants
since 2000.
On top of this dramatic influx in new aid, my colleagues on the
Education and Labor Committee have tried to move the national dialogue
about higher education beyond just federal spending, to get to the
heart of what I believe is the real problem: why costs are rising so
dramatically and what we can do to stabilize this trend. With that goal
in mind, we held over 30 hearings, considered several bills, and passed
a reauthorization of the Higher Education Act in the House in the form
of H.R. 609, the College Access and Opportunity Act.
That last point, I believe, is at the crux of this discussion. What
is causing the cost of higher education to skyrocket, and what can be
done to slow down or reverse this dangerous trend? According to the
most recent College Board report, over the last five years, there was a
35 percent inflation-adjusted increase in tuition and fees at four year
public colleges. This increase is higher than any other five year
increase since 1976-77. For private four year institutions, that number
was 11 percent.
Unfortunately, the skyrocketing cost of tuition minimizes the
positive impact of our increases to important financial aid programs,
such as Pell Grants. So, earlier this year, the full Committee's
Ranking Member, Congressman McKeon and I introduced H.R. 472, the
College Affordability and Transparency Act, which was adapted from the
affordability provisions in H.R. 609. Our bill aims to provide more
information to students not just about college tuition prices, but also
about net price, which we define as the amount the student must pay
after grant aid is subtracted from tuition. This is a measure and a
concept I am hopeful we will have the opportunity to discuss more as
the reauthorization process moves forward.
I will also be introducing the One Stop Student Financial Aid
Information Act of 2007 in the coming days, which will make it easier
for students and parents to learn more about their financial aid
options for college by providing all this information on one easy to
access website.
What I am most interested in learning here today is what the other
``partners'' in higher education are doing. I am interested in learning
more about how States are treating higher education and whether States
are doing their part to ensure that their citizens are able to achieve
the dream of a college education. I am also interested in hearing more
about what is being done in elementary schools and high schools to make
sure students are academically prepared to attend college. And finally,
I am interested to hear what institutions are doing to make sure that
their costs do not continue to spiral out of control.
Before I conclude, I'd like to thank our witnesses once again for
agreeing to testify before the Subcommittee today. I look forward to
the beneficial dialogue that I am sure will take place here today.
______
Chairman Hinojosa. Thank you.
I also want to welcome ranking member of the whole
Committee of Education and Labor, Congressman Buck McKeon from
California, and would invite him to give some opening remarks.
You want to pass on that?
Without objection, all members will have 14 days to submit
additional materials or questions for the hearing record.
At this time, I would like to introduce our very
distinguished panel of witnesses here with us this afternoon.
The first one will be Dr. David Breneman, who received his
doctorate from the University of California at Berkeley. He is
a nationally acclaimed economist and author and has taught at
various universities, including Harvard. For the past 10 years,
he has served as dean of their Curry School of Education at the
University of Virginia. Recently, he chaired the National
Advisory Group that reviewed the report we will discuss today,
entitled ``Measuring Up 2006.''
Next we are going to hear from Ross Wiener, who is vice
president for programs and policy at the Education Trust, a
national nonprofit organization focused on closing the
achievement gaps in public education. He is a graduate with
high honors from the George Washington University Law School
and has clerked for the U.S. Court of Appeals for the First
District. Prior to coming to Education Trust, he served as a
trial attorney in the civil rights division of the U.S.
Department of Justice.
Later we will hear from Jamie Merisotis. Jamie is the
founding president of the Institute for Higher Education
Policy, a highly respected organization established in
Washington, D.C. He is a leading authority and has published
extensively in the higher education field. Prior to founding
the institute, Mr. Merisotis was the executive director of the
National Commission on Responsibilities for Financing
Postsecondary Education, a bipartisan commission appointed by
the president and congressional leadership.
We will also hear from Don Soifer, who is executive vice
president for the Lexington Institute in Arlington, Virginia.
He has published extensively on various aspects of education
policy, accountability and assessment, higher education finance
and closing the achievement gaps. Mr. Soifer has testified
twice before the U.S. Congress as well as various state
legislatures. In addition, he has served as a consultant to the
Virginia Department of Education. He is a 1990 graduate of
Colgate University and is a resident of the District of
Columbia.
I want to welcome each and every one of you, and we will
start with the first--I forgot to give you some of the rules
that we are going to go by. Allow me to say that for those of
you who have not testified before this subcommittee, let me
explain our lighting system and the 5-minute rule.
Everyone, including members, is limited to 5 minutes of
presentation or questioning. The green light is illuminated
when you begin to speak. When you see the yellow light, it
means you have 1 minute remaining. When you see the red light,
it means your time has expired and you need to conclude your
testimony.
Please be certain, as you testify, to turn on and speak
into the microphone in front of you.
The rules of the committee, adopted January 24, give the
chair the discretion on how to recognize members for
questioning. It is my intention as chairman of this
subcommittee to recognize those member present and seated at
the beginning of the hearing in the order of their seniority on
this subcommittee. Members arriving after the hearing has begun
will be recognized in order of appearance.
With that, we are going to ask the first presenter to start
with his presentation.
Welcome.
STATEMENT OF DAVID BRENEMAN, DEAN AND PROFESSOR, CURRY SCHOOL
OF EDUCATION
Mr. Breneman. Mr. Chairman and members of the committee, I
am very pleased to be here. I am testifying on my own behalf as
an economist who has written about higher education for over 35
years and who has served as an administrator in both private
and public institutions.
My remarks will focus primarily on ``Measuring Up 2006,'' a
report which I believe has been supplied to all members of the
committee.
The series of ``Measuring Up'' reports are best understood
as a benchmarking exercise, evaluating empirically the
performance of the 50-state systems of higher education using
35 data indicators organized into six categories. States are
ranked from best to worst performance and grades are assigned
accordingly.
The purpose of these reports is to provide each state with
ah empirical measure of how it stacks up against the other
states and to encourage them toward better performance. In the
2006 report, a new international dimension was added as we were
able to include comparable data from 26 member OECD countries.
The results from that information were stunning.
The first finding was that for older citizens, those aged
35 to 64, the U.S. lags only Canada in the percentage of adults
with college degrees. When one looks at the younger generation,
however, age 25 to 34, the United States drops to eighth place.
Clearly, the early advantage this country had, which you
eluded to in your remarks, in ensuring mass higher education
for the baby boom generation, has eroded as other countries
have overtaken us in producing educated talent.
When one turns to college participation rates for students
age 18 to 24, Korea leads the list at 48 percent while the U.S.
is fifth at 35 percent. Finally, the U.S. ranks in the bottom
half, 16th among 27 countries, in the proportion of students
who complete college degrees or certificate programs.
The other key findings in the 2006 report are that while
middle and secondary school preparation for college has shown
some improvement from the early 1990s, participation and
completion rates in college have been flat for really about 15
years.
Finally, by our measures, virtually every state received a
failing grade on affordability.
Members of this committee are well aware of the serious
efforts being made at the federal, state and local level to
improve K-12 performance, student performance, but it must seem
obvious that the country is sending decidedly mixed messages to
young people, encouraging them on the one hand to prepare for
college and then pricing many of them out of the market or
forcing them to work long hours while enrolled or to incur
substantial debt.
I will conclude my remarks with some thoughts on
affordability.
Starting at the state level, competing priorities in state
government budgets have meant that the days of low or no
tuition are behind us never to return. One result has been
rising public tuitions, putting an end to one of the oldest
state policies to ensure affordability. The Pell Grant program,
enacted in 1972, was built on the assumption that states would
maintain low tuition policies and the federal government could
help to cover the other costs of attendance. That implicit
understanding has long since broken down with the result that
the maximum Pell Grant has not kept up to the rising cost of
college.
Further muddying the water were the tuition tax credits
passed in the late 1990s that broke with the longstanding
pattern of concentrating federal funds on those with lowest
income.
States have responded in part with their own student aid
programs, but in several states these are reward and merit and
are not targeted to the low-income student. Institutions have
vastly expanded their own aid programs, but again with much of
the money allocated competitively to attract students to a
particular campus through merit aid.
The resulting ``system,'' and I put that in quotations, of
financial aid lacks coherence and presents a barrier to
students who lack the sophistication and guidance about how to
navigate the multiple and overlapping federal, state and
institutional programs. The fact that no obvious forum exists
where federal, state and institutional policies can be worked
on simultaneously renders the problem of coherence elusive.
Let me close by noting one further anomaly in the market
for higher education. In normal markets, competition among
suppliers tends to keep prices down. Higher education operates
in an intensely competitive market, but the effect of
competition in this case leads to higher rather than lower
prices. Why is that so?
No traditional college or university seeks to increase its
market share of total enrollment. There are no potential
Walmarts in the nonprofit sector of higher education. Rather,
the competition is for quality, prestige and selectivity and
the resulting status competition conveys a clear advantage for
those institutions at the top of the pecking order. Colleges
and universities further down the pack strikes to enhance their
own standing in this ranking by spending more on their
programs.
Increased competition, therefore, is not the solution to
rising prices in this market and workable regulatory mechanisms
have eluded state and federal officials as well. Ensuring
affordability should be the highest priority of this committee
for if we fail to enhance educational opportunity, we will all
be the losers.
Thank you.
[The statement of Mr. Breneman follows:]
Prepared Statement of David W. Breneman, Dean and Professor, Curry
School of Education
Mr. Chairman, members of the committee, I am pleased to have the
opportunity to present my views on the topic of this hearing. I am
testifying on my own behalf as an economist who has written about
higher education for over 35 years, and who has served as an
administrator in both private and public institutions. My remarks, as
requested, will focus on my work over the past decade as chair of an
advisory committee to the National Center on Public Policy and Higher
Education, a non-partisan, foundation-sponsored independent entity. The
National Center has produced four national report cards on higher
education performance, the most recent being Measuring Up 2006, copies
of which I believe you have. I will note the highlights of this most
recent report, and add some comments of my own on the issue of college
affordability.
The series of Measuring Up reports are best understood as a
benchmarking exercise evaluating empirically the performance of our 50
state systems of higher education. The unit of evaluation is the state,
not the institutions individually, and all components of the
postsecondary sector in each state are included. The report evaluates
each state in six categories: preparation, participation,
affordability, completion, benefits, and learning. A number of data
indicators, 35 in total, make up these categories, and the grades
assigned in each category are determined through a weighted average of
the individual indicators. The states are ranked from best to worst
performance, and grades are assigned accordingly.
The purpose of these reports is to provide each state with an
empirical measure of how it stacks up against the other states, as a
way to encourage better performance. In the 2006 report, a new,
international dimension was added, as we were able to include similar
data from 26 OECD member countries. It was our view that the global
economy requires each state to consider not just how its performance
compares with the other states but with other developed nations as
well. The results from that additional information were stunning.
The first finding was that for older citizens (ages 35 to 64), the
U.S. lags only Canada in the percentage of adults with college degrees,
Canada having 41% compared to the U.S. 39%. When one looks at younger
adults, however, (ages 25 to 34), the U.S. drops to 8th place, behind
Canada, Japan, Korea, Finland, Norway, Sweden, and Belgium. Clearly,
the early advantage this country had in assuring mass higher education
for the ``baby boom'' generation has eroded, as other countries have
overtaken us in the production of educated talent.
When one turns to college participation rates of students aged 18
to 24, Korea leads the list at 48%, with the U.S. fifth at 35%.
Finally, the U.S. ranks in the bottom half--16th among the 27
countries--in the proportion of students who complete college degree or
certificate programs. These data alone should shock us out of the
complacent view, long held, that U.S. higher education is the envy of
the world.
The other key findings in the 2006 report are that while middle and
secondary school preparation for college has shown some improvement
from the early 1990s, participation and completion rates in college
have been flat for 15 years. Nor have the large gaps in college
attendance that correlate with either income or race and ethnicity been
narrowed. Finally, the report's measure of college affordability gives
precision to the widely-recognized fact that the cost of college is
rapidly outstripping the ability of many families to pay. Indeed, by
our measures, virtually every state received a failing grade on
affordability.
Members of this committee are well aware of the serious efforts
being made at the federal, state, and local levels to improve student
performance in K-12 education. No Child Left Behind is the signature
program for this effort. Yet it must seem obvious that the country is
sending decidedly mixed messages to young people, encouraging them on
the one hand to prepare for college, and then pricing many out of the
market, or forcing them to work long hours while enrolled, or to incur
substantial debt. Let me conclude with a few remarks on affordability.
