• Media Coverage
  • August12th

    NAICU Washington Update

    The Department of Education is seeking comments on recommended changes to eligibility standards for PLUS Loans. The proposed regulations, published on August 8, would update the criteria for determining if a potential PLUS Loan parent or student borrower has an “adverse credit history” that prevents the applicant from getting the loan. By Department estimates, the change would expand loan access to 371,000 borrowers.

    The PLUS Loan regulations have not been updated since 1994. Taking into account developments since that time, particularly the establishment of the Direct Loan Program, the Department has proposed several modifications designed to assure both access for students and responsible care of federal funds. The Department is seeking comments from institutions and has posed some specific questions in the rulemaking notice. Comments are due by September 8 – a short 30-day comment period. The quick turn-around enables the Department to publish final regulations by November 1, 2014, so that they can take effect by July 1, 2015.

    Some of the proposed revisions would relax the financial standards the Department began using in November of 2011. (See below for additional program history.) Specifically:

    1. An applicant (parent or graduate/professional student) is not considered to have an adverse credit history unless the applicant’s debts have a total combined outstanding balance greater than $2,085. This is an increase from the current level of $780.
    2. This $2,085 threshold could be modified to adjust to changes in the economy.
    3. The standard for delinquency will remain at 90 days.
    4. Debts “in collection” or that have been “charged off” in the past 2 (rather than 5) years will be included in determining adverse credit history.
    5. Financial problems, such as bankruptcy, tax liens, and foreclosures will be considered as far back as 5 years.
    6. Borrowers who are denied a PLUS loan may reapply based on extenuating circumstances. Such applicants must provide additional information about their financial situation.
    7. Those who are granted a PLUS loan based on extenuating circumstances must complete loan counseling provided by the Secretary. (However, the notice does not provide information about the timing of such counseling, nor does it indicate how institutions will be notified that a borrower has completed the counseling so that the loan may be disbursed.)

    Program History: Most PLUS loans were issued through FFELP, the bank-based loan program, prior to its elimination in 2010. In converting to all direct loans, Department of Education officials discovered that the “operational criteria” they were using to determine an adverse credit history were not consistent with the regulations, nor with the definition of adverse credit history used under FFELP. In short, the Department was not regarding loan applicants who had debts that were either in collection or charged off as having an adverse credit history. Thus, these applicants remained eligible for PLUS Loans—resulting in a significant increase in borrowing. In November 2011, after the inconsistency was identified, the Department modified its procedures. This action resulted in large numbers of applicants being denied PLUS loans. After considering a significant number of appeals to its decisions, the Department ultimately decided to update the regulations.

    The Department included the consideration of changes to PLUS eligibility in broader-reaching negotiated rulemaking sessions that extended from February to May of this year and covered six disparate issues. The negotiators were able to reach “tentative” agreement on issues related to PLUS loans, but failed to do so on several of the other issues included in the negotiation. Because of the urgency of the matter, Department officials decided to publish the PLUS provisions separately.

    In addition, the Department plans to publish consumer information about PLUS Loans, including default rates by institution and credit history characteristics of PLUS borrowers.


    For more information, contact:
    Maureen Budetti

  • August10th

    Published Tuition at Private Institutions Grew an Average of 3.6 Percent for 2013-14; Institutional Student Aid up 6.9 Percent

    WASHINGTON, D.C. (October 10, 2013) — Students and families entering the nation’s private, nonprofit colleges and universities this academic year experienced the lowest tuition and fee rate increases in at least four decades. According to an annual survey of its members, the National Association of Independent Colleges and Universities (NAICU) reports published tuition and fees increased by just 3.6 percent for the 2013-2014 academic year. At the same time, institutional student aid budgets at private colleges increased an average of 6.9 percent for 2013-14.

    This is the fifth consecutive year that the percentage increase in published tuition has stayed below pre-recession rates, and the second time in at least four decades it has been below 4 percent. From 2009-10 to 2013-14, average private college tuition increases ran in the mid-four percent range, down from an average annual increase of nearly 6 percent during the previous 10 years. This year’s rate is the lowest NAICU has on record dating back to 1972-73 (see chart below).

    “During the past five years, private colleges and universities across the nation have redoubled efforts and implemented innovative initiatives to cut their operating costs, improve their efficiency, and enhance their affordability,” said NAICU President David L. Warren. “This, coupled with generous institutional student aid policies, has resulted in a private higher education that is accessible and affordable to students and families from all backgrounds.”

