February 20, 2008

 

In this issue:

 

Previous Updates

 

Higher Education

 

Now that the House has approved the College Opportunity and Affordability Act of 2007, passed by a vote of 354-58, HEA attention shifts to reconciling differences between the House and Senate versions.  While a formal Conference Committee has not been formed, discussions among the two committees’ staffs have begun. 

The higher ed community is focusing on the areas during conference: 

• Accreditation.  The House bill incorporates the agreement reached between the higher education associations and the accrediting groups on this issue. The Senate bill has similar language.  The conference agreement must contain this language so that institutions retain the ability to define the standards by which student achievement is measured. 
• College Costs.  Under the House bill, institutions that raise tuition above certain limits will be placed on a “watch” list and forced to create campus quality efficiency task forces which must then file remediation plans with the Department.
• Regulatory Burden.  Rep. Howard McKeon (R-CA) successfully added an amendment to the House bill that calls on the National Research Council to study the federal regulatory burden on colleges and universities. 
• Other Items to Monitor.  Several other provisions of concern are those affecting endowment reporting, new application and complaint procedures for Title VI international education programs, foreign gift reporting, proposed modifications to the HEA graduate education programs, and peer-to-peer file sharing requirements, among others. 

The bill reauthorizes the Higher Education Act through FY 2012.  Here are the highlights:

 

Higher Education Price Index

• The measure also requires the Education Department to create "higher education price increase watch lists" on the department Web site that report the full price of tuition and fees, as well as the cost of room and board for students living on campus.  The department would also be required to post an online chart that compares the percentage change in states' appropriations per student enrolled in institutions of higher education.  Schools which have the highest percentage change in tuition and fees over the previous three years will be included on a Department watch list. As per the language in the amendment, schools whose tuition and fees in the last are in the lowest quartile of institutions in their sector and schools whose dollar increase was less than $500 are excluded.

• According to an analysis of the previous three years done by ACE, nineteen four-year public institutions would be placed on a “watch list” under the bill.  Of the nineteen, three are UT System institutions: UT Dallas (#2), UTSA (#4), and UT Arlington (#9).

[Back to Top]

 

Incentives & Rewards for Low Tuition

• Includes a number of initiatives intended to encourage colleges and universities to keep costs down, including competitive grants for institutions that have an annual net tuition increase of 1% or less, as well as bonuses given by the Education Department to institutions for distribution to students receiving Pell Grants.

[Back to Top]

 

Textbook Costs

• Directs college textbook publishers to make pricing information available to faculty when making purchasing decisions.  It also requires institutions of higher learning and college bookstores to provide textbook information to students early so that they are "aware of the textbook costs associated with each course" when making their course schedules.

[Back to Top]

 

Student Aid

• Pell Grants
• The bill increases the maximum authorized Pell grant award to $9,000 from $5,800.  Under the bill, these grants could be used year round, and would be accessible to part-time students.  The measure limits eligibility for such grants to 18 semesters or 27 quarters.