The reasons for rising tuitions are complicated and would require a
separate hearing to explore. Competing priorities in state government
budgets have meant that the days of low or no tuition are behind us,
never to return. One result has been rising public tuitions, putting an
end to one of the oldest state policies to assure affordability. The
Pell Grant program was enacted in 1972, when public tuition levels were
still very low, and a few among us may be old enough to remember that
the original Basic Educational Opportunity Grant (as Pell was initially
called), was designed to cover non-tuition costs. In short, that
program was built on the assumption that states would maintain low
tuition policies, and the federal government could help to cover other
costs of attendance. That implicit understanding has long since broken
down, with the result that the maximum Pell Grant has not kept up with
the rising cost of college, as these costs have been shifted from the
general taxpaying public to the student. Further muddying the water
were the tuition tax credits passed in the late 1990s that broke with
the long-standing pattern of concentrating federal funds on those of
lowest income. Various forms of tax-favored savings and tuition futures
plans from the 1990s further extended aid up the income scale.
The states have responded in part with their own student aid
programs, but in several states these have taken the form of merit-
based programs, modeled on the Georgia HOPE program, and are not
targeted at the low income student. Institutions have vastly expanded
their own aid programs, but again with much of the money allocated
competitively to attract students to a particular campus through merit
aid. Loan programs have proliferated, often part of an aid offer by the
institution that is ``preferentially packaged'' to deliver more loan
than grant aid to the less-competitive applicants, regardless of family
income.
The resulting ``system'' of financial aid lacks coherence, and
presents a barrier to students who lack the sophistication and guidance
about how to navigate the multiple and overlapping federal, state, and
institutional programs. I commend Secretary Spellings and Deputy
Secretary Martinez-Tucker in working toward simplification of the
federal programs, and I hope this committee encourages and supports
such efforts. (I also hope that the core federal commitment to need-
based aid is sustained.) No panacea is obvious, however, because the
system has evolved as it has in response to various political pressures
that are unlikely to go away. The fact that no obvious forum exists
where federal, state, and institutional policies can be worked on
simultaneously renders the problem of coherence elusive. But
understanding how the ``system'' works (or fails to work) is the first
step toward meaningful reform.
Let me close by noting one further anomaly in the market for higher
education. In normal markets, competition among suppliers tends to keep
prices down. Higher education operates in an intensely competitive
market, but the effect of competition in this case leads to higher,
rather than lower, prices. Why is that so? No traditional college or
university seeks to increase its market-share of total enrollments--
there are no potential Wal-Marts in the non-profit sector of higher
education. Indeed, few traditional institutions today seek to expand.
Rather, the competition is for quality, prestige, and selectivity, and
the resulting status competition conveys a clear advantage to those
institutions at the top of the pecking order. Wealthy parents then seek
to enroll their offspring in the most prestigious institutions, and
those colleges and universities further down in the pack strive to
enhance their own standing in this ranking (dutifully reported in U.S.
News & World Report) by spending more on their own programs. Increased
competition, therefore, is not the solution to rising prices in this
market, and workable regulatory mechanisms have eluded state and
federal officials as well.
Ensuring affordability should be the highest priority of this
committee, for if we fail to enhance educational opportunity we will
all be the losers.
______
[The Internet link to ``Measuring Up 2006'' follows:]
http://measuringup.highereducation.org/--docs/2006/NationalReport--
2006.pdf
______
Chairman Hinojosa. We will now hear from Mr. Wiener.
STATEMENT OF ROSS WIENER, VICE PRESIDENT FOR PROGRAM AND
POLICY, EDUCATION TRUST
Mr. Wiener. Thank you, and good morning, Mr. Chairman and
members of the subcommittee. Thanks very much for this
opportunity to testify this morning.
I just want to briefly reinforce the context that has been
established and then talk about a few suggestions as to how
Congress could help to turn around some of these patterns.
For much of our history, as has been stated previously this
morning, the United States has led the world in expanding
access to higher education and the Congress has shown great
leadership on this through the early establishment of land
grant institutions, the GI Bill, the Higher Education Act and
Pell Grants in 1972, and the return on our investment in
expanding this access has been incalculable, contributing not
only to our domestic prosperity but also to our global
leadership.
But as much as we can take pride in this tradition, I think
we have to acknowledge that we have broken faith with it and we
today have a serious problem in access and success in higher
education that has serious implications for our identity as a
nation and our leadership around the world.
Today there is less social mobility in America than there
was 20 years ago and less than in almost any other
industrialized country. One important reason is that over the
last 15 years there has been a massive shift in financial aid
policy away from helping low-income students. This has two
large effects.
One is that many college-qualified low-income students
never become college students and so can't be college
graduates. The situation right now is that our highest
achieving low-income students only go to college at the same
rate as our lowest achieving high-income students. But the
effect on college going is not the only impact. Those students
that do go to college go to college in ways that are much less
likely to allow them to be successful. They have to go part
time or they have to select to go to lower-cost institutions
that themselves have less resources to support these students.
And while we should celebrate these students' resolve and
we should be glad that these opportunities are available for
them, we should not be forcing low-income students and
disproportionate numbers of students of color to have to go in
these routes where they are likely to be less successful.
The end result of this diminishing opportunity is
unsustainable inequality along economic and racial lines. Just
two points of context before moving on. One is that children
from families in the top income quartile in this country have a
75 percent chance of having a baccalaureate degree by the time
they are 24. Children from the bottom economic quartile, the
bottom 25 percent, have only a 9 percent chance of graduating
from college by the time they are 24. And these issues play out
along racial and ethnic lines as well with white students
getting degrees at about twice the rate of African American
students and at about three-times the rate of Hispanic
students.
Hispanic Americans are the largest minority group in this
country, the fastest growing, and yet they have barely a one in
10 chance of having a baccalaureate degree by the time they are
29 years old. This has serious implications for the country and
we need to address this problem. And this shouldn't be seen as
charity for these groups or something we do out of compassion
for them.
The fact is, America needs more college-educated workers.
When you look at data generated by the Bureau of Labor and
Statistics and the Census Bureau and you project this out, we
are at risk of being short 3 million baccalaureate degrees in
the workforce, not in 20 years or in 30 years but in 5 years,
by 2012.
So let me talk about several ways that Congress could
address these issues in the Higher Education Act. One is to
restore the buying power of Pell Grants. Those used to cover
\3/4\ of the cost of attending college. They now cover less
than \1/3\. And this should be the first priority, as has been
mentioned earlier.
Another is to eliminate the FAFSA. The way that low-income
students have to apply for financial aid right now is
notoriously burdensome and confusing. The federal government
already has all the information it needs. Just like the federal
government produces estimates of benefits that citizens are
likely to get under the Social Security program, they should do
the same for low-income families and proactively inform them of
the aid they are likely to get.
Congress should consolidate multiple programs that are
intended to benefit low-income students. For example, the SEOG
program is located right now in proportionately wealthier
institutions that serve fewer low-income students, and that
money could be better put into Pell Grants.
Congress should make loan repayment schedules contingent on
family income so that college graduates who are in fields where
the income is less, there is a reasonable amount that they can
pay. If this were done, it would also make more loan students
more comfortable taking on the debt that is reasonable for them
to take on to go to college.
And, finally, Congress should continue to pursue reform in
the subsidized student loan market and use competition to keep
the subsidies down and, again, repurpose some of those
resources to help low-income students afford college.
Thank you.
[The statement of Mr. Wiener follows:]
Prepared Statement of Ross Wiener, Vice President for Program and
Policy, Education Trust
Mr. Chairman and Members of the Subcommittee, thank you for this
opportunity to provide testimony on this important issue. The Education
Trust is a national, non-partisan, non-profit organization dedicated to
improving the education of low-income students and students of color,
pre-kindergarten through college.
This morning, I want to describe the profound--and profoundly
disturbing--shift in financial aid policy that has put college out of
reach for far too many Americans. I also want to point to some concrete
actions that Congress should take to address problems related to both
access and success in higher education.
Background
For much of our history, the United States led the world in
expanding access to higher education. From the establishment of land
grants institutions, to the G.I. Bill, through the Higher Education Act
of 1965, and the creation of Pell Grants in 1972, the United States
Congress has shown true leadership on this issue. The return on our
investment in expanding access to higher education has been
incalculable, contributing both to domestic prosperity and
international leadership.
As much we can take pride in this tradition, we also must recognize
that we have broken faith with it. Our recent history is one of
shrinking opportunity and growing income gaps. One important reason is
that, over the last fifteen years, there has been a massive shift in
financial aid policy away from helping low-income students. Today,
there is less social mobility in America than there was twenty years
ago, and less than in almost any other industrialized country.
While the focus of this hearing is on the financial barriers to
getting a college education, I do not intend to minimize the other
issues that need to be addressed to improve the education of low-income
students and students of color. In particular, we at the Education
Trust are acutely aware that inadequate preparation in K-12 means that
far too many low-income students and students of color struggle in
college and the workplace. Moreover, the higher education community has
not stepped up appropriately to address low and stagnant graduation
rates of the students who do make it to college.
The large, unmet need faced by prospective students from low-income
families, and the fact that the amount of financial aid a student will
receive remains uncertain until so late in the process, have
implications across all these problems. For instance, many potential
college graduates never even become college students. Indeed, only 50%
percent of all ``college-qualified'' students from low-income families
enter a four-year college, compared to over 80% percent of similarly
qualified students from high-income families. The sad reality is that
America's highest achieving low-income high school graduates go to
college at the same rate as our lowest achieving high-income high
school graduates.
But that's not the only effect. Other low-income students do attend
college, but do so in ways that are far less likely to lead to a
degree. Many are intimidated by the financial aid and application
process but are enticed to enroll in fly-by-night proprietary schools
where they take on debt but do not acquire skills that will help them
pay off that debt. Others are forced to go to college part time, and/or
to start in a community college with the aspiration to transfer and
earn a B.A., but never gather the momentum to reach the baccalaureate
level. The tragic irony is that many of these students do not end up
with a degree, but do end up with debilitating debt burdens that leave
them worse off than before. So while we should ensure that all kinds of
options are available to students, we should not pretend that they are
all equally likely to ensure students' success, and we should not force
low-income and minority students down paths where success is rare.
The result is inequality that is bad not just for low-income
students and students of color, but bad for America. Children from
families in the top quartile for family income have a 75% chance of
getting a 4-year college degree by age 24; among children of families
in the bottom income quartile, just 9% have graduated from college by
24.
The gaps by race are also stark, with African-Americans earning
bachelor's degrees by age 29 at nearly one half--and Latinos at just
one-third--the rate of Whites. Moreover, instead of gradually getting
better, most of these gaps are getting worse. For while college-going
and degree rates have gone up for all groups, they have gone up faster
for white students than for students of color, who were already under-
represented. Since 1974, White students are up 19 points in college-
going and up 10 in college completion. African American students are up
20 points in college-going but only 5.5 in college completion. And
Hispanic students are up only 11 points in college-going, and just 3
points in college completion.
This inequality has grave implications for individuals and the
country.
In today's economy, education--and especially higher education--
provides the only certain route into the middle class and beyond.
Unlike a generation ago, there are very few jobs where good health and
a strong work ethic can ensure economic security. And the trend toward
work that requires some college education is accelerating. Projections
based on data from the Bureau of Labor Statistics indicate that, if
current trends are not changed, then the U.S. will face a shortage of
more than 3 million workers with bachelors degrees not in 20 or 30
years, but in five years--by 2012.
Moreover, we need to recognize that the rest of the world is not
standing still. Having learned from our example, other countries have
rapidly expanded participation and success in higher education. While
we once led the world in college graduates in the adult workforce, we
have slipped to fourth. Most disconcerting, the United States is one of
only two industrialized nations where older workers are more likely to
have a college degree than younger workers.
These trends hold serious social and economic threats. We are in
danger of creating a permanent underclass. And we are in danger of
losing our leadership in the global economy, which would have other
negative implications.
The reality is that America needs more college graduates. To
accomplish this, we must do a better job of educating low-income
students and students of color, who have been disproportionately left
out in the past. Given the especially dramatic growth in the number of
Hispanic Americans, and the distressingly low numbers of young people
from this community who are earning college degrees, their plight
merits particular attention. When the largest minority group in the
country has barely one in ten students getting through college with a
degree, the nation must act. We cannot continue our economic growth, we
cannot maintain our high standards of living, and we cannot create the
nation we all want to live in, without getting more students of color
and low-income students in and through college with a degree.
Congress can show important leadership by aligning federal policy
with the imperative to improve college outcomes, especially among low-
income and minority students. In addition to substantively improving
federal policy, the actions described below would allow Congress to
enlist states, colleges and universities, as well as the American
people, in a broader conversation about how to improve higher
education.
Financial aid: A promise abandoned
The federal government has always taken a central role in ensuring
equality of opportunity, and federal leadership is needed again if we
are to return this country to a path of truly expanding college access.
