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House Higher Education Committee Hears Tuition Reduction Legislation

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This morning the House Higher Education Committee took up two bills that would reduce tuition at Washington’s public universities and colleges.

Senate Bill 5954 creates the College Affordability Program (CAP), removing tuition-setting authority for resident undergraduate students for the public baccalaureate institutions.

Beginning in the 2015-16 academic year, tuition fees for resident undergraduates, under SB 5954,  would be no more than six percent of the state’s average wage for community and technical colleges, 10 percent for the regional universities and The Evergreen State College, and 14 percent for the research universities.

Beginning with the 2015-17 operating budget, the Legislature would appropriate to the State Board for Community and Technical Colleges and each four-year institution of higher education an amount that is at least equal to the total state funds appropriated in the 2013-15 biennium plus the reduction in revenues from resident undergraduate tuition operating fees received for the 2015-17 fiscal biennium adjusted for inflation.

In addition the committee took testimony on HB 2201. HB 2201 would repeal tax deductions for the interest on investments for loans secured by mortgages, deeds or trusts.  The revenue generated would be used to offset a reduction in tuition for institutions of higher education and any savings to the State Need Grant would be reinvested into the grant program to serve more students. The repeal would be sent to voters in a referendum for their approval.

The Council of Presidents, University of Washington and The Evergreen State College testified on both bills. Evergreen asked the committee to focus on the critical policy issue in front of Washington higher education, how to best provide sufficient, stable and predictable funding for the state’s colleges and universities. Whatever the path forward, it is critical that it must clearly and decisively link tuition policy and state investment for institutions and financial aid.

While the college appreciates that both bills continue to make an investment to provide affordable access in higher education and try to right the ship and begin to equalize the cost sharing involved in financing higher education between the state and students and their families, Evergreen expressed to major concerns.

First, there is the lack of a direct link between tuition policy and state investment in SB 5954 because it is a policy bill and not a budget.  And while there is a link between state investment and tuition policy for HB 2201 the bill refers the decision to voters. If the measure were to fail the result would be a cut to higher education funding to simply meet current programs and services.

Second, both proposals only provide a path to address maintenance level funding for institutions. Neither proposal provides a pathway forward for the needed investments in higher education institutions and financial aid to take steps forward to ensure access to a quality, affordable postsecondary education.

Evergreen summarized by stating that the College values the focus on tuition policy, but this one part of the equation. The critical issue for higher education is how to provide adequate public reinvestment to accomplish the state’s goals for access, completion and post-graduate success.

Obama Announces Free Community College Proposal

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On Friday, President Obama announced his intent to send legislation to Congress to make the first two years of community college free across the nation – America’s College Promise proposal.

The proposal, a federal-state partnership, would be funded primarily by the federal government (75%) and ask states to fund the remaining (25%). In addition, to qualify students would be required to attend at least half-time, maintain a GPA of at least 2.5, and progress towards their degree.

The proposal asks community colleges to strengthen their programs and increase the number of students who graduate. In particular, to offer academic programs that fully transfer to local public, four-year colleges/universities or occupational training programs with high graduation rates and lead to degrees/certificates that are in high demand by employers.

Finally, states will be required  to invest more in higher education and training by contributing the remaining funds necessary to eliminate community college tuition for eligible students as well as commit to continuing existing investments in higher education, coordinate education to reduce the need for remediation and repeated courses, and allocate a significant portion of funding based on performance not enrollment alone. In return, the federal government will pick-up the majority of the costs but will also provide states with flexibility to use some resources to expand quality community college offerings, improve affordability at four-year public universities, and improve college readiness through outreach and early intervention.

While the proposal would only cover tuition, which is a portion of the entire cost of education, and only pay for two years of college, many students go beyond two years, the White House estimates it would save 9 million students approximately $3,800 per year in tuition if every state chose to participate.
Details are still forthcoming in the President’s 2016 budget, but many questions remain unclear such as how the program would work, how the grants to states would be structured, and how the program would interact with the Pell Grant and other tuition-based financial aid programs.

