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On December 8, 2010, the House passed the Development, Relief and Education for Alien Minors (DREAM) Act, H.R. 6497, by a vote of 216 to 198. The DREAM Act authorizes the Secretary of Homeland Security to grant conditional nonimmigrant status to undocumented students who were brought to this country before the age of 16 and have been here for at least 5 years as of the enactment date. They also must be under 30 years of age. After 10 years, participating individuals would be eligible to have their status adjusted from conditional nonimmigrant status to legal permanent resident status if they have received a degree from an institution of higher education, completed at least two years toward a bachelor’s or higher degree, or served at least two years in the military.
On December 9, 2010, the DREAM Act was defeated when the Senate voted to table a motion to proceed to the bill by a vote of 59-40. The bill may be introduced in the 112th Congress.
On December 16, 2010, the House voted 277 to 148 in favor of the $858 billion package of tax extensions, which was sent to the President for his signature. On December 15, 2010, the Senate voted 81 to 19 to approve the compromise tax package.
The final package extends the 2001 and 2003 tax cuts and contains a handful of other tax “extenders,” provides a patch for the alternative minimum tax, provides a short-term tax holiday, and extends unemployment benefits for 13 months. In addition, it sets the estate tax at 35 percent with a $5 million exemption. Concerning education tax extenders, the bill provides:
- An extension of the above the line college tuition deduction up to $4,000 through 2011;
- An extension of the student loan interest deduction worth up to $2,500 through 2012;
- A renewal of a benefit that allows employers to provide up to $5,250 in tax-free tuition assistance to their employees;
- A continuation of the American Opportunity Tax Credit established by the American Recovery and Reinvestment Act that provides a maximum credit of $2,500 for qualified tuition and related expenses for each eligible student through 2012. It replaced the Hope Tax Credit for 2009 and 2010;
- A renewal of a tax credit for corporations that give research money to colleges; and
- An extension of a tax provision that would allow individuals to continue to contribute up to $2,000 a year, pre-tax, to Coverdell Education Savings Accounts.
On December 8, 2010, Congressman John Kline (R-MN) was selected to serve as Chairman of the House Education and Labor Committee in the 112th Congress. In his press release, Congressman Kline said:
“Job creation and American competitiveness are vital national priorities. As Chairman, I will ensure they are at the forefront of the Education and Labor Committee agenda…My goal for the federal programs and agencies that oversee our schools and workplaces is to provide certainty and simplicity. We must ensure federal red tape does not become the enemy of innovation, and that federal mandates do not become roadblocks on the path to reform.”
Congressman George Miller (D-CA), current Chairman of the House Education and Labor Committee, has been named by the House Democratic Caucus for the Ranking Member position of the Committee for the 112th Congress. In his press release, Congressman Miller said:
“I am truly privileged to have the confidence of the House Democratic caucus to continue to be the top Democrat on the Education and Labor Committee. It has been an honor to serve as chairman during the committee’s most productive years on behalf of America’s working families and students. While the next Congress will bring new challenges, I will not lose sight of the committee’s responsibility to ensure that workers are treated fairly on the job and students can be successful in the classroom. I fully intend to work with Chairman-elect John Kline to forge consensus on important issues where we can, but I will not hesitate to stand up when special interests are put ahead of workers and students.”
On December 16, 2010, the House approved S. 3447, the Post-9/11 Veterans Educational Assistance Improvements Act of 2010, a bill that improves the veterans educational benefits to those who served in the Armed Forces after September 11, 2001. S. 3447, sponsored by Senate Veterans’ Affairs Chairman Daniel K. Akaka (D-HI), passed the Senate on December 13, 2010. S. 3447 now moves to the President for his signature.
An important change made to the law creates a new national baseline on benefits for veterans attending all types of colleges. Current law derives its maximum payout from the highest in-state public tuition in a given state. The new legislation would cap annual payouts at $17,500. Any costs above that threshold could be covered by the Yellow Ribbon Program, which allows participating private colleges and universities to enter into dollar-for-dollar matching agreements with the Department of Veterans Affairs. By establishing a national benefit baseline, the program will be more equitable because currently veterans receive differing awards depending on which state they choose to attend college. When the law is enacted, some veterans will see a reduction in payouts because they may be attending colleges in states with high public tuition costs. Many higher education representatives were critical that the bill did not contain any hold harmless language for those currently enrolled.
The Congressional Budget Office (OMB) reported that the Senate bill would reduce the cost of the program by $734 million in 2020.
S. 3447 would:
- Revise definitions concerning eligibility to include certain National Guard Service as service qualifying for such assistance;
- Tie monthly living allowances to the veterans’ course loads (currently veterans who are taking 6 credits or more receive the same monthly living allowance);
- Revise types of approved programs of education to include certificate and diploma programs;
- Include distance learning as an approved program of study;
- Allow the pursuit of educational programs at institutions other than institutions of higher learning, including on-job training and apprenticeships, flight training, and correspondence courses
At the end of November 2010, the Government Accountability Office (GAO) issued an update to its August 4, 2010 report entitled, “For-Profit Colleges: Undercover Testing Finds Colleges Encouraged Fraud and Engaged in Deceptive and Questionable Marketing Practices” (GAO-10-948T) to clarify and add more precise wording to the review. The original report issued as testimony at a hearing held by Senator Tom Harkin, Chairman of the Committee on Health, Education, Labor and Pensions (HELP) examined recruiting practices at 15 for-profit colleges. Undercover GAO investigators posed as prospective students and applied for admissions and financial aid.
