Higher Education Act

The Higher Education Act (HEA) is a federal law that governs the administration of federal higher education programs. Its purpose is to strengthen the educational resources of our colleges and universities and to provide financial assistance for students in postsecondary and higher education.

First passed in 1965 to ensure that every individual has access to higher education, regardless of income or zip code, the HEA governs student-aid programs, federal aid to colleges, and oversight of teacher preparation programs. It is generally scheduled for reauthorization by Congress every five years to encourage growth and change.

The HEA has been reauthorized in 1968, 1972, 1976, 1980, 1986, 1992, 1998, and 2008. Current authorization for the programs in the Higher Education Act expired at the end of 2013, but has been extended while Congress prepares changes and amendments.
Capitol

Latest Actions

Efforts to update the Higher Education Act stalled as the COVID-19 pandemic put Congressional discussions on hold. Prior to the outbreak, lawmakers were reportedly close to reaching a deal after years of failure. As the new 117th Congress convenes, there is hope that negotiations will resume.

HEA in the 116th Congress

  • Senate Action

    U.S. Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Lamar Alexander (R-TN) in September 2019 introduced a piecemeal approach to update the Higher Education Act in the 116th Congress (2019-2020). The Student Aid Improvement Act, S. 2557, includes eight bipartisan bills to streamline the Federal Application for Student Aid (FAFSA), simplify financial aid award letters, expand Pell Grant eligibility for students in prisons and allow Pell to be used for short-term programs, among other changes.

    The proposal follows months of stalled efforts to reach a bipartisan deal for a comprehensive HEA reauthorization and illustrates Sen. Alexander's urgency to pass major higher education legislation before he retires after next year. However, Senator Patty Murray (D-WA), ranking member on the HELP committee, and Representative Bobby Scott (D-VA), chairman of the House education committee, have repeatedly stated that they are not interested in passing legislation that falls short of a comprehensive HEA update.

    SENATE PRESS RELEASE   BILL TEXT

  • House Action

    Democrats on the U.S. House Education and Labor Committee in October 2019 unveiled a sweeping overhaul of the federal higher education law, aiming to cut the cost of college and increase access to college for low-income and minority students. The College Affordability Act would update the Higher Education Act for the first time in more than a decade at an estimated cost of $400 billion over 10 years.

    The legislation would:

    • Include the Reverse Transfer Efficiency Act, which AACRAO strongly supports and has advocated for over the past several years
    • Create a national tuition-free community college through a federal-state partnership model where the federal government contributes a per student amount at least 75 percent of the average resident tuition for public community colleges and states contribute 25 percent
    • Increase the maximum Pell Grant award by $500 and permanently index the award to inflation
    • Simplify FAFSA, including an automatic zero EFC for recipients of means-tested benefits
    • Create the Federal Direct Perkins Loan Program to provide an additional source of borrowing for undergraduates and graduates
    • Allow Deferred Action for Childhood Arrivals (DACA) and certain other undocumented students access to federal student aid
    • Repeal the federal "student unit record" ban and require the Education Department to develop a system that uses student-level data to evaluate postsecondary outcomes
    • Change the 90/10 rule ratio (the percentage cap of Title IV aid an institution may receive) to 85/15 and expand it to include all educational programs
    • Require the Education Department to establish a Borrower Defense to Repayment process to discharge the federal loans of students who were defrauded by their colleges
    • Require the Education Department to establish a compliance standard that includes a debt-to-earnings threshold for training programs that are statutorily required to lead to gainful employment
    • Prohibit the Education Department from issuing or enforcing the proposed Title IX rules that the Trump administration published in November 2018, among other things.
     

    The College Affordability Act shares some key provisions with U.S. Senate Lamar Alexander's package of bipartisan bills. Both proposals would streamline FAFSA, simplify financial aid award letters, and expand Pell eligibility for incarcerated students and short-term programs—although the House bill excludes for-profit colleges.

    However, the House measure did not gain any traction in the Republican-controlled Senate or from the Trump administration.

    HOUSE PRESS RELEASE BILL TEXT OVERVIEW OF COLLEGE AFFORDABILITY ACT

     

UPDATES


STATEMENTS/LETTERS

EXECUTIVE DIRECTOR UPDATE(S)

House Republicans Unveil Bill to Reauthorize HEA

December 7, 2017
  • President and Executive Director Updates

House Republicans on Friday released a sweeping bill to reauthorize the Higher Education Act (HEA). The law, first enacted in 1965 and last reauthorized in 2008, governs federal higher education programs. Last week's proposal marks the first movement on reauthorizing the landmark legislation since the House passed a set of piecemeal measures several years ago.

The Promoting Real Opportunity, Success, and Prosperity through Education Reform (PROSPER) Act would:

  • Overhaul federal student loans to a "one grant, one loan, one work-study" system
  • Streamline income-based repayment plans to one program, as well
  • Simplify the Free Application for Federal Student Aid (FAFSA)
  • codify the use of prior-prior year (PPY) income data for the FAFSA
  • Create a "consumer-tested, mobile-friendly" FAFSA
  • Eliminate loan origination fees
  • Provide a bonus to Pell Grant recipients to incentivize completion
  • Allow institutions the authority to limit borrowing
  • Maintain the ban on a federal unit-record system
  • Codify the Trump administration's interim guidance on Title IX and campus sexual assault
  • Tie Title III and Title V funds for minority-serving institutions to their ability to graduate or transfer 25 percent of their students
  • Eliminate the Public Service Loan Forgiveness program
  • Eliminate the Federal Supplemental Educational Opportunity Grant program
  • Eliminate the 90-10 rule that prevents for-profits from getting more than 90 percent of their total revenue from federal student aid programs
  • Repeal the "gainful employment" regulations that seek to cut off federal funding to career college programs that produce graduates with large debt loads and
  • Repeal the borrower's defense to repayment regulations that provide debt relief to defrauded student loan borrowers
  • Repeal the state authorization rule for distance education programs.

Beyond that, the legislation would actually prohibit any future Secretary of Education from promulgating any new regulations related to gainful employment, definition of a credit hour, or from creating an institutional ratings system—even though the Obama administration’s attempt to do so was unsuccessful.

The proposed measure would also replace the cohort default rate metric (CDR) with a program-level repayment rate metric. Programs with three-year repayment rates below 45 percent would lose access to federal student aid.

Short summary of the PROSPER Act

Full section-by-section summary of the PROSPER Act

Bill Text

While we believe the legislation includes some practical proposals, we are concerned that other provisions would negatively impact institutions, students, and college affordability.

On the Senate side, the chamber's education committee held a hearing last week to discuss proposals to simplify the Free Application for Federal Student Aid (FAFSA). Sen. Lamar Alexander (R-TN), chairman of the panel, announced that the committee's first order of business in the new year would be to mark up its own version of legislation to reauthorize the HEA. Both Democrats and Republicans in the Senate expressed their willingness to develop bipartisan legislation.

HEA Reauthorization has become an increasingly difficult task over the years. In the early years, lawmakers routinely renewed the act every four years. The most recent reauthorization, in 2008, was the first in 10 years. And the latest attempt will have taken at least that long by the time it is finalized, with each renewal more complex and complicated than the last. The now law governs the billions of dollars allocated to federal student aid programs, millions of dollars of institutional aid, as well as tackling issues related to accreditation, Title IX enforcement, and campus crime reporting, among many others.

As the reauthorization process moves forward, AACRAO will continue to closely monitor any developments and seek ways to work with Members of Congress, from both sides of the aisle, to ensure that important programs and policies that promote student and institutional success continue to be supported.

-Mike

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