When Congress passed the Higher Education Act of 1965, colleges and universities were swept into a paradigm shift. The act shifted many funding responsibilities for universities from private endowments or state taxpayers to the federal government. Government loans and scholarship programs materialized. Pell Grants and Stafford Loans were a direct result of the legislation.
The HEA has seen many revisions across decades. Reauthorization generally occurred every four to six years, but renewals slumped over the past three decades. Congress reauthorized the HEA just twice between 1992 and 2008. Loans, forbearance, and forgiveness programs multiplied. Tuition inflated. Colleges and universities rose in power.
The HEA is overdue for a makeover, U.S. Rep. Virginia Foxx, R-5th District, told Carolina Journal Associate Editor Kari Travis in an exclusive interview. Foxx, who chairs the House Committee on Education and the Workforce, is chief engineer of a new bill, Promoting Real Opportunity, Success and Prosperity through Education Reform — also known as the PROSPER Act.
The 500-page bill is no standard reauthorization. Instead, it’s packed with reforms. Some affect student loan borrowers. Others hold universities accountable on issues such as free speech and transparency. Foxx outlined the most notable portions of the legislation — and commented on the role of higher education in today’s economy.
This interview was edited for clarity and space.
KT: Let’s talk about the Higher Education Act. In 1965, President Johnson said the law was intended “to strengthen the educational resources of our colleges and universities and to provide financial assistance for students in postsecondary and higher education.” The face and form of higher education has changed. How has the purpose of the Higher Education Act also changed, and what would you say is its primary purpose today?
VF: I would say that the country is not the same as it was in 1965 … . I think it’s way past time for us to reform higher education. And I would tell you that a lot of people thought that the Higher Education Act in 1965 broke ground legislatively, but now it seems that we’re stuck in the mud as a result of breaking that ground. So, part of what’s happened in addition to all the technological changes, the changes in our population, the changes in the way people think about education — we’re in a totally different world. But we now have [complicated] what started out as a reasonably simple piece of legislation. We now have six types of federal student loans, nine repayment plans, eight forgiveness programs, 32 deferment and forbearance options, higher tuition rates, longer completion times, nearly $1 trillion dollars in student debt, and six million unfilled jobs.
KT: What portions of the PROSPER Act are you most excited about?
VF: We have been promising for a long time that we want to go to one grant, one loan, and one work/study program. [I]t’s a major innovation and a major reform because it will fix many of the issues that plague our financial aid system. I think another part of the bill that is exciting is encouraging Pell grant eligible students to complete [their degrees] on time — and to me, on time means four years.
[We’re encouraging students] to complete their degrees in four years and with less debt by offering a $300 bonus to students who take 15 credits per semester.
We also want to require institutions to get in the game by shifting the burden of repayment to the institution when a student withdraws prior to completing their program. We have a fairly substantial dropout rate throughout the the country, especially among freshmen, and between sophomore and junior years. But at other times, there are students who come in, get a Pell grant, and never show up for classes. So we’re changing the way we dispense the Pell grants. Forcing the institutions to think about their responsibility to students once they admit them is a very important thing for us to do.
[We’re also] setting aside $250 million in the work/study program in institutions that have strong Pell grant recipient completion rates — or have significant improvements in these rates so that they can fund additional work/study jobs for students. I’ve been in this business a long time. We have known for probably 40 or 50 years that students who work 15 hours a week do better academically than students who don’t. And that’s especially true for students who work in an area related to their studies.
KT: The bill would end loan forgiveness and subsidized loan programs. Why make this overhaul? How will it impact students? Is there likely to be negative fallout?
VF: We’re looking to end [some loan forgiveness programs] because it’s become so complicated. We have eight different programs, we have 32 deferment and forbearance options. We wanted to simplify things that we were doing. [In the bill] we don’t repeal all the forgiveness [programs]. We don’t repeal forgiveness options for existing borrowers. All the reforms have grandfather provisions, so no promises are broken. That’s a blanket for everything we are talking about here. I’ve never known of an instance where the federal government has broken its promises.
We know that having allowed students to basically have unlimited borrowing with unlimited forgiveness has driven the cost of college [upward]. The inflation of numbers of the cost of college are higher even than health-care inflation. There’s a reason for that, because we’re not seeing higher graduation rates. Actually, there’s been a dip in high school graduation rates, and so there’s more competition. Generally, when you have more competition, prices go down … . So, it’s made sense that the more money the federal government was putting into higher education, the higher the cost of going. It should have been the opposite.
KT: The bill puts a lid on the amount that parents and graduate students can borrow. Will this limit access to education? What are the benefits?
VF: I have made this point for years. Anybody in this country that wants to get a college degree has practically unlimited opportunities. And it all can be done, basically, without borrowing a dime. People are making choices in this area. It is not as though somebody is forcing loans on [students].
I graduated from college with not a dime of debt. I worked part time. I then worked full time. Now it took me longer than four years to get my degree. But again, nothing forced me to borrow money. I was able to work. I was even married and had a child. My husband did not support me. I supported him because he was in college full time, and [he] worked part time. So I still contend it is a choice issue. It is a lifestyle issue.
The problem with paying it off is not with the people who complete their [college] program, but [with] the people who do not complete. Even people who borrow $100,000 to $200,000 to go into the medical field or the dental field. They’re not the people who are failing to pay. It is the people who have rather small amounts of debt, but who put themselves in the situation of not completing [their degree] that have limited earning capacity. The average debt is $20,000. For most people to pay that back over a 10-year period of time is not a huge burden. Most people with a degree are going to be making beyond $40,000 a year. Now, if you want to buy new cars and you want to live in expensive apartments, you might struggle. But I still contend that it’s a choice issue.
KT: You are an advocate for all forms of learning, including apprenticeships, certificate education, and other vocational learning programs. What does the legislation accomplish for those types of opportunities?
VF: The legislation is going to expand student access to — and the ability to participate in — industry-led “earn and learn” programs. Those include apprenticeships [that] will lead to high wage, high skill, and high demand careers.
We’re also going to expand the opportunity students have to use student aid, including Pell grants, for shorter term programs that will help them get into the workforce more quickly. Community colleges are doing a lot in this area. We’re going to encourage more collaboration with traditional colleges and universities that offer programs with new providers. There are a lot of businesses and industries that are getting involved with nationally certified programs that we believe could form the basis of a degree. We’re encouraging people to be innovative [and] look for ways they can make the experience better [and] get [students through more quickly.
KT: The bill establishes a “data dashboard” to give students a picture of how much they’ll spend, the outcomes of students attending their chosen college, etc. Critics have said you missed an opportunity to increase transparency by maintaining a ban on a student “unit record system” that would make public more detailed information about student performance and outcomes.
VF: The major concern with the unit records system is that you’re collecting a lot of very personal information about students that can be identifiable for that individual. It is a privacy issue. So yes, I want as much information as we can get, but I want it at the programmatic level. We know at the federal level that you cannot keep this information secret. I, frankly, am not going to be responsible for setting up a system where you collect a lot of personal info about people that then could be released to others.
Getting to the program level, we are going to be able to give students a lot of the information they don’t have now, and parents, so that they can say, “OK, I’m going to go major in accounting at [a particular] college or university.” A student needs to know how many people graduate in four years. How many people get jobs in certified public accounting, and what’s the average salary for them? That can be done in the aggregate, and that’s what the students need to know.