[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]





      EXPANDING OPPORTUNITIES IN HIGHER EDUCATION: HONORING THE 
       CONTRIBUTIONS OF AMERICA'S HISPANIC SERVING INSTITUTIONS

=======================================================================

                             FIELD HEARING

                               before the

                    SUBCOMMITTEE ON SELECT EDUCATION

                                 of the

                         COMMITTEE ON EDUCATION
                           AND THE WORKFORCE
                     U.S. HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

                               __________

                   October 6, 2003 in Edinburg, Texas

                               __________

                           Serial No. 108-35

                               __________

  Printed for the use of the Committee on Education and the Workforce



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                COMMITTEE ON EDUCATION AND THE WORKFORCE

                    JOHN A. BOEHNER, Ohio, Chairman

Thomas E. Petri, Wisconsin, Vice     George Miller, California
    Chairman                         Dale E. Kildee, Michigan
Cass Ballenger, North Carolina       Major R. Owens, New York
Peter Hoekstra, Michigan             Donald M. Payne, New Jersey
Howard P. ``Buck'' McKeon,           Robert E. Andrews, New Jersey
    California                       Lynn C. Woolsey, California
Michael N. Castle, Delaware          Ruben Hinojosa, Texas
Sam Johnson, Texas                   Carolyn McCarthy, New York
James C. Greenwood, Pennsylvania     John F. Tierney, Massachusetts
Charlie Norwood, Georgia             Ron Kind, Wisconsin
Fred Upton, Michigan                 Dennis J. Kucinich, Ohio
Vernon J. Ehlers, Michigan           David Wu, Oregon
Jim DeMint, South Carolina           Rush D. Holt, New Jersey
Johnny Isakson, Georgia              Susan A. Davis, California
Judy Biggert, Illinois               Betty McCollum, Minnesota
Todd Russell Platts, Pennsylvania    Danny K. Davis, Illinois
Patrick J. Tiberi, Ohio              Ed Case, Hawaii
Ric Keller, Florida                  Raul M. Grijalva, Arizona
Tom Osborne, Nebraska                Denise L. Majette, Georgia
Joe Wilson, South Carolina           Chris Van Hollen, Maryland
Tom Cole, Oklahoma                   Tim Ryan, Ohio
Jon C. Porter, Nevada                Timothy H. Bishop, New York
John Kline, Minnesota
John R. Carter, Texas
Marilyn N. Musgrave, Colorado
Marsha Blackburn, Tennessee
Phil Gingrey, Georgia
Max Burns, Georgia

                    Paula Nowakowski, Staff Director
                 John Lawrence, Minority Staff Director
                                 ------                                

                    SUBCOMMITTEE ON SELECT EDUCATION

                   PETER HOEKSTRA, Michigan, Chairman

John C. Porter, Nevada, Vice         Ruben Hinojosa, Texas
    Chairman                         Susan A. Davis, California
James C. Greenwood, Pennsylvania     Danny K. Davis, Illinois
Charlie Norwood, Georgia             Tim Ryan, Ohio
Phil Gingrey, Georgia                George Miller, California, ex 
Max Burns, Georgia                       officio
John A. Boehner, Ohio, ex officio


                                 ------                                
                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on October 6, 2003..................................     1

Statement of Members:
    Hinojosa, Hon. Ruben, a Representative in Congress from the 
      State of Texas.............................................     3
    Hoekstra, Hon. Pete, a Representative in Congress from the 
      State of Michigan..........................................     2
        Prepared statement of....................................     2

Statement of Witnesses:
    Brockman, Dr. John, President, Coastal Bend Community College    16
        Prepared statement of....................................    20
    de la Garza, Ariana, Student Representative, University of 
      Texas - Pan American.......................................    50
        Prepared statement of....................................    51
    Garcia, Dr. Juliet, President, University of Texas - 
      Brownsville................................................    36
        Prepared statement of....................................    41
    Juarez, Dr. Rumaldo, President, University of Texas A&M - 
      Kingsville.................................................    11
        Prepared statement of....................................    14
    Nevarez, Dr. Miguel, President, University of Texas - Pan 
      American...................................................     5
        Prepared statement of....................................     8
        Letter submitted for the record..........................    61
    Reed, Dr. Shirley, President, South Texas Community College..    43
        Prepared statement of....................................    46

Additional materials supplied:
    Ashby, Cornelia M., Director, Education, Workforce, and 
      Income Security, U.S. General Accounting Office, Statement 
      submitted for the record...................................    63
    Hatton, Dr. Sylvia Reyna, Executive Director, Region One 
      Education Service Center, Statement submitted for the 
      record.....................................................    72
    Hinojosa, Leticia C., Special Assistant to the Commissioner 
      of Higher Education, Texas Higher Education Coordinating 
      Board, Statement submitted for the record..................    82
    Johnson, Dr. Christine, President, Community College of 
      Denver, Statement submitted for the record.................    79
    Jones, Dr. Dan R., Provost and Vice President for Academic 
      Affairs, Texas A&M University, Statement submitted for the 
      record.....................................................    81
    Parker, Jimmy, on behalf of the Texas Student Financial Aid 
      Administrators and the Association of Texas Lenders for 
      Education, Statement submitted for the record..............    90
    Reyes, Dr. Mary Alice, Director, University of Texas - Pan 
      American GEAR UP Project...................................    93
    Torres, George C., Assistant Vice President for 
      Congressional/ Legislative Relations, Texas Guaranteed 
      Student Loan Corporation...................................    96
    .............................................................    00

 
EXPANDING OPPORTUNITIES IN HIGHER EDUCATION: HONORING THE CONTRIBUTIONS 
               OF AMERICA'S HISPANIC SERVING INSTITUTIONS

                              ----------                              


                        Monday, October 6, 2003

                     U.S. House of Representatives

                    Subcommittee on Select Education

                Committee on Education and the Workforce

                            Edinburg, Texas

                              ----------                              

    The Subcommittee met, pursuant to call, at 9:30 a.m., in 
the International Room, ITT Building, 1201 W. University Drive, 
University of Texas - Pan American, Edinburg, Texas, Hon. Pete 
Hoekstra [Chairman of the Subcommittee] presiding.
    Present: Representatives Hoekstra and Hinojosa.
    Staff Present: Alison Ream, Professional Staff Member
    Chairman Hoekstra. Good morning. A quorum being present, 
the Subcommittee on Select Education of the Committee on 
Education and the Workforce will come to order. The--weak gavel 
here. Don't get much noise. Kind of rings through the hearing 
room when you're in Washington.
    Let me just give you a little bit of a brief introduction. 
No. 1, I'd just like to thank my colleague, Congressman 
Hinojosa, for inviting the Subcommittee to be here today and to 
hear testimony. He's been a wonderful host. I came in last 
night and I'll be staying through the day and heading back to--
the Congressman and I will be heading back to Washington 
tomorrow. We have votes tomorrow night in Washington, D.C. But 
I very much appreciate the opportunity to be here.
    The first session that we have today will be more along the 
lines of what you typically see in Washington D.C. With the 
congressman and myself sitting up here and you sitting down 
there. And we have a timer, although we--I'll warn you in 
advance that for the witnesses that are testifying I have what 
is known as a weak gavel, which means that if you go over--
we're more--we're more interested in hearing what you have to 
say and we appreciate you being here and making the commitment 
to drive out and to be here and to testify. So we're interested 
in getting the information rather than sticking to--to the 
clock and those types of things.
    And this afternoon--so we've got a couple panels this 
morning that will be on the more traditional side of gathering 
information for policymaking in Washington. And then this 
afternoon we'll have a more of an informal discussion called a 
roundtable where we will--it will be more of a format for 
dialog and those types of things.
    I have a--about a five or seven page opening statement. And 
let me just go through parts of that and then we will--we'll 
put the rest of it, as we say we'll submit it for the record, 
so that if anybody in the future wants to go back and read what 
we had to say today they will find it, but I'm not going to go 
through it in its entirety.

  STATEMENT OF HON. PETER HOEKSTRA, CHAIRMAN, SUBCOMMITTEE ON 
   SELECT EDUCATION, COMMITTEE ON EDUCATION AND THE WORKFORCE

    I would like to thank the University of Texas Pan American 
for hosting the hearing today and also for hosting the 
roundtable this afternoon. I also ask for unanimous consent, 
which means that the two of us agree, for the hearing record to 
remain open for fourteen days to allow Members' statements and 
other extraneous material referenced during the hearing to be 
submitted in the official hearing record. Without objection?
    Without objection, it's so ordered.
    The hearing today is entitled ``Expanding Opportunities in 
Higher Education: Honoring the Contributions of America's 
Hispanic Serving Institutions.'' Your congressmen and myself 
have been very interested in a couple of specific groups of 
colleges. One is the HBCU's, Historically Black Colleges and 
Universities and the Federal efforts to make sure that that 
group of colleges serving a very specific population gets the 
Federal support that they need to be successful. And then over 
the last five to 7 years specifically we've also focused on 
Hispanic Serving Institutions and to make sure that we are 
providing the appropriate level of Federal support to those 
institutions so that--you know, the intent for all the higher 
education programs in Washington is that, you know, we do not 
leave any children behind. Whether it's K through 12, we put in 
place the proper Federal support for K through 12, but then we 
also move beyond that so that when our young people are coming 
out of high school that they have a range of opportunities to 
get higher education. You know, there is--it's clear that 
whether you're in Michigan, whether you're in Texas, or whether 
you're in any part of the country today the access to higher 
education is extremely critical. And if we are going to 
continue to be competitive in global markets we have to have a 
talented and an education--or an educated population.
    I can make copies of my opening statement for anybody who 
wants to read them. But I think I'm just going to submit mine 
for the record, thank everybody for being here and I will yield 
to our host, Mr. Hinojosa, for whatever comments he may have.
    [The prepared statement of Mr. Hoekstra follows:]

Statement of Hon. Pete Hoekstra, a Representative in Congress from the 
                           State of Michigan

    Good morning.
    On behalf of the House of Representatives Committee on Education 
and the Workforce, I would like to welcome everyone to the University 
of Texas, Pan-American for today's hearing, entitled, ``Expanding 
Opportunities in Higher Education: Honoring the Contributions of 
America's Hispanic Serving Institutions.'' My name is Pete Hoekstra and 
I am the Chairman of the Subcommittee on Select Education and represent 
Michigan's second district. I would like to thank my friend and 
colleague, Mr. Hinojosa, for his work and diligence in helping to put 
together this field hearing. I would also like to recognize the 
University of Texas, Pan-American for hosting both the hearing and 
roundtable on their campus. We appreciate their hospitality and we are 
pleased to be here.
    Let me begin by saying that I am excited to hear from our witnesses 
throughout the day and I believe that expanding educational 
opportunities for students at Hispanic Serving Institutions is an 
extremely important and timely topic. Moreover, Edinburg and the 
surrounding Hidalgo (Hee-Daahl-Go) county are steeped in a rich, 
Hispanic history that makes the University of Texas, Pan-American a 
fitting site for today's hearing.
    Hispanic Serving Institutions, or HSIs, are vital components of the 
higher education equation. There are currently more than 200 HSIs in 
United States, and the number of HSI institutions grows each year. 
While comprising only 5 percent of all institutions of postsecondary 
education, HSIs enroll 49 percent of Hispanic-American students.
    Not only do HSIs improve access to higher education for Hispanic 
Americans, but they also are committed to providing academic excellence 
to low-income and disadvantaged students. HSIs enroll and graduate 
thousands of impressive students each year, and enrollments at these 
institutions are climbing. According to the U.S. Department of 
Education, the enrollment of Hispanic American students in college is 
growing twice as quickly as college enrollments in general.
    Prior to reauthorization of the Higher Education Act in 1998, HSIs 
were eligible for federal funds under Title III, Part A--the 
Strengthening Institutions Program.
    During the 1998 reauthorization, Congress created a separate 
program and funding stream for HSIs in an effort to expand educational 
opportunities for Hispanic students. The new program, under Title V, 
allows institutions to use federal money to build their endowments and 
provide scholarships and fellowships for needy students.
    Congress has made breaking down barriers and expanding educational 
opportunities a top priority. This commitment is particularly apparent 
with regards to HSIs. Funding for HSIs has increased by more than 35 
percent since President Bush took office, growing from $68.5 million in 
fiscal year 2001, to $92.4 million in fiscal year 2003. The fiscal year 
2004 funding level for HSIs in the education spending bill passed by 
the House in July would increase funding for Hispanic Serving 
Institutions yet again, by $1.2 million, to an all-time high of $93.6 
million.
    In 1965, Congress enacted the Higher Education Act, which took on 
the central mission of ensuring that every low-income student in the 
country could be afforded the opportunity to pursue his or her 
educational goals. Currently, the Committee is in the process of 
reauthorizing the Higher Education Act. The reauthorization process 
offers Congress an opportunity to enact needed modifications to the 
programs covered under the Act and the rules that govern them, with the 
goal of building upon the programs that are working well.
    I would like to thank everyone for attending today. I would 
especially like to thank our distinguished panel of witnesses for their 
participation. I look forward to your testimony. At this time I would 
like to yield to my colleague, Mr. Hinojosa, for any opening statement 
he would like to offer.
                                 ______
                                 

STATEMENT OF HON. RUBEN HINOJOSA, RANKING MEMBER, SUBCOMMITTEE 
 ON SELECT EDUCATION, COMMITTEE ON EDUCATION AND THE WORKFORCE

    Mr. Hinojosa. Thank you, Mr. Chairman. It's indeed an honor 
for us and a privilege for me to host this field hearing in the 
15th Congressional District of Texas. I would like to 
personally thank the Chairman of the Select Education 
Subcommittee, Congressman Pete Hoekstra of Michigan, for 
agreeing to hold this hearing. And I want to thank him for his 
strong interest in seeing first hand the incredible strides we 
are making in South Texas in opening the doors of higher 
education to our community. I would also like to thank our 
host, the University of Texas-Pan American and especially 
President Miguel Nevarez for providing this wonderful venue for 
our field hearing.
    South Texas as a region is at the forefront of expanding 
opportunities to higher education. This community is hungry for 
higher education. It is the fuel for our economic development 
and growth. I heard Dr. Nevarez speak at an event recently 
where he spoke about the growing demand for higher education in 
Texas where it is estimated that the growth in this last two or 
3 years has been 7 percent. On the other hand he said the Rio 
Grande Valley of South Texas from Laredo, to Edinburg, to 
Brownsville, Kingsville we have seen a dynamic growth of 
twenty-eight percent growth of access to higher education.
    So this, Mr. Chairman, is proof that our people are hungry 
for that opportunity. We know that those who complete the 
bachelors degree, and especially a masters and a Ph.D. Degree 
are going to be able to earn far more money than those that 
just graduate from high school.
    We're starting to make great strides forward, but we have a 
long way to go. According to the most recent census Hidalgo 
County has outpaced the rest of Texas in its population growth. 
We have grown by nearly fifty percent over the last 10 years, 
more than double the twenty-three percent rate for the entire 
State of Texas.
    However, we continue to lag far behind the rest of the 
State in educational attainment and we have made little 
progress in closing that gap. Today nearly half of our adult 
population has not completed high school, just marginally 
better than 10 years ago. Likewise, the percentage of our 
population with college degrees remains much lower than the 
rest of the State of Texas. Barely thirteen percent of adults 
in Hidalgo County have a college degree compared to twenty-
three percent for the rest of Texas.
    If we do not dramatically improve our educational 
attainment our community will be left behind in the economy of 
this 21st century. The witnesses who will be addressing us 
today are leaders who are making a difference in expanding 
educational opportunities for South Texans and for Hispanic 
Americans. They are looked up to for leadership in us reaching 
that goal that I just described.
    Although the gap in educational attainment remains more 
South Texas--although the gap in educational attainment remains 
more South Texans are in college now than ever before. Consider 
the target enrollments for these institutions. South Texas 
Community College started 10 years ago with less than a 1,000 
students and now has more than 15,000 students, projected to 
have 27,000 students by 2015. The University of Texas at 
Brownsville plans to double its enrollment to 20,000 by 2010. 
Our host institution, the University of Texas-Pan American 
enrolls 16,000 students and has set 26,000 students as its 
target enrollment for the year 2015.
    I am looking forward to hearing from the college presidents 
and our student representatives how we at the Federal level can 
support this kind of growth and build the capacity of our 
institutions to meet the growing demand for higher education.
    Finally, Mr. Chairman, I'm also interested in hearing the 
witnesses' views and recommendations on how we can increase the 
number of Hispanics with advanced degrees. Thank you for being 
with us today and I'm eager to hear your testimony.
    Chairman Hoekstra. Thank you very much.
    Let me introduce the panels that we have today. I did not 
ask Congressman Hinojosa, but I asked his staff if he wanted to 
introduce the witnesses considering that they were, you know, 
his constituents or constituents of the State of Texas. And the 
staff said we'd rather have you do it because they're all his 
friends. And, you know, if somebody messes up we'd rather have 
it be you. You know, if somebody gets too long of an 
introduction or too short of an introduction we'd rather have 
you make the mistake than Mr. Hinojosa. So let me have the 
privilege of introducing the first panel.
    We're going to have two panels today--this morning. The 
first witness we will have Dr. Miguel Nevarez. Dr. Nevarez is 
the first Hispanic president of the University of Texas-Pan 
American and is also one of the longest tenured Hispanic 
presidents in the United States having served in this capacity 
since 1981. Prior to his current position Dr. Nevarez served 
the university as an assistant professor, an Associate Dean of 
Men, and as Vice-President for Student and University Affairs. 
Welcome and good morning to you.
    Your second witness will be Dr. Rumaldo Juarez.
    Dr. Juarez. Juarez.
    Chairman Hoekstra. Juarez. You know, it would be a lot 
easier if you had a lot of Dutch names here. I looked at this 
at the beginning of the day or when we were coming down here 
and it's like, you know, I'm going to have a great day, but I'm 
going to struggle with names all day. So hopefully you will be 
patient. America is a great country with a tremendous amount of 
diversity and hopefully all of us are patient with each other.
    Dr. Juarez was appointed the 17th president of the 
University of Texas A&M-Kingsville in August of 2002. 
Previously served as dean and professor in the College of 
Health Professions at Southwest Texas State University. He has 
received several awards throughout his career including the 
Association of Schools of Allied Health Cultural Pluralism 
Award. The third--Welcome to you.
    And then our third witness on this first panel will be Dr. 
John Brockman. Dr. Brockman currently serves as president of 
the Coastal Bend Community College in Beeville, Texas. 
Previously he acted as Vice-President of Arts and Social 
Sciences for Coastal Bend Community College. He presently 
serves as a member of the Southern Association of Colleges and 
Schools, Commission on Colleges and also on the board of 
directors for the Texas Community College Association.
    The process now will--will be that each of the witnesses 
will be allowed to make their statements. Your entire 
statements will be submitted for the record, so go through as 
much or as little of it as you would like, but the key thing is 
to make sure that you communicate with us and we get the points 
that you'd like to make this morning. So Dr. Nevarez, welcome 
and thank you for being here.

