Higher Education Opportunity Act of 2008

The Legislation:

The Higher Education Opportunity Act reauthorizes the Higher Education Act, increasing student aid and seeking to minimize tuition and cost increases at institutions of higher education. Efforts to keep tuition costs down include publishing tuition, graduation rates, and popular majors on a Department of Education website; and requiring that colleges with the greatest cost increases submit reports to the Secretary of Education explaining why costs have increased and what steps they will take to keep costs down. Additionally, the bill requires colleges to provide information about textbooks in their online course catalogues and prohibits the bundling of separate textbook materials.

The Act increases the maximum Federal Pell Grant, a need-based grant, from $4,731 in 2008 to $8,000 by 2014 and expands the program to accommodate year-round study, certificate programs, and part-time students. The TRIO and GEAR UP programs, which assist first-generation and at-risk students to progress towards degree achievement, are strengthened and funding for graduate student programs at Historically Black Colleges and Universities, at Hispanic Serving Institutions, and at Predominately Black Institutions is expanded. The bill includes measures to improve teacher preparation programs and to encourage high-quality teachers to teach in high-need schools. The legislation allows up to $10,000 in loan forgiveness for individuals working in areas of “national need”, such as early childhood educators, nurses, foreign language specialists, teachers working in low-income communities, public safety officers, and health care practitioners. A grant program to assist colleges design and implement sustainable practices is also created.

The Act introduces new regulations on the relationship between colleges and lenders in an effort to eliminate conflicts of interest, while prohibiting prepayment and repayment fees on student loans. Meanwhile, it eases a rule requiring for-profit schools to derive no more than 90% of their revenue from federal student aid funds.

The Higher Education Opportunity Act creates a simplified, 2-page Free Application for Federal Student Aid (FAFSA) form for low-income students and requires the current 7-page FAFSA to be phased out for all applicants in 5 years. The legislation also creates several pilot programs to investigate new ways of simplifying the financial aid application process.

The Act includes measures to expand access to higher education for military veterans and their families and for students with disabilities. Finally, the bill encourages institutions to curtail peer-to-peer file sharing.
The Middle-Class Position:

Middle Class Supports. Although a college education is increasingly a prerequisite for a middle-class standard of living, current and aspiring middle-class students and their families are struggling more than ever to afford college. Indeed, in recent years the maximum Pell Grant, designed to provide financially strapped students with an opportunity to attend college, has failed to keep pace with rising higher education costs. 2007’s College Cost Reduction and Access Act, which increased the maximum Pell Grant and limited federal subsidies to student lenders in order to increase college financial aid by $20 billion, was a necessary first step in making college more affordable. The Higher Education Opportunity Act’s additional increase of the maximum Pell grant will make college accessible to more aspiring middle-class Americans. Additionally, the expansion of the Pell Grant program to include year-round education supports the hardest-working students struggling to complete their educations quickly. Continued commitment to the TRIO and GEAR UP programs is critical to ensuring that first generation and at-risk students are able to obtain a college education and achieve a middle-class standard of living.

Skyrocketing tuition costs and large and confusing debt obligations can make college unaffordable and financial stability after college difficult. Indeed, the College Board reports that average tuition and fees at four-year public institutions have increased 51% over the last five years and that private undergraduate loans have grown from 3% to 12% of the funds used to finance postsecondary education since the 1996-1997 school year . The Higher Education Opportunity Act improves a student loan system that has been characterized by favoritism and murky lending practices. The Act will help put an end to the most egregious conflicts of interest and will expand and simplify the information that is available to students and their families when deciding what colleges to attend and what loans to take out. Ending such conflicts of interest will ensure that students receive the most affordable loans, not loans that are the favorites of an unethical financial aid officer. A simplified application form for federal student aid will ensure that students are not dissuaded from seeking financial assistance for higher education because of complex paperwork. Stricter reporting requirements for institutions that that fail to rein in tuition hikes are a positive step in influencing institutions of higher education to make college more affordable. Efforts to reduce the cost of textbooks will also be helpful to students struggling with high costs.
From the Experts:

“[The Higher Education Opportunity Act will] help increase college opportunity by strengthening the Pell Grant Program, our nation’s most successful college access program. This bill will increase the maximum authorized level for the Pell Grant to $9,000, charting a path to regaining the buying power of the maximum Pell award lost over the last thirty years. In addition the legislation allows students who have accelerated their studies to receive two Pell Grants in a calendar year, the so-called ‘Year Round Pell’ provision. Together these changes will help move this valuable program in the right direction.”

Source: themiddleclass.org