Innovation in College Affordability
At a Senate Committee on Health, Education, Labor and Pensions (HELP) hearing in February on college affordability, undersecretary of the U.S. Department of Education, Martha Kanter, discussed the president’s plan to cut the cost of higher education. Tensions were high as the senators questioned Kanter on the proposals unveiled during this year’s State of the Union address. In response to many inquiries on feasibility, Kanter said that much more would be known after the release of the budget. That day has come and gone. Many questions, however, remain unanswered, most importantly, which proposals will survive in Congress. What is certain is that the current trend of exorbitant college costs is unsustainable if the U.S. aim is to be the most educated nation in the world.
Here is what we do know about the Administration’s proposals:
- A higher education version of K–12’s Race to the Top would give states the incentive to implement state-level reform to promote affordability and increase value. The Race to the Top: College Affordability and Completion plan is a multiyear effort, beginning with a $1 billion investment in 2013, which would use federal dollars as a catalyst for change. Similar to the K–12 competition, states would submit proposals for reform, and the federal government would decide which proposed action plans would receive federal funding. The department would hold states accountable through a regular review process. Sen. Richard Burr (R-NC) expressed concern that a state like North Carolina, which has demonstrated a long-standing commitment to affordable education, would be penalized for not meeting standards.
- Similar to the Investment in Innovation (i3) program, "First in the World" is a competition that intends to incentivize innovative solutions that address the completion challenge and improve higher education productivity through outside-the-box thinking with $55.5 million.
- To encourage partnerships between community colleges and businesses, the Community College to Career Fund would provide $8 billion to train workers and fill more than two million jobs in growing industries. The funding would be jointly administered over three years by the departments of Education and Labor. A portion of the funding would be used to place students in apprenticeships and internships to provide students with relevant experience while earning course credit.
- The Administration also proposes a maximum Pell grant of $5,635, a bump of $85, and a hold on the current interest rate for subsidized student loans at 3.4%.
- To help prospective students and their families be savvier consumers, the Administration has created a college score card, which includes information on costs, graduation rates, student loan repayment, debt, and earnings potential.