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President to President

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President to President
Molly Corbett Broad's weekly email newsletter to higher education leaders.

President to President, May 28-June 1, 2012

Vol. 13, No. 18

  • Effort to Freeze Student Loan Interest Rate Remains Stalled in Senate
  • U.S. PIRG Report Looks at Bank-Affiliated Campus Debit Cards
  • Eighteen Groups Submit Briefs to Supreme Court Against University of Texas
  • House Republican Introduces STARS Act for Undocumented Students
  • Federal Agencies Schedule Webinars to Discuss Executive Order on Military and Veterans Education
  • Senate Science and Technology Caucus to Host June 12 Briefing on Technology Transfer

The Senate remained on break this week after the Memorial Day holiday, while the House returned to work Wednesday. We are still waiting for Congress to complete work on a bill to prevent subsidized student loan interest rates from doubling on July 1. The House passed a bill in May, but the Senate has yet to move forward on its version.

Without congressional action this month, the interest rate on these loans will double to 6.8 percent, which would cost about 7 million borrowers an estimated $1,000 each. The House-passed measure (H.R. 4628) is the subject of a veto threat from President Obama despite his support for freezing the rate at 3.4 percent. The president disagrees with how House Republicans want to pay for the bill: cuts to a preventative health care fund in the Affordable Care Act. The same argument—over how to pay for the freeze—has stalled the Senate version of the bill.

House and Senate Republican leaders sent a letter yesterday to President Obama, asking him to work with Congress on this issue and suggesting four additional ways of offsetting the cost of the interest rate freeze. It is unlikely these proposals will satisfy the administration. We will continue to watch the debate closely.

The U.S. Public Interest Research Group Education Fund released a report this week about partnerships between financial organizations and colleges and universities to produce student IDs that may also function as debit or prepaid cards and be used to disburse financial aid.

The Campus Debit Card Trap claims these financial institutions control or influence federal financial aid disbursement to students through these arrangements and the ensuing swipe fees, inactivity fees and overdraft fees. A well-structured debit card program can provide benefits, the report points out. But many of the current programs provide little to no choice, while high fees can leave students in deeper debt, the report charges.

The report recommends colleges and policymakers take steps to ensure students have an unbiased choice of where to bank and that there are no fees charged to access financial aid. As you might remember, Congress addressed similar concerns about the relationship between credit card companies and students in 2009 with the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act.

Briefs from the plaintiff's side are now on file in Fisher v. University of Texas, which is on the U.S. Supreme Court docket this fall. The case deals with the consideration of race and ethnicity in admissions at the University of Texas at Austin (UT).

The case is on appeal from the Fifth U.S. Circuit Court of Appeals, which upheld a 2009 lower court ruling that UT did not infringe on the civil rights of two white students who were refused admission. Both lower court opinions noted that UT's plan closely follows the admissions process approved by the Supreme Court in 2003 in the University of Michigan affirmative action case, Grutter v. Bollinger.

There are 18 amicus briefs supporting the reversal of the Court of Appeals decision. ACE is preparing an amicus brief in support of UT and helping to organize other amici from the higher education community to endorse the continued importance of diversity and the use of race in compliance with the Grutter decision. Briefs supporting UT are due by Aug. 13.

Rep. David Rivera (R-FL) has introduced a Republican version of the DREAM Act, the legislation designed to give undocumented young people brought to the United States as children a path to higher education and citizenship.

The bill, dubbed the Studying Towards Adjusted Residency Status (STARS) Act, provides a 13-year path to "conditional non-immigrant status" for undocumented immigrants who 1) obtained a high school diploma or GED® test credential in the United States; 2) arrived in the U.S. before the age of 16; 3) maintained residence in the U.S. for at least the previous five consecutive years; 4) demonstrated "good moral conduct;" 5) have been admitted to an accredited 4-year institution of higher education in the United States; and 6) are 19 years of age or younger (with some limited exceptions).

The bill's prospects are unclear: The highly volatile issue of immigration reform is doubly so in an election year. We have some serious concerns about the legislation as it is now written, especially the exclusion of community college students. But it is an interesting move by the Florida Republican, who joins his colleague Sen. Marco Rubio (R-FL) in wading into DREAM Act territory (though Rubio has yet to introduce his bill). We will be watching the efforts of both legislators closely in the coming months.

The Departments of Defense, Veterans Affairs and Education, in conjunction with the Consumer Financial Protection Bureau and the Federal Trade Commission, will present two webinars to discuss the recent executive order on Establishing Principles of Excellence for Educational Institutions Serving Service Members, Veterans, Spouses, and Other Family Members.

The webinars will give college and university staff specific information on the implementation process as well as the opportunity to ask questions about the Executive Order. The departments will host two separate webinars:

June 7 from 2:00–3:30 p.m. EDT
https://www2.gotomeeting.com/register/257518258

June 8 from 11:00 a.m.–12:30 p.m. EDT
https://www2.gotomeeting.com/register/515780162

Please submit your questions in advance of the webinar, no later than noon, June 5, to MOSwebinars@militaryonesource.com.

For more on the executive order, see our summary memo.

The Senate Science and Technology Caucus is hosting a luncheon briefing, From Lab to Market: Technology Transfer at Universities and National Laboratories and How the U.S. Economy Benefits, on June 12.

The event is scheduled from 12:00-1:30 p.m. EDT at 208-209 Capitol Visitors Center (Senate side). The panelists will examine the history of technology transfer at universities and national laboratories and the similarities and differences in the laws that govern it, and also identify potential improvements to facilitate the transfer of ideas and technologies from laboratories to the marketplace.

Sens. Lamar Alexander (R-TN) and Mark Udall (D-CO), co-chairs of the Science and Technology Caucus, will give opening remarks. Panelists include Jim Turner, senior counsel for Innovation and Technology and director of Energy Programs for the Association of Public and Land-grant Universities; Todd Sherer, president of the Association of University Technology Managers; and Mike Paulus, technology transfer division director for Oak Ridge National Laboratory.

Please RSVP to Andy Shine by calling (202) 646-5023 or emailing shinea@battelle.org.

Molly Corbett Broad
President of ACE