1. Federal POLICY UPDATE July 2018
Jee Hang Lee
Vice President of Public Policy and External Relations
Association of Community College Trustees

2. On the agenda for congress
Proposals for the reauthorization of the Higher Education Act
Funding for fiscal year 2019
Bipartisan plan to reauthorize the Perkins Career and Technical Education Act
Addressing DACA
Mid-term elections

3. Congress and HEA reauthorization
In December, H.R. 4508, the PROSPER Act was introduced in the House of Representatives by the Chairwoman of the House Committee on Education and the Workforce, Virginia Foxx (R-NC)
The PROSPER Act was marked up by the full-committee in December, and passed out of committee on a party-line vote.
Chairwoman Foxx wants a floor vote, but has not been able to garner enough support from her caucus.
Senate work on HEA reauthorization has stalled. Bipartisan negotiations are no longer happening. May, or may not see additional piece meal bills introduced.
House Dems plan to introduce their own comprehensive bill.

4. PROSPER ACT
“Reforming” the HEA, Not Merely Reauthorizing - Rep. Foxx Believes HEA is Failing
Emphasis on Meeting Current Workforce Needs/Skills Gap
Program Simplification and Streamlining
Tilt Towards Newer Providers, Away from Traditional Higher Education
Benefits for Borrowers Scaled Back

5. PROSPER ACT – Risk Sharing and r2t4
The bill implements risk sharing by modifying the requirements under Return of Title IV Funds (R2T4).
Presently, if a student completes less than 60 percent of their coursework then a proportion of aid must be returned based on when the student withdrew. If the student completes more than 60 percent, the institution and student may keep the aid.
It is the responsibility of the student to repay the necessary portion of aid that was disbursed to them.
The House bill shifts the onus of repaying R2T4 funds onto the institution with the student responsible for up to 10 percent of the amount owed.

6. Return to Title IV (R2T4) Formula

7. PROSPER ACT – Replacement for CDR
New Accountability Metric - Programmatic Repayment Rates
Would replace institutional Cohort Default Rates (CDRs).
Programs that have repayment rates of less than 45% for three consecutive years lose eligibility
Student is counted as being in repayment if less than 90 days delinquent.
Impact of this proposal is difficult to assess. Some programs would be eliminated.
Requires substantial data collection and analysis. ED’s Inspector General cited this proposal as ‘nearly impossible to successfully implement.’

8. PROSPER ACT – Pell Grants
Short-Term Training Programs - The threshold for Pell eligible programs is lowered from 600 clock hours to 300 clock hours, or a minimum of 8 semester hours over 10 weeks.
Pell Bonus - The bill creates a new bonus for Pell eligible students who are on track to complete 30 credits. Those students will be eligible for up to $300 in additional funds.
 Ability to Benefit - The proposal further reinstates Title IV eligibility for students who would qualify under ‘Ability to Benefit.’ These are students who do not have a high school diploma or equivalent, but have demonstrated their ability to benefit from postsecondary education.  
Competency-Based Education (CBE) Programs - The bill allows for certain CBE programs to be eligible for Title IV aid.
90/10 – The bill repeals regulations that require proprietary institutions to receive at least 10 percent of their revenue from sources other than Title IV aid.
No Increase to Pell Grant Maximum and No Second Chance Pell

9. PROSPER ACT – less support for college and students
Elimination of Title III-A, Strengthening Institutions program – Currently funded at $99 million
Elimination of Supplemental Educational Opportunity grants - Currently funded at $840 million
Creation of a new apprenticeship grant under a new Title II – Authorized at $183 million
Increased authorization for Federal Work Study – Proposed Increase of $700 million (currently funded at $1 billion)
Elimination of Public Service Loan Forgiveness – loss of $25 billion over 10 years
Changes to Repayment Plans (eliminating forgiveness and requiring higher payments) – loss of $15 billion over 10 years
Elimination of Loan Origination Fees – increased cost of $14.5 billion over 10 years
Elimination of Subsidized Loans – loss of at least $18 billion

10. Appropriations Update
Congress is working on funding for fiscal year (FY) 2019 at a faster pace than recent years.
House and Senate have both held full-committee markups of their FY 2019 Labor, Health and Human Services, and Education (LHHS-ED) funding bills.
Do no expect large-scale increases in FY 2019.
House bill increases funding for Perkins CTE and TRIO.
Senate bill includes a $100 increase to the Pell Grant maximum (and a $600 million cut to the Pell surplus), and an increase in funding for Adult Basic Education state grants.
Bills may be brought to the floor as mini-buses.

11. CTE Update
Senate Committee on Health, Education, Labor, and Pensions marked up a bipartisan Perkins CTE reauthorization bill in June.
Bill focuses on greater flexibility for training providers to respond to industry need.
Keeps funding formulas largely in place.
Accountability metrics better align with WIOA.
More authority given to states.
Senate bill has many similarities to bipartisan CTE bill passed by the House.
Momentum behind completing reauthorization in 2018.
Senate recently confirmed Scott Stump, for assistant secretary for career, technical and adult education.

12. DACA Update
Moderate House Republicans attempted to force a vote on immigration bills earlier this summer, including the Dream Act.
Instead House leadership brought for two partisan bills that failed to pass.
DACA renewals still possible due to court intervention, but no new applicants.
Congress unlikely to address DACA before elections.

13. Mid-Term Elections

14. QUESTIONS?