Some remain cautious of the new program. Some are concerned that this will provide funding to students who can afford tuition. Others argue that tuition is often entirely covered by the Pell Grant for low-income students, but that it is the cost of living and foregone wages, not tuition, that are the biggest financial barriers.

Still the opportunity to change the dialogue around higher education to focus on the possibility for everybody to earn an education is an argument made in favor of the program.

Higher Education Policy Committees Move Legislation as Deadline Nears

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This week marks the first major deadline of the 2014 supplemental session.  The policy committees in the House and Senate, including the House and Senate Higher Education Committees, must move bills forward to either the floor or the appropriations committee to keep them “alive” this session by the close of business on Wednesday. The same is true in the Senate with the deadline this Friday.

It is worth noting that a bill may not move forward by this deadline but may still be active because it is “Necessary to Implement the Budget” or may reappear as part of the budget.

The House Higher Education Committee held a series of public hearings on Tuesday morning. Among the bills taken up by the Committee included an audit of the state universities (HB 2038) and the creation of an Institute for Teaching Excellence (HB 2661).

Evergreen testified with concerns about proposed legislation that would design and implement a program that provides information to high achieving, low-income high school students with the intention of increasing the number of applications from this group four-year institutions of higher education in Washington (HB 2694).  As drafted Evergreen expressed concerns about the inclusion of the term “selective” as it relates to identifying higher education institutions, the stated assumption in the bill that national aptitude tests are predictors of college success, and the need to ensure a broad range of options to identify high achieving students.  Western Washington University also expressed concerns about the bill.

The Committee also moved several bills through to the next step. Among the bills the Committee to action was legislation to concerning mentoring and service learning opportunities in Washington (HB 2400), efficiency legislation for Washington’s public baccalaureate institutions (HB 2613), establishing statewide educational attainment goals (HB 2626) and the creation of the Pay It Forward program (HB 2720).

In the afternoon the Senate Higher Education Committee held several public hearings on proposed legislation. Among the bills that the Committee focused its attention on was efforts to expand the display of metric information for the public baccalaureate institutions to include the branch campuses (SB 6482) and to provide a tuition and fee exemption to the children and surviving spouses of certain highway workers (SB 6370).

The Council of Presidents testified against Senate Bill 6043 which would cap tuition for undergraduate residents students so as not to exceed 10% of the most current average annual wage reported by the Washington Employment Security Department (ESD). The average annual wage reported by ESD in 2012 was $51,595.

The Committee also moved several gubernatorial appointments to higher education related boards forward to the Senate Floor for confirmation.

Washington’s Public Four Year Institutions Release Proposal for Investment in Higher Education

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Today Washington’s public four-year universities are asking the Legislature to bolster sagging state investment in higher education in order to freeze resident undergraduate tuition for the first time in a quarter century.

The proposal asks for a $225 million investment in state funding for the 2013-15 biennium to sustain current enrollment levels and build capacity to expand access in the state’s public baccalaureate system.  In exchange the institutions would implement a tuition freeze for resident undergraduate tuition for the next two years.

This investment would support Evergreen’s basic needs and make an initial investment in sustaining and building capacity for student success. This would also provide Evergreen the necessary funds to build upon the quality of academic programs and improve student success, sustain and improve student recruitment and retention efforts through improved research capacity and investments in academic advising and financial aid as well as targeted support for entering students. In addition these funds would provide support to establish a dedicated Veterans Center at the College and increase support for the College’s science curriculum.

The investment by the state would be disbursed to the institutions on a pro-rata basis. Evergreen’s portionwould be $8.3 million.

Details Emerge About Obama’s Blueprint for Higher Education

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Late last week, several days after President Obama announced new proposed federal policies focused on the availability of affordable quality higher education, details  emerged about how the Obama Administration would go about achieving this goal.

In his State of the Union address, President Obama called for a comprehensive approach to tackling rising college costs. In a speech at the University of Michigan President Obama provided additional details about the framework by which he will work with Congress to establish a set of policies focused on increasing post-secondary education opportunities in the U.S.

The proposal put forth by the President would include several components.