For one, the federal government is the biggest player in student
financial assistance. In 2004-5, the federal budget for student aid was
$90 billion, accounting for approximately three-quarters of all
expenditures on student aid. Approximately $18.6 billion of this was
allocated for grant aid, $68.6 billion for underwriting student loans,
and $6 billion in tax credits and deductions. How this financial aid
money currently is allocated is confusing and inadequate.
Below are some concrete actions Congress could take to improve the
chance of success for low-income and minority students in higher
education:
Restore the buying power of Pell Grants
Historically, the federal government's principle vehicle for
providing access to low-income students has been the Pell Grant.
Created in 1972, the Pell Grant program has enabled millions of
students from low-income families to attend two- and four-year
colleges. But investments in this program, while up, have not kept pace
with rising demand for college, or with the rising price of higher
education. In 1975, the maximum Pell Grant covered approximately 84
percent of the cost of attending a public four-year college. Today, it
covers only 36 percent, effectively blocking access for thousands of
aspiring college students from low-income families.1 In 1974, the
majority of Pell recipients (62%) attended four-year colleges and
universities, but that is no longer true--as of 2004, the majority of
Pell recipients (54%) attend two-year colleges. Similar enrollment
trends exist among African-American and Latino students who
disproportionately attend two-year and proprietary colleges from which
they have significantly lower chances of earning a degree.
The diminution of Pell's buying power might, of course, be
understandable given other pressures on the federal budget. But, in
fact, federal expenditures on non need-based student aid have grown
exponentially faster over the past decade than expenditures on need-
based aid. Indeed, of current federal expenditures on student aid, 52
percent--or more than $45 billion--is not based on need. Much of the
growth has been in tax deductions and credits, which disproportionately
go to upper-income families and do nothing at all to assist the lowest
income students and families. Before other worthy goals are pursued,
federal financial aid policy should ensure that low-income students are
able to attend college by increasing Pell Grants.
Eliminate the FAFSA
In addition to the re-allocation of aid away from low-income
students, the process for applying for federal financial aid also is
fraught with problems. The complexity, intrusiveness, and sheer burden
of the FAFSA (Free Application for Federal Student Aid) manifests
patent indifference as to whether low-income students get the aid to
which they are entitled. The FAFSA is notoriously confusing and has
been characterized by scholars as more complicated than filing an
income tax return. Indeed, taking out a mortgage to buy a house is
significantly simpler and demands less financial acumen than completing
the FAFSA.
If we are serious about ensuring that low-income students know
about and receive their financial aid, this process can and should be
streamlined. The government should proactively calculate estimated
grant awards based on income tax returns and other publicly held
records that already are in the government's possession. To help these
students get an image of themselves as college students, the federal
government should send an estimate of expected federal tuition grant
aid to each low-income family with school-age children. The Social
Security Administration routinely provides workers with estimated
benefits and there is no good reason not to do this with federal grant
aid.
That the FAFSA persists in its current form makes a mockery of our
commitment to helping low-income students go to college. It is not an
exaggeration to say that the FAFSA evidences contempt for low-income
students' college-going aspirations. If this Congress does nothing else
to align federal policy with the goal of increasing low-income
participation in higher education, it should replace the arduous FAFSA
with a proactive notification of projected grant aid to prospective
college students from low-income families.
Consolidate programs intended to benefit low-income
students
The overriding focus of federal financial aid policy should be to
make college accessible to those who otherwise could not afford it, and
to make the financial aid process as simple and straightforward as
possible. The myriad programs that ostensibly exist to help low-income
students should be combined, so that the money goes to the right
students--and students can know up-front the amount of aid to which
they are entitled. Some of the many programs that exist now benefit
institutions more than low-income students, and dilute the federal
government's ability to target money to truly needy students.
The SEOG program is a perfect example: SEOG allocations go
disproportionately to wealthier institutions which serve
disproportionately fewer financially needy students. This money would
be better spent on increasing Pell Grants.
Make loan repayment schedules contingent on family income
As students are expected to assume more and more debt to finance
their college education, it is incumbent upon the federal government to
provide some insurance against individual financial ruin. Borrowing to
help for college is a good investment. Most students will go on to earn
more as a result, and it is fair and reasonable to expect them to pay
off their loan obligations. But for those borrowers who confront
prolonged debt-to-income disparities--and this includes not just drop-
outs, but also those who choose socially important, but lower-paying
professions such as teaching--the federal government should index loan
repayments on a sliding scale related to ability to pay. If low-income
students were made aware of this support early in the process, they
would be more likely to take on reasonable debt and enroll in college
in the first place. The Project on Student Debt has proposed a
reasonable plan to make repayment limits contingent on family income.
This plan is modest, fair, and urgently needed.
Ensure that tax-exempt institutions educate low- and
middle-income students
Institutions of higher education are huge non-profit corporations
with tax-exempt status. It is not unreasonable to expect them to
participate in the country's commitment to expanding higher education
among those in the bottom half of the income distribution. No
institution should be forced to educate more low- and middle-income
students. But if they do not include a reasonable share of these
students in their programs, then their generous government subsidy
should be repurposed to ensure these students have access to
postsecondary options somewhere else. At a minimum, each institution
that wants to maintain its tax-exempt status should make a commitment
to educating low-income students. It is a vital public interest and not
unreasonable to expect non-profit colleges to draw \1/4\ of their
students from the bottom \1/2\ of the income distribution.
Engage states and institutions in improving access and
success
Beyond its proportional role, it also is clear that federal policy
sets the context for what happens with state and institutional aid
dollars; as the federal government has abandoned low-income college
aspirants, so, too, have the other players in financial aid. Ten years
ago, grants to students without demonstrated financial need represented
14 percent of state grant expenditures. Today that fraction has nearly
doubled to 27 percent2. I want to be clear that it is not a bad thing
for government to help middle and upper-middle income families pay for
college. But the first priority of financial aid policy should return
to its historic purpose of helping students who cannot afford to attend
college without financial assistance.
Institutions of higher education have also abandoned low-income
access. In the absence of any accountability or recognition for
expanding access, these institutions have increasingly pursued higher
status in the private college ranking guides by using their
discretionary financial aid dollars to ``buy'' students who will
improve their rankings. A recent report from the Education Trust,
Promised Abandoned, documents how campus-based aid has also skewed away
from low-income students in recent years.
Congress cannot solve these problems alone, but Congress is
uniquely positioned to stimulate an important new dialogue on how
quality in higher education is defined. Current metrics for quality and
recognition bestow status on colleges that only admit students who will
succeed no matter where they go. Instead, we need to honor and support
institutions that are helping increasing numbers of students who face
far more difficult challenges to obtain the degrees that will help them
advance personally and contribute to the social, civic and economic
well-being of the nation. This larger issue deserves to be the focus of
more Congressional deliberation. I will mention just two discreet ways
in which Congress could spur progress:
Improve data collection systems so that both policymakers
and the public have easy access to honest and accurate information
about student outcomes. Congress should immediately add critical
information to the IPEDS data collection process, including the
addition of ``Pell Grant'' status to the Graduation Rate Survey, so
that the success of low-income students can be measured and reported;
tracking and reporting year-to-year retention rates disaggregated by
Pell status and race/ethnicity; and mandating and verifying the
reporting (now voluntary) of cohort transfer rates. At the same time,
Congress should facilitate development of unit-record systems that will
provide more accurate accounting of what happens to students in higher
education, while protecting privacy and confidentiality.
Partner with states to encourage more need-based aid and
better cost containment. Congress should explore ways to partner with
states that are willing to commit to improving access and graduation
rates for low-income students and students of color.
Conclusion
Thirty years ago, President Lyndon Baines Johnson and the 89th
Congress acted to make the American Dream a reality when they passed
the Higher Education Act of 1965. When he signed this historic
legislation, President Johnson recalled the experiences in his own
life--first as a needy college student himself, and subsequently as a
teacher in a school serving Mexican-American students--that prompted
him to work so hard to win the enactment of this ground-breaking law:
I shall never forget the faces of the boys and the girls in that
little Welhausen Mexican School, and I remember even yet the pain of
realizing and knowing then that college was closed to practically every
one of those children because they were too poor.
And I think it was then that I made up my mind that this Nation
could never rest while the door to knowledge remained closed to any
American.
Later in his remarks, he called on all of us--``the teachers and
the citizens and the educational leaders of tomorrow:''
[W]hen you look into the faces of your students and your children
and your grandchildren, tell them that you were there when it began.
Tell them that a promise has been made to them. Tell them that the
leadership of your country believes it is the obligation of your Nation
to provide and permit and assist every child born in these borders to
receive all the education that he can take.
``The rest,'' he said, ``is up to you.''
Clearly, in a whole host of ways, we've strayed from that central
commitment and broken that all-important promise. And the consequences
have been grave. Many young people no longer believe that if they work
hard, college is a real possibility for them. We can take issue with
their logic. We can argue that college costs less than they think, that
there is more aid money than they realize or that even large loan debts
make long-term sense. But we cannot contest the facts: pathetically few
low-income students, including the highest achieving, are entering and
completing college.
Though it may be too late for some students, it is not too late for
others. And it is not yet too late for our country. We can change these
patterns if we so choose.
______
Chairman Hinojosa. We will now hear from Mr. Merisotis.
STATEMENT OF JAMES MERISOTIS, PRESIDENT, INSTITUTE FOR HIGHER
EDUCATION POLICY
Mr. Merisotis. Chairman Hinojosa, Ranking Member Keller,
thank you very much for this opportunity.
Improving access to higher education continues to be one of
the most important contributions that the federal government
can make to our national well being. Increasing educational
opportunities for all Americans results in tremendous public,
private social and economic benefits.
Unfortunately, low-income, minority and other groups face
unacceptably large gaps in their ability to get into and
succeed in college due to a variety of financial, informational
and academic factors. Supporting programs that have a track
record of success is the best way to achieve an accessible and
accountable system of higher education.
At the same time, such an investment must be done with a
clear focus on accountability to the students who benefit from
the programs. With these dual goals of investing in those who
might not otherwise go to college and ensuring accountability
to the students we serve, I would like to offer the following
options for your consideration.
First, I urge you to invest in need-based grant aid as the
best way to promote college access. The declining purchasing
power of federal aid indeed continues to be a critical barrier
to access to higher education. I urge Congress to consider an
increase in the maximum Pell Grant to at least $6,000. this
would pay for slightly less than \1/2\ of the price of
attendance at a typical public 4-year college.
At the same time, while I don't support efforts to pay for
Pell Grant increases through cuts in other programs, in effect
taking money away from one group of needy students to give it
to another, I do believe that greater efficiency can be
achieved. For example, an increase in the minimum Pell Grant
would net at least some cost savings.
Second, encourage a broad partnership in college financing
through private sector aid to students. The private sector is a
largely unrecognized partner in college financing. While
private scholarship aid never can nor should be seen as an
alternative to federal aid, the more than $3 billion annually
awarded through private scholarships must be recognized and
expanded. I encourage you to explore ways that the Title 4
programs can be used to stimulate an even greater response from
local communities, corporations and other private sector
donors.
Private loans present a very different set of opportunities
and challenges. Given the predicted growth in private loan
borrowing, it is important to charter reasoned debate about
their potential benefits and risks. I support the overall goals
of transparency and consumer protection contained in the
Student Loan Sunshine Act.
Given the increasing borrowing demands of students, I don't
believe private borrowing should be discouraged, but I do
believe that students should be informed of their federal loan
eligibility prior to taking out a private loan.
Third, I encourage you to strongly support locally-managed
program, such as TRIO and GEAR UP, as essential components of
our national access strategies. For many of the nation's most
underserved populations, financial aid is necessary but not
sufficient to encourage college access and success. TRIO and
other programs provide tutoring, mentoring and counseling and
promote the successful transition of students into and through
college.
Fourth, strengthen the capacities of minority-serving
institutions to educate the nation's emerging majority
population. Tribal colleges and universities, Hispanic-serving
institutions and predominantly black colleges and universities
and other minority-serving institutions represent some of the
nation's most important but underserved education resources.
These institutions provide opportunities to more than 2.3
million students, the majority of whom are low-income and
educationally disadvantaged.
In the 110th Congress, I urge you to create a well-trained,
flexible workforce that will meet our economic and social
challenges head on through investment in minority-serving
institutions.
Fifth, embrace investment in immigrants as a key component
of higher education access and success. Many immigrants face
significant barriers to higher education. Developing a broader
and more efficient path to citizenship and offering affordable
and accessible programs to help immigrants learn English would
open the doors to college for many immigrants. Policies that
explicitly impede the college opportunities of legal
immigrants, such as in the academic competitiveness grant and
smart grant programs, which exclude legal permanent residents,
must be reversed.