• Students in the Armed Forces

• The bill requires colleges and universities to treat students returning from military service as continuously enrolled students, and allows a family's nursing home expenses to be calculated when deciding how much a student should receive in student loan aid.
• Byrd Scholarship Program
• The measure changes the Byrd Scholarship program to focus on encouraging students to earn degrees in math and science through the new Math and Science Scholarship Fund and the Math and Science Incentive Program.  The Math and Science Scholarship Fund would provide aid to students who commit to five consecutive years of service in a math or science field after graduation, while the Math and Science Incentive Program would provide loan forgiveness of up to $5,000 of accumulated interest if a student agrees to work for five consecutive years in a math or science field.
• Loan Forgiveness
• The measure provides a new $10,000 loan forgiveness program for individuals serving in high-need areas.  It provides up to $2,000 per year for five years for nurses, early childhood educators; foreign language specialists, librarians; teachers; speech language pathologists; national service participants; school counselors; public sector employees; nutrition professionals; medical specialists; and mental health professionals.
• Free Application for Federal Student Aid Simplification
• The bill contains the following provisions to simplify the free application for federal student aid (FAFSA):
• Encourages the Education Department to reduce the number of questions requiring an answer by 50% over five years;
• Creates a two-page "FAFSA-EZ" form for students and families who qualify for the "auto-zero" family contribution;
• Requires students reapplying for FAFSA in subsequent years to provide only updated information. Current law requires applicants to re-file a new FAFSA; and
• Requires the Education Department to allow students and families, before applying for aid, to receive estimates of their Expected Family Contribution, and an estimate for their amount of financial aid.
• AC/SMART Grants
• The bill allows legal permanent residents to receive Academic Competitive (AC) and Science and Mathematics Access to Retain Talent (SMART) grants.  The measure also amends the SMART grant program to clarify that a student pursuing "eligible courses of study" at institutions where students do not declare majors is still eligible for such grants.

[Back to Top]

 

Transfer of Credit Policies

• The measure requires colleges and universities to fully disclose the transfer of credit policies for current and prospective students.

[Back to Top]

 

90/10 Rule

• The measure clarifies that the 90/10 provision in the program participation agreement (which requires that a for-profit school must derive no more than 90% of its revenue from federal Title IV student aid programs) allows additional sources of funds (such as 529 College Savings Plans, which are tax-free college savings accounts) to count as part of the 10% of the non-Title IV revenue. (Title IV of the Higher Education Act governs all federal student aid programs.)

[Back to Top]

 

State 'Maintenance of Effort' Requirement

• The measure prohibits states from reducing its total higher education funding for any academic year beginning on or after July 1, 2008, to an amount that is less than the average amount allocated by a state over the five most recent academic years.  The Education Department could grant states waivers due to exceptional or uncontrollable circumstances, such as natural disasters or an unforeseen decline in revenue.  Violation of this requirement (without a waiver) would result in the Education Department withholding federal higher education funding for that state.

[Back to Top]

 

Loan & Contribution Disclosure

• The bill incorporates the provisions of the Sunshine Act (HR 890).  In its report, the committee notes that it has included changes to the bill to address concerns that the original version of the measure may have "unintentionally prohibited College Presidents from serving on a Bank's board of directors (and vice-versa), despite the absence of a conflict of interest." The bill retains the ban on lenders offering opportunity pools "as a quid pro quo for placement on a preferred lender list or for a specified loan volume." In opportunity pools, lenders could give an institution of higher learning a fixed amount of private loan funds, which are passed on to students who would normally be ineligible for such loans.  The college or university then could make the provider a preferred or exclusive lender of federal student loans on its campus.
• Gift Prohibition
• Bars postsecondary education institutions, officers, and employees from receiving any gift from a private lender in exchange for any advantage in its loan activities.
• Monitoring Students Who Default on Loans — Extends the period that the federal government monitors students who default on their loans from the fiscal year following the first payment to the third fiscal year after the student begins paying back the loan balance;
• Revenue sharing — Bars lenders from sharing profits from their loan activities with higher education institutions in exchange for an advantage to the lender in its loan activities.  This prohibition includes gifts to postsecondary education institutions or their employees;
• Disclosure of Private Contributions — Requires an institution of higher education that receives funds under the bill to disclose any contribution from private companies or foreign governments that exceed $1 million in one fiscal year;
• Advisory Councils — Bars financial aid officials from serving on advisory councils of private educational lenders;
• Prepayment Penalties — Prohibits private lenders from charging borrowers fees for paying off their loans early;
• Approved Interest Rate — Mandates that lenders give applicants up to 30 days to accept a loan following its approval with no changes in terms except an index to determine the interest rate.
• Cancellation  
• Requires lenders to allow for up to three days for borrowers to change their minds after entering to a loan agreement;
• Loan Disclosure
• Requires lenders to make disclosures of loans to borrowers when the advertisement or solicitation of loans is done, at the time of the approval applications, and when loans are finalized;
• Written Acknowledgement
• Mandates that private lenders obtain a written acknowledgement from borrowers that they have read and understand disclosure requirements.

