A Great First Step in Providing Equity for HBCUs and Low-Income, First-Generation College Students

On Oct. 15, Rep. Bobby Scott (D-VA), Chairman of the House Committee on Education and Labor, and the committee Democrats released an over 1,100-page proposal unveiling their ideas for reforming the higher education system. This proposal, known as the College Affordability Act (CCA), includes a number of provisions that have long been championed by UNCF (United Negro College Fund). UNCF applauds Chairman Bobby Scott for his work in presenting a comprehensive proposal to reauthorize the Higher Education Act of 1965 (HEA).

We express our support for several provisions. Most notability, we would like to highlight that the CCA does the following to benefit HBCUs:

  • Reauthorizes funding for the Honorable Augustus F. Hawkins Centers of Excellence competitive grant program;
  • Reduces endowment matching to 50% of the federal funds instead of the full amount of the federal funds and allows institutions of higher education (IHEs) to use endowment gifts as part of the matching requirement;
  • Allows IHEs to use endowment funds for scholarships to students statutorily and reauthorizes the Endowment Challenge Grant Program at $220 million;
  • Adds additional allowable uses for HBCUs, TCUs and MSIs in Title III of the HEA;
  • Adds deferment language in the HBCU Capital Financing program to decrease financial burden on HBCUs;
  • Increases mandatory funding in Title III, Part F to $300 million, reauthorizes this program indefinitely and provides an increase in the allotment for HBCUs;
  • Increases the authorization level for HBCUs in Title III from $375 million to $400 million;
  • Increases the authorization level for the Historically Black Graduate Institution program from $125 million to $135 million;
  • Creates a Minority-Serving Institutions Innovation Fund in Title VII of the HEA authorizing a total of $850 million for the program and allotting $224,987,083 for HBCUs; and
  • Reauthorizes the HBCU Masters program, provides mandatory funding for the program permanently and increases the mandatory allotment from $11.5 million to $13.5 million.

In addition, we would like to highlight a few proposals included in the CCA that benefits low income, first generation college students. Most notably the CCA:

  • Increases the maximum Pell grant award level by $500 and provides for annual inflationary indexes;
  • Allows for incarcerated individuals to receive Pell grants;
  • Increases the authorization level for TRIO programs from $900 million to $1.12 billion and increases the authorization level for the GEAR UP program from $400 million to $500 million;
  • Maintains the Federal Supplemental Education Opportunity Grant program, reinstates the Federal Perkins Loan program and creates a new Emergency Financial Aid Grant program;
  • Modernizes the Federal Work Study program, simplifies the repayment plans down to two (a fixed repayment plan and an income-based repayment plan) and simplifies the Free Application for Federal Student Aid; and
  • Eliminates loan origination fees, provides greater accountability over loan servicers and adds important modifications to the need analysis formula for students seeking financial aid.

While UNCF is appreciative of the aforementioned provisions, there remain proposals that UNCF would like to continue to work on with Members and staff. For instance, the CCA proposes to increase access to grant aid and federal student loans, but the proposal fails to mention the ability for institutions to limit student over-borrowing based on criteria such as program of study. UNCF finds that HBCU students borrow at greater rates, borrow greater amounts, and seek loans from more costly sources while encountering more obstacles when repaying loans. The proposal also repeals the student unit record ban and creates a new data system, but falls slightly short of providing clear assurances that the data being collected will not be misused for accountability purposes, especially as it relates to earnings and job placement data. The bill enhances the accreditation process, but stronger language could be incorporated to ensure that our nation’s HBCUs are treated fairly amongst accreditors.

Furthermore, the proposal seeks to increase institutional accountability by creating a new Adjusted Cohort Default Rate metric consisting of 10, 15 and 20 percent. While UNCF appreciates no mention of a risk-sharing proposal to increase accountability, there are concerns regarding the potential impact of this proposal for HBCUs. FY 2016 Cohort Default Rate (CDR) showed that all eligible HBCUs had three-year CDRs that fell below regulatory thresholds and no HBCUs were subject to CDR sanctions or the loss of Title IV aid. Under this proposal, it is unclear whether or not the outcomes would be the same.

HBCUs have a strong value proposition and punch well above their weight not only in their impact on their local communities but also in their states by ensuring low-income, first generation college students are prepared to succeed. They also produce skilled graduates for employers and bolster their local and regional economies—as documented in, HBCUs Make America Strong: The Positive Economic Impact of Historically Black Colleges and Universities.

UNCF looks forward to working with Chairman Bobby Scott and the entire House Committee on Education and Labor as a reauthorization of the HEA moves through the House to ensure college affordability and success for our most vulnerable students and the institutions that serve them.

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About UNCF
UNCF (United Negro College Fund) is the nation’s largest and most effective minority education organization. To serve youth, the community and the nation, UNCF supports students’ education and development through scholarships and other programs, strengthens its 37 member colleges and universities, and advocates for the importance of minority education and college readiness. UNCF institutions and other historically black colleges and universities are highly effective, awarding nearly 20 percent of African American baccalaureate degrees. UNCF awards more than $100 million in scholarships annually and administers more than 400 programs, including scholarship, internship and fellowship, mentoring, summer enrichment, and curriculum and faculty development programs. Its logo features the UNCF torch of leadership in education and its widely recognized motto, “A mind is a terrible thing to waste.”® Today, UNCF supports more than 60,000 students at more than 1,100 colleges and universities. Learn more at UNCF.org or for continuous news and updates, follow UNCF on Twitter @UNCF.