Finally, I urge you to support a system of accountability
that focuses on the complex life circumstances of today's
college student. Higher education institutions must demonstrate
that they are effective stewards of the funds that have been
invested in them by the federal government. Accountability
begins with an efficient system of information that can be
readily collected, easily understood and meaningfully applied.
I therefore support the pilot development of a national system
of student level data, ideally one that harmonizes the more
than 40 state systems already in place.
Investing in those who might not otherwise go to college
and assuring accountability to the students who are served are
not just nice goals to pursue as part of a federal education
policy agenda. They are necessary components of a national
workforce investment strategy that can lead to greater
prosperity, security and harmony for all Americans.
Thank you.
[The statement of Mr. Merisotis follows:]
Prepared Statement of James Merisotis, President, Institute for Higher
Education Policy
Mr. Chairman and Members of the Subcommittee: Thank you for this
opportunity to appear before the Subcommittee regarding how students
access and finance a college education.
In the 110th Congress, you face the ongoing challenge of promoting
access to higher education for all Americans who have the interest and
ability to attend college. Improving access to higher education
continues to be one of the most important contributions that the
Federal government can make to our national well-being. The simple fact
remains that increasing educational opportunities for all Americans
results in tremendous public, private, social, and economic benefits.
We know, for example, that workers who have attended college tend to
have low rates of unemployment, and analyses of job growth and employer
demands overwhelmingly suggest that future job growth will be
concentrated in fields that require a college education. We also know
that the higher earnings for college graduates results in more revenue
for government coffers through increased tax collections. Social
benefits of postsecondary education also accrue to individuals and to
the public. For instance, people with more education tend to have
greater health and life expectancy. Public benefits from higher
education include reduced crime rates, increased civic participation,
and more charitable giving and volunteerism. In short, by investing in
our fellow Americans who might not otherwise go to college, we are
investing in our collective future and well-being.
Unfortunately, not all Americans are able to benefit from higher
education due to a variety of financial, informational, and academic
barriers. According to data from the U.S. Census Bureau, while 75% of
high-income students enter college today, only 31% of low-income
students do. Of traditional age students who go to college after
graduating from high school, college enrollment rates are about 10
percentage points higher for whites than for African Americans,
Hispanics, and Native Americans. These gaps are even wider for adult
and so-called non-traditional students.
So if investment in higher education matters, then maintaining and
expanding that investment is critical. I recognize that the nation
faces an uncertain economic future, one that places constraints on
policy discussions such as these. But I hope you will not lose sight of
the long-term effects that your investments will have on the nation.
The programs established and defined within the Higher Education Act
(HEA) are now more necessary than ever. Supporting these programs is
the best way to achieve an accessible and accountable system of higher
education for all Americans.
At the same time, such an investment must be done with a clear
focus on accountability to the students who benefit from the programs.
Efficiency in the delivery and administration of programs that promote
access and success must be maintained at all levels. Supporting access
to quality programs, and to institutions that serve the nation's most
underserved populations, should be a hallmark of these investments.
With the dual goals of 1) investing in those who might not
otherwise go to college, and 2) ensuring accountability to the students
we serve, I would like to offer a limited set of concrete programmatic
options for your consideration.
Invest in need-based grant aid as the best and most important way to
promote access to postsecondary education
In the early 1990s, a bipartisan Federal commission called the
National Commission on Responsibilities for Financing Postsecondary
Education (for which I served as Executive Director) issued a widely-
circulated report called Making College Affordable Again. The
legislation creating the commission, authored by Senator James Jeffords
of Vermont in the late 1980s, noted that the purchasing power of aid
had been rapidly declining through the decade of the 1980s, leading to
increasing concerns about access to postsecondary education. In
commenting on the legislation, Senator Jeffords noted, ``Without
affordable postsecondary education, without national support for
meaningful access for able students to take advantage of higher
education opportunities, we will not be able to accomplish any of the
objectives that we strive for as a nation and a leader of nations.''
The final report of the commission, issued in 1993, recommended several
important improvements to Federal student aid, many of which have
subsequently been enacted. But the Commission's major recommendation--
to assure access to higher education for all qualified students through
the Student's Total Education Package (STEP), a mechanism that ties
Federal aid to a sliding subsidy scale based on financial need--remains
unfulfilled. Such a mechanism would go a long way toward emphasizing
the importance of grant aid for the neediest students while also
acknowledging the important concerns about affordability for middle
income students and families.
Research indicates that investment in need-based grant aid is the
best and most important contribution that the Federal government can
make to keeping the dream of a college education a reality for all
Americans. The declining purchasing power of Federal aid continues to
be a critical barrier to access to higher education. Even taking into
account the funding increases of the last few years, the maximum Pell
Grant today pays for only about one-third of the average price of
attendance at a public four-year institution compared to more than two-
thirds in 1980. Significantly increased support for the Pell Grant
program therefore should be a centerpiece of efforts to enhance the
programs and policies in the Higher Education Act. I am pleased that
both the Congress and the President have recently signaled their strong
support for a long-overdue increase in the maximum Pell Grant. I urge
Congress to consider an increase in the maximum Pell Grant to at least
$6,000. This would pay for slightly less than one-half of the price of
attendance at a typical four-year public college for the poorest
students--still well below historic levels, but an important down
payment for the future.
At the same time, while I do not support efforts to pay for Pell
Grant increases through cuts in other programs--in effect, taking money
from one group of needy students to give it to another group of needy
students--I do believe that greater efficiency could be achieved in
existing grant programs. For example, an increase in the minimum Pell
Grant would net at least some cost savings; it may be possible to do so
by indexing the minimum Pell Grant to increases in the maximum Pell. It
is also worth examining the issue of the allocation formula for campus-
based aid such as Supplemental Education Opportunity Grants, ensuring
that such aid is targeted to those students and institutions with the
least capacity to pay the costs on their own.
Encourage a broad partnership in college financing that promotes
private sector investment in aid to students
The dual goals of investing in students who might not otherwise
attend college and ensuring accountability to students can be achieved
in part through a partnership that encourages private sector aid to
students. Government-sponsored grant and scholarship aid from both
Federal and state sources today totals more than $25 billion per year,
with a similar amount awarded directly by institutions via their own
grant funds. An astonishing total of more than $70 billion is awarded
to students through government guaranteed student loans. But the
private sector is an important and largely unrecognized partner in the
college financing equation. The private sector's commitment and support
for helping students go to college--and succeed when they get there--
should be better recognized and understood as a valuable complement to
Federal aid.
For example, private scholarship support, sometimes thought of as
marginal or modest in its impact, is growing in importance and stature.
A 2004 IHEP study found that at least $3 billion per year is awarded
through private scholarship programs, and employer-provided education
assistance to employees and their dependents totals several billions
more. Private scholarship aid has long made a difference in the lives
of students hoping to go to college. In fact, at about the same time
that the National Defense Education Act of 1958 heralded the beginning
of a series of governmental programs that have allowed millions of
financially needy students to attend college, private scholarship
assistance also became more organized and related specifically to
meeting the country's educational, economic, and social needs. An
optometrist from Fall River, Massachusetts named Irving Fradkin
organized a community-based scholarship program in the late 1950s to
help academically able and financially needy students go to college.
The Citizens' Scholarship Foundation of America slowly expanded in the
New England region, and eventually across the country, creating local
scholarship foundations that contribute resources to assist students
with college costs. In 2006, the national organization now known as
Scholarship America--where I currently have the privilege of serving as
the Chair of the Board of Directors--distributed over $180 million in
scholarships to more than 120,000 students through its diverse array of
community-based, volunteer-supported programs.
Organizations like Scholarship America work in a variety of ways
with colleges and universities to offer numerous scholarships and
grants that include need-based and non-need-based forms of financial
assistance to students. While private scholarship aid never will--nor
should--be seen as an alternative to Federal financial assistance, it
must be recognized as one of the key partners working to support
students at the Federal, state, institutional, and private levels. I
therefore would encourage you to examine ways in which the HEA can be
used to stimulate even greater response from local communities,
corporations, foundations, organizations, and individual donors in the
private sector.
One specific way to do this is via the Leveraging Educational
Assistance Partnership (LEAP) program, which encourages state
governments to provide state tax dollars to assist students in their
states to gain the critical benefits of postsecondary education. This
program could be enhanced to leverage a much greater amount of aid for
students if it were used to stimulate not just state dollars for
student aid, but significantly increased private sector aid in each
state as well. For example, in the state of Washington the legislature
has provided small challenge grants to communities that have encouraged
the creation of over 100 new volunteer-supported, community-based
scholarship chapters. The current LEAP legislation could be modified to
reward those states where significant increases in student aid are
produced by partnerships with local community-based scholarship
providers.
The other area of significant private sector involvement in
financial aid is through private loans. A widely circulated recent IHEP
study on private loans found that they are becoming an essential part
of financing postsecondary education in today's market of rising
tuition costs and fees. Given the fact that experts are predicting
private lending will continue to grow, it is important to chart a
reasoned debate about private loans and their potential benefits and
risks for students in the future. Targeted outreach to students to
ensure that they are receiving comprehensive information about the pros
and cons of private loan borrowing is important. I support the overall
goals of transparency and consumer protection contained in the current
draft of the Student Loan Sunshine Act. While I don't believe private
borrowing should be discouraged--given the increasing borrowing needs
of students--I do believe that efforts must be made to inform students
of their Federal loan eligibility prior to taking out a private loan.
This would protect the interests of student consumers while ensuring
that alternatives are available if Federal loans are not a reasonable
option for certain students.
Decisively and unequivocally support locally-managed programs such as
Upward Bound, Talent Search, and GEAR UP as essential
components of our national access strategy
For many of the nation's most economically and educationally
underserved populations, financial assistance is a necessary but not
sufficient strategy for ensuring access to, and success in, higher
education. The Federal government recognized this more than 40 years
ago with the establishment of the Upward Bound program, and continues
that tradition through the TRIO programs and their more recent
complements such as GEAR UP. These critical programs serve as key
vehicles for improving the higher education prospects of low-income,
first-generation, and disabled students. The programs provide a
continuum of services from pre-college to pre-graduate level study for
the nation's low-income, first-generation, and disabled students. In FY
2006, the $828 million in funding for TRIO programs supported more than
850,000 students in over 2,700 distinct TRIO programs. Yet despite this
support, less than 10 percent of the eligible populations are served by
TRIO programs.
There are a total of seven TRIO programs. The pre-college programs
include Talent Search, Upward Bound, Upward Bound Math Science, and
Veterans Upward Bound. These programs provide counseling, information,
skills development, college planning, and an array of other services
that help students get ready for college. At the college level, Student
Support Services, the Ronald E. McNair Post-Baccalaureate Achievement
Program, and Educational Opportunity Centers programs provide tutoring,
counseling, and supplemental instruction to help students stay in
college through the completion of a degree (or transfer to a different
institution) and pursue graduate-level education.
These programs are key pillars in the overall effort to promote the
successful transition of students into and through college. Yet in
recent years the Upward Bound, Talent Search, and GEAR UP programs have
inexplicably been proposed for elimination as part of the President's
budget. Given their importance to the populations most in need of
college access--nearly one-third of all low-income high school
graduates who actually enroll in college have been served by a TRIO
program--we must not only be categorically opposed to the elimination
of these programs, but we should also support significant funding
increases in each of these programs and not allow the diversion of
funding from these proven programs to support other education
initiatives.
Strengthen the capacities of minority-serving institutions (MSIs) to
educate the nation's emerging majority populations
No group of institutions does more to promote the dual goals of
investing in students who might not otherwise go to college and
ensuring accountability to those students than Minority-Serving
Institutions (MSIs). Tribal Colleges and Universities (TCUs), Hispanic-
Serving Institutions (HSIs), and Historically Black Colleges and
Universities (HBCUs) and other predominantly Black institutions, which
collectively are referred to as MSIs, represent some of the nation's
most important but underserved postsecondary education resources.
Combined, more than 2.3 million students are educated by these
institutions, or about one-third of all students of color. These
numbers have been growing rapidly in recent years as increasing numbers
of students of color seek opportunities for a college education--in
fact, enrollment at MSIs increased by 66 percent from 1995 to 2003,
compared to only 20 percent at all postsecondary institutions.
Given demographic projections that show these communities are the
fastest growing in the nation, it is clear that MSIs must be recognized
as a leading voice for the underrepresented populations that are the
main focus of most HEA programs. These populations find that MSIs offer
a unique educational experience that fosters cultural values and
traditions, promotes civic and community responsibility, and produces
citizens who are attuned to the increasingly diverse country in which
we live.
