President Barack Obama unveiled a set of sweeping proposals Thursday that would tie federal aid dollars to college value and student’s academic success.
Colleges would be rated – and rewarded – based on factors such as student debt, graduation rates, tuition and low-income students enrollment in an attempt to pressure universities to lower cost of attendance. The ratings would be released by 2015.
“We’re going to start rating colleges not just by which college is the most selective, not just by which college is the most expensive, not just by which college has the nicest facilities – you can get all of that on the existing rating systems,” Obama told a crowd of students at the University of Buffalo. “What we want to do is rate them on who’s offering the best value so students and taxpayers get a bigger bang for their buck.”
If Congress approves the proposal, the government would dole out financial aid based on the value scores as early as 2018.
The Obama administration has already targeted transparency of college costs, creating a “shopping sheet” that allows students and their families to easily compare schools’ academic and financial facts.
The government will use that information, which is voluntarily submitted by thousands of colleges nationwide, to implement this round of affordability initiatives. But it will also require additional data collection to determine graduates’ pay and job rates, which are not collectedly evenly across colleges.
A plan that rewards universities for attracting students from low-income families – which can be measured by the number of Pell Grant recipients – could spell trouble for GW.
About 13 percent of GW students receiving the award in the 2010-2011 academic year – putting GW in the bottom rung of colleges that enroll Pell Grant recipients.
Secretary of Education Arne Duncan said he expects a “mixed reaction” from universities, and will seek input from college presidents, faculty and students.
College costs have soared over the last decade, while the recession shed thousands of American jobs and created new areas of growth in more high-tech industries.
“At a time when a higher education has never been more important or more expensive, too many students are facing a choice that they should never have to make: Either they say no to college and pay the price for not getting a degree – and that’s a price that lasts a lifetime – or you do what it takes to go to college, but then you run the risk that you won’t be able to pay it off because you’ve got so much debt,” Obama said.
The president also said he wants more ways for student borrowers to pay back loans based on how much they’re earning after college. That would apply to students who borrowed before 2008 ,and would cap payments on federal loans at 10 percent of their incomes.