However, congressmen and representatives from the for-profit sector are calling the revisions substantial rather than simply providing clarification. Senator Mike Enzi (R-WY), Ranking Member of the HELP Committee, sent a letter dated December 7, 2010 to the GAO’s Acting Comptroller General stating that the revisions appear to be “substantial” and requested that the report be withdrawn. “[T]he revisions made in the reissued testimony raise questions about the quality and rigor of this particular investigation.”
A Washington Post article of December 7, 2010 indicated that a spokesman for Senator Harkin said that the revisions “do not change the substance of the report” or its conclusions that the for-profit colleges investigated “used deceptive or fraudulent recruiting techniques to enroll new students.” In the same article, Lanny Davis, a spokesman for the Coalition for Educational Success, an organization representing some for-profit colleges, said the revisions in the report appeared to portray the sector less harshly but the revisions call into question the credibility of the report.
On December 9, 2010, a new report was released by the Senate Health, Education, Labor and Pensions Committee Chairman Tom Harkin (D-IA) titled, “Benefitting Whom? For-Profit Education Companies and the Growth of Military Educational Benefit,” which shows an increase in Department of Defense (DoD) and Veterans’ Affairs (VA) funds going to for-profit colleges. The Committee found that in the first year of the new Post 9/11 GI Bill benefits, for-profit institutions received $640 million (36 percent) of benefits despite enrolling 23.3 percent of the recipients. The report also indicated that between 2009 and 2010, revenue from military educational benefits at 20 for-profit institutions has increased 211 percent. The combined VA and DoD military benefits at these schools increased from $66.6 million in 2006 to a projected $521.2 million in 2011, an increase of 683 percent.
The report notes that the VA and DoD benefits are attractive for for-profit schools because they do not constitute federal financial aid for purposes of the 90/10 calculation. Instead, the military benefits counts toward the 10 percent.
In a press release of December 9, 2010, Senator Harkin said:
“Our government has made a commitment to this generation of Iraq and Afghanistan Veterans to offer them the same opportunities for advancement through higher education that were provided to previous generations of veterans. Given what we’ve already uncovered about the quality of education at many for-profit schools, I have serious concerns about whether the veterans who enroll at these schools are getting the education they deserve. This report raises serious questions about whether some for-profit education companies view providing education to our service members and veterans as incidental to ensuring a robust profit for their company and their shareholders.”
The Association of Private Sector Colleges and Universities (APSCU) issued a press release criticizing the report and President Harris Miller said: “The rapid growth of service members, veterans and their families in higher education is a very positive development that should be celebrated, not denigrated.”
The Department of Education was reported to have plans to increase its oversight of how colleges and universities administer its Title IV programs. In the December 10, 2010 The Chronicle of Higher Education, it was reported that the Office of Federal Student Aid plans to conduct about 300 program reviews of student aid operations in the coming year. During the current year, ED conducted about 200 program reviews. The Department will focus on publicly-traded institutions and on institutions with large distance education programs.
On August 20, 2010, William Taggart, the Department’s Chief Operating Officer, sent a letter to college presidents referencing the undercover investigations by the Government Accountability Office (GAO) on deceptive and unethical practices. Mr. Taggart warned the presidents that the Department will vigorously enforce all statutory and regulatory requirements and that all institutions will be held accountable for officers, employees, agents and contractors. The letter is part of a broader initiative by the Department to increase oversight of the administration of Title IV aid. Secretary of Education Arne Duncan outlined his plans for enforcement in a letter to the Senate Health, Education, Education and Pensions (HELP) Committee.
While the Secretary addressed high school completion, Deputy Secretary Tony Miller was addressing college completion. “I want to provide two takeaway messages to act on when you leave this conference,” he told approximately 6,000 attendees at the Federal Student Aid Conference in Orlando. “First, we need to embrace a modified mindset about the purpose of student aid. Student aid can no longer just be about providing college access. Instead, it also has to be about encouraging college completion and earning a degree…. My second, related message is that strengthening financial aid entails more than providing new federal dollars as vital as they are. The truth is that all levels of government and all institutions of higher education must advance reform and college completion, by making postsecondary education far more productive and efficient than it is today.”
Read a copy of the speech.
See presentations and session videos from the Federal Student Aid Conference.
A recent report issued by the National Center for Education Statistics (NCES) titled, “Persistence and Attainment of 2003-2004 Beginning Postsecondary Students: After Six Years,” finds that 49.4 percent of students who began postsecondary education in 2003-04 earned some credential by June 2009, ranging from an educational certificate to a bachelor’s degree as compared with 50.8 percent for students who entered in 1995-1996. Another finding is that 70 percent of full-time students have a degree or were still enrolled after six years as compared to only 28 percent of part-time students.
The results of another NCES study recently released, titled “Tracking Students 200 Percent of Normal Time Frame: Effect on Institutional Graduation Rates,” which measured bachelor’s degree completion after 8 years, resulted in a modest increase over 6-year graduation rates. The study reviewed institutional graduation rates reported at 200 percent of normal time, a time frame that corresponds to completing a bachelor’s degree in 8 years and an associate’s degree in 4 years. NCES then compared these rates with those reported at 150 percent and 100 percent of normal time for all nine institutional sectors. The comparison was an effort to determine whether the longer time frame results in higher graduation rates.
The findings show that across all types of institutions, the increase in graduation rates between 150 percent and 200 percent of normal time was small relative to the increase between 100 percent and 150 percent of normal time.
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