As Congress prepares to reauthorize the Higher Education Act, which has provided financial aid for college students since 1965, significant changes to the legislation are being proposed.
In response to the growing demand for financial aid, the Coalition for Better Student Loans, which includes a number of high-profile organizations including College Parents of America and Sallie Mae, sent a proposal to Congress Sept. 2 suggesting several modifications to the current allocation system.
Three days later, two Republican congressmen released a report on rising tuition rates entitled "The College Cost Crisis."
The report, which found that "exploding college costs" are responsible for high increases in tuition, was coauthored by Ohio Rep. John Boehner, education and the workforce committee chair, and California Rep. Howard P. "Buck" McKeon, 21st century competitiveness subcommittee chair.
In response to the findings in his report, McKeon said he plans to introduce a College Affordability Bill to Congress in about two weeks. The bill would penalize colleges that increase their tuition and fees at twice the rate of inflation for three years in a row.
"We have a lot of carrots out there, now we're going to put a stick out there as well," he said.
McKeon added that any penalties levied against colleges and universities would not affect the financial aid packages offered to students at those institutions.
In contrast to McKeon's anticipated legislation, the coalition's proposal suggests altering financial aid rules by increasing Stafford loan limits, creating flexible borrowing accounts, phasing out the current $300 loan origination fee, along with promoting loan consolidation and forgiveness opportunities. Stafford loans are loans directly from the federal government.
These changes would improve an already remarkable financial aid system, Sallie Mae spokesperson Steve Heyman said.
"We hope that by enacting these proposals, Congress can ensure a strong, viable student loan program for future generations of students," he added.
The federal government's current annual contribution toward higher education is $65 billion, which accounts for 30 to 35 percent of the total national cost, McKeon said. The figure rises to $90 billion when research and development grants are considered.
Despite their differing approaches, McKeon said his legislation would likely complement consideration of the coalition's proposal.
"One does not exclude the other," he said. "I'm sure we'll increase financial aid."
The coalition's plan, however, is just one of many which have been sent to Congress, said Alexa Marrero, press secretary for the education and the workforce committee.
"There are literally hundreds of proposals from many different groups," she said. "It will be taken into consideration."
Congress passed the initial Higher Education Act in 1965, and has reauthorized it in four and six year increments since. The last reauthorization came in 1998 and included controversial legislation which limited financial aid to convicted drug offenders.
"Congress is set to address rising tuition and the growing need for student financial aid," Marrero said.
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