[Back to Top]

 

Teacher Quality

• Teach for America
• Reauthorizes the Teach For America program, which recruits and trains recent college graduates seeking to enter into the teaching profession;
• Early childhood Education Taskforce
• Provides for newly created state taskforces to create comprehensive state-wide early childhood education systems;
• Augustus F. Hawkins Centers of Excellence
• Creates "Centers of Excellence" to provide grants to historically black colleges and universities and other minority serving institutions to improve teacher quality and preparation;
• Best Practices Study
• Requires the National Academy of Sciences to conduct a study to develop best practices in teacher education.

[Back to Top]

 

Minority College Assistance

• Predominantly Black Institutions/Asian-Pacific Islander Serving Institutions
• The bill establishes new designations for such institutions.  The measure defines predominantly black institutions as having an enrollment of "financially needy undergraduate students;" an enrollment of undergraduate students at least 40% of whom are African-American; and, that has at least 1,000 undergraduate students of whom at least 50% are enrolled at the institution are low-income or first generation and are registered in a bachelor or associate degree program.
• Native Americans
• The measure defines Native American non-tribal institutions as having an enrollment of undergraduate students that is not less than 10% Native American students, and that are not already designated as a tribal college or university.
• Historically Black Colleges & Universities 
• The measure adds the following graduate programs to this designation: Alabama State, Bowie State, Delaware State, Langston University, Prairie View A&M, and the University of the District of Columbia School of Law.

[Back to Top]

 

Graduate & Postsecondary Programs

• Graduate Assistance in Areas of National Need
• These fellowships are designed to enable colleges and universities to provide assistance to graduate students who are studying in areas of national need.  The measure gives priority to grants aimed at preparing professors to train teachers in science, technology, math, special education, as well as training for teachers with limited English proficiency.
• Patsy Mink Fellowships
• The measure re-authorizes Patsy Mink fellowships, which are awarded to students of minority groups to acquire master’s degrees or doctorate degrees in academic areas where minorities are under-represented.
• Fund for the Improvement of Postsecondary Education (FIPSE)
• The bill authorizes the Education Department to make grants to, or enter into contracts with, colleges and universities and other nonprofit entities, that are intended to improve postsecondary education opportunities.  The fund covers a number of new initiatives, including:
• A scholarship for family members of veterans or members of the military;
• A demonstration program for homeless youth and children in foster care;
• A "best practices" center to support single parent students; and,
• Support for academic programs in American history.

[Back to Top]

 

Urban-Serving Institutions

• The measure eliminates the Urban Community Service program and replaces it with the Urban-Serving Institutions program.  This program would provide incentives to urban-serving institutions to expand research, and implement initiatives in partnership with community-based organizations.

[Back to Top]

 

Students with Disabilities

• The measure provides for several postsecondary education initiatives aimed at assisting students with disabilities, including:
• Establishing of a National Center for Information and Technical Support intended to improve the dissemination of best practices related to working with postsecondary students with disabilities, and improve the recruitment, retention, and completion rates;
• Establishing demonstration programs to help students with disabilities succeed in postsecondary education, as well as a coordinating center to aid such programs;
• Creating demonstration programs aimed at improving "timely access and quality" of instructional materials in appropriate formats for students with print disabilities, and a commission to evaluate the feasibility of national technical standards and methods to more efficiently distribute these materials; and
• Requiring the Government Accountability Office to study the barriers and opportunities relating to the full participation of students with disabilities in higher education.  The study would examine the success rates of colleges and universities to recruit, retain, and graduate students with disabilities.