  • Reform student aid to promote affordability and value: To keep tuition from spiraling too high and drive greater value, the President will propose reforms to federal campus-based air programs to shift aid away from colleges that fail to keep net tuition down, and toward those colleges and universities that do their fair share to keep tuition affordable, provide good value, and serve needy students well. These changes in federal aid to campuses will leverage $10 billion annually to keep tuition down. The President’s plan calls for shared responsibility between the federal government, states, and institutions of higher education to tackle rising college costs by  improving the distribution of federal financial aid and increase campus-based aid. This reform will reward colleges that are succeeding in meeting the following principles:
      • Setting responsible tuition policy, offering relatively lower net tuition prices and/or restraining tuition growth.
      • Providing good value to students and families, offering quality education and training that prepares graduates to obtain employment and repay their loans.
      • Serving low-income students, enrolling and graduating relatively higher numbers of Pell-eligible students.

In his proposal the President is proposing to change how funds for the Supplemental Educational Opportunity Grants (SEOGs), Perkins Loans, and Work Study are distributed by implementing an improved formula that shifts aid from schools with rising tuition to those acting responsibly, focused on setting responsible tuition policy, providing good value in education, and ensuring that higher numbers of low-income students complete their education. He is also proposing to increase the amount of campus-based aid to $10 billion annually. The increase is primarily driven by an expansion of loans in the federal Perkins program – which comes at no additional taxpayer cost.

Under his plan colleges that can show that they are providing students with good long-term value will be rewarded with additional dollars to help students attend. Those that show poor value, or who don’t act responsibly in setting tuition, will receive less federal campus-based aid.  Students will receive the greatest government grant and loan support at colleges where they are likely to be best served, and little or no campus aid will flow to colleges that fail to meet affordability and value standards.

 

  • Create a Race to the Top for college affordability and completion: The president will create incentives for states and colleges to keep costs under control through a $1billion investment in a new challenge to states to spur higher education reform focused on affordability and improved outcomes across state colleges and universities. The Race to the Top: College Affordability and Completion will reward states who are willing to drive systemic change in their higher education policies and practices, while doing more to contain their tuition and make it easier for students to earn a college degree.The President is proposing a program that would spur systemic state reforms to reduce costs for students and promote success in our higher education system at public colleges. This $1 billion investment would incentivize states to: (1) Revamp the structure of state financing for higher education; (2) Align entry and exit standards with K-12 education and colleges to facilitate on-time completion; and (3) Maintain adequate levels of funding for higher education in order to address important long-term causes of cost growth at the public institutions that serve two-thirds of four-year college students. The intention is that the Race to the Top for College Affordability and Completion would incentivize governors and state legislatures around the nation to act on spurring this innovative reform. Through cost-saving measures like redesigning courses and making better use of education technology, institutions can keep costs down to provide greater affordability for students.

 

  • A first in the World competition to model innovation and quality on college campuses: The president will invest $55 million in a new First in the World competition, to support the public and private colleges and non-profit organizations as they work to develop and test the next breakthrough strategy that will boost higher education attainment and student outcomes. The new program will also help scale-up those innovative and effective practices that have been proven to boost productivity and enhance teaching and learning on college campuses.  This initiative would provide modest start-up funding for individual colleges, including private colleges, for projects that could lead to longer-term and larger productivity improvements among colleges and universities – such as course redesign through the improved use of technology, early college preparation activities to lessen the need for remediation, competency-based approaches to gaining college credit, and other ideas aimed at spurring changes in the culture of higher education.

 

  • Better data for families choose the right college for them: The president will call for a College Scorecard for all degree-granting institutions, designed to provide the essential information about college costs, graduation rates, and potential earnings, all in an easy-to-read format that will help students and families choose a college that is well suited to their needs, priced affordably and consistent with their career and educational goals. The Administration will create a College Scorecard for all degree-granting institutions making it easier for students and families to choose a college that is best suited to their needs, priced affordably, and consistent with their career and educational goals.  The administration will also make an updated version of the ‘Financial Aid Shopping Sheet,’ announced in October, a required template for all colleges, rather than a voluntary tool, to make it easier for families to compare college financial aid packages. Finally, the President is also proposing to begin collecting earnings and employment information for colleges, so that students can have an even better sense of the post post-graduation outcomes they can expect.