MSIs educate more students of color in many areas of national need
than mainstream institutions. For example, more than one half of all
teacher education degrees awarded to African Americans, Hispanics, and
American Indians in U.S. higher education are conferred by MSIs. These
institutions also make major contributions to our nation's workforce in
the areas of Science, Technology, Engineering, and Mathematics (STEM)
despite significantly lower levels of financial support than other
institutions.
Most MSIs provide postsecondary education opportunities
specifically tailored to low-income, educationally disadvantaged
students. Forty-four percent of students enrolled at MSIs in 2004 were
from families in the lowest income quartile, compared to 24 percent
enrolled at all institutions. The fact that nearly half of all full-
time students enrolled at MSIs receive Pell Grants compared to only 31
percent of all students enrolled in higher education, and that for MSI
students Pell awards tend to be 9 percent higher on average, is
evidence of the high financial need of MSI students and the critical
importance of grant aid to their educational endeavors.
In the 110th Congress, I urge you to see MSIs as a major avenue for
advancing the nation's goals to create a well-trained, flexible
workforce that will meet our economic and social challenges head-on.? I
believe that several important steps could be taken to strengthen the
capacity of MSIs. One is to expand both the scope and authorization
levels of Titles III and V to ensure the continued development and
growth of MSIs. Additional funding is required for MSIs to reach a
level of financial stability that ensures the students enrolled at
these institutions receive the same quality academic programs offered
by majority institutions.
Congress also could take steps to encourage improvements in the
infrastructure and application of information technology at MSIs. The
MSI Digital and Wireless Technology Opportunity Act incorporates many
of the key elements of investing in MSI technology capacity to benefit
our future workforce. This legislation should be passed by Congress and
its core principles applied to other policies and programs.
I also would urge you to consider the development of new graduate-
level opportunities to enhance the capacity of MSIs to train future
faculty and senior institutional leaders. The significant under-
representation of minorities in many advanced degree fields is a major
concern. The limited graduate-level opportunities available to MSI
graduates and other minorities can be enhanced through policies that
support: the infrastructure of post-baccalaureate education at MSIs--
such as Ph.D. programs for schools currently offering Master's degrees;
the recruitment and retention of minority professors; and the financial
resources necessary to attain an advanced degree, including
fellowships. It also would be useful to consider opportunities to
expand support for international education at MSIs under Title VI,
which historically have offered limited opportunities for the students
served by MSIs.
Embrace investment in immigrants as a key component of the higher
education access and success strategy
The United States has always been a nation of immigrants--a land of
opportunity where newcomers can, through hard work and perseverance,
achieve better lives for themselves and their families. But in today's
world, realizing the American Dream is now almost impossible without at
least some college education, and many immigrants face significant
barriers to gaining access to and succeeding in higher education.
Higher education for immigrants isn't an issue narrowly focused on the
well-being of these immigrants as individuals but has major
implications for the nation as whole. As the United States moves into
the 21st century as part of a global economy in which postsecondary
education is a key to economic competitiveness, it is imperative to
develop policies at the Federal, state, local, and institutional levels
to help immigrants gain access to and succeed in higher education.
Without such policies, the nation may find itself with a workforce that
does not have sufficient education to enable the United States to
remain economically competitive.
Legal immigrants face an array of barriers to access to higher
education. They lack access to accurate information about postsecondary
education, face high work and family responsibilities, are challenged
by limited English proficiency, and have significantly lower levels of
academic preparation and achievement. Immigrants who come to the U.S.
as adults confront even more substantial challenges in understanding
and gaining access to higher education because they did not attend
American primary and secondary schools.
Immigrants who actually enroll in higher education make up 12
percent of undergraduate college students--a percentage that makes this
group comparable in numbers to both Hispanic and Black students, and
students with disabilities--yet receive relatively little attention in
the public policy arena. Those who do enroll face additional barriers
to persistence and degree completion. Immigrant students have higher
unmet financial need than the average undergraduate and are more likely
to enroll in community colleges or private for-profit institutions.
There is no one way to overcome the barriers immigrants face in
gaining access to higher education in the United States. Most policies
that address immigrant needs must to be localized, narrow in focus, and
targeted toward specific immigrant groups to ensure that efforts reach
those who most need assistance. Many of the barriers immigrants
confront are similar to the ones generally faced by low-income and
first-generation college students in the United States, and policies
intended to benefit that population as a whole will directly help
immigrants. These include adequate investment in higher education grant
aid and support programs such as TRIO and increased efforts to broaden
public awareness of the steps traditional-age students need to take to
be prepared for college.
However, certain barriers have a greater impact on immigrants,
regardless of their background and resources. The most obvious of these
are limited English proficiency and difficulties in integrating into
American society. Developing a broader and more efficient path to
citizenship and offering accessible and affordable programs to help
immigrants learn English and become familiar with their new country
would open the doors to higher education for many immigrants. And
policies that explicitly impede the postsecondary opportunities of
legal immigrants must be reversed. An example of this is the provision
in the new Academic Competitiveness Grant and SMART programs that
limits these grants to U.S. citizens, thereby excluding eligible non-
citizens including legal permanent residents. Such arbitrary
limitations do a disservice to the nation by denying educational
support to populations that have contributed immensely to the nation's
economic and social prosperity over the course of many decades.
Support a system of higher education accountability that focuses on the
complex life circumstances of today's college students
Higher education institutions must demonstrate that they are
effective stewards of the funds that have been invested in them by the
Federal government and that they are accountable specifically to the
students they serve. Accountability begins with an efficient system of
information that can be readily collected, easily understood, and
meaningfully applied to determine effective stewardship. Unfortunately,
the current system of data collection and dissemination is fragmented
and often burdensome on institutions, with little of the information
used in an effective way by consumers or policymakers.
The emergence of a national debate about data-driven strategies and
accountability systems has been important, but has not done nearly
enough to take into account the complex circumstances under which
today's college students' lives are lived. The ideal scenario of a
normally persisting, well-advised, highly motivated student runs
headlong into the stark reality of life in America today: prior
educational deficiencies, family and child responsibilities, financial
pressures, language and cultural barriers, and poor information and
support systems. Until we grapple with these deeply rooted concerns,
the national dialogue about accountability will, in my view, continue
to reinforce the existing biases and under investments that have left
us with a system that is divided into haves and have-nots.
An important first step in moving ahead will be to develop a
national system of student-level data. This idea, first promoted on a
large scale by the National Center for Education Statistics, could
involve either a national system or a network of harmonized state
systems--a more likely scenario given that more than 40 states have
some type of statewide student information system. Such a national
network or system has detractors, chiefly those who believe that it
could both erode the privacy concerns of students and increase burden
on institutions, particularly in transitioning from current systems to
a new one. However, I believe that such a system could be developed
with limited risk to privacy. An important first step would be to
properly test and pilot a national student unit record system, perhaps
using a voluntary group of institutions. The burden of transitioning to
a new system is a legitimate one, especially for smaller institutions.
If such a system is implemented, it would be wise to provide limited
financial support to institutions to help pay for the costs of system
transition during a fixed period of time.
A privacy protected information system that collects, analyzes, and
uses student level data could provide enormously useful information
about student attendance patterns, the net price students pay (as
opposed to the sticker price, which is paid by a minority of students
at many institutions), and persistence and graduation rates. This
information could be used to develop more effective strategies to
assist students in negotiating the complex landscape of higher
education.
A related development in the national dialogue about accountability
in higher education has been the concern about students who transfer.
Approximately 60 percent of all students attend more than one college
or university as they work toward their undergraduate degrees. These
students need adequate financial support, effective information, and an
improved network of institutional agreements to ease the transfer
process. But mechanisms to do all of these things largely exist. A new
investment in need-based grant aid, for example, combined with
simplified financial aid application and award procedures, would be a
major benefit for transfer students. Effective information about
transfer could largely be obtained through a national student level
data system, augmented by private efforts to inform students about
specific institutional agreements, course requirements, and the steps
required to make a successful transition from one institution to
another. An example of such a private effort is the National
Articulation and Transfer Network (NATN), an initiative of the Alliance
for Equity in Higher Education that IHEP has supported and helped to
launch. NATN is a national research and policy development resource for
both students and school administrators designed to increase the number
of transfer students, including historically underserved student
populations, who graduate with baccalaureate degrees. More information
is available at www.natn.org.
On the issue of a possible Federal role in transfer, I do not see
how a Federally mandated system of transfer could work, given the
diversity of our higher education system--one of its hallmarks. Efforts
to impose a Federal framework on inter-institutional academic practices
are fraught with potential negative implications and would require a
major new regulatory apparatus. This would not benefit students in any
way. The Federal government's best contribution to the complex field of
transfer and articulation would be to encourage these types of private
sector efforts and support partnerships that involve inter-state
agreements and protocols.
Investing in those who might not otherwise go to college, and
ensuring accountability to the students we serve, are not just nice
goals to pursue as part of a Federal education policy agenda. They are
necessary components of a national workforce investment strategy that
can lead greater prosperity, security, and harmony for all Americans.
We must continue to invest in postsecondary education as a critical
component of our future knowledge and innovation infrastructure, much
as we have invested in roads, bridges, and technology as components of
our national transportation and information infrastructure. And we must
be certain that our efforts to promote accountability are ultimately
aimed at supporting the best interests of students--the backbone of our
workforce and economic security.
Thank you again for this opportunity to appear before the
Subcommittee on this important issue.
______
Chairman Hinojosa. Thank you.
And we will now hear from Mr. Soifer.
STATEMENT OF DON SOIFER, EXECUTIVE VICE PRESIDENT, LEXINGTON
INSTITUTE
Mr. Soifer. Mr. Hinojosa, Mr. Teller, Mr. McKeon and
members of the committee, I deeply appreciate the opportunity
to participate in this historic hearing this morning.
As the cost and demand of higher education have risen year
after year, traditional methods of financing have come under
increasing stress. We recognize that a higher education is
worth the investment. That is why we are here. But the ways to
support it, policymakers must maintain, that each appropriation
is in fact worth the investment.
College costs have risen at a rate generally double CPI and
they have risen at a right often higher than health care costs.
In terms of an average family's monthly income, the cost of
higher education is typically 25-cents on the dollar in many
cases. In short, federal student financial aid can no longer be
counted on to keep pace with the rising cost of higher
education in the United States.
We are currently asking our higher education system to
support the cost for remedial education for high school
students who enter. The Colorado Commission analyzed that the
cost of providing remedial education to students in its system
was $11 million in 2004. Research by the Alabama policy
institute found the total spending for public and private
higher ed institutions totaled some $84 million and had reason
to believe that that also was understated.
While state funding for higher education remains flat,
institutions often pass that increased burden on to students. I
think it is worth noting that should student loan providers
have their profit margins cut in half, that they could probably
be expected to do the same thing.
In the face of tighter budgets, many institutions are
finding ways to reduce their costs. A study by the Missouri
State Auditor found that they typically filled job vacancies
slower, freeze salaries, defer purchases and generally find
ways to lower their operating expenses across the board. But we
must still ask, in this changing environment, if our delivery
systems still make the most sense.
With fewer increases in state appropriations for higher
education, some states have evolved their systems for
delivering student aid. As the chairman of the Higher Ed
Commission in the Arizona State House of Representatives
described the goal of their new grant system as a student-
centered system of funding where access, affordability and
quality drive good public policy.
The president of the Chicago Federal Reserve observed last
year that universities must be more transparent in their
operations. I ask if it can truly be considered a slap on the
wrist to ask a higher ed institution that has increased its
cost at twice the rate of inflation to provide an explanatory
statement and to provide a strategic plan to hold down future
costs. There are certainly strong benefits to such transparency
in operations.
In light of the costs being incurred by our higher ed
institutions for remediating students, we have to look to our
public schools and ask if their education delivery methods are
the ones best suited for accomplishing the challenges before
them. Can charter schools, for instance, better prepare
students to enter higher education? Research shows that this is
often the case. And if so, how can there be more of them?
It is also critical that we continue to monitor whether our
local public schools are effectively closing learning gaps
between all subgroups of students. How is our public education
system helping children in perpetually under performing schools
to get this preparation as well? I respectfully request that
the committee consider these questions and trends as you
continue your valuable work in creating the policies that make
American students be able to reach and pay for a higher
education.
Thank you, Mr. Chairman.
[The statement of Mr. Soifer follows:]
Prepared Statement of Don Soifer, Executive Vice President, Lexington
Institute
Mr. Chairman and Members of the Committee: As the costs, and the
demand, for higher education have risen year after year, traditional
models of financing it have come under increasing stress. We recognize
that a higher education is worth the investment. That's why we are here
today. But how is it best supported? Policymakers must continue to
ensure that each appropriation is worth the investment.
