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Updated 10:00 AM April 10, 2006




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House reauthorization bill better, but still hurts higher ed

The U.S. House of Representatives passed its version of the Higher Education Act (HEA) reauthorization bill March 30. The final bill contained a number of improvements to provisions of great concern to the University and the higher education community that were included in the committee-passed version.

In the end, however, the University did not support the bill because it did little to address the important issues related to improving student access, especially in combination with the very dramatic changes enacted in the budget reconciliation bill earlier this year.

Improvements included softening the college costs provisions and those requiring schools to make their transfer-of-credit policies more lenient. Also the final bill did not include the original language that would have changed the formula for redistributing funds from the campus-based aid programs, which over the long term would have decreased U-M's share in these programs.

The reconciliation bill included a net cut of $12 billion dollars from the student loan programs. It also froze the maximum Pell Grant level at $4,050 for the fifth year, raised student loan interest rates—currently at a variable rate below 5 percent—to a fixed 6.8 percent and PLUS (Parent Loans for Undergraduate Students) would increase from 7.9 percent to 8.5 percent. The legislation still includes some troubling provisions regarding college costs, extensive fire safety reporting and establishment of an International Education Program Advisory Board, which also would have investigative powers and would not be accountable to either the Secretary of Education or Congress.

The issue on college costs was improved, but still is problematic. The bill requires the top 5 percent of colleges that are deemed to have raised their tuition excessively during a three-year period—determined by a "College Cost Affordability Index"—to create quality-efficiency task forces made up of administrators, professors, alumni, students and others to identify areas of the institution that are appropriate targets for cost reduction.

Focus now shifts to the Senate, which will revisit its version of the HEA bill and then on to the Senate-House conference. The University will continue to encourage the Michigan delegation to support the development of a final reauthorization bill that will serve the needs of students, and will avoid inappropriate governmental interference in the operations of higher education institutions.

For more information, contact Cindy Bank at or (202) 554-0578.

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