Feb. 15, 2019
On the first day of the new session of Congress, four senators blasted a letter to over 100 postsecondary education stakeholders soliciting policy solutions to help borrowers of color, who face “staggering and unacceptable outcomes” in higher education. Today, we submitted a letter to Sens. Jones, Warren, Harris, and Cortez Masto with our recommendations for steps that Congress can take to protect and empower students of color to pursue and succeed in higher education.
Unfortunately, the current higher education system perpetuates inequities at virtually every phase of the pipeline, leading to fewer students of color obtaining degrees and more students of color defaulting on their student loans.
Our recommendations lay out better, fairer, and smarter ways to support students of color. In this post, I detail a handful of them. To read the full set of recommendations, click here.
Increase Access to Effective Financial Aid
Students of color are more likely to receive Pell Grants and more likely to take out federal loans, resulting in disproportionate harm to these students when financial aid policies are inconsistent, unfair, or when funding shortfalls occur. This process needs a comprehensive overhaul that increases support for students in need, expands access to marginalized individuals, and protects students and families from predatory loans.
Applying and Qualifying for Aid
The first step in fixing this process is to simplify how students apply for aid: the FAFSA. Congress should ensure that the reimagined version fast-tracks Pell Grant eligibility for students whose families qualify for federal programs that demonstrate financial need, such as SNAP or TANF.
Lawmakers must also expand access to federal aid by removing prohibitions that disproportionately affect students of color. People of color are more likely to be convicted of a drug crime, and incarceration rates for the Black community are 5 to 7 times higher than the white community. Congress should both responsibly restore incarcerated individuals’ access to Pell and also remove the specific provision that revokes financial aid to students convicted of a drug crime while enrolled in school.
Over half of all Black students and 48 percent of Latinx students receive Pell Grants, putting them at the mercy of the uncertain yearly appropriations process and diminishing purchasing power of this program. Congress can protect these students by placing all Pell Grant funding on the mandatory side of the budget, increasing the maximum amount of the grant to restore its past purchasing power, indexing it to inflation, and raising the income level that qualifies for the maximum award--all critical steps to restore the Pell Grant’s power as a tool for college access.
The vast majority of students take out federal loans. We proposed ways to help reduce indebtedness (in addition to increasing available grant aid), like limiting part-time students to part-time loans. We also proposed options for helping borrowers manage their loans, like automatically placing delinquent borrowers in an income-driven repayment plan and considering a targeted loan cancellation policy for borrowers who demonstrate financial need through continuous enrollment in other social safety net programs for a number of years.
Additionally, the federal government grants Parent PLUS loans to dependent students’ parents based on a minimal approval process that does not consider parents’ ability to repay the loan. For low-income and low-wealth parents, a PLUS loan does not provide true access; when the bill comes due, the costs can be out of reach. In practice, this loan program worsens wealth inequalities for many students of color. Congress should protect borrowers of color by adding an “ability-to-pay” criterion when determining qualification for a Parent Plus loan, providing better counseling to Parent Plus borrowers, allowing the loan to be dischargeable in bankruptcy, and prohibiting institutions from listing PLUS loans in financial aid award letters, among other proposals.
Data and Transparency
Even with all of the information available, parents, students, stakeholders, and the federal government need more data to make informed decisions.
All higher education institutions should be responsible for reporting data on student outcomes and financial aid so that parents and students can make an informed decision about where to enroll, what program to pursue, and how to finance their education. Congress should capitalize on the momentum of the College Transparency Act to give students the information they deserve.
Hold Institutions Accountable
Congress should focus on accountability in order to protect borrowers of color. For-profit colleges disproportionately enroll Black and Latinx students, yet often have worse outcomes for students and sometimes engage in predatory practices. Congress must strengthen scrutiny of these institutions.
Additionally, Congress must heighten the focus on consumer protection throughout the higher education system. They can do this through improving accreditation practices, upholding regulations designed to protect vulnerable students from poor-quality education, and ensuring higher education gives students better odds for success through evidence-based interventions, increased accountability, and real reform. And before lawmakers open federal aid programs to new types of programs, like short-term certificate programs that can be as short as 8 weeks, Congress should have data to justify the investment and ensure that the program does not perpetuate inequities; current research suggests that there is often little labor-market value for those programs.
Renew Federal-State Partnerships
Finally, although the federal government can do far more to protect borrowers of color than it currently is, states also need shoulder more responsibility. State investment in higher education has steadily declined, harming many students of color who then have to borrow more to finance their education and attend under-resourced institutions. This year’s reauthorization of the HEA should establish a guideline for state-federal partnerships to ensure accountability for institutions of higher education.
Both Sen. Alexander and Sen. Murray say they are committed bold visions in a comprehensively reauthorized HEA that better serves students. That’s good news, because as our recommendations make clear, the hurdles facing students and borrowers of color demand drastic change. As the Senate begins work to reauthorize the HEA this year, lawmakers must keep equity at the forefront of their discussions and commit to addressing these huge challenges so that higher education can continue to serve as a path to economic mobility for students of color.