[Back to Top]

 

Addressing High Need Areas

• Provides for a number of programs to address the "unique needs in critical areas." These programs include the development of science programs for Alaska Natives and Native Hawaiians; a national scholarship database for Science, Technology, Engineering, and Mathematics fields; and a program intended to ease the transition of veterans returning from combat zones into higher education.

[Back to Top]

 

Campus Safety

• Includes new campus safety initiatives, including a program to provide grants to colleges and universities to implement state-of-the-art emergency systems and procedures; assistance to such institutions to develop emergency policies, procedures, and practices; and a disaster relief loan program to ensure that institutions can re-open as soon as possible after an emergency.

 

[Back to Top]

Endowments

 

WASHINGTON (Reuters) - A senior senator said recently he is less intent on legislation to force more spending on students by thriving university endowments now that some major schools have said they are changing their policies.  Sen. Charles Grassley told the Reuters Regulation Summit he has "slowed the push for legislation" since announcements by Harvard, Yale and other universities that they plan to commit more of their endowments' earnings to student financial aid.

 

[Back to Top]

 

national science board releases report on cost sharing

 

A committee of the National Science Board (NSB) has released a report on cost sharing policies of the National Science Foundation (NSF).  The “Report to Congress on Cost Sharing Policies at the National Science Foundation,” required by the America COMPETES Act, makes several important recommendations.  It says that NSF should:

• Define and communicate a set of overarching principles to guide the application of mandatory cost sharing, to include specific goals and expected outcomes of its application;
• Continue to employ OMB Circular A-110 to define cost sharing;
• Enhance its training of program officers to avoid unintended implicit of explicit requests for voluntary cost sharing/institutional commitments during the budget negotiation process;
• Reinstate mandatory cost sharing for programs for which cost sharing is foundational to strategic programmatic goals.  Mandatory cost sharing will be required for the following programs: Engineering Research Centers, Experimental Program to Stimulate Competitive Research; and Industry/University Cooperative Research Centers.
• Continue to communicate the requirements of tracking and reporting mandatory cost sharing to all institutions to which it provides funding; and
• Periodically review its cost sharing policies and their impacts.

 

[Back to Top]

 

 

Simon Study abroad bill

 

The Senate Foreign Relations Committee has approved the Simon Study Abroad Foundation Act which was approved by the House on June 5, 2007.  At this time, the bill has not been placed on the calendar for a vote of the full Senate.

 

[Back to Top]

 

 

NIH Fiscal Policy For Grant Awards

 

The National Institutes of Health (NIH) has released its fiscal policy guidance for FY08 grant awards.  The guidance adjusts the agency’s fiscal policy as determined by previous continuing resolutions the FY08 omnibus appropriations bill.  The policy guidance gives individual institutes discretion about allocating this adjustment, but states that:

• Non-competing awards will receive an overall increase of just one percent, rather than the three-percent inflation increase promoted previously;
• The average cost of competing grants will be allowed to increase by one percent (which will allow NIH to support an estimated 9700 new grants in FY08);
• NIH will seek to fund a number of new investigators comparable to the average of the last five years; and
• Ruth L. Kirschstein National Research Service Award (NRSA) stipends, tuition, and training-related expenses will be flat-funded at FY07 levels.  

 

[Back to Top]

 

 

medicare costs

 

The Administration has sent to Congress a Medicare bill in response to the Medicare Modernization Act "trigger" that requires Congress to consider changes in the program when Medicare spending exceeds the trigger threshold.

 

Title I of the draft includes several HHS priorities such as health information technology requirements for electronic medical records and e-prescribing, transparent pricing information, and monetary incentives for providers to deliver quality care.  Title II attempts to ease medical liability rules.  Title III seeks to reduce premium subsidies for Medicare prescription drug beneficiaries with higher incomes by adding a means-testing provision to the program.

 

[Back to Top]

 

 

FDA Woes

 

House Energy and Commerce Oversight and Investigations
Subcommittee Chairman Bart Stupak (D-MI) has called for the resignation of FDA Commissioner Andy von Eschenbach.  "The drug companies know that this administration ...will do nothing to them," Stupak told CongressDaily.  "There is no fear of the FDA."  Stupak as been after von Eschenbach for months, going so far as to seek a Committee subpoena of a briefing book von Eschenbach used to prepare for a hearing in March.