 

  • Federal Support to Tackle College Costs In his State of the Union, President Obama called on Congress to: (1) Keep student loan interest rates low. This summer, the interest rates on subsidized Stafford student loans are set to double from 3.4% to 6.8% – a significant burden at a time when the economy is still fragile and students are taking on increasing amounts of debt to earn a degree. The President is asking Congress to prevent that hike from taking place for a year to keep student debt down, a proposal that will keep interest rates low for 7.4 million student loan borrowers and save the average student over a thousand dollars; (2) Double the number of work-study jobs available:  The President also proposes to double the number of career-related work-study opportunities so that students are able to gain valuable work-related experience while in school; and (3) Maintain our commitment to college affordability: Over 9 million students and families per year take advantage of the Obama Administration’s American Opportunity Tax Credit – supporting up to $10,000 over four years of college.  In his State of the Union address, the President called on Congress to make this tax credit permanent and prevent it from expiring in 2012.

Though many within higher education support the President’s intentions to provide access to an affordable quality education, many are concerned that the lack of recognition regarding the dramatic decline in funding at the state and local levels and the need for flexibility to manage these unprecedented time within the President’s framework may lead to greater harm than good.

Higher Education Opportunity Act Introduced in Washington

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Today Representative Carlyle, Vice Chair for House Higher Education, launched the Higher Education Opportunity Act.

Carlyle stated “the trend in the Legislature is to reduce funding for the institutions of higher education under the operating assumption that they can continue to absorb the cuts without measurable or meaningful consequences for students, faculty, families and supporters. The trend of decreasing state support and increasing tuition seems virtually unstoppable. The question is not whether this trend will continue but how we can get a handle on the negative consequences for the middle class and more intelligently manage this structural shift.”

The Higher Education Opportunity Act would: 

  • Tuition-Setting Authority: For a four year window between academic years 2011 and 2014, public baccalaureate institutions are granted full local authority to set tuition rates for all students. After that four year time frame, tuition-setting authority for in-state undergraduates reverts back to the Legislature.
  • Dramatically Increasing Financial Aid for the Middle Class: Fifty percent of all tuition raised above a 7 percent ‘base’ per year at public baccalaureate institutions must be protected, reserved and spent by the institutions to fund new financial aid to directly increase assistance for the middle class. This allows students from families earning from 70% of medium family income (about $56,000 for a family of four–the current level of aid) to 125% of medium family income can receive substantial financial aid to mitigate the negative effects of rising tuition.
  • Institute a Radical Commitment to the Leverage Federal Tax Credits and Incentives: Strong requirements are put in place for higher education institutions to inform, educate and reach out to students about highly valuable federal tax credits available to them such as the American Opportunity Tax Credit and the Lifelong Learning tax credit.
  • Acknowledging Multiple Kid Family Costs for the Middle Class: In assessing higher education financing challenges, the Higher Education Coordinating Board (HECB) is required for the first time to consider family size as part of the family contribution for students of the state need grant, and is also required to establish criteria for awards that is not solely based on “first come, first served.”
  • Guaranteed Education Tuition (GET Program): The Committee on Advanced Tuition Payment (state treasurer, HECB director, OFM director, program participant and business rep) are required to review tuition levels and recommend a possible “GET II.”
  • Higher Education Institutional Accountability: The National Governor’s Association Complete to Compete Metrics are established in statute.
  • Eliminating Reports and Studies that are Duplicative or Unnecessary: Over the years the Legislature, Governor and boards have saddled the institutions with a huge number of reports, studies and data requests that may or may not be useful. This plan moves forward to eliminate the burden while keeping quality data available for public policy decision makers.

At a press conference this morning, Carlyle  shared that this legislation is a work in progress and needs time to ripen.  The bill is expected to be heard before the House Higher Educationo Committee next week.

