News: Senate education committee weighs short-term Pell Grants

Monday, July 24, 2023

Senate education committee weighs short-term Pell Grants

Jul 24, 2023

Presented by Sallie Mae®

SENATE SPOTLIGHT ON SHORT-TERM PELL GRANTS: The Senate education committee this week will take up legislation that expands the Pell Grant program to cover short-term training programs.

— It’s the first major legislative activity this Congress for an idea that’s won significant bipartisan support over the past several years even as lawmakers have struggled to reach a deal to turn it into law.

— The Senate HELP Committee on Thursday will mark up the Pell expansion legislation, which is known as the JOBS Act, S. 161, sponsored by Sen. Tim Kaine (D-Va.) and Mike Braun (R-Ind.). The panel will take up the measure alongside several other bills addressing apprenticeships and job training programs.

Sen. Tim Kaine (D-Va.) speaks during a press conference.

Sen. Tim Kaine has has pushed for the Pell expansion for several years. | Francis Chung/POLITICO

— Kaine, who has pushed for the Pell expansion for several years, has argued that it would help more low-income families quickly access the industry-recognized training they need to access higher-paying jobs.

— The bill would allow students to use Pell Grants to cover the costs of training programs at community or technical colleges that are as short as eight weeks long. The benefit currently is generally limited to programs that run for at least 15 weeks.

— The plan is backed by major business groups and community colleges. But some progressives have questioned whether the short-term programs would yield good results for students and whether taxpayers should subsidize job training programs for large corporations.

— Flashback: Proponents of short-term Pell Grants tried last year to attach the measure to the legislation that eventually became the CHIPS and Science Act. But disputes over exactly which programs should be eligible for the Pell expansion scuttled those efforts.

— A major disagreement has been over whether for-profit colleges will be allowed to participate in the expansion. The bipartisan Senate bill coming up in committee this week would exclude for-profit schools, which is an important provision for securing Democratic support for the measure.

— In the House, Rep. Virginia Foxx (R-N.C.), the chair of the House education committee, has said that expanding Pell to cover short-term workforce programs is a priority. GOP leaders earlier this year unveiled their proposal, which would allow all types of institutions to participate in the program. A handful of moderate House Democrats have also said they want to see for-profits included.

— Rep. Bobby Scott, the top Democrat on the House education committee, has previously said he’d like to reach a bipartisan deal to expand Pell Grants. His proposal, which he unveiled earlier this year, would include for-profit colleges but include more stringent eligibility criteria. The programs, among other things, would have to show that their graduates end up earning more than a high school graduate in their state and boost earnings by at least 20 percent.

— The administration angle: Education Secretary Miguel Cardona has previously expressed an interest in expanding Pell for short-term programs, though the Biden administration hasn’t made its own proposal or endorsed any of the legislative plans floating on the Hill.

ALSO HAPPENING ON THE HILL THIS WEEK: The House K-12 education subcommittee is holding a hearing about the impact of pandemic school closures. The panel meets Wednesday.

— On Thursday, Senate appropriators will take up their proposal for education spending for the coming 2024 fiscal year. The plan is likely to set up a clash with House Republicans who earlier this month unveiled their plan that called for a 28-percent overall cut to education spending and a slew of policy riders that take aim at Biden’s education and student loan policies.

IT’S MONDAY, JULY 24. WELCOME TO MORNING EDUCATION. Please send tips and feedback to the POLITICO education team: Michael Stratford (mstratford@politico.com), Mackenzie Wilkes (mwilkes@politico.com), Juan Perez Jr. (jperez@politico.com) and Bianca Quilantan (bquilantan@politico.com). Follow us on Twitter: @Morning_Edu and @POLITICOPro.

A message from Sallie Mae®:

Higher education access and affordability have been front and center and rightly so, following the Supreme Court's decision on federal student debt forgiveness. What’s been missing from the debate, however, is how we address the broader issue — a broken federal financing system in need of significant reform. Read more.

Student Loans

CARDONA CONFIRMS STATES CAN REGULATE FEDERAL STUDENT LOAN SERVICERS: The Biden administration is finalizing its repeal of a Trump-era policy that had been aimed at blocking states from regulating or investigating the companies that collect federal student loans.

— Education Secretary Miguel Cardona on Monday formally issued a final version of the legal opinion he first circulated two years ago. The notice of interpretation makes clear that the Education Department believes that states have the power to regulate federal student loan servicing companies in many cases.

— The policy reverses the Trump administration’s efforts to shield federal student loan servicing companies from having to answer to state regulators and attorneys general. A 2018 opinion, which the student loan industry had sought, was sharply criticized by state officials, congressional Democrats and consumer advocacy groups.

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— The Biden administration policy, by contrast, gives the green light to states to enact rules that prohibit federal student loan servicers from misleading borrowers or engaging in other types of misconduct. The policy acknowledges, though, that there are some circumstances in which state rules on federal loan servicers are invalid. The policy says that a state can’t, for example, outlaw the operation of federal loan servicer within its border. And it can’t impose its own requirements that clash so significantly with federal rules that it makes it impossible for a company to comply with both.

— No major tweaks: The thrust of the final Cardona policy remains essentially unchanged from what the Biden administration first released in 2021. The final version notes that the Education Department’s new contracts with loan servicing companies have explicit provisions that require compliance with state rules.

A message from Sallie Mae®:

K-12

ICYMI - CARDONA TELLS UNION LEADERS TO ‘GET BACK ON OFFENSE’: Education Secretary Miguel Cardona attacked a “fabricated attempt to divide our schools and families” to a friendly labor union audience on Friday, as the White House accelerates education-focused campaign messaging that targets President Joe Biden’s conservative 2024 election rivals.

— “This isn’t about ‘woke’ or ‘anti-woke’, this is about our need to wake up,” Cardona said in Washington during the American Federation of Teachers’ annual TEACH Conference. “We need to get back on offense and reclaim the narrative of our public schools.”

— Cardona’s political rhetoric dovetails with a schools-based counteroffensive from Biden’s allies that has intensified since spring. Vice President Kamala Harris also traveled to Florida last week to attack Republican Gov. Ron DeSantis and the GOP presidential candidate’s support for restrictions on classroom instruction and curriculum that address race, gender and sexuality. Juan Perez Jr. has more.

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Syllabus

— Democratic Rep. Marie Gluesenkamp Pérez’s automobile repair business targeted with bad reviews after student loan vote: The New York Times.

— 'This is a really big deal': How college towns are decimating the GOP: POLITICO Magazine.

— University of Phoenix deal needs to get approved. What’s next for University of Idaho?: Idaho Statesman.

A message from Sallie Mae®:

The federal higher education financing system is doing too much for too many and not enough for those who need the most support. Complicated applications, confusing financial aid offers, and federal programs that offer virtually unlimited lending without considering the borrowers’ ability to repay is driving unsustainable federal student loan debt. Without significant structural reforms to the current system, another generation of students and families will face the same hurdles as so many do today. Sallie Mae’s CEO Jon Witter highlights ways to bring meaningful reform to the federal higher education financing system. Click to learn more.