 

[Back to Top]

 

ama woes [from the national journal]

 

Finance Panel Freezes AMA From Talks
   The American Medical Association has been shut out of Senate Finance Committee talks on a top AMA priority, a Medicare bill that would delay a looming 10 percent physicians' fee cut, according to a senior Democratic aide.
   The AMA lost the trust of Finance Chairman Baucus when it broke a confidentiality agreement about Medicare talks last year and informed state affiliates.
   The association has been reluctant to endorse a patch that would schedule a higher pay cut in the future.
   The aide said Finance Committee members are irritated because the AMA signed off on the budget gimmick in 2006 only to complain about it later.
   This year, pay/go rules make it difficult to stop the pay cut from going into effect without a budgeting gimmick, especially when the White House is expected to veto most other offsets.
   "The AMA has become so increasingly and increasingly useless, that I believe the doctors are going to get hurt in the upcoming bill," the aide said.
   The AMA is asking the Finance Committee for an 18-month delay in the physicians' pay cut and a 1.5 percent increase to reflect cost increases.
   Last year, the group ran ads in Washington and in committee members' districts asking for a $50 billion cut to private Medicare Advantage plans.
   Those ads did little to curry favor with Republicans or the White House, who support Medicare Advantage.
   "The AMA, throughout time, in my opinion, has not been very good at lobbying. Even those who sympathize with their cause have been aghast at their lobbying techniques," said a GOP lawmaker.
   "They spent millions last year and alienated every single Republican and only got a six-month bill," said a GOP aide, referring to the pay cut fix bill that passed late last year.
   Without congressional action, the Medicare physicians' pay cut will go into effect July 1. The Finance Committee is expected to mark up a Medicare bill in April or May to temporarily correct the problem.
   Baucus wants to include provisions in that bill tightening rules on Medicare Advantage. Other committee members are hoping to add legislation such as electronic prescribing requirements.
   Baucus has said he is willing to dare the White House to veto the Medicare bill by including language the administration opposes, such as giving states more authority to regulate Medicare Advantage marketing.
   Under a scenario in which the administration threatens to veto the Medicare bill, the physicians' pay cut could be allowed to go into effect or the committee could patch the reimbursement rate for as little as six months with no cost-of-living increases.
   House Ways and Means Health Subcommittee Chairman Fortney (Pete) Stark, D-Calif., predicted Thursday that Congress would be unable to pony up the cash to pay for even the smallest patch and the payment cut would go into effect.
   He added that physicians could be reimbursed retroactively for the shortfall next year. "That is not the end of the world. But then it's more expensive to fix," Stark said.
   Last month, AMA President Ronald Davis, said the current payment scheme, with the budget gimmick, would cut reimbursements by 15 percent over the next 18 months.
   "The physician foundation is at terrible risk because of a short-sighted payment plan," he said.
   Stark said he would support any patch to the physicians' pay cut, but he was not hopeful about the AMA's request for an 18-month delay.
   "I'll take whatever I can get," he said. "Hopefully, we can do it for a year. I guess it'll get done, I expect, at the 11th hour in some kind of supplemental."
   Late last year, Stark said he would prefer to let the physicians' pay cut go into effect rather than repeatedly tinker with bare-bones legislation to patch it.
   On Thursday, Stark said, "What we have to write is a complete new payment system. I hope we can talk about it this year and begin to think about what's needed."
   House Ways and Means ranking member Jim McCrery, R-La., agreed with Stark on that point. "The formula is flawed. If we were to cut physician reimbursement by 15 percent, I think it would exacerbate what I perceive to be, already, a trend of young people looking for professions to look elsewhere." 

 

By Fawn Johnson

 

[Back to Top]