    According to NAICU, data show that the average inflation-adjusted net tuition and fees (published tuition and fees minus grant aid from all sources and federal higher education tax benefits) has increased just $230, to $13,380, at private, nonprofit institutions over the past ten years. According to the College Board, in 2012-2013, published tuition and fees averaged just over $29,000 at nonprofit colleges and universities.

    Results from NAICU’s survey also show this year’s average 6.9 percent increase in institutional student aid follows increases of 6.2 percent, 7.3 percent, 6.8 percent, and 9 percent in 2012-13, 2011-12, 2010-11, and 2009-10, respectively. The NAICU survey did not collect student aid figures prior to 2009-10.

    “Private, nonprofit colleges and universities have been and will continue to be positive investments that pay big dividends,” said Warren. “Nearly eight-in-ten students who earned a bachelor’s degree from a four-year private institution did so in four years, graduating with manageable debt and prepared to succeed and contribute to the workforce and society.”

    Tuition Cuts, Freezes, and Other Affordability Measures Spread

    Since the economic downturn, private colleges have introduced creative affordability measures to keep out-of-pocket costs as low as possible for students and families. In recent years, an unprecedented number of private institutions have cut tuition, frozen tuition, announced fixed-tuition guarantees (no increases for students while they are enrolled), or introduced three-year degree programs.

    Other initiatives are also spreading, including military scholarships, substantial student aid increases, loan repayment assistance programs, and articulation agreements with community colleges.

    More than half (510) of NAICU’s 962 member colleges and universities responded to this year’s survey of published tuition and institutional student aid increases. NAICU member institutions enroll 90 percent of the students who attend private, nonprofit colleges and universities in the United States. NAICU’s survey collects percentage increases in published tuition and institutional student aid budget increases, but not dollar amounts.

    Tuition Survey Chart 2013-14


  • October16th

    March 1 has come and gone and Congress did nothing to stop the looming budget cuts. As a result, If  students who get federal aid could lose hundreds of dollars a year. We calculate the cost could be as much as $876 a year in new fees, fewer work-study hours and reduced grants, and we are urging students to contact lawmakers and urge them to reverse the cuts. Be sure to contact your congressional representative  to let them know that students have given more than their fair share!  Our budget should not be balanced on the backs of hard working students.

    Bookmark this page for the latest in news and be sure to follow #studentfiscalcliff on Twitter.

    TEACH Grants Shrink and Loan Fees Increase as a Result of the Sequester (NAICU Washington Update)

    GOP delays controversial Labor-Education-HHS bill, but says it is close (The Hill)

    Explore the Sequester’s Effect on Higher Education Funding (US News & World Report)

    Sequestration Complicates College Aid Notices (USA Today)

    Sequester Cuts Hit Needy College Students’ Financial Aid (Huffington Post)

  • September6th

    On July 1, 2013 interest rates on many new federal student loans doubled–endangering the dreams of many middle class families. If this sounds familiar, its because we went through this last summer. The Student Aid Alliance rallied thousands of students across the country and Twitter was ablaze with the hashtag #studentfiscalcliff — we were out to let lawmakers know not to balance the budget on the backs of our nation’s college students.

    Congress kept interest rates low for one year–and now, that year has disappeared. Congress let the July 1 deadline pass without a deal, so come the fall, the interest rate on new subsidized student loans doubled from 3.4% to 6.8%. According to the White House, nearly seven million students will be affected by the rate increase, adding around $4.3 billion to the student debt burden next year.

    Even though the deadline has passed, Congress is still negotiating. Stay in the loop here.

    Pondering Pell (Inside Higher Education)

    Student-Loan Changes, With Lower Rates for Now, Are Set to Be Signed Into Law (The Chronicle of Higher Education)

    Congress Approves Student Loan Plan (Washington Post)

    Obama Administration Urges Passage of Senate Student-Loan Compromise (Education Week)

    Senate Reaches Deal to End Fight Over Student Loan Interest Rates (The New York Times)

    Senate Crafts a Deal on Student-Loan Interest Rates (The Chronicle of Higher Education)

    Senate Negotiates on Loans as Clock Ticks (National Journal)

    Even With Student-Loan Compromise, Rates Will Likely Increase (National Journal)

    Interest-Rate Jump Would Cost Average Borrowers $2,600 Over 10 Years (Chronicle of Higher Education)