   STATEMENT OF DR. MIGUEL NEVAREZ, PRESIDENT, UNIVERSITY OF 
                       TEXAS-PAN AMERICAN

    Dr. Nevarez. Thank you, Mr. Chairman, Congressman Hinojosa. 
Good morning, my name is Miguel Nevarez, I'm President of the 
University of Texas-Pan American. And I'm pleased and honored 
that you have chosen to provide this region the opportunity to 
share our challenges and our recommendation. I hope you enjoy 
our beautiful wonderful campus and our hospitality of our 
people.
    In preparing for this hearing I was asked to focus on 
issues and challenges of the University of Texas-Pan American. 
And these issues and challenges can be identified into five 
areas; access, affordability, success and retention, teacher 
preparation, and expanded research opportunities.
    As President I have articulated these issues as goals which 
the university must strive to achieve. Meeting these goals is 
essential. The main issue of access is the need to be sure that 
we have qualified students in our doors. The educational 
pipeline is only allowing 55 percent of the ninth grade 
students in our region to graduate from high school. Of those 
who graduate another small percentage go on to some type of 
higher education. Not graduating from high school and not being 
prepared for college work are critical issues that hamper 
access to higher education for our students.
    As Congressman Hinojosa said we're all experiencing 
tremendous enrollment increases and I believe that we will 
surpass the projections much sooner than they've been 
projected. However, we will not be able to serve these 
increasing number of deserving and qualified students unless 
increased amount of financial aids are available, more in terms 
of grants than loans.
    Another access issue has resulted from the 1996 Illegal 
Immigration Reform and Immigration Responsibility Act. This act 
removes the ability of States to determine residents for the 
purpose of higher education benefits. This act prohibits aliens 
who come to the United States as children and successfully 
complete high school in Texas to qualify for financial aid and 
for in-state tuition. We are betraying students who have worked 
hard in our public schools, persisted and graduated who are 
then denied the higher education assistance that is available 
to their peers who are in the same socio-economic 
circumstances.
    The next obstacle is affordability. I know you are all 
aware that State contributions to public higher education are 
dwindling nationally. Budget crises from State to State affect 
all of us in higher education. Students who do go to college 
are asked to contribute more of the costs of their education. 
For many this does not present a problem, but for our students 
who have to work just to break even with increased tuition 
costs additional burdens have been placed upon them.
    There has also been a discouraging shift over the past 
years from grant to loans as the primary means of financing 
higher education for many students. This shift has been a 
disservice to all of us.
    While access and affordability are critical for bringing 
students to the gates of academia it is essential that 
institutions offer support services and an environment 
conducive to success during their academic career. One of our 
goals--arching goals here is to improve student access and 
success. UTPA has increased its first year of retention rate 
for freshmen from 55 percent for the Fall 1999 cohort to 67 
percent for the Fall of 2000 cohort. Our target is to increase 
first year retention by at least 1 percentage point each year. 
Our 6 year graduation rate, the standard in the United States, 
is not stellar. For the Fall 1995 entering cohort 6 years later 
only 23 percent had graduated from UTPA. However, if one tracks 
the success of students in the cohort who have graduated from 
other institutions in the State or who have--still persist and 
still enroll here or elsewhere after 6 years the success rate 
increased to 50 percent, a rate more in line with other higher 
education public institutions.
    Another of UTPA's overarching goals is to be a State leader 
in the preparation and production of public school teachers. 
UTPA has been among the top producers in the State of certified 
teachers for many years, and has been the largest producer of 
bilingual teachers in the United States.
    The State measures the quality of these teachers according 
to their performance in the State-mandated comprehensive exam. 
We have in place strategies to increase the pass rate for 
first-time test takers to 75 percent, next year to 80 percent, 
and in '06 to 90 percent. These reforms will improve the 
quality of teachers we educate while increasing the production 
of much-needed instructors for the public schools.
    As one of the major population centers of the State we 
ought to be served by a major research institution. Hidalgo 
County is the seventh largest in the State and if we add 
Cameron County the number exceeds the population of El Paso.
    UTPA, therefore, is striving to become a doctoral/research 
intensive institution. Such institutions benefit their service 
area not only through the availability of an array of degree 
programs appropriate for the needs of the region, but also 
through focused research and research based public service 
activities that are intended to increase the understanding of 
the region and improve the quality of life within the region 
and beyond.
    We have an ambitious goal for research. We plan to have $20 
million a year in research funding by the year 2010.
    The following is a list of recommendations to indicate how 
our Federal Government can appropriately strengthen and enhance 
programs designed to meet the unique challenge of Hispanic 
students and HSIs through the reauthorization.
    In access, affordability, retention and success: Continued 
funding support for GEAR-UP programs. They really do make a 
difference. Fully fund Pell grants. Increase the maximum 
allowable per student. Amend the Illegal Immigration Reform and 
Immigration Responsibility Act of 1996 to permit States to 
determine State residence for higher education purpose. This 
will eliminate punishing children for the decisions of their 
parents. Increase funding for Tech Prep and TRIO programs that 
prepare disadvantaged students for college. Keep the interest 
rate on student loans as low as possible so that students leave 
college with a manageable debt load. And obviously increase 
Title V funding which assists the increase of capacity in 
institutions of HSIs just like UTPA. And as a matter of fact I 
will add the increase of funding for HSI's funding for this 
year to $100 million.
    In teacher preparation, provide financial support to 
doctoral students in the field of bilingual/dual language 
education and English as a second language by reinstating the 
Title VII doctoral fellowship program. This will provide 
faculties for institutions of higher education who will be able 
to prepare tomorrow's teachers to help limited English speaking 
students that they will encounter in their class. Also provide 
100 percent loan forgiveness for teachers in underserved 
elementary and secondary schools.
    In research, increase Federal funding for research 
especially in the area that impact health and economic well-
being in regions like the Rio Grande Valley. Increase grants 
and other financial aid for graduate students. And finally 
establish a set aside in Federal research dollars to encourage 
and enable emerging research institutions, especially those 
that are serving minority populations, to establish themselves 
as research partners with the Federal Government.
    Once again I want to thank the Committee for allowing UTPA 
an opportunity to share our thoughts.
    Chairman Hoekstra. Thank you.
    [The prepared statement of Dr. Nevarez follows:]

Statement of Miguel A. Nevarez, President, The University of Texas-Pan 
                                American

            Issues and Challenges
    Good morning. My name is Miguel A. Nevarez and I am President of 
the University of Texas-Pan American. I have served as President for 
the last 22 years and I am pleased and honored that you have chosen to 
provide this region the opportunity to share our challenges and 
recommendations. I hope you enjoy our wonderful campus and the 
hospitality of our people.
    In preparing for this hearing, I was asked to focus on the issues 
and challenges facing the University of Texas-Pan American.
    These issues and challenges can be identified into five areas:
      Access
      Affordability
      Success and retention
      Teacher preparation
      Expanded research opportunities.
    As President, I have articulated these issues as goals which the 
University must strive to achieve.
    If we are to prepare our students to be productive, successful, and 
able to serve the needs of the 21st Century, I believe meeting these 
goals is essential.

The Condition of the Economy and Education in the Rio Grande Valley
    Census 2000 figures show that 88% of Hidalgo County's population is 
Hispanic as compared to only 12% of the U.S. population and 32% of the 
Texas population.
    Educational attainment in the border region of South Texas is much 
worse than in the state as a whole. For example, in Hidalgo County 
(2000 Census), 34% of the adult population (age 25 and older) has less 
than a 9th grade education, compared to just 11% for the State of 
Texas. According to the 2000 Census, only one-half of the Hidalgo 
County adults (50%) graduated from high school, compared to 78% for the 
State and 80% for the nation. For post-secondary education achievement, 
only 13% of Hidalgo County's adults has a bachelor's degree or better 
compared to 23% for Texas and 24% for the nation. Just 4.5% of Hidalgo 
County residents have a graduate or professional degree, while 7.6% of 
Texans and 8.9% of the U.S. population have achieved this level of 
education.
    We all know that the more education a person acquires, the greater 
that person's earning power is. Access to education is the greatest 
leveler in a society. The low level of educational attainment in the 
Rio Grande Valley, and Hidalgo County in particular, reflects the 
downside of this axiom.
    According to the 2000 Census, Hidalgo County had a per capita 
income of only $9,899, less than half the national average of $21,587. 
The McAllen-Edinburg-Mission MSA ranked among the last five in per 
capita personal income among all the MSA's in the United States. The 
three border MSA's from Laredo to Brownsville rank among the bottom ten 
in the nation for per capita personal income.
    Census figures also show that 36% of Hidalgo County's population 
lives in poverty, a rate three times that of the US population (12%) 
and more than twice that of Texas (15%). A contributing factor is the 
presence in the valley area the majority of the nation's colonias.
    Although, these statistics indicate that there is much to be done, 
the region has come a long way. According to an article published in 
the Wall Street Journal ``Pan American has served as the means to the 
mainstream for recent generations of this region's long disadvantaged 
Hispanic majority...Only now, is the number of alumni in McAllen and 
other border communities reaching a level that gives them the social, 
political and economic clout of a fully fledged middle class.''
    In the last 10 years we have seen postsecondary education more than 
double in Hidalgo County alone. With the local community college 
enrollment, students in higher education number over 29,000. Our 
students want to learn with a passion, they strive to achieve a better 
life for themselves and their families, and they persevere and are 
persistent in obtaining their higher education.
    The University of Texas-Pan American has made a difference by 
providing higher educational opportunities to South Texas residents and 
by helping to create a Hispanic middle class of citizens.

Access
    The University of Texas-Pan American is the leading institution in 
this under-served and underrepresented area of the nation. We offer 56 
bachelors, 42 masters, 2 doctorates, and a cooperative doctorate in 
Pharmacy with UT Austin.
    While we offer many degrees, we need to be sure that we get 
qualified students in the doors. The educational pipeline is broken as 
only 55% of ninth grade students in Region One graduate from high 
school. Of those who graduate another small percentage go on to some 
type of higher education.
    An important feature of the University of Texas-Pan American 
enrollment is the high concentration of Hispanic students; currently, 
Hispanic enrollment constitutes about 87% of the total. The total 
number and percentage of Hispanic enrollment is expected to increase 
over the next ten years. The Texas Higher Education Coordinating Board 
projections indicate that we will reach an enrollment of 20,000 by 
2010. This fall our enrollment is just under 16,000 students. I believe 
that we will surpass the projections much sooner. However, we will not 
be able to serve these increasing numbers of deserving and qualified 
students unless increasing amounts of financial aid are available, and 
more in terms of grants than loans.
    In working with the public schools, we have increased the number of 
students who have taken the recommended high school curriculum or 
``college prep curriculum''. In 1993 only 25% of our beginning freshmen 
graduated with the recommended high school curriculum. Today, nearly 
90% of our entering freshmen have graduated with this curriculum and 
are better prepared for college work.
    The federal government has funded our GEAR-UP program which 
assists, supports, and educates one cohort of students beginning in 
seventh grade. These students are now in high school and so far results 
are extremely positive, but we are concerned about the thousands of 
public school students who do not have access to GEAR UP. We are 
attempting to institutionalize the programs that are successful with 
this particular cohort, but, school districts have limited funds to 
sustain the efforts and so do we.
    Another access issue has resulted from the1996 Illegal Immigration 
Reform and Immigration Responsibility Act. This act removed the ability 
of states to determine residency for the purposes of higher education 
benefits. This act prohibits aliens who have come to the United States 
as children and successfully completed high school in Texas to qualify 
for Federal financial aid, and for in-state tuition. We are betraying 
students who have worked hard in our public schools, persisted and 
graduated, who are then denied the higher education assistance 
available to their peers who are in similar socio-economic 
circumstances.
    Not graduating from high school and not being prepared for college 
work are critical issues that hamper access to higher education for our 
students. The next obstacle is affordability.

Affordability
    I know you are all aware that state contributions to public higher 
education are dwindling nationally. Budget crises from state to state 
affect all of us in higher education. Students who do go to college are 
being asked to contribute more of the costs for their education. For 
many this does not present a problem, but for our students who have to 
work just to break even, with increased tuition costs, additional 
burdens are being placed upon them.
    The national trend seems to be forming a division between the haves 
and the have-nots once again, a situation that was prevalent before the 
passage of the Higher Education Act of 1965. Those who can afford to 
pay for higher education will obtain it and those who cannot will be 
left behind. The citizens in our area have been left behind for too 
long.
    In fall 2000, the most recent data available, among all Texas 
public 4-year institutions, UTPA reported the highest percentage (42%) 
of first-time entering undergraduates with zero-dollar family financial 
contributions to their education. With financial aid not covering the 
total cost of education for the economically disadvantaged, even at a 
relatively low-cost institution such as UTPA, our students are obliged 
to work, often full-time, as they attempt to complete their bachelor's 
degrees. Added to this is the burden of caring for family members--not 
just children, but also parents. Indeed, the results of the National 
Survey of Student Engagement show that UTPA first year students spend 
more hours working for pay off campus, more hours caring for 
dependents, and more hours commuting than students at our peer 
institutions; this translates to fewer hours preparing for class, and 
fewer hours in co-curricular activities.
    Recent surveys of students and parents in UTPA's GEAR-UP program 
show increasing pessimism about the affordability of a college 
education. In 2001, 42% of students and 45% of their parents thought 
they could afford post-secondary education. In 2003, the percentages 
had fallen to 30% for students and 38% for their parents. And this is 
in a program that is geared toward informing students and their 
families about the costs of education and the ability of financial aid.
    There has been a discouraging shift over the past years from grants 
to loans as the primary means of financing higher education for many of 
our students. This shift has been a disservice to all of us.
Retention and Success.
    While access and affordability are critical for bringing students 
to the gates of academe, it is essential that institutions offer 
support services and an environment conducive to their success during 
their academic career. One of UTPA's overarching goals is to improve 
student access and success.
    UTPA has increased its first-year retention rate of new freshmen 
from 55% for the fall 1999 cohort, to 66% for the fall 2002 cohort. Our 
target is to increase first-year retention by a percentage point each 
year.
    UTPA's six-year graduation rate, the standard in the United States, 
is not stellar. For the fall 1995 entering cohort, 6 years later, only 
23% had graduated from UTPA. However, if one tracks the success of 
students in that cohort who have graduated from other institutions in 
the state or who have persisted and are still enrolled here or 
elsewhere after 6 years, the ``success'' rate increases to 50%, a rate 
more in line with other regional public institutions. A local cohort 
study found that, after 10 years, 54% of the 1992 cohort had graduated 
from UTPA or other higher education institutions. This study allowed 
for the crediting of ``stop-outs'' who return to college in the cohort 
graduation figures; this is not calculated in standard cohort studies 
at the state or national level. The impact of increased freshman 
retention is expected to reveal itself in increased persistence and 
graduation rates in the next few years.

    Teacher Preparation
    Another of UTPA's overarching goals is to be a state leader in the 
preparation and production of public school teachers. UTPA has been 
among the top producers of certified teachers for many years, and has 
been THE largest producer of bilingual teachers in the United States.
    The state measures the quality of these teachers according to their 
performance on the state-mandated Texas Examination of Educator 
Standards (TExES, formerly the ExCET) comprehensive examination. UTPA's 
overall pass rate, including all the re-takes by students, is 
respectable. However, re-taking the test is expensive and demoralizing 
for our students. Therefore, UTPA has in place strategies to increase 
the pass rate of first-time test takers to 75% for fiscal year 04, 80% 
for fiscal year 05, and 90% for fiscal year 06. These reforms will 
improve the quality of the teachers we educate, while increasing our 
production of much-needed instructors for the public schools.

Expanded Research
    As one of the major population centers of the state we ought to be 
served by a major research institution. Hidalgo County is the 7th 
largest in the State and if we add Cameron County, the numbers exceed 
the population of El Paso.
    UTPA is, therefore, striving to become a Doctoral/Research 
Intensive institution. Such institutions benefit their service areas 
not only through the availability of an array of degree programs 
appropriate to the needs of the region but also through focused 
research and research-based public service activities that are intended 
to increase the understanding of the region and improve the quality of 
life within the region and beyond. UT Pan American is well-positioned 
to serve the South Texas region as a regional research university.
    UTPA is developing an institutional research agenda that focuses 
and concentrates research efforts and support on selected areas of 
regional significance. Four broad areas of emphasis will be 
bilingualism, biomedical science and engineering (directed at health 
and quality of life issues relevant to the South Texas Border area), 
border life and international relations, and the subtropical 
environment and ecology.
    UTPA has an ambitious goal for research. We plan to have $20 
million in research funding by 2010. This is an significant increase 
from our fiscal year 02 accomplishment, but we feel that striving 
toward a doctoral research institution will necessitate and also enable 
us to achieve this goal.

            Recommendations
    Following is a list of items to indicate how the Federal Government 
can appropriately strengthen and enhance programs designed to meet the 
unique challenges and needs of Hispanic students and Hispanic Serving 
Institutions (HSI's) through the reauthorization of the Higher 
Education Act.

Access, Affordability, Retention & Success
      Continue to fund and support GEAR UP Programs. They do 
make a difference.
      Fully fund Pell Grants, and increase the maximum 
allowable per student.
      Amend the Illegal Immigration Reform and Immigration 
Responsibility Act of 1996 to permit states to determine state 
residency for of higher education purposes. This will eliminate 
punishing children for the decisions of their parents.
      Amend the Immigration and Nationality Act to cancel the 
removal and adjust the status of certain alien college-bound students 
who are long-term U. S. residents.
      Increase funding for Tech Prep and TRIO programs that 
prepare disadvantaged students for college.
      Keep the interest rate on student loans as low as 
possible so that students leave college with a manageable debt load.
      Increase Title V funding which assists in increasing the 
capacity of institutions such as the University of Texas-Pan American.
      Increase the funding of HSI's to $100 million for fiscal 
year 2004.

