Republican Bill Aims To Hold Colleges Responsible for ‘Astronomical Student Loan Debt’

A Republican-backed bill aiming to hold colleges responsible for saddling students with crippling student loan debt is advancing in the House. The College Cost Reduction Act passed out of the Committee on Education and the Workforce at the end of January, and if passed by the House, would “hold institutions financially responsible for overpriced degrees that leave students with unaffordable debt.”The more than 200-page bill aims to ensure that colleges make information about the “costs and return on investment” of a degree clear and transparent to families, and would fund colleges based on student outcomes, the committee says. “We want to have the colleges and universities have some skin in the game on this issue,” the bill’s sponsor, Virginia Foxx, said in an interview with News Nation. The bill would ensure colleges communicate information about the cost, financial aid, chances of job in a degree, and how much value is added by having the degree compared to expenses, she said. “Many students fail to go on to college and develop their skills because of the high cost,” Ms. Foxx added. The average cost of tuition and fees for the 2023-2024 school year is $42,162 at private colleges, $23,630 for out-of-state students at public colleges and $10,662 for in-state residents, according to U.S. News and World Report data. Collective student loan debt in the United States, spanning some 43 million borrowers, totals more than $1.6 trillion — most of which is from federally guaranteed loans.The bill is part of efforts by the committee to reform and update the Higher Education Act of 1965, which governs federal student financial aid was signed into law by President Johnson. Democrats have criticized the bill as being rushed and an ineffective way to actually lower costs for students and families.“The details are murky and no thoughtful lawmaker should vote in favor without a more thorough discussion,” a Democrat representative from North Carolina, Kathy Manning, said, as reported by Inside Higher Ed. The American Council on Education says the bill is a “mix of positive and concerning provisions.” The bill aims to incentivize staying on track to graduate and choosing degrees that are considered to be a high return on investment by doubling the maximum Pell Grant awards for juniors and seniors who meet those standards, the council notes. It would also prevent interest from capitalizing on student loans, simplify the payment process, and contains a risk-sharing proposal that would hold schools accountable for loans that students don’t pay. The bill would also eliminate some programs that the council notes are “vital support for many low-income students.”“It would create a new value-added earnings metric that picks winners and losers based on what institutions charge per program relative to what students earn at their jobs after leaving the institution,” the council says.

Republican Bill Aims To Hold Colleges Responsible for ‘Astronomical Student Loan Debt’

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