One formidable, and growing, challenge is in meeting the
transitional issues of high school students as they advance into the
higher education system.
Secretary Spellings' 2006 Higher Education Commission pointed out
insufficiencies in preparing high school graduates for either college-
level work or the changing needs of the workforce. The Commission
connected this trend to scores on the National Assessment of
Educational Progress (NAEP), noting that only 17 percent of seniors are
considered proficient in math and only 36 percent are proficient in
reading. We are currently asking our higher education system to support
the costs for this remediation.
The Colorado Commission on Higher Education found that the cost to
the state of providing remedial education to its students in public
higher education institutions was $11.4 million in 2004.
Research by the Alabama Policy Institute found that total remedial
spending by that state's public and private higher education
institutions totaled some $84 million per year. The authors pointed out
that this may be understated because it does not reflect the time spent
in non-remedial courses bringing students ``up to speed.'' Another
concern this figure does not address is whether college level courses
are at times being watered down to compensate for the skill levels and
preparation of students.
Higher education cost and funding trends
Institutions of higher education need to keep tuition increases as
small as possible, while also maintaining quality. This often requires
defining the mission of the university in meeting multiple goals.
College costs have typically risen at twice the Consumer Price
Index, and often faster then health care expenditures, according to the
U.S. Department of Labor. Tuition costs, as a percentage of the average
family's paycheck, are increasingly upward of 25 cents on the dollar.
In short, federal student financial aid cannot be relied upon to
keep pace with the rising cost of higher education in America.
When state funding for higher education remains flat, institutions
often pass the increased burden on to students. It is worth nothing
that student aid providers would likely do the same thing should their
profit margins be cut in half, as some current federal proposals would
effectively do.
Most of us have by now read examples of extravagant spending on the
campuses of public and private universities, such as elaborate new
fitness and recreation centers that carry pricetags of $50 or even $100
million.
In the face of tighter budgets, many institutions are actively
seeking ways to reduce spending. Colleges and universities that cut
costs tend to fill job vacancies slower, freeze salaries, defer
purchases, and find ways to lower operating expenses across the board,
according to a 2006 report by the Missouri State Auditor.
In this changing environment, do our delivery methods still make
the most sense?
As the demand for higher education continues to grow, we are seeing
major changes in the demographics of the population going to college.
The Department of Education projects that the college-age population
will increase approximately 12 percent from 2005 to 2014. Increases in
non-traditional higher education students, who are not attending
directly following high school, are also predicted.
With fewer increases in state-level appropriations for higher
education, some states have evolved their systems for delivering
student aid.
Arizona State Representative Laura Knaperek author of her state's
new Postsecondary Education Grant Program, described the goal to be,
``A student-centered system of funding where access, affordability and
quality drive good public policy.'' Participating full-time students in
the program receive $2,000 grants they can apply to tuition or other
qualified expenses at accredited private higher education institutions
in the state. Eligible students must meet residency requirements and
are eligible for up to four years.
New policy options
Chicago Federal Reserve President Michael Moskow observed last year
that, ``Universities must be more transparent in their operations.''
Can it truly be considered a slap on the wrist to ask a higher
education institution that increases its cost at twice the rate of
inflation to provide an explanatory statement and provide a strategic
plan to hold down future costs? There are strong benefits to such
transparency in operations. Just ask the public universities that
invest their endowments in Strayer University stock, as the Chicago Fed
also noted.
A proposal introduced last year in the Senate would have extended
the Pell Grant program to provide low-income high school students the
opportunity to take classes at a nearby university, community college
or technical college, a new option deserving further consideration.
In light of the costs being incurred by our higher education system
for remediating students, we have to look to our public schools and ask
if their education delivery methods are the ones best suited for
accomplishing the challenges before them? Can charter schools better
prepare students to enter higher education? Research shows that this is
often the case. If so, how can we develop more of them?
Quality online education at primary, secondary and postsecondary
levels can bring specialized subject-matter expertise, using more
current education technology, to communities such as those where the
traditional manufacturing base is no longer thriving. It can also
provide a more cost-effective strategy to meet the remedial and other
education needs of many higher education students, making a quality
higher education more accessible to more Americans.
It is also critical that we continue to monitor whether our local
public schools are effectively closing learning gaps between all the
subgroups of students? How is our public education system helping
children in perpetually underperforming public schools to get this
preparation as well?
And how can the best, most effective teachers and administrators in
those schools be paid commensurate to their success, and be paid well
enough to compete with jobs in other sectors?
I respectfully request that the Committee consider these questions
and trends as you continue your valuable work creating the policies
that will help American students reach and pay for higher education.
Thank you.
______
Chairman Hinojosa. Very good.
I would like to start and ask my first question of James
Merisotis. I will recognize myself for 5 minutes.
Most of us support the GEAR UP and the TRIO programs that
you mentioned in your statement. Why is it that after so many
years in existence these programs are so severely under funded
that TRIO, for example, serves less than 10 percent of eligible
students? Is it accountability, as defined by the
administration? What are your thoughts?
Mr. Merisotis. It is not clear to me what the reason is for
the under investment. Only about 10 percent of the eligible
populations for the TRIO and GEAR UP programs actually benefit
from those programs. The track record of success in those
programs is impressive both in TRIO and in the more recent GEAR
UP case.
I think the challenge for those programs is that they are
dealing with the complex life circumstances of students. So
some of the traditional measures of success in these kinds of
programs are difficult to pin down. You can't predict what
someone would have done in the absence of these kinds of
programs.
It is also difficult to use the existing data systems to
measure the long-term success of students. Students in today's
society, particularly low-income and minority students, live in
a very mobile, fluid context. It is difficult for us to track
those students, to ensure continuity of services and
consistency over time, and I think that is one of the reasons
why there has been some focus on the question of are these
programs as efficient as they should be.
I think these programs are enormously important and I am
troubled by the fact that they haven't received the sufficient
support they deserve.
Chairman Hinojosa. Do you agree that two things occur under
both programs, particularly I see it in the GEAR UP program,
that we have corporate America investing $1 for every dollar
that the federal government invests in the GEAR UP program?
And, number two, that we are seeing more parental involvement
than we had before?
Mr. Merisotis. I think that is right, and I think this
broader issue of partnership and the involvement of the private
sector through things like the private scholarship that I
talked about are terribly important in terms of our
understanding of how we can finance and effectively pay for
higher education.
The federal government doesn't stand alone in this process.
And I believe states, institutions and the private sector all
have an important part in playing to support the efforts of
families and students in financing higher education and getting
through college once they are in.
Chairman Hinojosa. Thank you.
My next question is for Mr. Wiener.
Why do you think that both federal and state policymakers
decided that it is more important to fund and develop programs
for the middle-and upper-class college students than it is to
focus and concentrate available funds to lower-income students?
Mr. Wiener. It is hard to understand why we have shifted
our emphasis so profoundly over the last 10 to 15 years, not
just in student financial aid, although it is in acute example.
And I think one of the reasons that it has been allowed to
happen and perhaps hasn't gotten as much attention as it
deserves is because we really need to have a new conversation
about the metrics for quality and accountability within higher
education.
You know, right now, in all the ways that we tend to bestow
status and recognition on institutions, they sort of earn that,
the fewer students that need help they take on, the more elite
the students they take on, the more likely those students are
to graduate from college no matter where they go, the more
elite status we tend to assign to the institution.
And I think we really need to figure out a way that we
honor and support those institutions that are really serving
the national interest and the public interest of educating
students who need an education, and I think that is part of
sort of recentering this whole conversation.
As your question notes, states have also shifted in this
direction, although not quite as much as the federal
government, and institutions themselves have as well shifted
away from low-income students. So it is very important that we
try to recenter and put this in a new direction.
Chairman Hinojosa. Thank you.
My last question is to David Breneman.
Learning model section of your report discussing the
question, ``To what extent do colleges and universities in this
state educate students to contribute to the workforce.'' This
implies that degree completion is not only a personal benefit
but a societal benefit as well.
Do you think the answers to this question will help us
improve our efforts in the international competitiveness arena
that we are losing the lead on?
Mr. Breneman. The group that put out this report, we call
it a report card, we decided one of the things we should
include in this was an assessment of learning, apart from
simply degree achievement. And you have certainly heard
business people and others complain about college graduates who
can't write a decent business letter and so forth. That
suggests that the processes within the institutions in all
cases are not adequate.
This is an intensely controversial subject within
faculties. The institutions have little incentive or interest
in many cases in pursuing this. And what we have tried to do is
begin to develop some empirical metrics and ways that
institutions who wish to pursue them could pursue them. And the
report lays out our, the state where that has reached in our
work. And, as you know, the Spellings Commission has emphasized
this as well.
I think it is a difficult task. I don't know that I would
pin all my hopes for the future on reaching some magical set of
metrics. But I think it is a good exercise as part of a total
strategy to improve the system.
Chairman Hinojosa. I need to give my ranking member an
opportunity to ask his questions. I recognize Congressman
Keller.
Mr. Keller. Well, thank you, Mr. Chairman, I appreciate
that.
Thank you all so much for coming here today.
Let me start with you, Dean Breneman. I look at the report,
this state report card on higher education, and the Florida
section in terms of affordability gives Florida an ``F.'' And
if you didn't know more and all you are doing is looking at
this report, you would think, man, it sure is expensive to go
to college in Florida. But I can tell you, it is complete and
total nonsense.
Florida community college is $1,500 and the 4-year public
schools are $3,400. Where does that rank Florida? Second
cheapest in the United States, according to the Department of
Education. And if you have a ``B'' average in Florida, it is
completely free. Your community college is paid for 100 percent
by the state. And if you have better than a ``B'' average, a
3.5, it is 100 percent tuition paid for at 4-year schools, and
``B'' average 75 percent.
So it is the best deal in--give the report?
Mr. Breneman. There is no question this affordability
measure and category has been the one that has been the
lightening rod in this report. And I don't stand here and
indicate to you that we or anyone else in the country has come
up with an absolutely unambiguous and defensible way to measure
this.
What we tried to do is index college costs to the incomes
of people in the individual states, and we have taken grief
from the state of New York, from the state of Georgia, from a
number of states who don't like their gradings.
We have, however, tried to work with the metric of income
and we have anchored it in the early 1990s and looked at the
trend----
Mr. Keller. I don't want to cut you off. I just want to let
you know my concerns. I have got some other questions.
Mr. Wiener, you had talked about shifting the federal aid
from the low-end to the middle class. I don't know what you are
talking about. We have increased Pell Grant funding 80 percent
since I have been here, from $7.6 billion to $13.7 billion.
And, really, nothing for the middle class, absolutely nothing.
Let me give you an example. I have a teacher in my district
who is married to a police officer. Collectively, they make
$70,000. They have three kids in high school. Do you know how
much their kids get for Pell Grants? Zip. Zip. They get no
federal grant whatsoever.
So what the heck are you talking about in terms of we are
shifting all the money from that middle-class family away form
poor families?
Mr. Wiener. Well, first, let me just say, as I said in my
written testimony, that it is a good thing to try and make
college more affordable for middle-and upper-income families. I
think the problem has been that really we haven't prioritized
low-income, so let me explain how that has happened.
Mr. Keller. Well, alluding to the fact I just told you, why
don't you tell me, what are we doing to help that family, that
middle-class family who makes $70 grand and can't get a Pell
Grant? What are we doing and what should we be doing?
Mr. Wiener. Well, we have actually created a number of tax
credits and deductions that that family is entitled to.
And, again, I would just note, with respect to the Pell
Grants, the college board analyzes trends in financial aid
every year, and in the 2005-2006 year it was the first time
that they noticed a decrease in real dollars in funding for
Pell. So that in 2005, 2006, in terms of constant dollars, Pell
Grant's funding was back down to the level it was in 2001-2002.
Mr. Keller. Let me interrupt there. I can just tell you the
exact facts. The Pell Grant was $3,300 in 2000 and $4,310
today. And the Pell Grant funding in 2000 was $7.6 billion and
is $13.7 today. Only in Washington would someone call that a
cut. There is no real cut. You may have argued that, well,
should have kept up with inflation better. But there is no cut.
Let me go on to my next question. The biggest frustration I
have--and I am a big fan of Pell Grant, don't get me wrong. You
are not going to find a bigger fan in Congress. But we are
dealing with skyrocketing tuition.
And, Mr. Merisotis, you said we should have Pell Grants at
$6,000. Let us say that we had a magic wand today and I am
pretty sympathetic to that, actually, and we made Pell Grant
$6,000. And then universities across the country said, you know
what, we have decided to increase our tuition this year $5,000.