Teacher Preparation
      Provide financial support to doctoral students in the 
fields of bilingual/dual language education, and English as a Second 
Language, by reinstating the Title VII doctoral fellowship program. 
This will provide more faculty for institutions of higher education who 
will be able to prepare tomorrow's teachers to help the limited English 
speaking students they will encounter in their classes.
      Provide 100% loan forgiveness for teachers in underserved 
elementary and secondary schools.
Research
      Increase federal funding for research, especially in 
areas that impact the health and economic well-being of the Rio Grande 
Valley.
      Increase grants and other financial aid for graduate 
students.
      Establish a set aside in federal research dollars to 
encourage and enable emerging research institutions, especially those 
that serve minority populations, to establish themselves as research 
partners with the federal government.
                                 ______
                                 
    Chairman Hoekstra. Just one quick question. How many of 
your students are minority?
    Dr. Nevarez. Eighty-seven percent out of 6,000.
    Chairman Hoekstra. Great. Thanks.
    Dr. Juarez.

     STATEMENT OF DR. RUMALDO JUAREZ, PRESIDENT, TEXAS A&M 
                     UNIVERSITY-KINGSVILLE

    Dr. Juarez. Good morning, Mr. Chairman and members of the 
Subcommittee. My name is Rumaldo Juarez, I'm President of Texas 
A&M University-Kingsville. Thank you for this opportunity to 
testify before your Subcommittee about our mission and our 
plans at Texas A&M University-Kingsville. A special thanks to 
Congressman Hinojosa and yourself for bringing these hearings 
to South Texas where we can more easily participate. And also a 
special thanks to Dr. Nevarez and this outstanding university 
for being our host today.
    I must also take credit that Dr. Nevarez is one of our 
alums, so we're very proud of him.
    A&M-Kingsville, established in 1925, is the oldest 
comprehensive and the only research-intensive university in 
South Texas. A&M-Kingsville seeks to provide quality 
undergraduate and graduate programs in agriculture, business, 
education, engineering, pharmacy and arts and sciences. The 
emphasis is on providing an intellectually challenging 
education reflecting high standards of academic performance. 
Our mission is to develop well-rounded leaders and critical 
thinkers who can solve problems in an increasingly complex, 
dynamic and global society.
    We serve a student body that is largely from South Texas, 
but there is wide diversity in the population, with students 
from more than twenty-eight States and more than thirty-three 
countries. Graduate students comprise about twenty percent of 
our student body. The average age of our students in Kingsville 
is twenty-four years and more than sixty percent of our 
freshmen are first generation college students. Our total 
enrollment between our campus in Kingsville and a new campus 
that is South San Antonio is approximately 6,800 students. Of 
these about sixty-one percent are Hispanic reflecting the 
demographics of our region.
    Our university currently offers fifty-one bachelor degree 
programs, fifty-four masters and five doctoral programs. The 
doctoral programs are in Environmental Engineering, Bilingual 
Education, Educational Leadership, Wildlife Sciences and 
Horticulture. All of these programs are in good demand and have 
a healthy enrollment. These five programs, however, hardly 
touch the surface on the demand for additional post 
baccalaureate and professional programs in South Texas. Due to 
a lack of funding we are being held back from starting five new 
doctoral programs. These are: Pharmacy, Wildlife Medical 
Science, Hispanic Studies, Chemical Engineering and Civil 
Engineering. In addition, we have plans for five new masters 
degrees in; Fine Arts, Computer Information Systems, 
Instructional Technology, Industrial Management, and Ranch 
Management.
    Not surprisingly, funding is always an issue when 
considering new degree programs. Finding sources of funding for 
new programs is one of the greatest challenges facing A&M-
Kingsville today. We can identify the demands for new programs. 
We can develop proposals and curriculum. We can develop 
meaningful research projects. What we cannot do is fund these 
new programs without some type of startup funding. We cannot 
create the infrastructure required for quality doctoral 
programs without some type of financial support from State, 
Federal or private sources.
    A&M-Kingsville has a commitment to keeping pace with degree 
offerings in other parts of the State and the Nation, including 
a number of masters degree programs and selected doctoral 
degree programs. These advanced degree programs are critical to 
the economic development of our region as well as to the 
professional and personal development of our citizens. They 
provide important opportunities for better jobs and better pay 
for South Texans. These opportunities will not come without 
some assistance in the form of seed or startup funding to 
develop and expand our post baccalaureate degree offerings and 
the research capacity that accompany these types of programs. 
Seed funding or startup funding for development of new masters 
and doctoral programs will multiply the dollars invested in a 
very short period of time. These dollars, in turn, will result 
in an educated workforce that will contribute to the strengths 
of this region, this State, this Nation, and the rest of the 
world.
    Let me share with you one example of how an investment of 
only $350,000 from State funds made possible the creation of a 
doctoral program in Environmental Engineering at Texas A&M-
Kingsville. This program began enrolling students in January 
2002 and 3 months later in March of the same year the faculty 
succeeded in obtaining a National Science Foundation grant for 
$5 million to establish the Center for Research Excellence in 
Science and Technology.
    Also created during the same year was the South Texas 
Environmental Institute. Within one and one half years of 
operation this program has generated a total of $7.7 million in 
research grants that are helping to support the research 
projects, provide financial support for graduate students and 
faculty and conduct valuable environmental research for the 
South Texas region. Initial enrollment for this program 
exceeded our expectations. We currently have twenty-eight 
doctoral students enrolled and twenty-five percent of these are 
Hispanic. That means we will be the largest producer of 
Hispanic environmental engineers in the country very shortly. 
This program has provided an important opportunity for South 
Texas students, for the State of Texas, and for this Nation. 
Just as important as producing environmental engineers is that 
the program is conducting valuable environmental research for 
this region. My point in elaborating on this example is that 
with a very small investment this doctoral program has 
flourished and is providing a valuable service to this Nation. 
It demonstrates what is possible when we identify a need and 
are able to find sources of funding to meet that need.
    We are currently attempting to start a doctorate of 
pharmacy program, the first such professional program in South 
Texas. This program is scheduled to begin in the Fall of 2005, 
but it is being jeopardized by lack of funding. We have secured 
construction funding of $50.5 million. Construction, in fact, 
has already started. Unfortunately we have yet to secure the 
$5.486 million needed for the operation of the school. This 
program was created in response to a critical need for 
pharmacists statewide and across the Nation. By locating this 
professional school in South Texas we hope to have a positive 
impact on the number of pharmacists in our own region, 
especially in the rural communities of South Texas. In addition 
to training much needed pharmacists who are more likely to 
remain in the region we also anticipate that the pharmacy 
program will bring in approximately $10 to $20 million into our 
region through related industries and research within the first 
5 years of operation.
    In my earlier remarks I mentioned that we had plans to 
start five new doctoral and five masters programs. These will 
require startup funding. The cost for starting a new quality 
doctoral program is in the range of $3 to $5 million over a 4-
year period. In order to develop highly competitive and well 
respected programs we need to be able to hire faculty who have 
a high level of expertise. These faculty can literally ensure 
the success and growth of the program because they attract top 
quality graduate students, additional faculty members, and 
write competitive research proposals. They conduct important 
research and attract external sources of funding for their 
programs. These startup funds are also needed for providing the 
necessary graduate research and teaching assistantships, funds 
for maintenance and operations, and funds for the required lab 
and office equipment and supplies. In the State of Texas we 
have a method of funding that requires institutions to start 
new programs on their own for the first 2 years before State 
formula funding begins to flow. Typically it is these startup 
funds that are the major obstacles to our starting new graduate 
level programs.
    Programs such as the McNair Scholars program have been very 
successful in recruiting underserved students into graduate 
study. Ninety-eight percent of our McNair students completed 
their bachelors degree and seventy percent have entered 
graduate programs. Twelve percent have gone on to pursue 
doctoral degrees and that's better than the national average of 
7 percent. There is little doubt that these types of programs 
that provide financial support for students wanting to pursue 
post baccalaureate programs really work. What we would like to 
see is more of these types of programs.
    These statistics show that federally funded programs can 
make a difference. We have seen the difference at Texas A&M-
Kingsville and we remain dedicated to continuing to affect 
positive changes in our region. These programs have begun the 
important process of bridging the educational gap that exists 
in South Texas, but there's always more that is needed. We must 
continue to develop new programs to provide the needed 
educational infrastructures and to provide the necessary 
opportunities for our students to succeed.
    It is our hope that the Federal Government will only 
remain--will not only remain a partner in the process of 
providing educational opportunities in South Texas, but that it 
will increase its contribution to that process. South Texas 
institutions of higher education have consistently demonstrated 
that small investments result in a multiplier effect for the 
expansion of our programs, a multiplier effect for the economic 
development of our region and more important a multiplier 
effect for the improvement of the quality of life of South 
Texans. Thank you.
    Chairman Hoekstra. Thank you.
    [The prepared statement of Dr. Juarez follows:]

Statement of Rumaldo Z. Juarez, Ph.D., President, Texas A&M University-
                               Kingsville

    Good morning Mr. Chairman and Members of the Subcommittee. Thank 
you for this opportunity to testify before your subcommittee about our 
mission and our plans at Texas A&M University-Kingsville. A special 
thanks to Congressman Hinojosa for bringing these hearings to South 
Texas where we can more easily participate.
    Texas A&M-Kingsville, established in 1925, is the oldest 
comprehensive and the only research-intensive university in South 
Texas. Texas A&M-Kingsville seeks to provide quality undergraduate and 
graduate programs in agriculture, business, education, engineering, 
pharmacy and arts and sciences. The emphasis is on providing an 
intellectually challenging education reflecting high standards of 
academic performance. Our mission is to develop well-rounded leaders 
and critical thinkers who can solve problems in an increasingly 
complex, dynamic and global society.
    We serve a student body that is largely from South Texas, but there 
is wide diversity in the population, with students from more than 28 
states and more than 33 countries. Graduate students comprise about 20 
percent of our student body. The average age of our students in 
Kingsville is 24 years and more than 60% of our freshmen are first 
generation college students. Our total enrollment between our campus in 
Kingsville and new campus in South San Antonio is approximately 6800 
students. Of these, about 61 percent are Hispanic, reflecting the 
demographics of our region.
    Our university currently offers 51 bachelor degree programs, 54 
masters and five doctoral programs. The doctoral programs are in 
Environmental Engineering, Bilingual Education, Educational Leadership, 
Wildlife Sciences, and Horticulture. All of these programs are in good 
demand and have a healthy enrollment. These five programs, however, 
hardly touch the surface on the demand for additional post 
baccalaureate and professional programs in South Texas. Due to a lack 
of funding, we are being held back from starting five new doctoral 
programs. These are: Pharmacy, Wildlife Medical Science, Hispanic 
Studies, Chemical Engineering and Civil Engineering. In addition, we 
have plans for five new masters degrees in: Fine Arts, Computer 
Information Systems, Instructional Technology, Industrial Management 
and Ranch Management.
    Not surprisingly, funding is always an issue when considering new 
degree programs. Finding sources of funding for new programs is one of 
the greatest challenges facing Texas A&M-Kingsville today. We can 
identify the demands for new programs. We can develop proposals and 
curricula. We can develop meaningful research projects. What we cannot 
do is fund these new programs without some type of start-up funding. We 
cannot create the infrastructure required for quality doctoral programs 
without some type of financial support from state, federal or private 
sources.
    Texas A&M-Kingsville has a commitment to keeping pace with degree 
offerings in other parts of the state and the nation, including a 
number of master's degree programs and selected doctoral degree 
programs. These advanced degree programs are critical to the economic 
development of our region as well as to the professional and personal 
development of our citizens. They provide important opportunities for 
better jobs and better pay for South Texans. These opportunities will 
not come without some assistance in the form of seed or start-up 
funding to develop and expand our post baccalaureate degree offerings 
and the research capacity that accompany these types of programs. Seed 
funding or start-up funding for development of new master's and 
doctoral programs will multiply the dollars invested in a very short 
period of time. These dollars, in turn, will result in an educated 
workforce that will contribute to the strengths of this region, this 
state, this nation, and the rest of the world.
    Let me share with you one example of how an investment of only 
$350,000 from state funds made possible the creation of a doctoral 
program in Environmental Engineering at Texas A&M-Kingsville. This 
program began enrolling students in January 2002 and three months later 
in March of the same year the faculty succeeded in obtaining a National 
Science Foundation grant for $5 million to establish the Center for 
Research Excellence in Science and Technology (CREST). Also created 
during the same year was the South Texas Environmental Institute. 
Within one and one-half years of operation, this program has generated 
a total of $7.7 million dollars in research grants that are helping to 
support the research projects, provide financial support for graduate 
students and faculty and conduct valuable environmental research for 
the South Texas region. Initial enrollment for this program exceeded 
our expectations. We currently have 28 doctoral students enrolled and 
25% of these are Hispanic (that means we will be the largest producer 
of Hispanic environmental engineers in the country). This program has 
provided an important opportunity for South Texas students, for the 
state of Texas and for this nation. Just as important as producing 
environmental engineers, is that the program is conducting valuable 
environmental research for this region. My point in elaborating on this 
example is that with a very small investment, this doctoral program has 
flourished and is providing a valuable service to this nation. It 
demonstrates what is possible when we identify a need and are able to 
find sources of funding to meet that need.
    We are currently attempting to start a Doctorate of Pharmacy 
program, the first such professional program in South Texas. This 
program is scheduled to begin in the fall of 2005, but it is being 
jeopardized by lack of funding. We have secured construction funding of 
$15.5 million dollars. Unfortunately, we have yet to secure the $5.486 
million needed for the operation of the school. This program was 
created in response to a critical need for more pharmacists statewide 
and across the nation. By locating this professional school in South 
Texas, we hope to have a positive impact on the number of pharmacists 
in our own region, especially in the rural communities of South Texas. 
In addition to training much-needed pharmacists who are more likely to 
remain in the region, we also anticipate that the pharmacy program will 
bring in approximately $10 to $20 million dollars into our region 
through related industries and research within the first five years of 
operation.
    In my earlier remarks I mentioned that we had plans to start five 
new doctoral and five masters programs. These will require start-up 
funding. The cost for starting a new quality doctoral program is in the 
range of $3-5 million dollars over a four-year period. In order to 
develop highly competitive and well-respected programs, we need to be 
able to hire faculty who have a high level of expertise. These faculty 
can literally ensure the success and growth of a program because they 
attract top-quality graduate students, additional faculty members, and 
write competitive research proposals. They conduct important research 
and attract external sources of funding for their programs. These 
start-up funds are also needed for providing the necessary graduate 
research and teaching assistantships, funds for maintenance and 
operations, and funds for the required lab and office equipment and 
supplies. In the state of Texas we have a method of funding that 
requires institutions to start new programs on their own for the first 
two years before state formula funding begins to flow. Typically, it is 
these start-up funds that are the major obstacles to our starting new 
graduate level programs.
    Programs such as The McNair Scholars program have been very 
successful in recruiting underserved students into graduate study. 
Ninety-eight percent of our McNair students completed their bachelor's 
degree, and 70 percent have entered graduate programs. Twelve percent 
have gone on to pursue doctoral degrees, and that's better than the 
national average of seven percent. There is little doubt that these 
types of programs that provide financial support for students wanting 
to pursue post baccalaureate programs really work. What we would like 
to see is more of these types of programs.
    These statistics show that federally funded programs can make a 
difference. We have seen that difference at Texas A&M-Kingsville and we 
remain dedicated to continuing to affect positive changes in our 
region. These programs have begun the important process of bridging the 
educational gap that exists in South Texas, but there is always more 
that is needed. We must continue to develop new programs, to provide 
the needed educational infrastructures and to provide the necessary 
opportunities for our students to succeed.
    It is our hope that the federal government will not only remain a 
partner in the process of providing educational opportunities in South 
Texas, but that it will increase its contribution to that process. 
South Texas institutions of higher education have consistently 
demonstrated that small investments result in a multiplier effect for 
the expansion of our programs, a multiplier effect for the economic 
development of our region, and more important, a multiplier effect for 
the improvement of the quality of life of South Texans.
    Thank you!
                                 ______
                                 
    Chairman Hoekstra. Dr. Brockman.

