PROSPER Act Fails to Make Higher Ed More Affordable
Wednesday, February 7, 2018
Posted by: Carrie Warick, Director of Policy and Advocacy
As Congress looks to reauthorize the Higher Education Act, they should ensure that any simplification of programs should benefit students first before deficit reduction. Unfortunately, the PROSPER Act will save the federal government approximately $15 billion over the next decade instead of making higher education affordable for our students. These savings are a contradiction to bill sponsor Rep. Virginia Foxx’s (R-NC) stated vision that the PROSPER Act would maintain the amount of aid students receive to go to college.
Foxx is the chair of the House Education and the Workforce Committee and she shared this goal in a recent interview. But the non-partisan budget analysis from the Congressional Budget Office (referred to in Washington as the CBO score) demonstrates that the PROSPER Act contradicts her stated goal. The combined effect of changes in the Pell Grant program, elimination of Supplemental Educational Opportunity Grant (SEOG) and Federal Work-Study may or may not work out in balance for need-based aid in the short-run. In the long term, though, these students will see the gap in their financial aid packages grow as tuition grows and the Pell Grant remains flat.
Additionally, students who borrow to attend school will lose more than they gain under this proposal. Origination fees are eliminated but income-based repayment will be less generous with few to no possibilities for loan forgiveness. Further, the accountability changes in this bill actually cost the government money while leaving students more vulnerable. (Check out this table from Ben Miller at the Center for American Progress for a quick reference on which proposals save the government money.)
A recent NCAN analysis demonstrates that in many states, a four-year college degree is not affordable for low-income students. While the PROSPER Act does provide a bonus to Pell Grant recipients who take an increased number of credits and expands the program to cover short-term certificates, neither of changes alone are enough to move the needle on affordability for low-income students who desire a bachelor’s degree.
Access to high-quality credential and certificate programs only addresses affordability at one end of the spectrum. Students who desire to pursue a four-year degree, but do not have the financial resources to do so, should still have the option to follow their desired education and career path. The PROSPER Act falls short of better supporting students with that goal.
Should this bill be considered on the floor of the House of Representatives, members of Congress should consider amending the bill to re-direct these savings into programs that support low-income students. Specific ideas for this re-investment of funds includes incremental increases to the Pell Grant maximum award to keep pace with the rising cost of tuition or retaining some aspects of the income-based repayment plan safety net of loan forgiveness.