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Congress Ends Fiscal Impasse, But Fights Loom for Higher Ed Funding

WASHINGTON -- Congress passed legislation Wednesday night to re-open the federal government and increase the nation’s borrowing authority to avoid a default on its obligations.

Lawmakers voted to fund the government at the same level as this year through mid-January, ending a 16-day shutdown that, among other things, halted military tuition assistance and stalled a wide range of academic research.

But the measure keeps intact the automatic government spending cuts for the current fiscal year, known as sequestration, at least through January 15. Higher education advocates have blasted those cuts as detrimental to scientific research. The cuts, which took effect in March, have already reduced federal research funding by billions of dollars and prompted universities to lay off researchers and close laboratories.

Funding levels for federal research and federal student aid programs will be at stake in the budget negotiations between the House and Senate this fall, which will occur because of the deal reached Wednesday night. Those negotiations, which are also aimed at producing a long-term agreement to reduce the budget deficit, will be led by Democratic Senator Patty Murray of Washington and Republican Representative Paul Ryan of Wisconsin. 

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Problems plague servicing of private student loans, CFPB says

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Borrowers of student loans face obstacles not only when they seek flexibility from private lenders in reducing their monthly obligations but also when they seek to pay down their debt more quickly, a new CFPB report says. 

After nearly 15 years, Education Dept. revives fines against two institutions

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The Education Department has revived cases against two universities involving minor violations of student aid rules -- from the mid-1990s. College lobbyists cite them as the epitome of inefficiency.

Citing Shutdown, U.S. Cancels Gainful Employment Negotiating Session

The U.S. Education Department, citing the partial shutdown of the federal government, has canceled the second round of negotiations over regulations on vocational programs at community colleges and for-profit institutions.  

The department will reschedule the negotiated-rulemaking session when the government reopens, Lynn Mahaffie, the acting deputy assistant secretary for policy, planning and innovation, wrote in a letter on Friday to members of the rule making committee. The session was originally slated for October 21-23.

The panel is tasked with rewriting the "gainful employment" regulations that were thrown out by a federal judge earlier this year. The rules would cut off federal money flowing to career-training programs if they do not meet certain standards that measure their graduates’ earnings relative to the graduates’ student loan debt.

The Obama administration is proposing tighter standards that would apply to more vocational programs. At the first negotiating session last month, it appeared unlikely that negotiators would come to a consensus on the rules. Even if the committee doesn’t reach an agreement, the Education Department could still move forward with its own proposal. 

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Suspension of military education benefits forces some students to drop out

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The suspension of tuition assistance for active-duty service members during the shutdown is jeopardizing their academic progress and forcing some to withdraw from classes.

Education Groups Oppose 'Pay It Forward'

The "Pay It Forward" concept -- in which students would not pay tuition to attend public colleges, but would pay a share of their salaries after graduation -- has attracted considerable attention in recent months. But a coalition of education groups issued a statement Friday opposing the idea. The group's analysis says that such plans would increase the cost of higher education, do nothing about the "state disinvestment" in higher education and create the wrong incentives for public colleges. For example, the groups say that public colleges would have an incentive to build up programs likely to attract students who will earn the most money after graduation, which may not be the most important programs for a state or its higher education system. "We are heartened that state lawmakers are taking the student debt crisis seriously and are seeking solutions. However, these solutions need to actively attack, not obscure, the root cause of rising student costs and debt -- declining state investment in high quality public higher education. Pay It Forward moves us in the wrong direction," the statement concludes.

The groups that signed were: American Association of State Colleges and Universities, American Association of University Professors, AFL-CIO, American Federation of Teachers, Colorado Student Power Alliance, Education Trust, Jobs With Justice, National Education Association, Student Labor Action Project (and University of Oregon Student Labor Action Project) and the Institute for College Access and Success.

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Website for First-Generation College Students

The Center for Student Opportunity has begun a campaign called "I'm First" that is aimed at first-generation college students. The nonprofit group, with support from the Bill and Melinda Gates Foundation, created a website inspired by Dan Savage's "It Gets Better" videos. The site includes testimonial videos featuring first-generation graduates, as well as tips and guidance about how to navigate college.

Government Shutdown Stalls Military Education Benefits

The Department of Defense has suspended a program that provides members of the military with money to attend college because of the federal government shutdown. Branches of the armed forces will not authorize tuition assistance for new classes during a government shutdown, a Pentagon official wrote in a blog post this week.

In addition to rejecting new requests for the benefits, the Army said in a statement that it could not process some existing requests that were received before the shutdown began on October 1.

The Department of Veterans Affairs, meanwhile, said it is continuing to process veterans’ education benefits, but that could stop if the shutdown drags on longer than several weeks. The agency has already closed its education call center because of the shutdown. 

Consumer bureau issues initial findings on college debit card deals

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Arrangements between colleges and financial institutions that provide services to students may mirror problems with private student loans and predatory credit card marketing on campuses, U.S. consumer agency says. 

Student loan defaults hit highest level since 1995

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The latest snapshot of defaults on federal student loans shows that one in ten borrowers are defaulting within two years and nearly 15 percent are defaulting within three years. 

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