    STATEMENT OF DR. JOHN BROCKMAN, PRESIDENT, COASTAL BEND 
                       COMMUNITY COLLEGE

    Dr. Brockman. I'm John Brockman. I'm president of Coastal 
Bend College and I appreciate the opportunity of presenting 
testimony before the Select Committee this morning. I also 
appreciate the opportunity of meeting more informally last 
evening. My only regret is that I'm not currently teaching a 
political science class where I could share some juicy inside 
information with my students. I teach political science from 
time to time, but not this semester.
    As I was preparing for this hearing I began to get phone 
calls from people all over the country that I didn't know and 
faxes and e-mails and suggestions for what I should say and 
what I shouldn't say at the hearing. And I suppose--Well, even 
over the weekend I continued to receive information. And I 
suspect if I was starting over today I would probably re-write 
some of the things I would say.
    Coastal Bend College is a Hispanic Serving Institution. We 
have a student population that's fifty-eight percent Hispanic, 
a total of sixty-five percent minority. The college started or 
opened its doors in 1967. We operate in Beeville, Texas, which 
is about 160 miles north of here. We have three operations 
outside of Beeville; one in Pleasanton, Texas, which is just 
south of San Antonio; another one in Alice, which is about a 
hundred miles north of Edinburg, and another one in Kingsville. 
Coastal Bend College serves all or part of nine counties in 
Texas. The population is majority Hispanic. All of these 
counties have populations with per capita incomes and median 
family incomes that are below average for Texas and for the 
United States.
    When Congressman Hinojosa was visiting our campus a few 
years ago he met with students at the college and asked if 
there were any questions and the very first raised his 
question. His question was why didn't Coastal Bend College 
participate in the student loan program. And the next question 
I got was from Congressman Hinojosa asking why didn't Coastal 
Bend College participate in the student loan program. And when 
I read the invitation to this meeting student loans was 
mentioned and I thought, oh, gosh, I'm going to have to explain 
why we don't participate. But Congressman, I will say this, one 
result of this hearing is that we are beginning to really look 
at the student loan program. We heard from our friends at the 
Texas Guaranteed Student Loan Program last night. I got some 
additional information about student loans and we will 
certainly be looking into the possibilities of once again 
participating in student loans.
    We dropped out of the program in 1989 because our default 
rate began to trigger letters from the Department of Education 
that suggested that unless there was some improvement our Title 
IV funding might be terminated. Community colleges are 
different from universities in that we offer a great variety of 
programs from cosmetology and child development to fuel cell 
and nanotechnology. We go from all kinds of different programs 
that lead to all kinds of different jobs. Some lead to well 
paying jobs. Some lead to very important jobs that don't pay so 
well. Child care workers, for example.
    When we were in the loan program we did not have any say on 
who was eligible or what programs a student was going into. A 
number of students who took out loans some of them would enroll 
in classes or programs that would lead to jobs with less than 
desirable pay. Apartment rent, car payments, utilities, food 
costs perhaps would consume their paycheck with very little 
left to pay their student loans.
    I understand now that the student loan default rate is 
probably at an all-time low and it's about 4 percent for 
universities and about 9 percent for community colleges. And 
with this information we may consider re-entering the program.
    I wanted to mention just a little bit about Title V and 
HSIs. The set aside for HSIs first under Title III and now 
under Title V has been a great benefit for Coastal Bend 
College. We use these funds to establish a distance learning 
program so that we can tie our three campuses--now four 
campuses together and that we could offer access to more 
classes to more students and teach classes more efficiently. We 
just received word last week that we received a Rusk grant and 
we will be adding to our distance learning capabilities with 
this money.
    One thing I wanted to say, there are more and more 
colleges, as we were talking last night, that are becoming 
Hispanic Serving Institutions. And more and more colleges then 
are eligible to apply for Title V grants. The current proposal 
for an increase from 93.4 million to 94.4 million would not 
even keep up with the growth and the numbers of Hispanic 
institutions. And we certainly support Congressman Hinojosa's 
efforts to raise the funding level up to $125 million.
    We also support the Part B that would support graduate 
programs. I know from personal experience faculty and staff 
that teach and work at Coastal Bend College if they had the 
opportunity or encouragement to go on for a masters degree or a 
doctors degree that they would enhance their career 
possibilities. That many of them have been passed over for jobs 
because although they have the skill we tend to look for that 
Ph.D. When we're in the hiring process.
    At the same time I wanted to point out that all Hispanic 
Serving Institutions are not alike in terms of financial 
resources. As a group Hispanic Serving Institutions receive 
less than one half of the Federal funding per student compared 
to other types of his colleges and that's the reason why we 
have the set aside for Hispanic Serving Institutions. But among 
the Hispanic Serving Institutions there are some colleges and 
universities that are well funded and others that are not. 
While adequate funding is in the eye of the beholder, no 
college thinks it has adequate funding I'm sure, if you look at 
the revenue spent per FTE you can see that there are great 
variations among Hispanic Serving Institutions.
    I want to give you an example of two colleges, College A 
and College B. And these are both community colleges in Texas. 
They're exactly equal in size and mission. One college has 
expenditures of over $30 million, the other college has 
expenditures of less than $15 million and they're producing the 
same number of contact hours, as we measure these things in 
Texas. The college with the budget of $30 million has a grant 
writing office, regularly sends people to workshops and 
training for grant writing. The other college does not even 
have a full time grant writer. They both apply for a Title V 
grant. Which college is more likely to be funded, the $30 
million college or the $15 million dollar college. Now I don't 
know how to do it, but I know that Pell grants and financial 
aid is awarded according to a student's need. And there are 
colleges with different kinds of needs as well.
    From time to time I'm sure you hear complaints about 
Federal mandates and unfunded mandates. And sometimes, though, 
I think that mandates are things that cause us to do the things 
that we should be doing already, but we need a little 
encouragement.
    Texas Community Colleges have three main sources of income; 
State appropriation, a local tax levy, and money for tuition 
and fees. And thank goodness for Pell grants. Most of our 
students receive the money they need to pay tuition and fees 
through the Federal Government. However, as the level of State 
support declines local taxes and student tuition must increase. 
It's interesting to me that the community colleges along the 
Rio Grande in South and Southwest Texas serve students who live 
in counties where the per capita income and median family 
income are the lowest in the State of Texas, yet the rates of 
tuition and fees for community colleges are the highest in 
Texas. The opposite should be true, but it's fairly easy to 
explain why this happens. Where per capita income is the lowest 
home values are also the lowest. And as a result local tax 
levies are small.
    We raised our tax rate actually by forty-three percent this 
year. Knock on wood because we're still in the roll back period 
of time. And even with raising our taxes--tax rate forty-three 
percent we're very close to the bottom in the tax levy per 
student in Texas.
    When we dropped out of the Federal loan program in 1989 our 
tuition was very, very, very low. So we consoled ourselves by 
saying, well, it's better that our students don't acquire debt 
at this time. They can wait and get a student loan after they 
transfer and when they'll need the money more than they need it 
at Coastal Bend College. Well since 1989 our tuition has 
increased 435 percent.
    Now we don't want to publicize this a great deal, but we 
are concerned that now--tuition may not have been a problem in 
1989, it's becoming a serious problem in 2003. However, at the 
same time, as we talked last evening, if there's some kind of a 
cap or punishment for colleges that raise tuition above a 
certain amount we would be hurt because we have no other place 
to go. And our tuition is still low compared to other States 
and to universities, thank goodness. We're still able to 
operate with a fairly low tuition rates. But if the trend 
continues I see the rate going up higher and higher and higher. 
And if there's a cap we will be punished despite the fact that 
our tuition rate is still, comparatively speaking, low.
    Spending per student among Texas community colleges 
varies--and I used the word ``obscenely'' because you're 
looking at one where the spending rate is very low. When I 
point this out to some of my other community college presidents 
in Texas that are at the other end of the spectrum they will 
say, so what, higher education is a right, not a privilege. 
There's no State or Federal mandate. There's no constitutional 
proviso that says there should be equality of opportunity among 
community college students. In other words it's constitutional. 
Well, does it make it right? No, I don't think so. I think that 
the spending from local taxes and from State taxes per student 
among community colleges should be more equal. I don't know how 
to accomplish that, but I'm working on it at the State level 
and just I thought I would mention it in case there's a similar 
problem in the other States.
    As has been pointed out already we have a very difficult 
time, whether we're a university or a community college, 
starting new programs. It's difficult to find money to start 
new programs. And I don't know if there's something in Title V 
that would help us in this effort. If so, I think that would 
be--as Dr. Juarez had pointed out sometimes a small investment 
can lead to great dividends. We have to eat the cost of new 
programs for a couple of years. If you're in a community 
college that has a very limited tax base it is even more 
difficult to start new programs.
    Well, two other things I need to cover. One is that as I 
mentioned last night I've heard that there is an effort to 
establish a set aside for rural colleges. Now I don't know if 
it's colleges and universities or just rural community 
colleges. I suspect its community colleges, because community 
colleges usually depend on the local tax base for buildings. 
But I will be attending a meeting, the Rural Community College 
Alliance, later today in San Antonio and as I get more details 
I'll be glad to pass them along to you.
    The last thing I wanted to mention concerns our TRIO 
program. And I agree with those who have said before me that we 
need to increase money for the TRIO program. I know that this 
has made a tremendous difference at Coastal Bend College and 
throughout South Texas. And there are people that are working 
at every one of our institutions in South Texas now who got 
their start in higher education because of an upward bound 
program or because of an education talent search.
    There's some controversy now about points for experience. 
And some congressmen I understand want to take the points for 
experience away. And those of us, of course, with programs will 
argue that we would like to keep those. And I've had friends in 
the TRIO program for thirty years at Coastal Bend College and I 
know how it has been in the past when there were no points for 
experience. You had people who were working in TRIO programs, 
and I acted out a little bit, they're working in a TRIO program 
but they're looking around for another job because they're on 
what is called soft money. And their contract say no grant, no 
job. And in the old days it was no grant, no job, no COBRA, you 
know. And it was reinforced that you needed to be looking for 
another job probably if you wanted job security. In higher 
education we often attract people who are--job security is a 
very high priority. And when you cannot offer it you have 
people that--you have a much bigger turnover. So we would favor 
the provision to keep the points for existing TRIO programs.
    I think there was another issue that was just casually 
mentioned to me and I don't have any details on it, but as you 
know the TRIO programs have been color blind and ethnically 
blind. And there may be a talk for a set aside for Hispanic 
institutions. The TRIO people that I talked to said that they 
felt like the color blindness of the TRIO program was something 
that seemed to cause a lot more collegiality among the people 
that worked at different colleges and TRIO programs and they 
were afraid that might be hurt somewhat if there was a 
particular set aside. That the better solution might be 
increased funding so that more people can participate in the 
TRIO programs. And I believe that's it. Thank you very much.
    Chairman Hoekstra. Great. Thank you.
    [The prepared statement of Dr. Brockman follows:]

    Statement of John Brockman, President of Coastal Bend College, 
                            Beeville, Texas

Federal Student Loan Program
    Coastal Bend College (CBC) is a Hispanic Serving Institution (58%) 
with its main campus in Beeville, Texas, and with three satellite 
operations in Pleasanton, Alice, and Kingsville. CBC serves all or part 
of nine counties. The population is majority Hispanic. All of these 
counties have populations with per capita incomes and median family 
incomes that are below average for Texas and for the United States.
    CBC dropped out of the federal student loan program in 1989 because 
an increasing default rate placed all of our federal funding in 
jeopardy. Community colleges such as CBC offer a variety of programs 
from cosmetology and child development to fuel cell and nanotechnology. 
Most of our programs lead to well paying jobs, but some lead to very 
important jobs, child care workers for example, that don't pay so well. 
When CBC was in the loan program, all students were eligible for 
student loans no matter what program they entered and with no questions 
asked. The college had no say in who received loans. So, out of the 
number of the students who took out loans, some of them would enroll in 
programs that would lead to jobs with less than desirable pay. 
Apartment rent, car payments, utilities, food costs could consume all 
of their paychecks with nothing left for student loan payments. Because 
of the increasing default rate, the Department of Education began to 
send a series of letters that appeared to threaten all of our Title IV 
funds. We elected to drop out of the program in order to protect our 
Title IV funding. (I understand that colleges now can have some say in 
who is eligible for a loan and who is not, but I also understand that 
denying a student a loan is difficult. I also understand that today the 
lending institutions are more diligent in servicing loans that are in 
default. In other words, there have been some changes in the way the 
loan program is administered.)
    I want to suggest the possibility of restricting federal student 
loans to students enrolling in certain designated community college 
programs. There are multiple federal grants and programs that single 
out certain programs or majors for scholarships, namely mathematics, 
science and engineering. Students planning to teach school are eligible 
for a number of different kinds of scholarships offered through various 
federal grants. Perhaps community colleges should have the flexibility 
to designate certain programs as being loan eligible. I know the loan 
issue is complicated by proprietary schools, community colleges, and 
private and public universities and the desire to make one set of rules 
fit all. Perhaps it would be better to make different rules for 
different types of higher education institutions.

Title V and HSIs.
    The set aside for HSIs, first under Title III and now under Title 
V, has been a great benefit for CBC. We have used the money well to 
improve our college and to increase access to higher education in South 
Texas. As more and more colleges become designated as HSIs it is 
necessary to increase the funding for Title V or the impact on HSIs 
will be diminished. The current proposal for an increase from $93.4 
million to $94.4 million would, in practical terms mean a decrease in 
funding due to the increasing numbers of HSIs. I support funding at 
$125 million.
    In a related issue, any change that would enable ``for profit'' 
institutions to participate in Title III or Title V funding would 
further diminish the effectiveness of this funding. While I can see the 
rationale of granting aid to students who attend ``for profit'' 
institutions, I am also aware of various reports of abuses. Making 
these institutions eligible for Title V would be like investing in a 
private company which should, at the same time, make the national 
government ``stockholders'' in these private companies.
    I would also like to point out that all HSIs are not alike in terms 
of financial resources (and I'm sure this is also true for HBCUs). As a 
group HSIs receive less than one-half of the federal funding per 
student on average compared to all other groups of degree-granting 
institutions and thus the justification for the set asides. But among 
the HSIs, there are some colleges and universities that are well funded 
and others that are not. While ``adequate funding,'' is in the eye of 
the beholder, it can be substantiated empirically by spending per FTEs. 
I want to give you two examples of community colleges in Texas--College 
A and College B, equal in size, equal in FTEs. College A has 
expenditures of $30,000,000, while college B has less than $15,000,000 
to spend. College A has a grant writing office and it sends several 
people to grant writing workshops every year. College B does not even 
have a full-time grant writer and no money for workshops. Both colleges 
submit grants. Which college's proposal is more likely to be funded?
    Pell Grants, student loans, and most other federal student aid 
programs are ``need based.'' Shouldn't federal grants such as Title V 
grants to colleges and universities also be need based?

Federal Mandates
    Texas community colleges have three main sources of income: state 
appropriation, local tax levies, and tuition and fees. (Most of our 
students in South Texas depend on Pell Grants for their tuition 
payments.) As the level of state support declines, local taxes and 
tuition must increase. The community colleges along the Rio Grande, in 
South and Southwest Texas, serve students who live in counties where 
the per capita income and median family income are the lowest in Texas. 
Yet the rates of tuition and fees in this same area of Texas are, on 
average, the highest in Texas for community college students. While the 
opposite should be true, it is fairly easy to explain why this is so. 
Where per capita income is the lowest, home values are also the lowest. 
As a result local tax levies are small. CBC raised its tax rate 43% 
last month and we are still near the bottom in local taxes per FTE.
    When CBC dropped out of the federal student loan program, we 
consoled ourselves and our students by saying that our tuition and fees 
were very low. Our students could afford to go to CBC without student 
loans, we thought in 1989. Since 1989 our tuition has increased at 
least 435%. It is a lot more difficult to say that our students can get 
along without student loans today. While CBC has raised tuition 435% 
and recently raised local tax rates by 43%, we are still very near the 
bottom of the state in expenditures per student.
    Spending per student among Texas community colleges varies 
obscenely and as a result the poorest students pay the highest rates of 
tuition. Those students paying the highest rates of tuition often have 
fewest number of program choices. The students paying the highest rates 
of tuition often do not have access to the higher tech or the allied 
heath programs that are available to students who pay the lowest rates 
of tuition. When I point this out, I am told, ``so what, higher 
education is not a right, it's a privilege.'' There is no state or 
federal mandate for equality of opportunity among community college 
students. In other words, an obscene variation in spending per 
community college student is constitutional. Does that make it right? 
This committee can change this. Mandate that the total of state and 
local tax spending per FTE in public community colleges must be 
substantially equal, state by state, to qualify for Title IV funds.
New Programs and Buildings for HSIs and Rural Colleges
    Rural HSI colleges with limited tax bases have a difficult time 
starting new programs and almost no chance to initiate higher tech or 
health related programs. Nor do rural colleges have funds for building 
buildings to house new programs. Is it any wonder that rural areas of 
Texas (and the nation) continue to decline economically and in 
population. Texas community colleges often have to eat start-up cost 
for a year or two before any state funding kicks in. In Texas, 
maintenance and utilities are the responsibility of local taxpayers or 
students. If a community college has a limited tax base, then a heavier 
burden falls on students, as I have shown. If a community college has a 
limited tax base, it is out of luck with regard to start-up funds or 
new buildings. When the state of Texas, in response to a MALDEF suit 
concerning unequal higher education opportunities, initiated what 
became known as the South Texas Initiative (STI), hundreds of millions 
of dollars were spent on new buildings and new programs at South Texas 
universities, but not a penny on new buildings or new programs at Texas 
community colleges because at community colleges buildings are a local 
responsibility.
    I believe that there is a move to create a set aside for rural 
colleges similar to what has been established for HSIs and Tribal 
Colleges and for HBCUs. I support this effort. I have seen wonderful 
new buildings at community colleges in Eastern Kentucky that were built 
with federal dollars. I think these came through ``earmarks'' as 
opposed to grants so there was no RFP or anything like that. I would 
like the opportunity to apply for federal funds to build buildings and 
to start new high tech or allied health programs to support the 
economic development of my area of South Texas. I would not object 
should this new set aside be need based.

