With student loans, tuition costs, and value of higher education in the headlines every week, it’s a good time to look at the legislation behind federal student aid — where it’s been, and where it could be going.
The highly popular and overwhelmingly bipartisan Higher Education Act of (HEA) 1965 broke open the possibility of college for thousands of Americans though financial assistance from the government via Pell Grants and federal student loans. It also established requirements for the institutions that would seek to enroll those federally aided students.
In the nearly 60 years since the HEA was born, higher education has grown tremendously in size, complexity, options, and cost. In 1964, 447,000 people received bachelor’s degrees. In 2021, that number grew to more than 4 million students, with many more completing other credentials. Higher education legislation has not evolved apace. The last reauthorization of the HEA was the Higher Education Opportunity Act (HEOA) in 2008, which focused on transparency in pricing, consumer information, and some added requirements for institutions.
With huge challenges facing higher education, the need for reform is greater than ever before.Kelly McManus vice president of higher education at Arnold Ventures
Set to expire in 2013, the HEOA has largely sat stagnant, despite several partisan attempts at reauthorization. In the meantime, the department has instead instituted policy changes in multiple directions through regulation. Ten years later, higher education advocates and policymakers are eager to create a solid, bipartisan act with staying power that will benefit students and taxpayers alike.
Amount of federal student loan debt in 2023
The federal government’s investment in higher education is now more than $115 billion per year. Today, students owe $1.6 trillion in federal student loan debt. The student loan system has become more complicated, rising tuition has far outpaced increases in the cost of living, and the schools that enroll federally aided students too often leave students without a credential of value. Yet, the Higher Education Act has not adapted to address these problems.
With the start of the new Congress, a host of new and returning committee members and hardworking staffers are back on Capitol Hill. With their return comes the possibility of bipartisan progress on one of the largest, most comprehensive pieces of legislation in higher education — and Arnold Ventures is excited to engage in those discussions.
At Arnold Ventures, we see the next reauthorization of the Higher Education Act as a moment to shore up measures that create value for students — through more transparency about the outcomes colleges provide to their students, greater accountability for institutions, a better and more efficient student loan system, and the broader use of evidence-based practices to support students as they work to complete their degrees.
“With huge challenges facing higher education, the need for reform is greater than ever before,” says Vice President of Higher Education Kelly McManus. “These priorities for improvements to the Higher Education Act offer common-sense, straightforward solutions to hold institutions accountable for ensuring that students’ and taxpayers’ investments are in high-value programs.”
Here is a look at our biggest priorities as well as our policy agenda.