Legislative Update: President’s Proposal for College Affordability

President’s College Affordability Tour

CapitolIn recent years, the costs of higher education in the United States have risen more quickly than any other sector of our economy. According to the Department of Labor, college tuition and fees have increased by a staggering 538% since 1985. In an effort to combat these alarming trends, President Obama recently embarked on a two-day college affordability bus tour which concluded last week.

The President’s proposal would tie federal financial aid to school performance through a new college ratings system. Institutions would be ranked based on factors such as average tuition, loan debt, and graduation rates. Student outcomes after graduation have also been a point of emphasis for the proposed ratings system, although it is unclear how these indicators would be measured. As the President summed up, “Colleges that keep their tuition down and are providing high-quality education are the ones that are going to see their taxpayer funding go up.”

President Obama’s new proposal for higher education urges states to fund public universities and colleges based on similar measures. His new plan would also increase accountability for both students and colleges by linking continued federal financial aid to progress made towards a degree.

Changes to how higher education is paid for and the measures used for accountability have implications for Career Technical Education (CTE) programs particularly at the postsecondary level. The Administration’s emphasis on more affordable, high quality education and stronger outcomes will likely highlight the important role CTE programs have in preparing students to close the skills gap and fulfill the pressing needs of the American economy.

The President’s full speech can be found here and a summary of his plan can be found here. The new rankings system will not be fully available until 2015, but the Department of Education’s College Affordability and Transparency Center has released a College Scorecard similar to President Obama’s proposal.

Boehner to Introduce Short-Term Continuing Resolution

When regular appropriations acts are not enacted by the start of a new fiscal year, Congress must pass what is known as a continuing resolution (CR) to fund Federal agencies and programs. Current legislation funds the federal government only through September 30th with a new fiscal year beginning on the first of October. If Congress fails to pass a CR to fund the government in the short to near-term, the Federal government will cease all non-essential functions until an appropriations bill is signed into law. Failure to pass a CR before October 1st would result in what is known as a government shutdown.

Last week, Speaker of the House John Boehner (R-OH) confirmed plans to “move quickly on a short-term continuing resolution [CR] that keeps the government running and maintains current sequester spending levels.” The length of this CR has not yet been announced. However, a clearer outline should emerge when Congress comes back in session on September 9th.

Additionally, Congress is still grappling with the impending need to raise the debt ceiling. This past Monday, the Treasury Department announced that it expects the federal government to reach its statutory debt limit by mid-October. This is a legislative restriction on the amount of money the Treasury Department is allowed to borrow to pay for existing legal obligations such as Medicare, Social Security, military salaries, interest on the national debt, and other such payments. Failure to raise the debt ceiling would force the federal government to default on these legal obligations— an unprecedented move that would have “catastrophic economic consequences,” according the Treasury Department.

It is also important to note that the new fiscal year will coincide with the scheduled opening of the Affordable Care Act’s (ACA) mandated insurance exchanges. Certain elements in Congress are seeking to defund these exchanges, along with the rest of the ACA, by linking their support for raising the debt ceiling and a short-term CR to ACA’s funding. Congressional willingness to fund these exchanges, along with the rest of the healthcare law, may adversely impact the passage of a short-term CR and the need to raise the debt ceiling in October.

These two issues will likely consume the majority of Congressional time and energy during September and well into October. Compromise will be crucial to finding a solution to these fiscal and budgetary disagreements. In the coming weeks, negotiations between both parties will have significant implications for the functionality and day-to-day operations of the federal government.

Steve Voytek, Government Relations Associate


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