TRIO
    Coastal Bend College has participated in the TRIO program 
practically from the beginning. In the early years a program would be 
funded, we would lose the funding, then later regain it. People, both 
professional and secretarial, who were working in a TRIO program were 
well aware of the ``soft'' money aspect of the TRIO grants because 
their contracts would say, ``no grant = no job.'' So as they were 
working for a TRIO program, most would be looking for another job at 
CBC or at another college. After points began to be awarded for 
experience, most of the programs were refunded most of the time. This 
added to the job security in this area and it reduced the very high 
turnover rate. As a result the various TRIO programs have improved and 
improved. I would hate to return to the days of rapid turnover and 
disruption.
    [In a similar situation, whenever campaign finance reform comes up, 
the power of incumbency is noted. An incumbent congressman is difficult 
to unseat and so in campaign finance reform debates, it is sometimes 
argued that the ``points for experience'' informally credited to 
incumbents should be negated someway. I don't know how one would do 
this unless you required incumbent congressmen to change their names 
every two years. While Congressman Hoekstra might favor this provision, 
Congressman Hinojosa could change his name every two years and still 
will 90% of the vote. This is because a Congressman Hinojosa by any 
other name would still be the best congressman in Texas.]
    To turn to another matter, I have heard some reference made to the 
possibility of setting aside some TRIO funding for this group or that 
group. TRIO has focused on low income and first in family to go to 
college rather than on racial or ethnic groups. As a result, the 
program is widely supported. I have attended a number of TRIO support 
group meetings and I have witnessed a lot of cooperation and unity of 
purpose. I would hate to see an element of racial or ethnic competition 
introduced to this program. I know what I am saying can be used as an 
argument against set asides for HSIs or HBCUs and if these set asides 
were replace by a set aside for institutions with limited financial 
resources (measured by spending per FTE), I would not object.
Caps on Tuition
    Coastal Bend College raised its tuition by 25% this year, or eight 
dollars. The new tuition total is only $43.50 per semester hour. Other 
colleges and universities may have gone up only 2% or 3%, but this 
might have resulted in a ten dollar increase from $300 to $310. While I 
think caps on tuition (or on prices in general) are unwise, if one is 
mandated I would prefer than it be described in terms of dollars per 
semester hour instead of by percentages.
    Thank you.
                                 ______
                                 
    Chairman Hoekstra. Thank you very much to the entire panel.
    Dr. Nevarez, you brought up a very difficult issue. I face 
it in my district as well. I've got a few communities with a 
sizable Hispanic population. But whether it's Hispanic or 
whatever background, the whole issue with financial aid for 
kids or for students who came here when they were young 
children. What do you propose we do?
    Dr. Nevarez. Well, the proposal is to be able to amend the 
immigration--You're talking about illegal aliens?
    Chairman Hoekstra. Yeah.
    Dr. Nevarez. Yeah. The proposal is to amend the Immigration 
Act so that the States are permitted to determine residence 
requirements so that they can--that's at State level so that 
they can do--we can do in State tuition. Because what they do 
now that we have to charge them out of State tuition. At the 
Federal level so they'd be able to qualify for financial aid. 
As it is they do not qualify for financial aid. These are 
students that have--you know they've finished high school. 
They've been with their counterparts in high school. They've 
been successful. They've been persistent. They have the same 
qualifications of the students that they kind of grew up with. 
Yet when they come to higher education they're--you know, 
they're put aside and have an additional burden of cost there. 
I think--You know, it does all of us a lot of good to give 
these students an opportunity for higher education. I think we 
all will benefit as a society in doing that. So I guess the 
answer to the question is if the Immigration Act could be 
amended to allow that to happen. The Immigration Naturalization 
Act of 1996.
    Chairman Hoekstra. The end result is, as you know, that 
there will be students who were here legal in the country who 
will get fewer benefits.
    Dr. Nevarez. Well, that may be true, but I think you can 
put some safeguards against that.
    Chairman Hoekstra. I'd like to know how.
    Dr. Nevarez. We can work with you.
    Chairman Hoekstra. I mean it's a limited pool. I mean I 
think it is--you know, it is an ugly issue in that you have 
some very, very talented young people who end up going through 
K through 12. And what we see in our district or as I talk to 
some of my K through 12 folks is that, you know, these kids get 
the message, you know, as they're going through where they see 
their friends who have done very well in K through 12 and all 
of a sudden have a dream or aspire to go to college and all of 
a sudden that dream is closed and not open to them. And the end 
result is that other kids who are in 9th or 10th grade say, 
well, you know I guess that's not an opportunity for me and 
they start dropping out of school.
    Dr. Nevarez. Right. Absolutely.
    Chairman Hoekstra. And, you know, it is an issue that we 
have to resolve one way or another. I mean I don't know what 
the other way is, but it has to be addressed.
    Dr. Nevarez. Let us try to make some concise 
recommendations. I know we have fourteen days more to submit 
some things?
    Chairman Hoekstra. Sure.
    Dr. Nevarez. And if we're allowed to do that we'd be more 
than glad to do that.
    Chairman Hoekstra. And I recognize it's part of a much 
bigger immigration issue that we have to deal with in Congress. 
But it is--it's probably one of the more painful elements of 
current immigration law that, you know, it's just very, very 
difficult to get your hands around and identify a strategy. But 
if you've got any suggestions on safeguards or whatever I'd be 
very open to hear it. How much of your State funding comes 
from--or how much of your funding comes from the State?
    Dr. Nevarez. It's been going down every year.
    Chairman Hoekstra. So State versus tuition.
    Dr. Nevarez. This year the State allows--gave us 
flexibility on tuition so that they--instead of the State 
setting the tuition now the board of regents sets tuition.
    Chairman Hoekstra. Right.
    Dr. Nevarez. I believe that every university in the State 
of Texas is going to have a tuition increase, not only for next 
year, most of them are going to have a tuition increase this 
January and another one in September. That's why I'm real 
concerned about the cost of education that we're passing it on 
to the students on it. It's happening all over. This is not 
just Texas.
    Chairman Hoekstra. Right. I'm interested in your budget--
what are the sources of funds, tuition, State funding?
    Dr. Nevarez. Tuition, State funding, local funds and 
Federal funds or restricted funds.
    Chairman Hoekstra. Do you--Can you tax locally?
    Dr. Nevarez. No. No, sir.
    Chairman Hoekstra. All right, so what's the breakdown?
    Dr. Nevarez. It's about forty percent State, thirty-five, 
forty percent local monies in terms of tuition and the balance 
is restricted funds.
    Chairman Hoekstra. That's a grant--.
    Dr. Nevarez. Or contracts. Federal, private contracts.
    Chairman Hoekstra. Dr. Juarez, is it similar for you?
    Dr. Juarez. The State funds right now we're running between 
forty-five and forty-eight percent. I don't have the figures 
with me of the remaining breakdown.
    Chairman Hoekstra. OK.
    Dr. Juarez. But one of the things that we have seen in the 
presentations by the Texas Higher Ed Coordinating Board is that 
over the years this percent of State funding and State 
contributions has been decreasing. You know, at one point it 
was as high as--as I recall about seventy or eighty percent 
and, you know, it is just going the reverse at this point. It 
is very coincidental in this relationship that it is also a 
time, as the coordinating board points out, that the number of 
Hispanics or minorities were beginning to enter the higher 
educational system.
    Chairman Hoekstra. So Dr. Nevarez what does a student pay 
for tuition?
    Dr. Juarez. Fifteen hours right now is about 1,500 a 
semester for a fifteen hour load.
    Chairman Hoekstra. Dr. Juarez?
    Dr. Juarez. We're approximately in the same range.
    Chairman Hoekstra. We'd say that's a pretty good bargain.
    Dr. Nevarez. It is. It is in terms of what other States are 
doing. You have to take into consideration the kind of students 
that we're serving also. You know, we just went through 
hearings on this campus because we're raising their tuition in 
September. And the concern the students have here is that 
they're already working beyond twenty hours a week. The 
additional burden that they have to do to pay it's going to 
cause them to work more than twenty hours, therefore they're 
going to be taking less courses and it's going to take more 
time to graduate from the institution on it. I think that's why 
it's so critical that financial aid, you know as I mentioned 
particularly the Pell grants, be increased. And that more be 
done on grants than in loans because as you probably know 
Congressman the shift has been over the years to do more in 
loans than grants. And some of our students are coming out with 
a tremendous debt burden when they graduate.
    Chairman Hoekstra. Yeah, but I mean for 4 years you're 
telling me the debt burden would be about $12,000?
    Dr. Nevarez. Undergraduate.
    Dr. Juarez. In our case they're averaging between 22 and 
$25,000. And I know we have a few that are as high in the 
eighties that have gone on for graduate degrees.
    Chairman Hoekstra. For masters or a doctorate, yeah.
    Dr. Juarez. But at the undergraduate level they're 
averaging around 22,000, somewhere in there.
    Chairman Hoekstra. For the ones coming out of debt or for 
the--.
    Dr. Juarez. For the ones coming--recent graduates with a 
bachelors degree. And I would concur with Dr. Nevarez that one 
would need to consider--well, a couple of things. One is 
certainly the income level of the students coming into the 
university. But the tuition and fees tell only a part of the 
story. The other costs of higher ed are going up very rapidly. 
A new algebra book, for example, is now between 120 and $140. 
So these kinds of costs, you know, just books alone easily a 
student will now pay a $600 or $800 tab before the semester is 
over with.
    Chairman Hoekstra. Sure.
    Dr. Nevarez. The other thing--the other variable here is 
that a lot of our students contribute to family income while 
they're going to school. In other words they're working, but 
some of the funds that they earn is going to go to the family 
contribution for the household. I remember some years back our 
computer had problems, we couldn't get the checks, financial 
aid checks on time on that. We had more calls from parents that 
rely on those checks--And I know that's not supposed to be the 
case on it, the financial aid should go totally to the--you 
know to contribution of the cost of education. But the reality 
of the thing is that a lot of the families rely on the students 
to work. And a lot of the students in order to come to college, 
you know, commit to the parents that they will work in order to 
help the family.
    Dr. Brockman. They do not always get a lot of encouragement 
to go to college because of the fact that sometimes they feel 
pressure from their families to go ahead and work as much as 
they can full-time to contribute to the family well being. So 
we hear from students all the time where they have to overcome 
the objections of one or both parents in order to come to 
college. And the Pell grant and increasing the size of the Pell 
grant I think would make it easier for some of these students 
to overcome these parental objections that they shouldn't have 
to face but they do.
    Chairman Hoekstra. The largest cost item in the school is 
what, salaries for staff and personnel?
    Dr. Nevarez. Eighty percent of our budget is salaries.
    Chairman Hoekstra. And benefits, right? Or--.
    Dr. Nevarez. Salaries and benefits.
    Chairman Hoekstra. Same thing Dr. Juarez?
    Dr. Juarez. Yes, sir.
    Chairman Hoekstra. Dr. Brockman, same thing?
    Dr. Brockman. Yes, it's at least eighty percent.
    Chairman Hoekstra. And the top drivers toward increasing 
total cost at the college would be, what, the costs of benefits 
and those type of things right now. I mean what's driving the 
overall cost?
    Dr. Nevarez. The main thing that's driving us is that we're 
getting less percentage of our support from the State.
    Chairman Hoekstra. Yeah, I know, but I mean that's what 
impacts tuition. But I mean if you're taking a look at your 
expenses this year versus last year why--Is it health care 
costs? What's driving your costs--.
    Dr. Nevarez. The health care the benefits are obviously 
increasing at a bigger percentage than the price index on it. 
But also salaries are increasing. Particularly for those 
institutions that are trying to go into the graduate and 
doctoral professional programs, it's a very competitive area. 
If we want to do this in the, for example, in engineering and 
in the business area, in the health-care, you have to pay top 
dollar for faculty.
    Chairman Hoekstra. Dr. Juarez.
    Dr. Juarez. A similar situation, but I would add another 
variable and that is it depends on the age of the university or 
the campus and depending how old your buildings are, because 
the maintenance and upkeep of our buildings is becoming an 
issue. And especially as--in universities that are growing, 
such as the University of Texas-Pan American that are growing 
very rapidly, and South Texas Community College and some of 
these universities. And even in our case the need for building 
new buildings or remodeling some of the old buildings the 
methods of instruction and needs have changed from the time 
that the universities were first established. And that's, you 
know, forcing us to make some modifications on campus, 
including some that involve some safety issues. For example, 
putting sprinkler systems in the dorms. In the early years when 
these were built that was not a requirement. Now the State is 
requiring that. It's one of those mandated kinds of things that 
we get no funding for, so we have to continually allocate some 
of the resources for those kinds of expenses.
    Dr. Nevarez. The increased need of technology is another 
variable on it. We're going through an administrative software 
revision right now. In the next three to 5 years we're going to 
have to spend about 14 to $15 million for the revision just in 
software. That doesn't count everything else in hardware that 
we would have to do. So technology is also driving--it's a 
driving force. And as you know computers and computer labs 
after three to 5 years have to be replaced.
    Chairman Hoekstra. Just--if you don't mind, what does the 
University of Texas charge for tuition?
    Dr. Nevarez. I don't know what they charge. They have--I 
can tell you because the fees are all over the place for all of 
us in fees. But in tuition there is a statutory mandate and 
we--all State institutions pay the same and that's $48--I think 
it's $46 or $48 this semester. Now there's another--there's 
another which is more locally controlled called designated 
tuition and that can go to the equal amount of what's the 
statutory condition. In other words you can raise that to 
forty-eight. I would think that UT-Austin in tuition is already 
at $96 per semester credit hour. I'm not too sure where we are 
on all the other fees because in the fees we're all very 
different. We're at thirty--At this year we're at--obviously at 
the State-mandated we're at $48, but on the designated we're at 
$32 a semester credit hour, so that's a difference of about--in 
intuition of $16 a semester credit hour.
    Chairman Hoekstra. So the most that the University of Texas 
could charge is about $96 a credit hour?
    Dr. Nevarez. Most of them are--for tuition it's at $96 
right now, but it's all going to go up.
    Dr. Brockman. But they also have a lot of fees that--.
    Dr. Nevarez. Well, the fees that's--.
    Dr. Brockman. --could be almost as much as the tuition 
sometimes.
    Chairman Hoekstra. You know, last night at dinner we were 
talking about the--you know, you've heard about the proposal in 
Washington, although it hasn't been written yet, that says if 
you--for colleges that increase at a certain rate they will 
lose access to certain Federal programs. Do any of you have any 
comments on that proposal?
    Dr. Juarez. I certainly do, Mr. Chairman. Considering the--
And that's, I believe, the proposal that is proposing on 
charging--if the tuition rate increases more than 2 percent 
over the inflation rate--.
    Mr. Hinojosa. Twice.
    Dr. Juarez. Twice the inflation rate, right. That they 
would be penalized. And if you'll look at what is occurring, 
for example, in the State of Texas right now the trend is for 
the State to start decreasing the State funding. So what else 
is left to us except probably put some caps on enrollment in 
order to make some of those ends meet. So I don't think it 
would be in the interest of higher education, especially in 
South Texas, to impose that kind of a penalty.
    Dr. Nevarez. I agree with that, because you're putting it 
based on a percentage. A lot of us in South Texas have kept 
traditionally the tuition and fees low, like Dr. Brockman has 
mentioned, but had been forced to raise the tuition recently 
where I think you mentioned, John, awhile ago 400 percent in a 
short period of time. Where other universities that are already 
at the high end of tuition, you know, their 2 percent above the 
CPI is a lot more money than what we would generate, because we 
start at a lower base than some others.
    Chairman Hoekstra. OK. Mr. Hinojosa.
    Mr. Hinojosa. Thank you, Mr. Chairman. I was very pleased 
to hear some of the questions that you asked so that we could 
get into the record the feelings of the leaders of colleges and 
universities on some of the proposals that are before us, such 
as the caps, such as--Another one that I'm anxious to have some 
of you give us your feelings and your thoughts and that is the 
changing of the definition of institutions of higher learning. 
We presently have two separate, one for the for profit 
proprietary schools and then we have another one for community 
colleges and universities which we refer to as non-profits. And 
I know that there is a very strong lobbying effort in 
Washington coming into our congressional offices and asking us 
to change that definition to one for the 21st century allowing 
proprietary schools under certain circumstances to be able to 
compete for pockets of--for monies in pockets of money that are 
very low. And all of you have been talking about the lack of 
Federal resources to reach the eligible students that are out 
there. So I'll start with you, Dr. Juarez, what are your 
thoughts about this definition, going to just one?
    Dr. Juarez. Well, Mr. Hinojosa, I believe it really gets 
down to the real issue of what are our priorities in the 
country. Do we place a priority on education or not. And the 
fact is that it is going to cost more money. There are more 
students coming into the educational pipeline. Many of us in 
our institutions are doing better jobs at recruitment and 
better jobs at bringing these students into the educational 
hierarchy. So it stands to reason that it's going to require 
more dollars. And, you know, trying to divide the same pie in 
different ways is--I don't think is the real issue. The fact is 
that there are more students that we need to educate and that 
we're dealing with and that's why it's costing a lot more than 
it used to several years ago.
    Mr. Hinojosa. Recently, maybe three or 4 weeks ago, the 
Chairman called a panel to Washington to talk to us about--
about fellowships in areas like math and science. And we had 
four African American administrators, some presidents, some 
deans. We had one Hispanic dean of education talk to us about 
the growing demand of students wanting access to higher 
education and the lack of supply being the number of professors 
to teach the courses. And with the explanation that you all 
have given us a few moments ago, legislatures giving us less 
money, then it forces you as presidents to offer fewer programs 
simply because that's the way you can cut the cost of running 
your universities and colleges. Well, I introduced a piece of 
legislation known as H.R. 2238 and this is a program that would 
increase the support for masters and Ph.D. Programs in Hispanic 
Serving Institutions creating Part B under Title V. And I'd 
