Dividing Lines Take Shape in Senate

WASHINGTON -- The U.S. Senate education committee got into the weeds of higher education policy again Thursday, examining how the federal government could open up innovation by colleges and universities.

But the biggest buzzword that emerged from a two-hour hearing -- “guardrails” -- signaled the focus of Democrats and expert witnesses on the quality protections that should come with opening up federal aid to nontraditional providers, as congressional Republicans have proposed doing. The tension over that specific issue reflects a larger divide between the parties that applies to many questions involved in an update of the Higher Education Act.

As senators hash out potentially ambitious reforms on key issues, Republican and Democratic members have followed a familiar call-and-response. GOP senators, led by committee chairman Lamar Alexander, a Tennessee Republican, have called for substantial changes to the way students apply for financial aid and the structure of the federal aid system, as well as restrictions on the programs that receive those funds.

Democrats, led by Washington Senator Patty Murray, have signaled general agreement with Republican goals, but with important caveats. Streamline grants and loans, yes, but only if the total amount of aid is preserved. Support innovation, too, but only if quality protections are put in place for students and taxpayers. Thus, the oft-repeated warnings about protections for students and taxpayers in Thursday’s hearing.

“Now, I know there will be a lot of discussion today around improving access to higher education and the role innovative models of education can play,” Murray said Thursday. “But we also need strong guardrails to hold all programs accountable for results -- ensuring students get high-quality instruction and the right support.”

The respective priorities of both senators point to possible areas of consensus on a reauthorization of the law governing postsecondary education. It also signals potential roadblocks for reaching a deal by the spring.

The hearing Thursday was the third on postsecondary issues since November and the second of the new year. The sudden flurry of activity signals Alexander's intention to move ahead with a reauthorization of the Higher Education Act after his party devoted much of the last year to multiple efforts to repeal the Affordable Care Act (which failed) and a $1.5 trillion tax plan (which passed).

While those bills were major Republican priorities pushed through without Democratic cooperation, Alexander has said he wants to produce bipartisan legislation. That would also differ from the approach to Higher Ed Act renewal in the House, where Republicans moved the PROSPER Act out of committee last month despite complaints from Democrats that they were shut out of the process. (Higher ed groups, too, have complained about lack of input, and a letter released Thursday from the Association of Public and Land-grant Universities said the bill would make college "less accessible and affordable.")

Alexander and Murray have a history of working together to pass legislation. One of the few legislative achievements in the second half of the Obama administration was an effort by the senators to pass a reauthorization of the K-12 No Child Left Behind law.

“The Senate has to act in a bipartisan manner. If it doesn’t have a reasonably bipartisan bill coming out of committee, it has a greatly reduced likelihood of getting a vote on the Senate floor,” said Terry Hartle, senior vice president for government relations and public affairs at the American Council on Education. “The key question is whether or not Senators Alexander and Murray can find common ground on dozens of complicated and occasionally intractable issues to move legislation forward.”

Both have offered broad outlines of their own priorities for reauthorization with a fair amount of overlap and some significant divergence. Alexander has said he sees a bipartisan focus on a less complex system that keeps the quality of a degree in mind.

“The consensus that I see emerging is student focused: simpler, more effective regulations to make it easier for students to pay for college and to pay back their loans; reducing red tape so administrators can spend more time and money on students; making sure a degree is worth the time and money students spend to earn it; and helping colleges keep students safe on campus,” Alexander said earlier this month.

Murray, for her part, has warned that streamlining can't be code for reducing the total amount of aid for students.

“We must acknowledge that simplification cannot mean elimination of aid -- especially as college costs continue to rise,” she said at an earlier hearing focused on the federal aid system. “We should be reducing the barriers facing students at every stage of financial aid: before they apply, while they are enrolled and after graduation.”

There is broad support for simplifying the Free Application for Federal Student Aid, which students must complete each year to qualify for federal grants and loans. Reshaping the way that aid is set up -- including eliminating some loans and collapsing multiple loans into one program -- will be more complex. But the most contentious work in a higher ed bill may involve opening up restrictions on higher ed providers.

There appears to be strong momentum for opening up Pell Grant eligibility for more short-term programs. Many online and for-profit providers could seize on that opportunity. But community colleges in particular may benefit from Pell for short-term programs, meaning traditional higher ed will likely be on board, albeit with an eye on quality controls. Higher ed groups will also want assurances that expanding Pell eligibility to additional programs won't mean taking money away from students at existing programs.

The committee focused most of its attention Thursday on expanding the role of competency-based education. One problem with that, flagged by witness testimony? There is still no federal definition of competency-based education.

Some discussions outside the hearing room have also centered around the institutional provider rule, which bars colleges from getting federal aid for programs that outsource more than 50 percent of content and instruction to an outside entity that’s not a higher ed institution. The Department of Education launched the EQUIP experimental site program in 2016 to study such partnerships, but that effort is still barely off the ground.

The PROSPER Act, the House's HEA update legislation, would allow colleges to partner with those outside providers to offer 100 percent of a program -- and receive the same amount of federal student aid.

“Particularly in the innovation space, there are a lot of very concerning developments that could happen way faster than we are prepared to take them,” said Clare McCann, deputy director for federal higher education policy at New America.

Advocates for innovation, though, say Congress must pass a law that acknowledges the reality of today’s students.

“The overall trend that colleges need to work more closely with nontraditional providers is only going to accelerate -- in large part because that’s already demonstrated in demand by students,” said Burck Smith, the CEO and founder of StraighterLine, an unaccredited online course provider that does not offer degrees itself but works with scores of partner colleges.

At least one more hearing -- on accountability issues -- is planned for the education committee. After that, the committee will likely move forward with sorting out a number of higher ed-related bills filed over the past two years for inclusion in comprehensive legislation. And they’ll attempt to reach some consensus on an assortment of issues.

Alexander is aiming for an April markup of the bill -- a somewhat optimistic goal that would allow Senate Majority Leader Mitch McConnell to bring legislation to the Senate floor in the first part of the year.

The committee may appear to be fully engaged in higher ed issues for the first time under the Trump administration. But the longer negotiations drag out, the tougher it may become to pass a bill this year. Vic Klatt, a principal at the Penn Hill Group and a former GOP education policy staffer in the House, said Alexander and Murray are facing a tight timeline for putting together a process to negotiate a bill.

“They’re discussing how to meet and what issues to talk about and all that kind of stuff,” he said. “If they’re going to get this done by this year, they need to figure it out real quick.”

Klatt said to have a chance of becoming law, a bill will likely have to make it out of the Senate in the next few months to begin what will likely be a tough conference negotiation with the House. If the process continues to drag out, there is a danger legislation could lose momentum as midterm election season heats up, he said.

“Not to say you can’t get it done, but boy, their window is shrinking by the day,” he said. “They really need to get moving if they want to get across the finish line.”