NCAN Member Testifies at Senate Hearing on Aid Simplification
Thursday, January 18, 2018
Posted by: Carrie Warick, Director of Policy and Advocacy
Today, the Senate Health, Education, Labor, and Pensions Committee held a hearing on Higher Education Act reauthorization focused on two primary topics: the information students need to understand the cost of college through graduation, and how to simplify federal financial aid programs to help support that understanding. Witnesses included Laura Keane, chief policy officer at NCAN member uAspire, a community college president, a legal advocate, and two researchers.
In practical terms, the hearing focused on financial aid award letters, student loan repayment and whether the federal government should move to a “one grant, one loan” program. The latter proposal usually means preserving the Pell Grant program and moving to a loan program that offers one unsubsidized undergraduate loan, a graduate loan, and a parent loan. Supplementary Educational Opportunity Grants, subsidized loans, and Perkins loans would all be eliminated. Federal Work-Study would be preserved. Not all witnesses agreed on how to move forward with one grant, one loan, but there was a resonating theme that this move to simplification cannot result in fewer dollars for students.
Today’s conversation was a productive step in that all of the senators present – 16 of 21 committee members – appeared to agree that the current system is too complicated and something needs to be done. Whether they agree on a solution remains to be seen. Sen. Patty Murray, ranking member on the Committee from the state of Washington, focused her opening and closing remarks on having a student-centric law and expressed her concerns about whether the current administration would appropriately implement a new law.
NCAN will continue to support policy changes that promote better information for students and a simpler process while insisting that the total dollar amount of financial aid cannot be decreased in the name of simplification. The next version of the Higher Education Act must address both our complicated system AND the affordability struggles that our students face. In his closing remarks, Alexander acknowledged this point, saying they had heard the message loud and clear that simple doesn’t mean fewer dollars.
Sen. Lamar Alexander greets Laura Keane at the hearing. (Photo courtesy of uAspire)
Keane, of uAspire, told a story of a student, Ella, that perfectly illustrates why every dollar counts in piecing together financial aid. Ella received a state scholarship to attend her late father’s alma mater. Upon arriving to campus, the indirect costs of higher education, such as textbooks, burdened Ella despite the fact that she was employed while at school. When Ella lacked sufficient funds to pay for her textbooks, her grades suffered, and she lost her academic performance-based scholarship. Keane drove home this point by saying, “Now she has debt and no degree.”
In her testimony, Keane emphasized the key phases through which we can best serve students: when they're choosing an affordable college, matriculating to college, and attending college. She focused her oral testimony on the before and after of the financial aid award letter process, underscoring the need for FAFSA simplification to reduce summer melt. Keane noted research (previewed here) uAspire is doing with New America to analyze student aid award letters, including the jaw-dropping statistic that of 454 letters, the Federal Direct Unsubsidized Loan was referred to 143 unique ways, including 26 that didn’t use the word “loan.” Keane’s full remarks submitted to the committee discussed the need for additional counseling during the summer and annual loan counseling once a student is enrolled. Read uAspire’s write-up on Keane's testimony here.
"Equity needs to be at the core of how simplification occurs to ensure that those who need [aid] most get what they need," she said.
Four other panelists joined Keane to round out the discussion from multiple perspectives:
Russell Lowery-Hart, president of Amarillo College in Texas, discussed the post-traditional student, who is most likely female, in her mid-20s, and has a child or other family members to support. He explained how many students can receive a full Pell Grant, maximize their federal student loans, work two jobs, and still be unable to afford their full costs of college, which include not only tuition and fees, but books, rent, food, transportation and child care.
Joanna Darcus, Massachusetts Legal Assistance Corporation racial justice fellow for the National Consumer Law Center, focused her testimony on student loan repayment and the supports that students need throughout that process to better understand it. She also called for regulations and oversight when Federal Student Aid or its loan servicers are not doing their job well.
Matthew Chingos, director of the Education Policy Program at the Urban Institute, shared data on the burden debt places on students and how our system makes it harder for those students to repay their debt. He recommended moving to a one grant, one loan program where the savings from the new one-loan program are redirected into upfront support through investment and expansion in the Pell Grant program. He also recommended a vastly different income-based repayment program that would automatically fluctuate based on earnings.
Susan Dynarksi, professor of public policy in education and economics at the University of Michigan, spoke about student debt levels in other countries such as Australia and Great Britain. She noted that the United States is not unique for its average level of debt per student but for the rate at which students here default on that debt. No other country has a repayment window nearly as short as 10 years.
The committee has already announced its next hearing for Wednesday, Jan. 25, which will focus on access and innovation at the institutional level. NCAN will continue to report back to members on these hearings and will respond to Senate offices as needed.
Advocacy Associate Jack Porter contributed to this report.