like to ask Dr. Nevarez if Texas requires institutions to 
support programs for 2 years prior to State funding do you see 
my pending legislation being even more crucial for institutions 
like yours?
    Dr. Nevarez. Absolutely. I would agree. One of the things--
one of our arching goals is to become a doctoral research 
university and one of the things that we need to do other than 
increase the dollar amount in research is to increase their 
rate of graduate and professional programs that we offer. So 
that effort would certainly be very beneficial for this 
institution on it.
    Mr. Hinojosa. In your comments you talked about trying to 
take the University of Pan-American to another level becoming a 
research university. What do you need to reach and be able to 
get to that next level?
    Dr. Nevarez. Research funds. One of my recommendations that 
I mentioned is that hopefully the HSIs can start partnering 
with the Federal Government in research. And particularly 
research that is applied that has economic or health benefits 
to the area that we're serving on it. That's definitely a need. 
The other need would be is what you just mentioned is to 
develop additional graduate and professional programs and 
support for faculty in those graduate programs. And even more 
important to support for graduate students. One of the ways to 
grow this is through graduate fellowships, doctoral fellowships 
that I mentioned, and particularly--And for institutions like 
HSIs it's even more important to do research at the 
undergraduate level.
    Sometimes we tend to concentrate student support at the 
graduate level. I think we need to start thinking about 
involving students in research at the undergraduate level. Part 
of the problem is transitioning students through these leaky 
pipelines. You know, one of the things that we're doing with 
public schools in access is already having the students start 
taking college credit courses while they're still in high 
school through concurrent enrollment, AP programs and things 
like that. Well, the same thing applies at the upper-level. We 
have a great program here with Baylor Medical School where 
eighty-seven percent of our students go on to medical school 
out of that program. Why? Because we begin to transition those 
students while they're undergraduate and they start doing 
research and start working with Baylor into that program. The 
same thing applies if we do need to increase our graduate 
programs we need to get our students to start thinking that at 
the undergraduate level that they can still start going into 
graduate programs to do research.
    Mr. Hinojosa. Let me interrupt you. Would you then continue 
that explanation--you said earlier that your rate of success--
access and success rate increased from fifty-five percent to 
sixty-seven percent?
    Dr. Nevarez. In first year freshmen.
    Mr. Hinojosa. To what do you attribute that?
    Dr. Nevarez. I think we're putting a lot more--First of all 
I think we're getting better students--we've been working with 
getting better students from the public schools right now. We 
have some real good partnerships. They're much more prepared. 
Eight years ago only about twenty-five percent of the students 
that were coming from the high school had gone through the 
recommended college prep curriculum. This past fall it was 
ninety percent. So that has a variable. No question, better 
students will give us better retention rate. But then also is 
the support programs that we give students while they're here, 
from academic support outside the classroom to mentoring 
programs for students.
    And then the financial aid. I think financial aid is very 
important for our students because we have--there's a tendency 
for students to take just minimum loads of let's say twelve 
hours. What we're trying to do is get students to take, you 
know, a higher load. The problem is the work study. What we're 
trying to do--For example, one of the benefits of the flexible 
tuition that the State has given is to give incentives to 
students or a flat fee to students after let's say thirteen or 
fourteen hours. That if you take fifteen, sixteen, seventeen or 
eighteen hours you pay the same amount of tuition and fees on 
it so that we can get students more to take, you know, 
additional hours so they can, you know, complete--.
    Mr. Hinojosa. That sounds like a good incentive. So that 
leads me then to a question to Dr. Brockman who knows very well 
that when I went to visit you the first term that I went to 
Congress I was not a happy camper when I heard the past 
president talk about not participating in student financial 
assistance to a college that represents or rather serves a 
region of the State that has very low income. A lot of families 
just barely making minimum wage. And so I realize that in your 
talking points you talked about knowing that we've made great 
progress and that universities have a rate of only 4 percent 
not paying their loans and community colleges 9 percent or 
lower. Tell me why it's taken you all so long to hire an 
individual who knows how to sell and how to convince and 
recruit and get them into the program because I think that it 
takes trained individuals, administrators to be able to 
increase that student enrollment in our area simply because we 
have so many below the national poverty level. And the only way 
that they're going to go to college is with a student loan or a 
Pell grant or some type of a grant?
    Dr. Brockman. Now we participate in the Pell grant program 
and supplemental Pell and all of the State financial aid 
programs.
    Mr. Hinojosa. That's not enough.
    Dr. Brockman. I understand.
    Mr. Hinojosa. Today's Pell grant even though it doubled in 
size pays less than what it did 10 years ago percentage wise. 
No, but what I'm saying is it seems to me that with your 
leadership Coastal Bend College would already be in the student 
loan program and not be afraid. All you need is some good 
administrators to do the recruitment. And I encourage you to 
move in that direction because here in this southern part of my 
district over ninety percent are on student loans. That's the 
only way they can come to the community college at STCC. And 
I'm sure that when Dr. Reed comes to testify on her panel that 
we'll hear some of those accurate numbers. But tell me what we 
can do to help you get into the student loan program.
    Dr. Brockman. Well, I think having this hearing certainly 
brought me into contact with several people from the Texas 
Guaranteed Student Loan Program. And we plan to have some 
follow-up visits and begin the process of looking into re-
entering that program.
    Mr. Hinojosa. Dr. Brockman, forgive me for interrupting 
you, the Chairman has thought of something important to ask 
you.
    Chairman Hoekstra. I don't know important, but why wouldn't 
all of your students get Pell grants to cover the vast majority 
of their tuition costs?
    Dr. Nevarez. The amount of money we get will not cover all 
the students that qualify for Pell grants. We have to balance--
In order to stretch the money we have to balance the grants 
with loans and work study.
    Chairman Hoekstra. What percentage of your students would 
get Pell grants?
    Dr. Nevarez. Pell grants, I'm guessing here, but sixty-five 
to seventy percent would get Pell grants.
    Chairman Hoekstra. For the bulk of their tuition cost?
    Dr. Nevarez. For the bulk of their tuition at the freshman 
level, because we have less than a 1-percent default rate. At 
the freshman level what we try to do is give almost a hundred 
percent grants for freshman coming in. That may be part of the 
retention that we're experiencing, one of the reasons. But once 
you get beyond the freshman level we balance that with work 
study and loans and the percentage goes down.
    Chairman Hoekstra. Dr. Juarez.
    Dr. Nevarez. Our student population characteristics are 
pretty similar and we're running just about the same breakdown. 
I don't have the specific figures with me, but we wouldn't be 
too far off from what Dr. Nevarez just reported.
    Chairman Hoekstra. Dr. Brockman.
    Dr. Brockman. We have over fifty percent of our students 
that are Pell eligible.
    Chairman Hoekstra. OK.
    Mr. Hinojosa. Dr. Brockman, I'll finish the point that I 
was trying to make about the importance of your college being 
involved and participating in student loan programs. In 
addition--in addition to those there are scholarships available 
through some of our Federal agencies that include the 
following; HUD, Department of Defense, Department of Energy, 
Department of Labor, and USDA. And if those in the audience who 
represent colleges and universities are not looking into those 
agencies you are missing out on an opportunity that other 
regions of the country, other colleges in Maryland and 
California, East Coast, the West Coast, are indeed picking off 
those scholarships and those grants, fellowships that are 
offered by those other agencies. So I encourage you to take a 
look at that and that you contact my staff, particularly Moria 
Lenehan and Ricardo Martinez, so that we can help you and guide 
you into those sources of funds.
    Dr. Brockman. We do have a Department of Agriculture grant 
that is providing scholarships as we are beginning to re-
establish our Ag program at Coastal Bend College. So we are 
taking advantage of that. I expect that we will have another 
grant proposal in this year as well.
    Mr. Hinojosa. And I'm going to conclude my questions so 
that--Mr. Chairman, by saying that I've discovered in these 
last three or four terms that I've been in Congress that there 
is--there is a great--a huge shortage in nursing, in medical 
careers, an acute shortage of engineers and math and science 
technicians. And as a result of that I have worked very closely 
with Dr. Reed at South Texas Community College and we have 
leapfrogged the amount of money--Federal money that has come in 
to try to move us into having a lot more students in nursing 
and medical careers. We've done the same thing with UT-Pan 
American in raising the level of awareness of this acute 
shortage of the engineers and technicians. And I'd like to ask 
you Dr. Nevarez this HESTEC 2003 that you all are advertising 
here tell us what success you had as a result of 2002 and what 
you project over the next two or 3 years.
    Dr. Nevarez. I think we had a tremendous success last year. 
First of all we had an entire week that was devoted here on 
campus which brought over 15,000 public school kids to our 
campus here and they mingled with our students and our faculty. 
But the real advantage of HESTEC is that this institution is 
involved with the GEAR-UP program almost year round. Our 
students serve as mentors in that program and faculty serve as 
advisers to the program. So when HESTEC--when the celebration 
of HESTEC comes in, you know, it brings everything together. 
The other thing that attracts a lot is the kind of speakers 
that we have for HESTEC. There are speakers that we bring in 
that are specialized that will attract the attention of the 
students like astronauts and things like that that they've 
talked to. And aside from other scientists that come in and 
will attract our faculty particularly in science and 
engineering. So I think overall it's been a tremendous success. 
What's going to happen this year, it's going to--It's going to 
be a challenge just try to match what we did last year, but 
we're going to try to surpass it.
    Mr. Hinojosa. Thank you. With that I yield back the balance 
of my time.
    Chairman Hoekstra. Thanks. I need some help here. I'm 
trying to figure out the financial support level because I 
think that's critical. If the average or if the maximum Pell 
grant is $4050 each year, your tuition is roughly around $3,000 
and Dr. Brockman yours would be less, I think, right?
    Dr. Brockman. Mine would be a little less than that.
    Chairman Hoekstra. That for your students who come from low 
income backgrounds the Pell Grant should cover a hundred 
percent of their tuition costs; is that correct?
    Dr. Nevarez. First of all let me make a correction here.
    Chairman Hoekstra. Yeah, I'm here to learn.
    Dr. Nevarez. Yes. Let me make one correction. When we--I 
think when we use the 1,500 or at least when I used the 1,500 I 
was talking about basically tuition and fees.
    Chairman Hoekstra. Right.
    Dr. Nevarez. When you look at the other costs of coming to 
college, which is living expense or stuff it goes up to--I 
think it's 3,200, almost twice that much. But the point is--
your point is still very valid, it still does not reach the 
maximum of Pell grants. The problem, as I understand it, is 
that the funds that we get is not enough to cover 100 percent 
of the needs of those students, so we have to spread it over or 
use other kinds of sources of funds to be able to--you know, to 
meet a hundred percent of the need. As I mentioned we have to 
use work studies, we have to use loans.
    Chairman Hoekstra. But for Pell grants, Pell grants the 
4,000 is available to every student or every family that meets 
the income guidelines, right? I mean you're not taking a look 
at a pool of students and saying ``X'' amount of dollars is 
coming to your school and saying I've got more than those 
students that qualify, therefore I have to spread it around. I 
mean the student qualifying for a Pell grant is strictly a 
process between that student and the Federal Government where 
if their family income falls below a certain level they qualify 
for the maximum Pell grant and they then get that money. Then 
you compliment that for that students needs by work study and 
by, you know, loans and those types of things, right? I want to 
go through this with you.
    Dr. Nevarez. I'm going to have to look into that, 
Congressman, but it's $4,050 per year?
    Chairman Hoekstra. 4,050 is the maximum Pell grant.
    Dr. Nevarez. Per year?
    Chairman Hoekstra. Yeah.
    Dr. Nevarez. All right. And if we're looking at $1,500 for 
one semester of tuition, plus another let's say 1,500 of other 
expenses now you're looking at 3,000 per semester. And if you 
go to the second semester it's 6,000 or six thousand and then 
sometimes--So I guess what I'm leading to is that the 4,000 
does not cover the whole--.
    Chairman Hoekstra. The total amount.
    Dr. Nevarez. The total cost.
    Chairman Hoekstra. It would cover the--Right. OK. It would 
cover the cost for tuition--.
    Dr. Nevarez. Tuition and fees.
    Chairman Hoekstra. Tuition and fees, but not--Do you charge 
$1,500 for room and board?
    Dr. Juarez. Well, ours runs around eighteen--depending on 
what kind of plan they get, between 1,800 and 2,000.
    Chairman Hoekstra. Yeah, OK.
    Dr. Juarez. And then added to that would be the cost of 
their books and then some transportation costs as well.
    Chairman Hoekstra. So the total cost, perhaps, of attending 
either of your colleges would be eight to ten thousand a year?
    Dr. Nevarez. Eight thousand.
    Chairman Hoekstra. OK.
    Dr. Nevarez. A full load is $8,000.
    Chairman Hoekstra. A full load, somebody living on campus, 
would be about eight--.
    Dr. Hoekstra. Full load scholarship for fall and spring 
semester is 8,000.
    Chairman Hoekstra. All right. Dr. Brockman.
    Dr. Brockman. And they cannot expect in most cases any kind 
of family contribution. But the contrary is true that the 
student often is expected, as Dr. Nevarez said, to contribute 
to the family's economic well being. And this is something--it 
took me awhile before people were able to actually convince me 
that this was true, that families were not encouraging of their 
children to participate in higher education. I just thought 
that it didn't happen, but it does. And I've been informed 
many, many times through stories and actual interviews with 
students that many of them have to overcome many more obstacles 
to participate in higher education than you would normally 
expect.
    Dr. Juarez. I don't know about Bee County, but in our 
particular region I would say that the number of students in 
that category are in a very small minority. For the most part 
you've got a lot of family support, a lot of extended family 
support that is encouraging their children to get a college 
education.
    Chairman Hoekstra. But their income earning ability may 
still be essential to the family?
    Dr. Juarez. Yes, sir, it is.
    Chairman Hoekstra. Well, this has been very helpful and 
very informative and we've got another panel that is waiting in 
the wings. You know, thank you very much for being here and I'm 
hoping we can continue our conversations through the day. Thank 
you very much.
    Dr. Nevarez. Thank you.
    Dr. Juarez. Thank you.
    Chairman Hoekstra. Now you're leaving, right?
    Dr. Brockman. I have to go to another meeting.
    Chairman Hoekstra. This new organization.
    Dr. Brockman. Yes.
    Mr. Hinojosa. Dr. Brockman, take with you the model of UT-
Pan American that was able to bring down their rate to 1 
percent was it?
    Dr. Nevarez. Less than 1 percent.
    Mr. Hinojosa. Less than 1 percent.
    Dr. Brockman. I'll certainly try to.
    Chairman Hoekstra. All right. Thank you very much. With 
that we will dismiss this panel and we'll invite the second 
panel to come forward. Thank you very much.
    [Short Break.]
    Chairman Hoekstra. All right, let's begin with the second 
panel. Before we do that I really do want to extend my 
appreciation to my colleague, Mr. Hinojosa. He's done a 
wonderful job in setting up the hearings and the panels for 
today. When we went through this process he said, you know, 
want do you want to get done? And I said, you know, it is your 
day, Mr. Hinojosa, so it's your day to do what you'd like to 
get on the public record, to expose me to the issues that you 
think are important down in your district. And I think you've 
done a great job putting together some--with the folks that we 
met with last night and the folks that we're seeing today. Just 
done a very nice job. And he also is a wonderful colleague of 
mine on the Subcommittee in Washington. We break it down if 
you're a member of the majority party you're the Chairman, if 
you're a member of the minority party you're the ranking 
member. But he's been a great partner in us getting done what 
we wanted to get done on the Subcommittee on Select Education. 
And so I appreciate the work that we can do together.
    Chairman Hoekstra. With that I would like to just introduce 
the second panel. Dr. Juliet Garcia. She is currently President 
of the University of Texas in Brownsville. She serves as a 
member of the Ford Foundation, Project Grad USA, and has also 
recently been heralded by Hispanic Business Magazine as one of 
the 100 most influential Hispanics. Welcome and thank you for 
being here. Also not on the bio she was also on the--the 
chairwoman for--What was the commission, student financial--.
    Ms. Garcia. It's the advisory committee to Congress on 
student financial aid.
    Chairman Hoekstra. So we have the expert here who can 
answer any and all of the questions that we--or curveballs that 
we maybe threw at the last panel. So thank you for being here.
    Ms. Garcia. Thank you, sir.
    Chairman Hoekstra. Dr. Shirley Reed. Dr. Reed was a 
founding of the South Texas Community College in McAllen, Texas 
and has served in this capacity since 1994. Under her 
leadership South Texas has become one of the fastest growing 
community colleges in the Nation. Previously she was the 
District Vice-president For Administrative Services at 
Northland Pioneer Community College in Holbrook, Arizona. Dr. 
Reed welcome to you.
    You know, I thought college presidents had a short tenure 
at colleges, but--.
    Dr. Reed. It depends on how good you are.
    Chairman Hoekstra. I was going to say--Well, you're not as 
good as the guy before us who has been here since 1981, but 
you--.
    Dr. Reed. I'm not done yet either.
    Chairman Hoekstra. Yeah, you're not done yet either. I 
think we actually had the longest serving college president in 
the country in West Michigan, in my district, at Grand Valley 
State University who had been there for close to forty years, 
Dr. Lubbers. So that gives you something to shoot for. But I am 
impressed that the folks and the presidents that you have here 
have fast, rapidly growing colleges. Isn't that true that the 
average tenure of a college president is, what? Is it--.
    Dr. Reed. About 5 years.
    Chairman Hoekstra. It's about 5 years, yeah. Well, 
congratulations to each of you.
    Mr. Hinojosa. Just a little longer than congressmen.
    Chairman Hoekstra. You know, we'd actually do anything for 
a 5-year term, wouldn't we? Although we might not be willing to 
give it up after 5 years.
    And then our third witness is Ms. Ariana de la Garza. She 
is a native of Mission, Texas and currently attends the 
University of Texas-Pan American in Edinburg. She serves as a 
student representative at the university and will be speaking 
with us today about the issues and challenges facing Hispanic 
college and university students. Welcome to you.
    So, Dr. Garcia, we will begin with your testimony.