    Senators Scramble to Prevent Doubling of Student-Loan Rates (National Journal)

    Kline Calls for Compromise on Student Loan Rates (Education & the Workforce Committee)

    Arne Duncan Bullish on Student Loan Deal (Politico.com)

    Everything You Need to Know About the Student Loan Rate Hike (Washington Post)

    Arne Duncan Signals Worry Over Student Debt Levels (Huffington Post)

    Moral Bankruptcy on Student Loans (Huffington Post)



  • July5th

    Providence Journal
    “This New England Blog” – Opinion Piece

    By Clay Pell

    July 3, 2012

    When I was a boy, my grandfather would take me on runs. “Shuffles,” he called them – 1.1 miles from the house and back. People would often stop us to thank him for helping them go to college.  By the time that I headed to college, Parkinson’s disease had long since slowed Grandpa’s gait. But he lovingly invested in my education – both financially and emotionally – every step of the way. My grandfather was Sen. Claiborne Pell, who 40 years ago overcame opposition in Congress to establish a grant enabling every American “with the moxie and the drive” to get access to a college education.

    Since 1972, Pell Grants have let 60 million students pursue higher education, including much of America’s current college-educated workforce and 9.8 million current students.All my life, people have approached me to say how much their Pell Grants meant to them. It’s not just that the money made  their educations possible, they say, but that they feel proud of, and grateful to, a country that invested in them.

    When the U.S. Coast Guard assigned me to Washington in 2009, I was naturally drawn to the debate over the Pell Grants. While here, it’s been interesting – and somewhat sad – to hear people say that we can no longer afford this program. Some think that higher education does not need to be accessible to all. Others suggest that the Pell Grants should be less ambitious, focusing not on those with the greatest need but rather those who fit a preconceived view of “the best investment.”

    When I hear those arguments, I remember the people who have shared their stories with me. Single mothers who went back to school and eventually earned Ph.D.s. Fellow officers in the U.S. Coast Guard who came out of poverty to attend college and now serve in the finest military in the world.

    Collectively, these students are our future, and they represent our changing face as a nation. More than 50 percent of African-American and 40 percent of Latino college students count on Pell Grants. For African-Americans, a bachelor’s degree erases any difference in economic mobility compared with their white peers. For the average American, a bachelor’s degree will add about $1 million to her or his lifetime earnings.

    Now is not the time to reduce their access to that opportunity. Even as more Americans go to college than ever before, the U.S. has slipped to 14th in the world in the proportion of young adults with a post-secondary credential. I am grateful that President Obama has called for full funding of the Pell Grants this and next year. I am grateful that Pell Grants has remained true to Grandpa’s original vision – grants, not debt – and awarded to students – not institutions – so that they can study wherever their drive leads them.
    But we have more to do.

    We must guarantee access to higher education, both as the primary means of upward social mobility for individuals and for our collective competitiveness around the globe. We must combat rising tuitions and student debt, continue to invest in higher education at the federal, state and local levels, and ensure that institutions themselves focus their own aid on the students with the greatest need.

    And we must demand that institutions provide the instruction and the support that students need for success. As we reached the midpoint on our shuffles, both of us probably ready to take a breather, Grandpa would remind me to keep up the pace, that we were not yet there. As we celebrate 40 years of the Pell Grants, Grandpa might remind us that we as a country are not yet there. We hold the responsibility for protecting Pell Grants and extending the dream of college to the next generation. Let’s keep the trust and make sure our generation keeps up the pace.

    Clay Pell is a U.S. Coast Guard lieutenant now serving as a White House Fellow and director for strategic planning on the National Security Staff. The views here are his own. Click here to visit The Providence Journal.

  • July21st

    As President Obama and Congress work on a deficit-reduction plan that would decrease federal spending, much of the media’s attention has been directed toward the serious threat facing Pell Grant funding. The nation’s support for protecting student aid from budget cuts is reflected by the pro-Pell editorials and opinion pieces that have appeared in just the last few days. We encourage you to share them with others, and use them in your advocacy efforts!

    Here are links to the opinion pieces that have run recently.

    If you see other pro-student aid opinion pieces, please post links to them in the comments section below!

    Cuts in Pell Grants would have detrimental affects on the 9 million college students who currently receive them. For many of these students, the grant is the deciding factor of whether they can pursue a higher education.