WASHINGTON – President Obama’s plans to tie federal aid to college costs and outcomes could face resistance from Rep. John Kline (R-Minn.), just weeks after Kline traveled to the White House to commemorate their bipartisan work on securing a student loan fix.
The president will need Republican support for his proposal to rein in rising college costs, but uniting the coalition that came together to lower loan rates could prove difficult, observers say.
“The agreement on interest rates was prompted by a congressionally manufactured political crisis. That is not the case here,” said Michael Dannenberg, director of higher education and education finance policy at Washington, D.C.-based Education Trust. “There is a real problem out there. College affordability is a very large issue that touches almost every family.”
The centerpiece of the president’s proposal is a new rating system that would combine access, affordability and educational outcomes in assessing a school’s performance.
The administration can launch the rating system on its own. But the White House wants to tie the ratings to federal student loans, giving more generous loans to students who go to higher-rated colleges.
That would require congressional approval and Kline, as chairman of the House Education and the Workforce Committee, could play a major role. He has already cast doubt on Obama’s plan.
College costs are an outsized matter in Minnesota, where 2010 graduates racked up an average debt load of $29,800, according to a report released recently by the state’s Office of Higher Education.
Nationwide, the average tuition at four-year public colleges was $8,655 last year, a rise of 250 percent over the past 30 years. Housing costs have spiked, too, according to the College Board, with students paying an average of $9,205 last year. Household incomes have risen only 16 percent over the same period.
“There’s widespread agreement that there's a problem,” said Robert Applebaum, executive director of Student Debt Crisis, a New York-based nonprofit advocacy group. “There isn’t widespread agreement on the solution.”
The White House and Kline have pointed to the Higher Education Act, which expires at the end of the year, as the appropriate legislative venue for Obama’s affordability proposals. That’s where the agreement seems to end.
“I remain concerned that imposing an arbitrary college ranking system could curtail the very innovation we hope to encourage — and even lead to federal price controls,” Kline said in a statement. He did not respond to an interview request for this article.
U.S. Sen. Al Franken, D-Minn., a member of the Senate Education Committee, said, “We … need to take a hard look at what’s driving college costs and work with states and institutions of higher education to address these important issues.”
For-profit colleges a target
As the administration discussed ways to gain support from Republicans who consistently have thwarted Obama’s initiatives, the student loan compromise came up repeatedly. Kline and other lawmakers watched over the president’s shoulder in the Oval Office as he signed the bill.
Obama cast the deal as the first of many measures needed to make college more affordable, including his efforts to tighten for-profit colleges’ access to student aid.
At Minnesota for-profit colleges, 2010 graduates borrowed $45,100 on average, according to the state’s Office of Higher Education report. That’s 50 percent higher than the average for the state’s graduates.
“Students aren’t getting what they need to be prepared for a particular field, they get out of these for-profit schools loaded down with enormous debt, they can’t find a job, they default, the taxpayer ends up holding the bag, their credit is ruined, and the for-profit institution is making out like a bandit,” Obama said last week.
A 2012 investigation by the Senate Education Committee slammed the for-profit industry over its high costs and student debt. U.S. Department of Education data show that for-profit postsecondary institutions educate 11 percent of students, but account for more than 40 percent of student loan defaults.
Since becoming chairman of House Education Committee, Kline has fought the administration’s efforts to link student aid at for-profit colleges to the income and loan repayment rate of its graduates. A defender of the for-profit college industry, Kline has said he would prefer that colleges, nonprofit and for-profit, disclose graduation rates, costs and graduates’ debt burden to applicants.
Sandy Baum, a senior fellow at George Washington University and the Urban Institute, a Washington-based think tank said: “We can debate whether college is unaffordable or not. … The question of whether the federal government can play a significant role in controlling the role is another question. There’s not a simple answer.”
Corey Mitchell is a correspondent in the Star Tribune’s Washington Bureau. Twitter: @C_C_Mitchell