News You Need to Know: Daily Roundup, Mon., Oct. 2nd
Blog Post
Oct. 1, 2006
Education Department audit accuses guaranteed-student-loan program of inadequate oversight
The U. S. Education Departments Office of Inspector General issued an audit last Friday charging the division that oversees the guaranteed student loan program with inadequate oversight of the participating lenders. Financial Partners, the division within the Federal Student Aid Office responsible for monitoring the $70 billion Federal Family Education Loan (FFEL) program, is accused of failing to establish and follow consistent policies in its reviews of lenders. Senator Edward M. Kennedy of Massachusetts says that the audit makes "the strongest case yet" for putting the direct-loan program, which competes with FFEL loans, "on an even playing field" with the guaranteed-loan program.
Blunt believes current version of MOHELA deal will be final
Last week, Missouri Governor Matt Blunt failed to bypass the Missouri legislature in his efforts to enact a deal that finances construction and research projects at state universities with the sale of assets of Missouris student loan agency (MOHELA). The plans details have undergone numerous changes since its creation, but Blunt now believes that the plan is in its final form. Missouris House and Senate leaders have expressed approval of the current deal, and Blunt is hoping that it will easily pass the legislature. However, there have been no committee hearings or debates on the current version and the composition of the legislature is likely to change after November elections, which may lead to more modifications.
Oregon introduces a "shared responsibility" need-based financial aid plan
The governor of Oregon has proposed a new approach to need-based financial aid that focuses on the responsibility of students to help finance their educations. In an effort to increase middle-class access to need-based aid in a time of budget constraints, Governor Ted Kulongoski came up with a "shared responsibility" plan. Under the plan, all students and their families are expected to contribute a reasonable amount to tuition payments, depending on their financial situations and the type of school the student chooses to attend. The state would take into account the contributions of a variety of different aid sources, including an "earnings expectation" for students and federal financial aid, and then cover the remaining tuition costs through its Earned Opportunity Grant program.