How do we help students if we don't address this
skyrocketing tuition problem when we just keep increasing Pell
Grants?
Mr. Merisotis. I have been a researcher in the field of
higher education for two decades. I have never seen credible
evidence that suggests that federal student aid contributes to
tuition increases. We can have a debate about this point if you
would like, but my argument is that federal financial aid is
one of many factors that are taken into account in the tuition-
setting decisions.
Tuition-setting is a complex process. Institutions are
involved. In some states, state boards are involved,
legislators, et cetera.
The historical records show that in times of increasing
federal aid, tuitions have gone down, and in times of
increasing tuitions, federal student aid has declined. So it is
not clear that there is a correlation between the two,
particularly as it relates to grand funding.
Mr. Keller. My time is expired. Thank you.
Chairman Hinojosa. At this time, I would like to recognize,
from the state of New York, Congressman Bishop.
Mr. Bishop. Thank you, Mr. Chairman. I want to thank you
and the ranking member for holding this hearing.
I want to thank our panel.
To the last point that was just raised, I would just like
to reinforce what Mr. Merisotis said. I participated in pricing
decisions at the institution I was at for 25 years. We never
once took into consideration available federal aid. We were
focused exclusively on what we needed to charge to generate the
revenue that we needed to have to provide quality service to
our students, and we tried to do it at the lowest possible
price.
And as to what is driving costs, at least my own experience
is the principal cost driver is personnel cost. 70 percent to
75 percent of what colleges spend is in salary and fringe
benefits. Those are the principal costs. And so if we want
larger class sizes, we can cut costs. If we want fewer student
services, we can cut costs. But I think the question we have to
ask is what trade offs we would be making.
I want to ask Mr. Wiener a question.
I would like to engage you on your recommendation that we
would eliminate SEOG. My own view is that that would be a
tragic mistake if we were to do that, and I think that it would
exacerbate a problem that you outlined in your testimony, which
is that the way in which we finance higher education is driving
low-income students to low cost, and I think your
characterization of it was as low-service institutions. And if
we were to remove SEOG from the toolbox, if you will, that the
financial aid officer has, I think that would be precisely the
outcome if we were to do that.
I would like to hear your thoughts further on that.
Mr. Merisotis. Yes, and those are I think very real
concerns. Just two responses.
One is that right now the SEOG money, it is not as if those
institutions, and those institutions are sort of institutions
that do disproportionately have more resources already, those
institutions don't have to target SEOG money to their neediest
students.
And so one of the concerns is that that money, again, while
it is going on a need base, is actually--how you end up
deciding who is eligible for SEOG money at those institutions
that have it is you look at cost of attendance minus expected
family contribution. Those are much higher-cost institutions,
so that they are able to serve students who are much higher up
the income level.
And so the thing I worry about is that those institutions
actually can use the SEOGs in a sense to embellish their status
by actually giving SEOGs to higher-income and previously higher
performing students, who don't need the support as much as
students who are eligible for Pell.
Mr. Bishop. Again, we ought not to make policy by anecdote,
which I am about to do, but my own experience has been that
virtually every single student, at least at the institution I
was at, that received an SEOG was a Pell-eligible student, and
it was simply a means by which we were enhancing the value of
the Pell Grant and trying to close the gap between total
student cost and available resources.
I want to move on. I would like to put this out for all of
you. In the current you we now I think for the first time have
a merit-based Pell program. I don't know what we call it, Pell
Plus or something.
And my question is, is that the best use of limited federal
resources? Or would we be better served if we were to increase
the Pell Grant, for example, for students who have a negative
EFC?
I will give it to either Mr. Wiener or Mr. Merisotis.
Mr. Merisotis. I think our best investment is investing in
students with financial need.
The problem with a lot of merit-based aid is you are
rewarding students for doing what they would have done any way,
and I would rather invest money in the students who have the
greatest financial need.
We have huge barriers in terms of access to higher
education in this country between low-income and other
students. Let us focus on that. We can find other ways to
encourage academic excellence outside of the Pell Grant
program.
Mr. Bishop. So can I infer from that that you would think
that if we took a merit-based component out of Title 4 moneys,
you would support that?
Mr. Merisotis. I would.
Mr. Wiener. I think this is actually, again, a very
complicated issue. We do need a more comprehensive solution
than we have right now. We have a lot of different programs
that are serving discreet little parts of it.
We need to make it much clearer to students earlier on in
their education that there is support for them to go to
college. We need to make there be more support. We need to make
it clear to them what that support is. But we also need to make
it more clear to students that what they do while they are in
their K-12 education will have a big impact on how successful
they are in higher education.
And I would just point to the 21st Century Scholars program
that was initiated by then Governor Bayh in Indiana, that sort
of created a compact with students and said if you take a
college prep curriculum and apply for financial aid and apply
for financial aid and apply to college, we will make sure that
affordability is not a problem. And I think that kind of
comprehensive package is the most likely to really help low-
income students to succeed.
Mr. Bishop. I know my time has expired, but if I could just
make one last comment.
My fear is that merit-based component, given the vast
proliferation of merit-based aid on the institutional level,
simply saves the institution money, that the institution is
simply going to have the federal government do what they would
have done anyway, and if we are going to target federal moneys
to where they are needed the most, we ought to be targeting
them to needy students and let the institutions deal with
merit.
Thank you, Mr. Chairman.
Chairman Hinojosa. I now wish to recognize the gentleman
from California, Ranking Member McKeon.
Mr. McKeon. Thank you, Mr. Chairman.
I always enjoy these discussions. Interesting how when we
are talking about the cost of education, we talk about student
loans, we talk about federal financial aid. We talk about
everything but the institutions that are actually responsible
for their tuition and fees.
I know we heard a little bit about it, and they are
handicapped. There is no way they can keep their costs down.
They have to be going up because it is a very competitive
world.
I come from a business background. I thought we had kind of
a competitive business. We were selling western clothes, jeans,
shirts. If we raised our prices, somebody would keep theirs
down and would do more business than we were, and we had to
then lower our prices, because there were only so many pair of
pants going to be sold, and the ones that could keep their
prices down were the ones that were going to get the business.
How do you say that this is a very competitive field when
all schools have more applicants--I might be generalizing, but
every time I visit schools, this is what they tell me--that
they have more applicants than they have seats, or availability
for students.
Where are they competing? What are they competing for?
Mr. Breneman. Well, since I introduced some of that
conversation, I think the difference between your situation in
the business you were in and in higher education is that you
had an incentive to expand your market, through presales and
presumably as your costs were lowered your profits went up.
Higher education doesn't have that bottom line. It plays in
another league. The institutions are not trying to expand, by
and large. In fact, in many ways, just the opposite. They are
trying to enhance their selectivity. The game they are playing
in, just as a worst-case example, is the U.S. News and World
Report. And if you look at the things that are rewarded, they
are things that drive up costs and----
Mr. McKeon. So as our population grows and we have more
students coming out of high school that we are talking about we
should be helping to benefit to get this education, at the same
time we have the institutions keeping their numbers down.
Mr. Breneman. Well, no. I think national enrollments are
up.
Mr. McKeon. Well, they are. But let us look. Ten years ago,
the largest school in the country was University of Minnesota.
They had about 50,000 students. They still have about 50,000
students. So where is the competition? They are competing for
the best students, okay, but meanwhile then their setting
ground rules that are eliminating a great part of our
population.
Mr. Breneman. Well, the other change that I think is worth
noting, and we are largely talking about the public sector
here, I think, in----
Mr. McKeon. Let me just assume that if all of the schools
in the country had a million seats and we had a million and a
half students competing for those seats, the competition it
seems to me is on the students' side, not on the schools' side.
If we have the same million seats and we have a half a million
students, do you think there would be any incentive for some of
the schools to lower their costs?
Mr. Breneman. Yes, actually, well, two points, let me make.
During the so-called ``birth dearth'' years in the 1980s,
when actually the 18-year-old population was dropping, what you
saw during that period, where you really were looking at
smaller numbers, was you saw the great rise in tuition
discounting, which was a way to--you would move your sticker
price up, but then you would give more and more of it back to
students and turn them back out----
Mr. McKeon. In other words, when there was a declining
number of students competing for the seats, they did move to
keep their costs down.
So what you are doing, what I kind of hear from the
discussion, is it is the federal governments responsibility to
pick up the cost for the increased number of students while the
schools are trying to keep--they are competing for the best
students. They are not doing anything to help other students
come in.
So back to that question, where we had a million and a half
competing for a million seats versus a half million competing
for a million seats, where do the schools--I mean, how is that
competitive? How are they in competitive environment to really
help the students that you are saying we should be working to
help?
Mr. Breneman. Well, let me just introduce----
Mr. McKeon. Is it all the federal government's
responsibility? Should the states bear some responsibility?
Should the institutions bear some responsibility? Should the
students themselves?
I mean, one of these hearings that I attended a few years
ago, one of our members said, ``I have a student in my district
that wants to go to Princeton, and they should be able to do
that.'' Well, I have some constituents that would like to have
a Rolls Royce, but they can only afford a Chevy, you know.
In my state, community colleges are doing a fantastic job,
but they are overburdened, and they, in fact, in my state
lowered the cost of their tuition this year. I would like to
see other institutions lower their costs. It should not be all
a federal government responsibility.
Mr. Breneman. If I could just 10 seconds. The third player
in this discussion we are having here is state government, and
I think a big, historic change somewhere in the 1980s and early
1990s was really the dropping and discarding of enrollment-
driven funding formulas which provided some incentive. If you
added more students, you got a claim of----
Chairman Hinojosa. If the gentleman will yield, there is a
vote. This is the second call. I am going to ask for a short
recess. It is only two votes. I am going to request that all
members please return as soon after the second vote is taken
and we will resume until each member has had an opportunity to
ask their questions.
Thank you. We are recessed.
[Recess.]
Chairman Hinojosa [presiding]. We are ready to resume.
And I am delighted to be able to recognize the gentlelady
from California, Congresswoman Susan Davis.
Mrs. Davis of California. Thank you very much, Mr.
Chairman.
Thank you to all of you for being here. I think I may have
missed some of the early remarks, but I hopefully could have
picked that up.
I wanted to follow up with Mr. McKeon's thoughts, if I may,
because we obviously know that we have many, many young people
who are doing basically what we ask. I mean, they are getting
through what may be a fairly rigorous curriculum, but then they
are not getting into the schools that they would like, into
state schools.
And while they have community college as a resource to
them, at the same time they feel that, you know, they are just
kind of being pushed out of what they had hoped 4 years prior
they would be able to do.
So if you can address, how do we deal with that?
I mean, one of the ways in which I think in the state
system, and I come from San Diego, that we have dealt with it
is to have schools, you know, not running 24 hours, but to
utilize available buildings. We certainly bring in other
instructors, professors, to try to pick up that lag. So we are
actually being able to educate more students than perhaps the
old caps would indicate.
So what are the best practices around that? We know that
there are some. What should we be doing?
The other issue that is very clear to students is that if
they are not graduating in 4 years, that is adding thousands
and thousands to their education when, in fact, they are not
graduating because they don't have the instructors, they can't
get the classes, they are working too hard, they are not able
to get there. Kind of a dual issue.
If you could address that question, I would really
appreciate it.
Mr. Wiener. These are very important issues. And I think
generally we need to try to figure out how we sort of
reemphasize undergraduate education. And, again, how we allow
institutions to distinguish themselves for serving students who
actually really need help to get in and through college.
One of the recommendations in my written testimony is
around collecting better data so that we can understand which
institutions really do the best job for serving these
nontraditional students. At what institutions are they most
likely to actually get a degree, and not in 6 years, as you
noted, but in 4 years. Where now the standard metric for
evaluating graduation rates in 4-year institutions is 6 years.
Only about 40 percent of students actually graduate in 4 years
anymore.
But right now we don't collect data very well to
distinguish which institutions do a better job with those
students, and we really do nothing to celebrate them.
Mrs. Davis of California. What is the problem with that? I
mean, would it take an organization to do that? Is it something
that we ought to be doing here, Congress ought to be
appropriating money for? What is the problem? I mean, that is
an obvious need that we have.
Mr. Wiener. Well, some of it relates to--so there is the
IPEDS, the Integrated Postsecondary Education Data System,
which is how the federal government collects a lot of
information on higher ed, but it collects information in silos,
so there is no way of cross referencing. We know which students
are getting financial aid, but we don't know how those students
do in different institutions. There is huge variations.
