Finding the terms “ethics reform” and “U.S. Senate” in the same sentence is about as likely as avoiding hearing about the end of “Harry Potter and the Deathly Hallows.” However, that’s just what happened last week as the Senate passed its final legislation to reauthorize the Higher Education Act of 1965 and reform ethics codes on the relationship between college officials and student loan companies.
- Sarah Royce
Among the many new changes, the bill prohibits loan companies from providing financial aid officers with trips, gifts or other incentives in exchange for advantages in the student loan market. It also cuts almost $19 billion over five years in private educational lending subsidies, adding most of that money to low- and middle-income students. Finally, the bill simplifies the FAFSA from seven pages down to two and requires that growth in tuition and fees for all universities be reported.
At a time when students are being hit with rising tuition costs and dwindling financial aid, this new bill is a big victory. Not only does it make the student lending industry more competitive and less criminal, it adds a much-needed increase to student grants and reduces loan payments for students who are suffering from Congress’s previous negligence.
However, the effectiveness of the law’s other stipulations will largely be determined by how they are implemented. Decreasing the number of FAFSA pages may be more convenient, but the priority is to create a financial aid application that will gauge an individual’s ability to pay for college through questions like how much a student’s parents will contribute to tuition. Unless the government chooses to reevaluate the form, it’s likely that the shortening of the FAFSA will only aggravate this problem.
Likewise, forcing colleges to release tuition increases for scrutiny helps the public monitor exorbitant price hikes and hold educational institutions accountable. But forcing universities to report price hikes does nothing to stop them from raising them steadily but surely.
Finally, while marshalling the relationship between lenders and financial aid officials is an obvious way to prevent the scandals that have riddled student lending, this legislation may not have gone far enough. After all, the scandal within Columbia University’s financial aid department last year didn’t involve gifts, but rather officials owning stock in a company classified by the university as a “preferred lender.” This bill does nothing to prevent such conflicts of interest in the future.
While the Senate’s new ethics bill could use some tweaking, it is at least some good news for students and an encouraging sign of long-overdue competence from Congress.