STATEMENT OF DR. JULIET GARCIA, PRESIDENT, UNIVERSITY OF TEXAS-
                          BROWNSVILLE

    Ms. Garcia. Thank you, Mr. Chairman. I also would like to 
join the others in thanking congressman and yourself for taking 
time to visit us in our part of the country. There's nothing 
like actually being onsite to get the feel and the ambience of 
an environment. And also the needs. So we appreciate very much 
all that it takes for you and your staffs to make these 
arrangements. I'd also like to thank my colleague, Dr. Nevarez, 
for hosting us so graciously on his campus.
    My testimony is going to shift dramatically from what I 
submitted, so if you're looking to follow along you'll be lost 
immediately. But I thought I might refocus more clearly on 
those issues that have not been covered by my colleagues and 
that might be of interest to the discussion. I will, however, 
affirm--take the moment to affirm some of the things that they 
have said so that on the record you understand my concurrence 
with theirs.
    Dr. Nevarez spoke about the immigrant students and the need 
to find a solution for the issue of trying to involve them in 
higher education to the same extent as the nonimmigrant 
student. And I would offer one suggestion as you requested that 
we might do. And that is remember when Senator Gramm allowed 
for a bill that would import expertise to the United States 
because there was such a lack of technical expertise in 
engineering and in sciences. And then Senator Gramm came back 
and asked for an expansion of that. And so yet there was 
another wave of import. And what I would offer is if there's a 
model in Congress already that allows you for importing talent 
like that that there should be some way to create a similar 
kind of model that would say there's some immigrants who are 
already here who have except for legal status paid their dues 
and should have the same rights to work and to go to school as 
those that we might import for a specific cause.
    Chairman Hoekstra. You're actually proposing making it an 
incentive for kids in--or for kids K through 12 saying if you 
do really really well you might fall under a category that--a 
necessary skill.
    Ms. Garcia. That's exactly right. There's no reason why--
that might be one of the ways to lead into.
    Chairman Hoekstra. That's an interesting approach. Thanks.
    Ms. Garcia. Thank you, sir. I would also affirm what Dr. 
Nevarez mentioned about the shift from grants to loans. And 
while we have been very aggressive at University of Texas at 
Brownsville in increasing the number of grants to students 
today those number of grants are almost $35 million dollars per 
year that we get from the Federal Government and goes directly 
to the students on our campus. There is also increasing amount 
of loan debt. And I'll talk a little bit about that in just a 
moment.
    We would also request that you consider full funding of 
Pell grants. And again I'll focus on Pell more extensively.
    We also would ask that you continue to fund in the 
reauthorization consideration, the Tech Prep, the TRIO 
programs, the GEAR-UP programs, and the Title V programs. Every 
one of them has been essential in building capacity in fast 
growing Hispanic Serving Institutions like the two that we--
like the many that we represent today.
    Loan forgiveness for students that are going to go into 
those fields is a wonderful idea. It's a perfect kind of carrot 
to hold for students who are reticent and reluctant to take out 
loans. And remember when you've got a family that's earning 
less than $25,000 a year a loan burden of 17,000--which is the 
average, by the way, of a student in the country these days 
upon exiting a bachelors degree program. There's a tremendous 
amount of reluctance to borrow 17,000 when your family makes 
25,000 a year. So some sort of forgiveness program especially 
aimed at those targeted occupations seems to make sense to me.
    Grants for graduate students. Again I'll focus a little bit 
on the bill that Congressmen Hinojosa has proposed. But that 
there is probably no greater incentive for getting students in 
than to provide some sort of financial assistance, or teaching 
assistance, or fellowships for them to do research, or teaching 
as graduate students.
    And then support for building research capacity at the 
graduate level. Our university is a new one. We're only twelve 
years old, as compared to the University of Texas at Austin, 
for example. And we don't have the oil revenues, by the way, 
that is enjoyed by others. We are in the fastest growing region 
in the State of Texas and yet building as fast as we can trying 
to accommodate that growth. So any incentive, any additional 
dollars that would come to help us build capacity, meaning 
buildings literally, faculty, or monies for graduate students 
would help spur that effort.
    I'd also like to agree with Dr. Juarez as he talks about 
the number of dollars it takes to build doctoral programs. He 
mentioned 3 to $5 million for one doctoral program a year. And 
that was in engineering. That's a very real cost and it can be 
returned to the institution, and of course to the Nation, in a 
very short-term. It's been discovered--I mean the results are 
that if a small investment in higher education in HSIs the 
return is twenty fold. So while it sounds like an awful lot of 
money up front capital it is just that to start a business or 
to start a new industry.
    Dr. Brockman discussed the tuition differences between 
university and community colleges. And he mentioned that it was 
not without some cause that there seemed to be the irony that 
those community colleges on the border seemed to have to charge 
more when in fact those are the students who can least afford 
it. And that's because of their dependence on an ad-valorum 
tax. And I think that's a sad irony of the kind of financial 
situation that we're in.
    Let me tell you a little bit about UT-Brownsville. We are a 
neighbor of Pan-American University. We're about sixty miles 
southeast of here. Our campus is one block from Mexico. So when 
people say where you located and I'll say, you know, close to 
Mexico. And literally we can go across the border to eat lunch 
quicker than we can to go across town. Which means that 
students can also blur that national boundary and come across 
more easily prior to the new immigration laws than before.
    Our faculty are the hardest working faculty in the State of 
Texas. I can say that because they actually have been measured 
to work more hours and teach more students than any other 
faculty in the State of Texas. They're also concurrently the 
lowest paid faculty. And, yes, it is eighty percent of the 
cost. And some of that is driven by a 17 percent insurance rate 
increase last year, a 14 percent insurance rate this year. But 
it's not because you're putting an awful lot more money in the 
faculty pockets, it is because you've got so much more need 
than you're able to supply.
    We also are tied for first in the State of Texas as the 
most well utilized campus. That's a nice way of saying in Texas 
you're the most crowded. Only with University of Texas at San 
Antonio in comparison.
    But given all of that we are producing now the third most 
mathematics graduates--Hispanic mathematic graduates in the 
Nation. Now what's amazing is that only after twelve years as a 
university it would be us that would be producing the third 
most math Hispanic graduates in the Nation. I say that not in a 
braggadocios kind of way. I say that because there's something 
wrong with the system of higher education that would allow us 
to come up so much--so close to that front line and not provide 
for other Hispanics in mathematics, the same thing.
    The potential is great. And the way I'd like to talk about 
that is to talk about two points. One is we've had the fastest 
growth in getting research dollars over a 3-year period in the 
State of Texas of any other university. Between '99 and '01 our 
increase in research dollars was over 2000 percent. We thought 
there was an error in that so we called the coordinating board 
just to make sure. The real clue there is that we started at 
such a small number that that number was easy to reach. But the 
year subsequent to that we rose by another 170 percent. So 
there is no lack of initiative in terms of these border 
institutions to try to access Federal dollars, NSF dollars, NIH 
dollars. We're running as fast as we can and so are our faculty 
to try and bring those extra resources to bear to our programs.
    I'd to like to tell a story about one student. Her name is 
Tania Perkins. T-A-N-I-A is her first name. As an example of 
why a community university, like ours, that combines the best 
characteristics of a community college, open admissions, a 
nurturing environment, an opportunity to do occupational/
technical studies as well as academic studies and graduate 
studies, with the very best of a university and why that seems 
to be working. We're a unique kind of model where we simply 
built an upper level university on top of a community college. 
Instead of duplicating administrations, instead of duplicating 
campuses and efforts, we're going to streamline administrative 
efforts, streamline expenses, and break down barriers that 
usually exist between community colleges and universities. The 
best community college in the State-- in the Nation, excuse 
me--in the Nation still has only about a 17 percent rate for 
transfer of students to baccalaureate degrees. The reason 
that's so crucial to us is because most Hispanics, most Blacks, 
and most women start out in community colleges nationwide. And 
if they're not making that transfer over to the baccalaureate, 
and the graduate, and the doctoral degree then that access that 
community colleges do such a good job of providing is not 
realized in benefits to a new economy that requires advanced 
degrees.
    Tania Perkins starting out in our institution in the 
English as a Second Language program. She came from Matamoros, 
which is the city directly across the border from Brownsville. 
She said she remembered sitting in the classroom watching the 
real college students pass by--what she meant was students that 
were not in English as a Second Language--and said one of these 
days I'm going to be a real college student. She learned 
English and then she got into the real college classes. Ended 
up with her bachelors degree from our institution in physics.
    Now if you had asked me 5 years ago if UT-Brownsville would 
be doing cutting edge analysis in gravitational wave analysis--
I did not know what that was 5 years ago--I would have said, 
no, we'll be in education, we'll be in math, but not in 
physics. We now have twelve physicists on our campus and that's 
kind of another story.
    But Tania was recruited by those physicists into that 
bachelors program. She decided then to get married, have a 
couple kids and then she was lured away by her husband and an 
opportunity for a higher degree because we don't have a masters 
degree in physics yet, to another university where she got her 
masters. Tania Perkins now after stopping out of school for 5 
years has returned to school and she's now at the University of 
Texas Health Science Center Medical School working on her 
doctorate degree in Bio-Engineering.
    By all measure of the word Tania is so non-traditional that 
if you measure her by time to degree she would have been a 
failure, and so would we. If you measure her by what her SAT 
scores were, she had none, she was ESL programs. If you measure 
her on almost any other traditional criteria that we use you 
would have seen that she probably would have predicted her not 
to succeed. But she's not an anomaly, her sister is also 
working on her doctorate at the University of Texas at Austin. 
She's in Spanish literature. The reason I tell you Tania's 
story and her sister's story is because the student in the 
border and in South Texas is often a non-traditional student. 
And while some of those criteria measurements--we don't look as 
good, our students don't look as good on the traditional ones 
the value of that student often is greater than or at least 
comparable to that of other students. And certainly the 
potential for them to succeed is great.
    Now I'd like to go to the issue of financial aid if I might 
just have one more moment. According to Tony Carnevale, who is 
with the educational testing service in a study he did, the 
most underrepresented group of Americans at the Nation's top 
colleges and universities is not Blacks, and it's not 
Hispanics, it's students from low income families. Only 3 
percent of the freshmen at the 146 most selective colleges and 
universities come from families in the bottom quarter of the 
Americans ranked by income.
    The reason I mention that is because the discussion earlier 
today about financial aid. And I would like to refer you to a 
study that was done by the committee that I was privileged to 
serve on for awhile called ``Access Denied.'' It was followed 
by a committee report called ``Broken Promises.'' What we 
decided to do was to get experts from around the Nation to 
study the issues that you all were focusing on this morning. 
What's the problem? If we're giving Pell grants what else is 
there that we're not counting. Now are students working too 
much or what are the other issues that are involved. So both 
reports I commend to you and I'd be glad to get copies sent to 
you because they very clearly delineate the issues that you 
were referring to.
    But I might mention just one and that had to do with unmet 
need. If we're paying $4,000--4,050 for the maximum Pell grant 
award doesn't that cover tuition? Yes, sir, it does. And yes, 
sir, it is regulated. That is I can't decide to change that. If 
a student qualifies for a certain amount of aid that's the 
amount that the student will get. It comes through us as a 
conduit only, but it goes directly to the student.
    On average, however, the very lowest income students face 
$3,200 of unmet need even at 2 year institutions, which are the 
lower tuition institutions. At 4 year a low income student 
faces $3,800 of unmet need. It's apparent that excessive unmet 
need is forcing many low income students to choose levels of 
enrollment and financing alternatives not conducive to academic 
success and persistence. Well, what does that mean? It means 
that they have to work too many hours. That is they work--Now 
this is unmet need after Pell, after work study, and after any 
other sort of assistance that they might get of an additional 
job. The unmet need includes everything from child care, to 
transportation, to housing, to all of those things that are not 
reflected in tuition in addition to the fees. And the fees is 
really where--I guess we should have like a truth in 
advertising stipulation for colleges and universities.
    Chairman Hoekstra. Be careful, if you ask for it we might 
give it to you.
    Ms. Garcia. Well, it would be a way to candidly tell 
parents here is what it costs you. Because to look at just the 
per credit hour cost of tuition is to look at a very thin slice 
of the cost of higher ed. And so your suggestion about not 
raising that beyond twice the CPI would control one thin slice 
and perhaps may not be the incentive to use.
    One final point and that has to do with graduate programs. 
At a time we know that when the advanced skills are becoming a 
more important a future earnings and of this Nation's economic 
strength only twenty percent of all the HSIs in the Nation 
offer a master's degree. Less than twelve percent of HSIs offer 
doctoral degrees. It is a chronic shortage. And let me just 
give you an example. Only 4 percent in 2000 of the doctoral 
degrees went to Hispanic graduates. When I graduated from 
university as a doctoral candidate I was told that I had now 
joined the ranks of the 1 percent of the students that year--
one percent of all the doctorates went to Hispanics in the 
1970's when I finished. That doubled twenty years later to 2 
percent. Now we are at 4 percent. So anything that we can do, 
including the bill that Congressman Hinojosa mentions, anything 
we can do to provide financial assistance to build capacity at 
universities, to bring more faculty to that process, to add 
more degree programs would be beneficial to that end. Thank 
you, sir.
    Chairman Hoekstra. All right, thank you.
    [The prepared statement of Ms. Garcia follows:]

Statement of Juliet V. Garcia, PhD, President, The University of Texas 
               at Brownsville and Texas Southmost College

    Good morning, Mr. Chairman and Members of the Subcommittee on 
Select Education.
    I am Juliet Garcia, President of The University of Texas at 
Brownsville and Texas Southmost College. I appreciate the opportunity 
to testify today at this hearing on ``Expanding Opportunities in Higher 
Education: Honoring the Contributions of America's Hispanic Serving 
Institutions.''
    Let me first give you a glimpse of our university, our mission, and 
our student body, and then share my recommendations with you.
    The University of Texas at Brownsville in partnership with Texas 
Southmost College is located in Brownsville, which is about 60 miles 
from this meeting site at our sister component, UT Pan American. Our 
university is one block from the border of Mexico.
    Our partnership is a unique community university that serves over 
10,600 students on campus and through distance education. We offer a 
wide range of programs--academic and technical--with certificate, 
associate, baccalaureate, and graduate degrees.
    Recently, we have experienced tremendous growth in our Workforce 
Training and Continuing Education division that serves more than 16,000 
(duplicated) enrollments per year.
    To meet the growing demands for higher education in the fastest 
growing region in the state, UTB/TSC needs to double its enrollment to 
20,000. That will take increased funding for all areas of the 
university.
    Our mission at UTB/TSC is to provide accessible and affordable 
postsecondary education of high quality, to conduct research that 
expands knowledge and to present programs of continuing education, 
public service, and cultural value to meet the needs of community.
    We accomplish this mission by ensuring that we maintain the 
strengths of both the community college and the university. Our primary 
goal in forming the partnership was to increase student access and 
eliminate inter-institutional barriers that hinder students from 
continuing their education.
    On average, over 80 percent of our students have received a form of 
financial assistance. They are students who are predominantly first-
generation college students. And, about 93% of our students are 
Hispanic, and for many, Spanish is their preferred language at home.
    Fortunately, we are making progress in enrollment and graduation at 
every level of study offered at the community university.
    I now offer recommendations for how the federal government can 
appropriately strengthen and enhance programs designed to meet the 
unique challenges and needs of Hispanic students through the 
reauthorization of the Higher Education Act (HEA).
    Our partnership marked its 12th anniversary last month; we felt 
fortunate to be left standing and ready to move forward after the 
budget work during the state's 78th legislative session. Given the 
short time that we have been a university, we had to make a case that 
our progress would be severely impeded without sufficient state 
funding. Without sufficient federal dollars, our students' progress 
would be stopped. Thus, my recommendations focus on how to facilitate 
their progress.
Recommendations
    I address the recommendations in order of their priority to ensure 
access to education at The University of Texas at Brownsville and Texas 
Southmost College.
Financial Assistance
    As you know, too many Hispanics are poor and undereducated. Since 
Hispanics are the largest and youngest minority group in the country, 
the effect of the situation is important for individual lives and for 
the nation.
    Our university is situated as follows: in our service area, the 
poverty rate is twice that in the state. The number of people over the 
age of 25 in our community without a high school diploma is twice that 
in the state. Thus, many first generation college students who depend 
extensively on financial aid to attend college arrive full of hope on 
our campus each semester. They don't know if it will take five years or 
ten for them to graduate. Their measure of success is not a national 
average; persistence and working through difficult situations make them 
successful. We need the federal government's support to make sure that 
their hope for higher education is not left void due to the lack of 
money.
    My parents taught me the lessons of advocacy for the education of 
children--mine and others. So when I was asked to serve on the Advisory 
Committee on Student Financial Assistance (ACSFA), it was a chance to 
join with others across the nation to understand the impact and 
advocate for financial assistance. During my tenure as a member and as 
chair of ACSFA, we produced two reports: Access Denied and Empty 
Promises.

    What was found?

      The cost of higher education has risen steadily as a 
percentage of family income only for low-income families; however, 
middle-income affordability and merit have begun to displace access as 
the focus of policy makers at the federal, state, and institutional 
level.
      Families of low-income, college-qualified, low-income 
high school graduates face annual unmet need of $3,800 in college 
expenses not covered by student aid, including work-study and student 
loans. And the shortage in grant aid requires these families to cover 
$7,500--two-thirds of college expenses at public four-year colleges and 
one-third of family income--through work and borrowing. Their peers 
from moderate-income families face similar barriers.
      Financial barriers prevent 48 percent of college-
qualified, low-income high school graduates from attending a four-year 
college, and 22 percent from attending any college at all, within two 
years of graduation.
    These important national findings apply to too many families in our 
region. Now, with the state's budget crisis, my request is that the 
federal government will help to cover the dire shortfalls and growing 
need with increased financial funding for students and partnerships 
with the states.
    I will begin with the partnership option. Our state's program, 
Toward Excellence, Access and Success (TEXAS) Grant, was created with 
the best of intentions to help provide additional dollars to the 
students and incentives to prepare for college. The Texas Grant is a 
merit based program that favors school district students who have had 
access to the recommended curriculum.
    Based on where they live, some students will have better access to 
this curriculum. With an influx of students who are better prepared for 
college and even with this particular criterion, the does not have 
adequate funding.
    At UTB/TSC, in fiscal year 03, 872 initial year students were 
allocated Texas Grant monies; in fiscal year 04, 315 initial year 
students were able to be funded. That is a decrease of more than 60%. 
This shows that additional partners are needed to ensure the state 
program succeeds in rewarding students for their preparation. And, in 
keeping with the spirit of access, other considerations need to be made 
for students who have limited access to the recommended high school 
programs.
    Next, I will talk about loans. Each year our students have to 
borrow more money. Finding yourself in steep debt after completing 
college diminishes your earning power. The federal government needs to 
find means to help these students. Suggestions may include doing away 
with any processing fees for students or even forgiving loans for 
selected students where a greater good could be served with their 
talents.
    In a study sponsored by the Century Foundation, Anthony Carnevale 
concluded that poor students are the most disadvantaged students in 
America, particularly those students whose parents did not graduate 
from high school and earned less than $25,000 per year. That is a 
typical student at UTB/TSC.
    In the work-study programs, I recommend that additional funding be 
added to the college work-study program, and you reexamine the 
distribution formula to take growing institutions into consideration.
    Long term immigrants are another group of students who could 
benefit from college, but find themselves shut out of federal financial 
aid programs. Long term immigrant students need to be given access to 
financial assistance. Through no doing of their own, they are in a 
situation that keeps them away from a route to a better financial 
status. The HEA could make allowances for students who have been in the 
country for a continuous period on a long term basis.
Outreach Programs
    Our community university operates more than 30 outreach program. 
This year, we have added another Upward Bound Program for another 
school district. We also received a CAMP grant that helped us to fund 
migrant students into campus housing. Adequate funding for such 
programs throughout the HEA cycle must be assured.
    Our GEAR-UP program is completing its 5th year, after having served 
an average of 6,000 in six school districts. My monthly meetings with 
the area's superintendents and curriculum supervisors provided 
partnerships that have forged paths for middle school students to start 
planning for college and enrolling with the goal to finish.
    Let's increase funding to help this widespread program continue to 
bring college preparation to the plans of students early in middle 
school.
Title V
    Undergraduate education is our start. What about graduate students?
    I support Congressman Hinojosa's H.R.2238 to expand and enhance 
post-baccalaureate opportunities at Hispanic-Serving Institutions. We 
certainly hope that the House Committee on Education and the Workforce 
will support this important bill.
    The $2.1M Title V funding received by the University of Texas at 
Brownsville and Texas Southmost College has helped us to meet the needs 
of students who were at risk of stopping out of college. Retention is 
the primary focus of our funding. Between Fall 1997 and Fall 2002, our 
sophomore retention increased 16.1%; junior retention increased by 19%; 
and senior retention increased by 25.1%.
    The need is as great at the graduate level. As our campus serves a 
majority of first generation undergraduates, our students need to be 
recruited into graduate school and assisted in succeeding. Congressman 
Hinojosa your new provision for Title V would be most helpful in our 
ability to do that.
    Many students in our area are just beginning to realize the 
possibilities that they can generate with obtaining a graduate degree. 
In the last 12 years, our master's programs have tripled, and we are 
expanding offerings in education, health, and math. The students who go 
into these programs will help shape our region because they are likely 
to stay in the Lower Rio Grande Valley.
    Technology is an area that could use a hearing of its own. As a 
member of Hispanic Educational Telecommunications System consortium, we 
have benefited from the experiences and assistance of others who are 
upgrading and utilizing new technology. I will be brief in an example 
to show how more funding is needed.
    In March, we had to send 7% of our general revenue budget back to 
the state. That return took away our ability to purchase new equipment, 
particularly computers for the classrooms. Our students should not have 
to take turns with computer equipment to participate in their classes 
or study labs. With adequate funding included for technology, the HEA 
would help HSIs tremendously.
    Lastly, in the area of Title V, I believe that the ``50% percent 
low-income'' assurance requirement should be eliminated from the 
funding criteria of Title V. It is a requirement that applies only to 
HSIs among minority-serving institutions, which adds an administrative 
burden in efforts to assist students.
Teacher Shortage
    Our local schools are short on teachers with master's degrees and 
on teachers in the areas of math, science, and technology.
    Additional funding for teacher training would help HSIs to address 
needs at the PK-12 level and, thereby, the college level.
    Our partnerships with other University of Texas System components 
have helped us to produce graduate school graduates in physics and 
engineering. Yet, certainly there are not enough graduates in those 
areas who go into teaching. Additional funding targeting those areas 
would help us to recruit and train people who want to stay in the area 
to teach.
    The reauthorization of the Higher Education Act is an important 
opportunity to take a stand on the future of this nation. As a world 
leader, we can set a pace for removing barriers to undergraduate and 
graduate education by putting adequate funding where the investment 
could give immeasurable returns. It would be the best way to honor the 
contributions of Hispanic Serving Institutions.
    Again, thank you for the opportunity to testify at this hearing.
                                 ______
                                 
    Chairman Hoekstra. Dr. Reed.