We have created a publicly acceptable database called
College Results Online, that puts every 4-year institution in a
peer group that looks at all of the kinds of inputs that we
know do make some difference in terms of how selective they
are, how many resources they have, how much, you know, what
kind of students they are serving. And within every group of 15
or 25 institutions, there is a huge range in the actual
graduation rate of those students.
But that data right now is limited to first-time full-time
freshmen, and we think it is one fair metric for evaluating
higher ed, because those are the students who are most likely
to get through with a degree. But we really have terrible data
with respect to how nontraditional students are served, and
there are ways of getting more data in IPEDS that would help
that.
Mrs. Davis of California. Thank you, Mr. Wiener.
I can see that--would you like to respond?
Mr. Soifer. As we have seen a greater demand for higher
education, we have also seen a change in the demographic. We
have also seen an increase in the nontraditional student rate
at which students are going into higher education not directly
out of high school.
And when we talk in terms of these very high remedial
costs, I was giving a talk at a campus in Pennsylvania and a
student asked me, well, aside from the formal remedial costs,
we just worry that our classes are being watered down because
of kids who are--you know, my older brother was in this school
6 years ago and is the content of the course matter being
watered down to some extent that really is not measurable.
So these are real challenges and the delivery systems that
were created to serve this population really need to be looked
at in ways to see if they really are still meeting the needs
that they were created to meet.
Mrs. Davis of California. I appreciate that.
One other thought, very quickly, and you don't need to
answer this now, is the FAFSA, the application for financial
aid in assistance. I have been to workshops with the kids and
they all have, you know, I speak FAFSA, and they are trying to
reach out and do a good job.
Is there something about that that could be easier, more
accessible and more helpful to parents particularly? And is
there information that is being captured in that that they
don't have easy access to their income tax returns, and beyond
income tax returns.
Mr. Wiener. Beyond income tax returns, it is any kind of
public assistance anybody in their household received. So
whether it is likely that there is good record keeping
generally in these households I think is a real challenge.
And the fact is the federal government has all of the
information. The federal government is the custodial for all of
that information. And if we allowed low-income families to
check a box on their income tax return, we could actually
generate for them and proactively inform them of their
eligibility for grant aid, which I think would have a huge
effect on the motivation and on these students and these
families visualizing themselves as college-going.
Mrs. Davis of California. Thank you.
Thank you, Mr. Chairman. That would be something to follow
up on. I would appreciate that. Thank you.
Chairman Hinojosa. Thank you.
I now would like to recognize the gentlelady from North
Carolina, Congresswoman Foxx.
Mrs. Foxx. Thank you, Mr. Chairman. I appreciate it very
much.
I have a couple of questions I would like to ask.
Mr. Wiener, you said in your statement that persons of
color are relegated, I believe you said, I am not sure of the
exact words, to going to schools of lower cost. You were right
on the verge of saying lower quality, and you didn't say that,
but I could feel that that was what you felt.
Do you really have statistics to back up the fact that
there is proportionately more students of color in lower-cost
institutions than higher-cost institutions?
Mr. Wiener. Yes, Madam Congresswoman.
So in our report that I think is a part of the background
materials for this hearing, but if not I would be very happy to
provide it to the committee, it is very clear that students
from minority groups are much more likely than other students
to be in proprietary, for profit institutions as well as in 2-
year community colleges as well as in nonselective 4-year
institutions. And each of the way sort of up that ladder are
institutions that have more resources to support students.
So, you know, we, I think, need to figure out how to create
an accountability system or at least a system that recognizes
institutions for serving underserved populations, because again
right now I just am very worried that all the metrics on which
colleges and universities can distinguish themselves encourage
them to serve fewer of these students.
Mrs. Foxx. Is there any proof at all that students,
particularly going to proprietary schools, are unhappy with the
fact that they are going to those institutions?
I mean, there aren't many places where liberals in this
country promote choice. I mean, mostly they want the government
to control everything. But people do have a choice about which
institution of higher education they want to go to, and if they
are going to those, is it not that they are voting with their
feet?
Mr. Wiener. If that were the case, I think that--I
certainly am in favor of students having choices about where
they attend college. The problem is that cost is a truly
prohibitive factor at this point for many of our young people,
and the choice really is illusory. They are needing to figure
out where they can go on very limited means. I think it is very
clear.
The Advisory Committee on Financial Aid has documented very
clearly just how many college qualified students are not
attending the institutions where they could be most successful.
I mean, we are talking about millions of students over the
course of years.
So it is a very big problem and I think that is the reason
that this hearing is so important, is that financial aid and
the federal commitment to this really plays a big part in what
they think of as their options and the country suffers for
losing those college graduates.
Mrs. Foxx. I have not heard you all say anything at all
about encouraging more money for work-study. You have talked a
lot about grants.
I used to be in higher education, so I know a little bit
about the research. I don't follow it as closely now as I used
to, but the research used to show that if a student works 15 to
20 hours on campus, they are much more successful academically.
And then they do much better when they get out of school
because they have had the work experience and they have people
who can vouch for them when they are leaving college.
So why don't you all ever talk about increased funds for
work-study instead of just grants, grants, grants? You know,
people don't respect what is given to them for free. They often
respect what they get that they work for. And you change the
whole ethos of people.
So why don't you talk about work-study? Anybody? I mean,
why are you silent on the issue of work-study?
Mr. Breneman. Well, let me venture something. I don't think
any--I certainly still subscribe to the perspective you have
expressed about the 15 to 20 hours a week being very desirable.
I don't actually know the answer to why work-study--my
sense is it is sort of one of the campus base programs, and my
sense is those programs have sort of stalled out and haven't
shown much political clout. And I don't know if it is because
of lack of advocacy or so much concentration on the Pell Grant.
No one that I know is unhappy with work-study or thinks it
is a bad program.
Mrs. Foxx. Well, I mean, is it that it might involve a
little bit of work on the part of the institutions to create
those jobs? I mean, I am just stymied by the fact that all the
research shows that it is so positive.
And the other thing that you are silent on is increasing
money for distance learning. I mean, we could vastly expand the
opportunities for people with no money to do programs in
distance learning because they could stay at home and do that.
And so, why don't you talk more about the money for
distance learning?
Mr. Breneman. Well, I will just speak for myself on this. I
have taken the theme of this hearing, perhaps inaccurately, to
be primarily focused on the traditional college-age student,
and I think distance learning is a vehicle that has greater
applicability to the older student, personally, which I assume
falls under the purview of your committee and perhaps there has
been narrow mindedness on our side.
Certainly this report which I was asked to speak to is
really looking more at the traditional aged undergraduate.
Mrs. Foxx. Mr. Chairman, I know my time is up, but I just
would like to say I find that very narrow-minded, because of
all the people we should be pursuing in distance learning, it
is this media-afflicted population. I mean, they are so
oriented to television and computers that I find it really
narrow-minded on your part that you would say we are thinking
about older people. Older people would be much less likely to
want to do their learning that way than the current generation,
it seems to me.
I think the paradigms of so many of you are very narrow. I
think that the questions you start with are often the wrong
questions. I think you have just given us a great opportunity
to say let us see what the rest of the story is or the other
side of the issue.
Thank you.
Chairman Hinojosa. As we move on to allow other members to
ask their questions, I wanted to ask unanimous consent that the
report that Mr. Wiener referred to be made a part of this
hearing. Hearing no objections, so be it.
[The Internet link to an August 2006 report by the
Education Trust, ``Promise Abandoned,'' follows:]
http://www2.edtrust.org/NR/rdonlyres/B6772F1A-116D-4827-A326-
F8CFAD33975A/0/PromiseAbandonedHigherEd.pdf
______
Chairman Hinojosa. I would like to recognize the gentleman
from the great state of Virginia, Congressman Bobby Scott.
Mr. Scott. Thank you, Mr. Chairman.
I thank the witnesses for their testimony and for their
contribution.
I had one question about the prohibition against those who
have had drug convictions qualifying for financial aid. I have
always had a problem with that, because upper-income students
who get convicted can continue their education, but if you
actually need student aid, you lose your education.
What is the status of that and how many students are losing
their educational opportunities because of that provision?
Would the witnesses suggest that we get rid of it so that
everybody can continue their education on an equal basis? Is
there any reason to continue that policy?
Mr. Wiener. If I could answer, Congressman Scott, you know,
obviously we want to discourage young people from making bad
choices, including using drugs or abusing alcohol, but I do
think it is a big mistake to try and pursue that good public
policy by limiting the chances and basically taking away the
second chance those students have.
Once they are sort of punished for that offense, they ought
to be allowed to basically rejoin society and we need for those
students to have a chance at higher education. And I think we
are making a big mistake by cutting off their chances in that
way.
Mr. Scott. And is their likelihood to continue on drugs
greater or less if they are allowed to continue or if they are
prohibited from continuing college? Is that a counterproductive
policy?
Mr. Wiener. We certainly know that Americans who aren't
able to access higher education are much more likely to be on
public assistance, to be in trouble in any number of ways with
the law. Recently there have been a whole spate of studies and
reporting in The Washington Post this weekend and then
editorialized on yesterday, how limiting the social advancement
and social mobility of Americans is if they don't access higher
education.
Americans who go to higher education are much more likely
to get married and have a family now than other Americans. So
we are really shooting ourselves in the foot by cutting off
these young people so early.
Mr. Scott. Well, thank you.
The portion of the education expense paid for by a Pell
Grant has been eroding. Do you have the statistics? I believe
it was that the Pell Grant would cover about 80 percent of the
cost of education 20 or 30 years ago and now it is down below
50 percent and not keeping up with inflation, so it is eroding
even more. Do you have those numbers?
Mr. Merisotis. In 1979, 1980, actually, was the high point,
when it did cover about 80 percent of the average price.
Today----
Mr. Scott. Does the price include room and board?
Mr. Merisotis. The price includes room and board, yes. So
it is the price of attendance, tuition, fees, room and board.
Now it covers nationally on average about 33 percent, so we
are at a significant decline from where we were more than two
decades ago.
Mr. Scott. And for those who qualify for the Pell Grant,
their chance of being able to cover that gap is obviously a lot
less. When it covered 80 percent, a person could work a part-
time job, 15 hours a week and a little bit during the summer,
and actually ``work their way'' through college.
Can students work their way through college now?
Mr. Merisotis. A couple of things. The first one is, the
vast majority of college students today do work, particularly
low-income students. So work is as a necessary part of how they
finance their education.
It is very difficult to manage an excessive amount of work,
more than 15 or 20 hours, without it having other implications
either on their academic progress, but also because a lot of
today's college students have complex family and life
circumstances that make it very difficult to work a very large
number of hours without it having very serious consequences.
Mr. Scott. What portion of low-income students don't go to
college because they can't afford it?
Mr. Wiener. Well, we know from research at the Department
of Education that approximately 20 percent of low-income
students who are fully college qualified, and that means that
they were in the high levels of achievement in high school,
don't go directly on to college, 20 percent. For high-income
families, that is fewer than 3 percent of students don't do
that.
Mr. Scott. So 20 percent are not going to college because
they essentially can't afford to?
Mr. Wiener. That is correct. And there are more students
who could be successful in college who are not going because of
the expense.
But, again, the Advisory Committee on Financial Aid
estimates that in this next decade, anywhere--and I know this
is a broad figure--but anywhere from 1.5 million to 2.4 million
low-income students who are college-qualified won't go because
of the financial burden and the risk that they don't feel that
they can take in terms of taking on debt. That is way out of
proportion to anything their family has ever earned.
Mr. Scott. Well, is it also out of proportion to what they
can reasonably pay back?
Mr. Wiener. We are getting to that place, and very many
students are forced to take on that level of debt. That is why
in my testimony I referred to a program or a policy that is
offered by the Project on Student Debt, and it is to try and
make loan repayment schedules contingent on family income.
One of the things that we do right now for paying back
loans, sometimes it can have negative implications, actually,
to work more, to earn more money. You could have your loan
payment go up more than your additional income. So it
encourages people to work less.
The second is, we don't take into account at all whether
the loan--whether the loan repayment--the person who has the
obligation has a family, so that we have the same expectations
as somebody paying back who is single and just out of college
as someone who has two kids, as we have more and more
nontraditional students. And, again, we need to encourage these
people to go to college. We have got to index that against
their actual expenses for supporting their family.
Chairman Hinojosa. Ladies and gentlemen, I want to make
some concluding remarks.
I want to thank the witnesses and the members of the
subcommittee for a very informative session.
As previously ordered, members will have 14 days to submit
additional materials for the hearing record. Any member who
wishes to submit follow-up questions in writing for the
witnesses should coordinate with majority staff within the
requisite time.
Without objection, the hearing is adjourned.
And I thank each and every one of you.
[Whereupon, at 12:32 p.m., the subcommittee was adjourned.]