Lift the Veil

As Congress works to finalize legislation to reauthorize the Higher Education Act for the next five years, higher education lobbyists are making one last ditch effort to dissuade lawmakers from requiring colleges to provide even the most basic information about how they spend their own institutional financial aid dollars.

At issue are provisions in both the House and Senate reauthorization bills that aim to provide prospective students, their families, and policymakers with more detailed data about their aid policies, as well as other types of consumer information, such as graduation and retention rates. Both bills ask colleges to report the average amount of grant aid that the institutions award their students and the proportion of students who receive these grants. The House legislation goes a much-needed step further, and requires colleges to provide a breakdown by income of students who receive institutional aid.

The two bills also differ on how this consumer information is to be reported. Under the House measure, colleges would be required to provide the data to the Education Secretary who would then publish it on the U.S. Education Department’s College Navigator website, which the agency hopes prospective students will use when picking colleges. In contrast, the consumer reporting provisions in the Senate bill would be completely voluntary. Colleges that chose to participate would publish the information on their websites, using a model form developed by the Education Department.

College lobbyists, not too surprisingly, favor the Senate’s voluntary approach. “Institutions provide a substantial amount of data to the U.S. Department of Education through the Integrated Postsecondary Education Data System (IPEDS) each year, and we applaud efforts to assure that this information is used,” the American Council on Education (ACE) wrote in a letter in late February to the leaders of the House and Senate education committees on behalf of itself and 13 other college groups. “However, many data elements specified in both bills are not currently collected through IPEDS in the form specified. Mandating that they be provided would create a significant new reporting burden for institutions.”

If, however, Congress decides to make the reporting mandatory, ACE wrote, then it should “limit the data elements” required to those that the Department already collects through IPEDS. The groups know, of course, that such a limitation would continue to cloak colleges’ institutional aid policies in mystery, as the Department currently asks the institutions little about how they spend their own aid dollars.

At Higher Ed Watch, we believe that colleges should be required to provide more detailed information about their institutional aid policies. The federal government, which spends tens of billions of dollars a year to help low- and moderate-income students gain access to college, has a right and responsibility to know whether institutions of higher education are helping or hindering public policy goals. Are colleges, for example, using the new influx of federal Pell Grant dollars that Congress and the Bush Administration have provided to supplement their own institutional financial aid and insure that low-income students don’t have unmet financial need? Or are they using the new federal funding to replace institutional aid dollars they would have spent otherwise and using that money for other priorities, such as building fancy new dorms and athletic centers or providing merit aid to attract better, and often wealthier, students?

These are important questions for policymakers to be able to answer. Hopefully as lawmakers complete work on the Higher Education Act reauthorization legislation, they will stick to their guns and make colleges’ financial aid practices more transparent. As we’ve said before, a little sunshine almost never hurts.