The Democratic Alternative

Just in time for midterm election season, Democrats in the House of Representatives on Tuesday released details of a comprehensive higher education bill they say will ensure every student has the chance to get a postsecondary education without debt.

The bill has no chance of passage with Republicans in control of Congress and the White House. But Democrats plan to contrast the proposals in the bill with GOP legislation to overhaul the Higher Education Act. And the bill signals where Democrats might go on higher ed policy if they regain control of the House of Representatives in the fall.

The GOP bill, the PROSPER Act, eliminated regulations on for-profit colleges, would have dropped benefits for student borrowers like Public Service Loan Forgiveness and streamlined other student aid programs.

The Democrats’ bill is almost a point-by-point rejection of PROSPER, making current accountability rules tougher and directing new federal funds to student aid and programs for college readiness and completion. Virginia Democrat Bobby Scott, the ranking Democrat on the House education committee, said the legislation stands in stark contrast to the PROSPER Act.

“Every person deserves the economic mobility and personal growth that comes with higher education, and that’s what the Aim Higher Act provides,” Scott said Tuesday while introducing the bill.

But Aim Higher is also more modest than other recent higher ed proposals from Democrats in Congress. Senator Bernie Sanders, a Vermont Independent, last year along with several Democratic co-sponsors introduced a bill to make tuition free at public two- and four-year institutions. Legislation authored by Senator Brian Schatz, a Hawaii Democrat, would go even further by tackling the costs associated with attending college.

Like those proposals, Aim Higher includes a federal-state partnership to incentivize states to spend more on higher education. The provision would require states to make public two-year college free for every student -- a departure from the Sanders and Schatz bills. While Sanders and Schatz pitched their legislation as "free college" or "debt-free college" bills, committee staff said Aim Higher would offer an opportunity toward a debt free postsecondary degree or credential through free two-year college, more campus-based aid, and a stronger Pell Grant. 

The bill would boost the maximum Pell Grant (currently set at $6,095 for the 2018-19 award year) by $500 and index the value of the grant in future years to inflation. Additionally, it would shift the majority of Pell funds to mandatory spending, making support for the program more stable.

Aim Higher would also overhaul the funding allocation for the federal Supplemental Educational Opportunity Grant to better direct the program to institutions with the most unmet need.

Mark Huelsman, a senior policy analyst at the think tank Demos, which is credited with helping to advance the movement for free college nationally, said the bill was a step in the right direction. But he said now is the time for Democrats to offer a much more bold vision of an endgame for higher education.

“Democrats should start with that vision in mind rather than a laundry list of small tweaks to the system,” he said. “You’re not in a moment where you’re haggling over appropriations or over a budget. The bill is supposed to lay out a vision of what the federal role in higher education should be.”

Student aid advocates have called for dramatically increasing the value of the Pell Grant to eventually cover 50 percent of the cost of attending a four-year public university. Aim Higher falls well short of that.

Huelsman noted that House Democrats had adopted the language of debt-free college.

“It sort of shows how the debate has shifted,” he said.

Other progressives agreed that the bill shows how the Democrats’ message on affordability is changing.

“I’m glad the committee is explicitly setting debt-free college as a goal,” said Maggie Thompson, executive director of Generation Progress, which backs progressive policies at the national and state level. “I don’t know that they’ve ever leaned in this much on the idea of debt-free education as a value of the caucus and something we’re going to move towards.”

Democrats did not offer details about the projected cost of the bill -- a Congressional Budget Office score is expected sometime next month -- and actual legislative language has not yet been released.

Even if many liberals and progressives won’t think the bill goes far enough, it sets up a clear narrative about the party’s approach to higher education compared to Republicans heading into the midterm elections, said Lanae Erickson Hatalsky, vice president for social policy and politics at Third Way, a center-left think tank.

“It makes it pretty easy to say to voters that there’s a contrast here and we want to spend more money on higher education,” she said.

More Accountability for Colleges

The Democrats’ bill would take a dramatically different approach to accountability as well, preserving key rules targeting for-profit colleges eliminated in the PROSPER Act, in some cases pushing them further. For example, the so-called 90-10 rule, which limits the proportion of revenue an institution can generate from federal student aid to 90 percent, would be changed to an 85-15 formula.

The Republican plan would drop 90-10 and other rules like gainful employment dealing mostly or exclusively with for-profit colleges.

Aim Higher would also maintain the cohort default rate, an accountability rule that applies to all higher ed institutions, by adjusting the metric for total number of borrowers at an institution and number of borrowers in long-term forbearance. It would also alter the role of accreditors by requiring the oversight bodies to account for student outcomes like completion and work-force participation in their evaluations of colleges. Where accreditor standards are deemed too low, the department would be authorized to exercise veto power.

The bill also explicitly acknowledges state regulators’ consumer protection role in higher education, where Education Secretary Betsy DeVos has argued that only federal agencies have the authority to oversee the federal student loan program.

A Republican committee spokeswoman called the bill a political exercise.

“Nancy Pelosi has made it clear she wants higher taxes. This bill promises higher tuition and higher unemployment to go with it,” the spokeswoman said.

The Democratic proposal does share some common features with the PROSPER Act. Like the Republican bill, it would streamline loan repayment options by offering one fixed rate and one income-driven repayment plan for student borrowers. It eliminates student loan origination fees. And it opens Pell Grant eligibility to short-term programs -- a goal shared by members of both parties looking to address work-force needs.

Over all though, the bill was designed to be the polar opposite of PROSPER, said Jon Fansmith, director of government and public affairs at the American Council on Education.

“They’re the two poles of higher education reauthorization,” he said. “These are at either end of the spectrum in terms of what we’re likely to see. Whatever comes out of the Senate will probably be somewhere between these two.”