AGB Federal Policy Alert: the College Affordability Act (CAA)

By November 8, 2019 AGB Alerts

On Tuesday, October 15, the House Education and Labor Committee Democrats introduced the College Affordability Act [CAA] (H.R.4674), their proposed comprehensive reauthorization of the Higher Education Act (HEA). Then, on October 29, 30, and 31, the committee marked up the bill and passed it through committee by a 28 to 22 vote. The bill contains a number of major provisions of relevance to governing boards, including, for the first time, institutional governance as a part of HEA’s accrediting standards. It is unclear whether or when this bill will be brought to the full House for a vote. While it is highly unlikely that CAA eventually becomes law during this Congress, the bill does set the standard that House Democrats will use going forward in future HEA reauthorization negotiations.

Background

Over the course of the spring and summer, the House Education and Labor Committee held six hearings related to HEA reauthorization, covering: (1) the cost of college; (2) accountability in higher education; (3) improving student outcomes; (4) the role of community colleges, Historically Black Colleges and Universities (HBCUs) and Minority Serving Institutions (MSIs); (5) innovation in higher education; and (6) teacher preparation. These hearings were meant to inform the development of CAA, which is an updated version of the Aim Higher Act, House Democrats’ HEA reauthorization proposal from the last Congress.

On the Senate side, Health, Education, Labor and Pensions (HELP) Committee Chair Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) spent the spring negotiating a potential bipartisan HEA reauthorization bill. However, talks between parties stalled due to disagreements over a number of issues, including a federal-state partnership and how to address campus sexual assault. This fall, Senator Alexander introduced the Student Aid Improvement Act (S.2557), a mini HEA reauthorization that would: simplify the Free Application for Federal Student Aid (FAFSA) by reducing the number of questions; simplify student aid award letters; lift the ban on incarcerated individuals eligible for parole receiving Pell Grants; allow shorter-term skills or job training programs to be eligible for Pell Grants; increase the maximum Pell Grant award; and permanently extend mandatory funding for HBCUs and other MSIs. Senator Murray came out in opposition to the bill, as she is against any noncomprehensive reauthorization of HEA, leaving the fate of the Student Aid Improvement Act uncertain.

Major Provisions

As mentioned above, CAA has a number of major provisions that would affect governing boards and the institutions they serve. These provisions include:

  • Including institutional governance as a part of HEA’s accrediting standards;
  • Requiring accreditors to set benchmarks on outcomes related to completion and workforce participation using federally defined measures and allowing the secretary of education to require such benchmarks to be revised if too low;
  • America’s College Promise, which, in states that provide 25 percent of the total funding, would eliminate the cost of tuition and fees at community colleges and subsidize the cost of two years of attendance at an MSI. Because of the size ($76 billion over 10 years) and scope envisioned by this program, it would constitute a significantly different approach in how the federal government supports higher education—moving from a financial aid system almost entirely focused on aiding students directly to one focused on sending aid through states and institutions. (America’s College Promise requires a state maintenance effort for participating states and has transfer of credit requirements for public institutions.)
  • Preventing the U.S. Department of Education (ED) from implementing, enforcing, or otherwise giving effect to the administration’s proposed Title IX regulations or any similar future rule;
  • Increasing the maximum Pell Grant award by $625 while also indexing future maximum Pell increases to inflation and allowing Pell Grants to be used for postbaccalaureate study at public and private nonprofit institutions;
  • Expanding Pell Grant eligibility to incarcerated individuals and short-term education programs;
  • Establishing a Federal Pell Grant Bonus Program that provides additional funding to institutions that graduate high numbers of Pell Grant recipients;
  • Allowing federal student aid eligibility for any student who lives in the U.S. before the age of 16, regardless of their immigration status, if they have earned a high school diploma or served in the U.S. military;
  • Establishing an on-time repayment rate—calculated as the percentage of students who have paid at least 90 percent of their monthly payments over a three-year period—with zero-dollar income-based repayment (IBR) “payments” being considered as paid;
  • Establishing an adjusted cohort default rate that takes into account the share of borrowers at an institution and the number of borrowers in forbearance for 18 months or longer;
  • Expanding the role of states to include: (1) evaluating institutions on facilities equipment and supplies; (2) certifying that the state will accept student complaints, including those who are residents but attending institutions not located in the state; and (3) establishing policies and procedures to anticipate and respond to closures of institutions;
  • Reestablishing a version of the Perkins Loan program; and
  • Extending funding for HBCUs and MSIs permanently at $300 million annually.

The Outcome for Boards

If passed into law, the College Affordability Act would have a substantial impact on governing boards and higher education as a whole. That is why AGB sent a letter to House Education and Labor Committee Chair Bobby Scott (D-VA) and Ranking Member Virginia Foxx (R-NC) outlining our praise for and concerns about the bill. For instance, while AGB is in favor of the inclusion of institutional governance as a part of HEA’s accrediting standards, AGB opposed the technical review panel that would have been created at ED, tasked with establishing measures and definitions that accreditors must choose from when assessing institutional outcomes related to completion, progress toward completion, and workforce participation. This technical review panel provision was dropped from the bill during the markup. AGB also encouraged the inclusion of a provision into HEA’s program participation agreement section assuring that board members receive appropriate preparation and continued education to best serve their institutions. AGB encourages members to reach out to their member of Congress to express their views about the bill.

Questions to Consider:

  • How would CAA affect your institution and its ability to serve students?
  • How would CAA change institutional or board policies and practices? (Differences between publics and privates/independents?)
  • Are there parts of CAA that benefit your students and institution? Are there provisions that might have unintended consequences? What provisions should be added? Which provisions should be removed?

Resources:

  • College Affordability Act bill text
  • College Affordability Act title by title summary
  • AGB letter on the College Affordability Act
  • American Council on Education (ACE) letter on the College Affordability Act