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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.

Work in Washington Slowly Ramps Up

October 21-25, 2013 ~ Vol. 14, No. 34

  • Work in Washington Slowly Ramps Up 
  • College Board Reports Find Slight Slowdown in Tuition Increases, Grant Aid Not Keeping Up​

The federal government continued to spring back to life this week, with the House in session (the Senate will return Monday) and all eyes focused on making it through the coming weeks until the next budget deadline. 

For the first time since the government shutdown ended, all 29 members of the budget conference committee will meet next Wednesday, Oct. 30. As part of the deal struck to reopen the government and raise the debt ceiling last week, the House-Senate committee is required to produce a report by Dec. 13. Meanwhile, the Department of Education (ED) has rescheduled the second session of its negotiations over possible new regulations on gainful employment. The rulemaking session, which was postponed during the shutdown, is now set for Nov. 18-20. The administration also might soon name a replacement for Under Secretary of Education Martha J. Kanter, who announced in August she would leave the post this fall. Former Occidental College (CA) President Ted Mitchell reportedly is under consideration.

In other news this week, the College Board Wednesday released its annual reports on student aid and college costs, and the picture appears mixed. 

The average sticker price at U.S. public four-year institutions rose 2.9 percent for 2013-14, the smallest annual increase in more than three decades, according to Trends in College Pricing. This comes after increases of 4.5 percent last year and 8.5 percent the year before. Tuition at private nonprofit four-year colleges increased 3.8 percent, slightly lower than in recent years. The 3.5 percent increase for public two-year colleges, which is just $110, is typical over the long run, but the smallest gain since 2007-08.

Unfortunately, the companion report—Trends in Student Aid—found the tuition increase slowdown was accompanied by a decline in federal grant aid. Between 2007-08 and 2010-11, the net prices paid by many students were held down by large boosts in grant aid and tax benefits, particularly from the federal government, even though published prices were growing rapidly over the same period. However, between 2010-11 and 2012-13, federal grant aid fell, according to the report. While grants per student from other sources increased, net prices rose. Meanwhile, family incomes have not recovered from the recession. Institutions are committed to holding down costs, but it is equally important for state and federal governments to play their part to make college affordable.

The issue of college costs—long of great interest in Washington—promises to play a prominent role in the upcoming reauthorization of the Higher Education Act, as well as in continuing discussions of President Obama’s college affordability proposals. We have a number of free publications on college costs and student aid available to help you plan your response to these debates, including:

Paying for College (Oct. 15, 2013) 
This report summarizes how students and their families apply for and receive Title IV student aid and outlines what institutions must do to participate in the federal programs. 

Does Federal Financial Aid Drive Up College Prices? (May 13, 2013) 
Donald Heller, dean of the College of Education at Michigan State University, gives a brief overview of federal financial aid programs, recent trends in tuition, and the economic theory behind financial aid and tuition, and then reviews some of the major interpretations of the so-called Bennett Hypothesis advanced over the years. 

Putting College Costs Into Context (April 5, 2012) 
The paper looks at why college prices are rising and what higher education institutions are doing to contain costs. 

The Anatomy of College Tuition (April 5, 2012) 
A report by Robert B. Archibald and David H. Feldman based on their book, Why Does College Cost So Much?, explores an economic framework for the forces driving college tuition. 

Molly Corbett Broad
President of ACE​