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Three months ago, the U.S. Education Department caused a stir when it announced in August that it planned to hold a series of regional meetings with college officials and others this fall to decide which issues it might explore in a federal rule making process -- and, by the way, that it might use that process to carry out some of the recommendations of the Secretary's Commission on the Future of Higher Education.
Wednesday, as the department wrapped up the fourth and last of those public meeting at its headquarters in Washington, it seemed clear that its officials face a potentially big decision -- one that will almost certainly be influenced by the results of Tuesday's Congressional midterm elections.
The question comes down to this: Should the process known as "negotiated rule making" focus narrowly on carrying out the new grant and loan programs enacted last winter as part of the budget reconciliation act, or should it expand to include other priorities of the department or the Spellings commission, such as revamping accreditation or creating a student records database?
That question hung in the air even before Democrats seized control of the House of Representatives (with the Senate possibly to follow) in Tuesday's election, as some college officials and a bipartisan collection of members of Congress had warned the department that efforts to make policy through the regulatory process might well trample on Congressional authority.
The Democratic takeover seems likely to complicate the situation even further -- though in which direction is unclear, college lobbyists and other higher education officials say. Bush administration officials could conclude that they are unlikely to get many of their priorities through a Congress controlled in all or part by the Democrats, so they would be better off accomplishing whatever they can through regulation. Conversely, department officials could recognize that they are likely to have a relatively limited number of chits to use with the new Congress -- renewal and expansion of the No Child Left Behind law is their No. 1 priority for the coming year, for instance -- and opt not to pick a fight over this.
Negotiated rule making is designed to be the process by which federal agencies develop regulations to put into practice laws that Congress has passed. In this case, the Education Department is obligated to conduct negotiated rule making to carry out changes enacted in student aid and other programs as part of the budget reconciliation law that President Bush signed in February. The Higher Education Reconciliation Act created two new grant programs, the Academic Competitiveness Grants and the National Science and Mathematics Access to Retain Talent Grants, and also made numerous changes in student loan programs, and the rule making process the department announced in August is designed, at the least, to craft regulations to put those programs in place for the 2008-9 fiscal years and beyond.
The department's announcement that it was considering expanding the scope of the rule making process to include possible changes that may "result of the final report from the Secretary's Commission on the Future of Higher Education" troubled some college officials, who viewed it as a potential end-around Congress. Twelve members of the Senate's education committee made largely the same points in a September letter to Spellings, which expressed "concerns about including the commission recommendations in negotiated rule making. It added: “[T]he draft recommendations approved by a majority of the commission members are extremely broad and will likely require legislative action before they could be appropriately included in regulations,” the lawmakers wrote.
In the four regional hearings the department has held since September, its officials have heard from all sides. The hearings, including Wednesday's last one, have been dominated by students (organized by the U.S. Students Association and the Student Public Interest Research Groups) urging the department to use the rule making process to adopt a set of policies (the much-discussed "five-point plan") aimed at giving borrowers more options for repaying their student loans. Robert Shireman, who heads the Project on Student Debt, which has promoted the borrower repayment options, said he believes the department could embrace the new policies within the technical boundaries of the rule making process.
At Wednesday's public hearing, in addition to the students' often compelling stories of personal hardship, some speakers pushed hard for the department to take an expansive approach to rule making. Constantine W. Curris, president of the American Association of State Colleges and Universities, urged department officials to change its regulations -- without seeking Congressional approval -- to collect more and better information from colleges about how their students perform. "We believe that the department has the necessary authority to modify its current requirements for institutional reporting in this area, and still meet the narrow minimum requirements of the statute and regulations," Curris said.
Similarly, the U.S. Chamber of Commerce, which is representing a consortium of for-profit higher education companies including Capella University, Corinthian Colleges, DeVry and Kaplan, called for a "wide-ranging negotiated rule making that considers the recommendations in the commission's final report."
The business group argued that the department already has the authority, without additional approval from Congress, to expand reporting requirements on colleges, bar colleges from having policies that automatically reject the academic credits of students transferring from institutions based on the kind of accreditation they have, and revise federal policy that requires institutions to derive at least 10 percent of their revenues from sources other than federal student aid.
In their presentations at the hearing, meanwhile, representatives of some accrediting groups urged the department to keep its focus on the tasks immediately at hand -- rules to carry out the grant and loan programs -- and to put off other topics until after Congress has passed legislation to renew the Higher Education Act. That is unlikely to happen until some time next year, with the Democrats in charge and, in all likelihood, a bill that looks entirely different.