Tuition, Accountability and Budget Topics of Discussion

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Higher education advocates, inlcuding the Higher Education Coordinating Board (HECB) and the Council of Presidents (COP), spoke to the critical links between state funding, tuition, and financial aid and the role of accountability/performance metrics at the January 18 Senate Higher Education & Workforce Development Committee’s work session.

Chair Rodney Tom focused the two-hour work session on the relationship between tuition, state funding, and accountability and the impact on student access. The work session provided the opportunity for higher education institutions to provide testimony and answer questions from policymakers.

Following informative presentations by the HECB , legislative staff, and COP institutions were provided the opportunity to share their thoughts.  The comments provided by representatives of the public, four-year higher education sector included the impacts of reductions to date, the importance of flexibility, and ideas about accountability and performance metrics.

In the afternoon, the presidents of all six public, baccalaureate institutions engaged the Senate Ways & Means Committee regarding state funding and the impacts of the Governor’s proposed 2011-13 biennial budget.

Chair Ed Murray focused the work session on higher education, including both two- and four-year institutions. 

Kicking off the discussion with an overview, the Council of Presidents highlighted the recent impacts to state funding for higher education and the potential impact of the Governor’s proposed budget. 

The presidents then spoke to the challenges they share with policymakers in funding services and programs for their constituents in a difficult fiscal climate.  The presidents acknowledged the difficult fiscal climate in their comments and asked for the flexibility and the opportunity to work with members to make strategic decisions that will allow institutions to steer through the storm.

U.S. Senate Committee Considers Veterans’ Benefits

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The U.S. Senate Committee on Veterans’ Affairs held another hearing on legislation that would streamline benefits for veterans under the Post-9/11 GI Bill.

S. 3447 would revamp the benefit formula that has been in place since the Post-9/11 GI Bill took effect last year. The bill, as currently written, would establish a new national cap on benefits for private colleges – both for- and non-profit.

The new cap would be derived from the average tuition and fees of all private and public baccalaureate institutions across the nation, instead of the maximum benefit on the highest tuition of any public program in a given state. 

Many higher education officials are supportive of the concept of setting a national standard of benefits and agree with the goal of erasing inequities between states. However, there is concern that the currrent discussion regarding a cap would result inveterans at private institutions receiving less funding in nearly 25 states. Language for the bill is still being hammered out.

In addition, the bill would make small changes with regards to funding for undergraduate education at public institutions and extend benefits to more members of the National Guard and Active Guard Reserve.  This could potentially lead to coverage for an additional 30,000 whom were not covered by the original law.

Finally, the bill extends housing allowances to students taking courses purely online. Though the current GI Bill provides no allowance to students taking on distance education courses, the legislation under consideration would provide those students with 50 percent of the allowance given to residential students.

Higher Education Advocates Express Concern with Proposed Changes to Tax Credits

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This week the National Association of Student Financial Aid Administrators (NASFAA), the American Council on Education (ACE) and other higher education advocates shared concerns with the U.S. Department of Treasury’s proposal to institute a community service requirement as a condition for receiving a tax credit for tuition and related expenses.

In a letter to the Department more than 20 higher education organizations expressed several concerns about requiring mandatory community service as a condition for receipt of federal higher education tax credits.

The letter argues that this proposal, if implemented, could:

  • Detrimentally impact a number of students, particularly low-income and nontraditional students,
  • Be extremely difficult and costly to implement and administer, and
  • Inadvertently harm the thriving community service and service-learning efforts already occurring on campuses across the higher education community.

Prepaid Tuition Unit Price Increases in Washington

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Early this week the Guaranteed Education Tuition (GET) committee met to deter unit costs of Washington’s prepaid tuition program.

As of May 1, the price of one GET unit will increase from $101 to $117. 

The Committee is increasing the unit price beyond the 14 percent Washington universities and colleges are expected to raise tuition to reflect future investment and tuition expectations.

In addition, the Committee also recognized that enrollment this academic year (09-10) is the second largest in the program’s 12 year history and investment returns have picked up during the last quarter.