STATEMENT OF DR. SHIRLEY REED, PRESIDENT, SOUTH TEXAS COMMUNITY 
                            COLLEGE

    Dr. Reed. Good morning.
    Chairman Hoekstra. Good morning.
    Dr. Reed. And thank you for coming to South Texas. And 
thank you, Congressman for arranging this. And thank you, Dr. 
Nevarez for hosting us. This is a community of many 
dichotomies. You've heard us talk about the booming increase in 
enrollment. And yet I opened up Sunday's Monitor, ``Developing 
the Displaced.'' This community has lost 7,000 jobs since 1994. 
Training programs--``Unemployed workforce lacks a training 
outlet.'' ``Search for jobs in saturated market proves 
difficult.'' ``Plowing ahead: Training programs yield low job 
counts.'' And yet this community is the fastest growing in the 
State of Texas. We have the fastest job creation rate in the 
State of Texas. We are the fourth fastest growing metropolitan 
area in the country. So how can we have headlines such as this 
when we're all bragging of our tremendous successes in 
increasing higher ed.
    Now the 8,000 jobs that were lost they're all primarily in 
the sewing operations that have gone offshore. And the typical 
profile of these employees would be a female--Hispanic female, 
early fifties, fourth grade education, has a family. Now these 
are workers that may not work again. Half of them go back to 
work after several years. They may not ever earn a living wage 
again. And of the two million residents that live along our 
border only thirteen percent of them have a college degree 
compared to about thirty-three percent in other parts of this 
country. And I--I share that background with you to help put in 
perspective that one of our greatest challenges, particularly 
for the community college, is to create a match between the 
skills of the workforce and the needs of business and industry 
coming to our community.
    The loss of the sewing operations we don't have comparable 
jobs right now. We're most challenged with how to provide the 
re-training that will bring a person from the fourth grade, 
without any fluency in English, up to college level to pursue a 
degree in nursing, or to go on to UT-Pan American.
    So our challenge for the community college, and 
specifically South Texas Community College, is to prepare that 
workforce. That's why we were created. That is the most 
important plank in our mission.
    We define our enrollment as being revenue constrained. We 
would be a much larger institution than we are today if we 
would have had the resources and the buildings to accommodate 
the growth. We went from 1,000 students to over 15,000. We now 
have eighty-one different degree and certificate programs for 
students. Students are taking classes in a vacated elementary 
school, using high school facilities in the evening. We teach 
at churches. We teach at police substations. We even began our 
nursing assistant program in a Laundromat. This is from where 
we came, because we simply did not have the revenue to 
accommodate the students, hire the faculty and build the 
buildings.
    Since that time the voters in our community have voted to 
double their tax rate. They approved a $98 million bond issue 
which will allow us to finally build facilities. Then the State 
of Texas cuts back our funding almost nineteen percent. And 
one-third of our funding comes from the State of Texas, a third 
comes from our local taxpayers, and a third comes from student 
tuition. So while we move forward on this front we go even 
further back on that front.
    Among our challenges are helping students complete their 2 
year degree and transferring to the university. A study that 
was done by HACU stated that the biggest deterrent to Hispanic 
students earning a bachelor's degree is they never leave the 
community college for many, many reasons. Financial, they can't 
afford the tuition. They have family responsibilities. They 
have geographical limitations where they cannot leave the area 
because the commitments to family. We have to find funding to 
help us provide support services for our Hispanic students so 
that they can transfer to the universities, earn their 
bachelor's degree and go into masters and doctoral level 
programs.
    Among the most valuable to the community college are the 
TRIO programs and Title V. Specifically Title V permits us to 
work with our students who our ``not college ready.'' We find 
ourselves with forty-five percent of our incoming high school 
graduates that are not able to pass the Texas academic 
readiness test. These students have to go through a 
developmental studies routine. They have to take courses in 
English, Math and Reading. Those are very expensive courses for 
us to offer. We do not have the funds to provide the intensive 
counseling and support that is needed for those students to be 
successful. That's why TRIO and Title V has been invaluable to 
us.
    There are 11 million Hispanic students in this country's 
community colleges. Sixty-two percent of those students begin 
in community colleges. Half of the institutions they attend are 
HSI institutions. There are only two hundred HSI institutions 
in the country. We're attempting to serve among the most 
uneducated, unserved population in this country and yet we only 
receive half of the Federal funding that's provided for 
students compared to what all other degree granting 
institutions are earning.
    There's also the expectation that there will be a fifty 
percent increase in HSIs within the next decade which is going 
to further dilute the amount of funding that's available. And 
also with the discussion of including for profit institutions 
you're going to see a rapid increase in the number of HSIs. And 
if the pie stays the same that means all of us are simply to 
get less and less to serve a very needy population.
    In Texas there are seventeen percent less Hispanics 
enrolled in colleges as compared to white non-Hispanics in 
Texas. And there are nineteen percent less Hispanics with a 
bachelor's degree than the white non-Hispanic population. This 
is a result of lack of access, lack of funding, lack of 
support.
    When South Texas Community College began there was a 
question, do we really need another institution in this region 
of Texas. We already had UT-Pan American, we had UT-
Brownsville. We have Texas State Technical College. And some 
people sincerely questioned the need to increase access. We 
opened our doors--and the Congressman will remember--They were 
in line at 2 a.m. In the morning with sleeping bags. They lined 
the entire campus just for an opportunity. That's all they 
asked. Give us an opportunity. They knew they couldn't afford 
the tuition at UT-Pan Am, even with Pell grants.
    And as you were asking the questions earlier we were doing 
a little math. You get your $4,000 Pell grant. At South Texas 
Community College--Now that's $4,000 for the year. It has to 
cover summer also if you're going to summer school. You'll need 
$1,200 for tuition. $1,000 for textbooks. Almost more than your 
tuition. That leaves you with $1,800. And if you do it on a 
twelve month basis you have a $150 a month. You've got to pay 
for child care. You have to have transportation. You have to 
have a place to live. You have to pay your medical expenses, 
plus all those unforeseen surprises life provides.
    So $4,000 in the Pell grant just doesn't begin to provide 
an opportunity for our students to complete their education. We 
see it over and over again. And we have a fifty-seven percent 
retention rate. Much lower than UT-Pan American. You have your 
Pell grant. You're an honor student. All of a sudden your 
grandmother becomes ill. You have to drop out of school because 
there's no one to provide care, or you have the only car in the 
family. Even a modest additional $1,000 a year would make a 
substantial difference in these students being able to complete 
their college education.
    In closing I just have one quote I want to share with you. 
This is from Steve Murdoch, who is the demographer for the 
State of Texas. And the State of Texas, the Coordinating Board 
Higher Ed Plan of Closing the Gaps is calling for another 
300,000 students to come into higher ed by 2015, sixty percent 
of which will be beginning in the community colleges. And Dr. 
Murdoch says, ``If all ethnic groups in Texas had the same 
educational attainment and earnings as white non-Hispanics the 
total personal income in the State would be $44 billion higher 
and the State would realize an estimated $16 billion in 
additional tax revenue.'' You know at the State level, at the 
Federal level that will go a long way to increasing funding for 
HSIs, Pell grants, TRIO and Title V. Thank you for the 
opportunity.
    Chairman Hoekstra. Thank you.
    [The prepared statement of Dr. Reed follows:]

Statement of Shirley Reed PhD, President, South Texas Community College

    As the founding President of South Texas Community College, I 
welcome the opportunity to share with you the challenges and needs 
before South Texas Community College as a Hispanic Serving Institution.
    South Texas Community College (STCC) was created on September 1, 
1993, by Texas Senate Bill 251 to serve Hidalgo and Starr counties, 
which are located in deep South Texas along the U.S.-Mexico border 
region. It is the only community college in Texas to have been 
legislatively established because of the compelling need for a 
comprehensive community college to serve the over 600,000 residents of 
the region, with over ninety-six percent (96%) being Hispanic and who 
previously did not have access to such an institution.
    STCC began as an institution with 10 certificate programs and less 
than 1,000 students. An enrollment of 1,000 students in 1993 has 
increased to over 15,000 in Fall 2003 with 81 degree and certificate 
program options available to its students.
    South Texas Community College serves the over 623,000 residents of 
its districts, with over ninety-six percent (96%) of the population 
being Hispanic and a student population who are 96% Hispanic, which 
parallels the ethnic distribution of the counties served by the 
College.
    South Texas Community College's two-county district of Hidalgo and 
Starr counties had unemployment rates of 24.1% and 40.3%, respectively, 
in 1993. Since the creation of STCC, unemployment has dropped 
significantly to 12.7% and 21.7% in Hidalgo and Starr counties. The 
future employment market related to industrial growth in McAllen/
Reynosa will be dependent upon the ability of STCC to develop a highly 
skilled workforce that is specifically trained to meet the needs of 
businesses and industries relocating to deep South Texas.
    STCC has become a model throughout the state for providing access 
to higher education to Hispanic students who have had limited 
opportunities to pursue higher education. These are achieving and 
successful Hispanic students as measured by job placement, graduation 
rate, transfer success and employer satisfaction.
    South Texas Community College is strategically located on one of 
the world's most dynamic borders dividing an industrial power and a 
developing one. The local, predominantly Hispanic, workforce is being 
faced with many challenges as well as opportunities. The local 
workforce simply has not had the opportunity to develop the skill 
levels necessary to assume the new employment opportunities readily 
becoming available in the community. South Texas Community College is 
the primary provider of workforce development for deep South Texas and 
must address the challenge of preparing the Hispanic workforce for an 
economically competitive deep South Texas, state of Texas as well as 
the United States.
    By way of background information, the Texas Higher Education 
report: Closing the Gaps by 2015, the strategic plan prepared by the 
Texas Higher Education Coordinating Board, has recognized the need to 
expand access to an additional 500,000 new higher education students by 
2015 and to increase the degree completion rate by fifty percent (50%). 
Of these students, 60% or 300,000 will be attending community colleges 
and 50% or 150,000 of these new students will be Hispanic. Hispanic 
enrollment in the state of Texas increased by over 40,000 students 
since 2002, according to a report released by the Texas Higher 
Education Coordinating Board. Most of the state's increase in Hispanic 
enrollment came from South Texas, along the Mexican border and around 
the Houston area. Two-year colleges, including South Texas Community 
College, were responsible for 58% of the increase in Hispanic student 
enrollment.
    The Texas Higher Education report Closing the Gaps by 2015 states:
        ``Currently, Texas is profiting from a diverse, vibrant and 
        growing economy. Yet, this prosperity could turn to crisis if 
        steps are not taken quickly to ensure an educated workforce for 
        the future.''
        ``A large gap exits among racial/ethnic groups in both 
        enrollment and graduation from the state's colleges and 
        universities. Groups with the lowest enrollment and graduation 
        rates will constitute a larger proportion of the Texas 
        population. If the gap is not closed, Texas will have 
        proportionately fewer college graduates.''
        ``Hispanic enrollment must continue to increase statewide by 
        22,000 students each year through 2005 to be on track with the 
        Higher Education Coordinating Board's goal of strong college 
        enrollment among all ethnic groups by 2015. The recent 
        enrollment trends put Hispanics at 35% of the state's goal to 
        have 340,000 Hispanics enrolled in Texas colleges by 2015.''
        ``By 2008, Texas will become a minority-majority state. 
        Hispanics will account for more than forty percent (40%) of the 
        state's population.''
        Steve Murdock, the state of Texas demographer, indicates; ``If 
        Texas does not close its education racial gap, the average 
        state of Texas household in 2040 will be about $6,500 a year 
        poorer than in 2000. By then, the poverty rate among family 
        households could increase by three percent.'' Increased levels 
        of enrollment for Hispanics are critical for their own 
        betterment and the future of the state of Texas as well.''
    The State-by-State Report Card for Higher Education, prepared by 
the National Center for Public Policy and Higher Education, has 
reported the performance gaps in the Texas higher education system. 
These gaps include the following:
      Thirty-nine percent (39%) of white non-Hispanic 18 to 24 
year olds enroll in college as compared to twenty-two percent (22%) for 
all other races.
      Thirty-three percent (33%) of white non-Hispanic 25 to 65 
year olds have a bachelor's degree, compared to fourteen percent (14%) 
for all other races.
    This same report put the higher education performance gaps in 
financial perspective and stated, ``If all ethnic groups in Texas had 
the same educational attainment and earnings as white non- Hispanics, 
total personal income in the state would be $44 billion higher, and the 
state would realize an estimated $16 billion in additional tax 
revenues.'' Increased opportunities must be provided for Hispanic 
students to achieve the same educational attainment level as white non-
Hispanic students.
    The Texas Workforce Commission has projected a 17.6% job growth 
rate over the next ten years for the state of Texas and a 16.6% job 
growth rate for this region of deep South Texas. Unless new initiatives 
are implemented to prepare the competitive workforce, the job growth 
rate will not be achieved, opportunities will be lost and there will be 
a long-term social and economic price to be paid. In order for the 
region of deep South Texas to close the substantial economic and 
educational gaps, significant workforce development investments must be 
made to prepare the Hispanic workforce and to build the workforce 
training infrastructure that will be necessary to continue attracting 
industry to the region.
    The Texas Border Infrastructure Coalition reported in its 
Legislative Recommendations for the 78th Legislative session of the 
Texas Legislature, ``Less than thirteen percent (13%) of the two 
million border residents have a college degree.'' This disturbing 
statistic depicting the low educational attainment levels of deep South 
Texas has kept the region from preparing the competitive workforce 
necessary to attract new business and industries to deep South Texas 
and that provide ``living wages'' for their employees.
    The Hispanic Outlook in Higher Education, March 2003 edition, 
contained a telling article, ``Baccalaureate Access through Two-Year 
Colleges,'' which addressed the disparities affecting Hispanics. Thirty 
percent (30%) of white non-Hispanic adults have attained the 
baccalaureate degree by the age of 24, while only seven percent (7%) of 
Hispanics have done so. The biggest single reason cited for the 
difference in the baccalaureate degree completion rate is that the 
majority of minority students who attend post-secondary education 
initially enroll in public community colleges and do not transfer to 
complete the baccalaureate degree. For the citizens of deep South 
Texas, there is much more than the digital divide, the place between 
having access to computers and being shut out of cyberspace. The people 
of deep South Texas have experienced a great degree divide, a lack of 
access to a community college education and a baccalaureate degree for 
Hispanics who are seeking preparation in specific workplace skills and 
professional preparation.
    The Rio Grande Valley, along the U.S.-Mexico border, is key to 
making Texas competitive in a global economy and companies are 
relocating to deep South Texas on an ongoing basis; however, they are 
recruiting professionals from other parts of the country to take these 
new jobs. The Hispanic potential workforce from deep South Texas has 
the talent and initiative to excel in these new job opportunities; 
however, they lack the diploma and adequate workforce preparation. 
Access to a college degree would ensure them not only a valued 
employment opportunity but also a complete change in their lives 
impacting generations to come. The increased and new employment 
opportunities in deep South Texas are now requiring high skill 
technical workers with certified skills at the community college and 
four year baccalaureate degree level. Hispanic Serving Institutions are 
the front line institutions that must respond to this need.
    There is a strong connection between workforce development and 
economic development in the counties STCC serves. Business and industry 
function as an economic engine by providing employment opportunities 
for the community and by investing in a region that has been previously 
underserved. South Texas has been slowly transforming from an 
agricultural area to an area driven by agribusiness and has been 
experiencing an increase in the business sector and an increase in the 
number of industrial plants which relocate to the area on a monthly 
basis. These new trends continue to create opportunities for STCC 
graduates, challenges for the business and industry sector, and many 
direct and indirect benefits to the community.
    Preparing Hispanic students to be competitive in the workforce 
offers profound economic and social benefits to the region. This is 
affirmed by the key role STCC has played in decreasing the unemployment 
level in deep South Texas by almost fifty percent (50%) and it has been 
achieved by working collaboratively with the Economic Development 
Corporations in the area to serve the needs of the communities within 
the STCC service area.
    Community colleges currently comprise 53% of all HSIs. Community 
colleges also enroll 62% of all the Hispanic students in American 
higher education while only enrolling about 44% of all the students. In 
the fall of 2001, community colleges had Hispanic student enrollments 
of over 11 million students, including both credit and non-credit 
students.
    As the nation's youngest and largest ethnic population, Hispanic 
Americans will have a dramatic impact on this nation's economic success 
and security. Hispanics are the backbone of the American workforce. 
They currently account for one of every three new workers and are 
projected to provide one of every two by 2025. Much greater investment 
in Hispanic higher education is required to supply the number and 
quality of highly skilled workers demanded by our high technology and 
knowledge-driven economy. Yet, the country's more than 200 HSIs, which 
serve the most undereducated and underserved racial/ethnic population 
in America, continue to receive half the federal funding per student on 
average compared to all other degree-granting institutions. This 
inequity will prove catastrophic in the coming years, especially with 
an expected 50 percent increase in the number of HSIs within the next 
two decades.

Concerns:
    HSI colleges and universities are opposed to a proposal to create a 
new category of ``for-profit'' Hispanic-Serving Institutions (HSIs). 
This is a proposal that would immediately dilute already inadequate 
Title V federal funding for HSIs by dramatically increasing the numbers 
of HSIs with a new category of institutions not required to meet the 
same accountability or accreditation standards as institutions 
currently meeting the HSI definition.
    The existing funding inequity exacerbates the funding crisis by 
asking an even larger number of institutions to compete for the same, 
already inadequate pool of Title V funds. The number of ``for-profit'' 
institutions that would become eligible to be HSIs under the bill's 
current ``for-profit'' component would immediately increase by 107 or 
more, which is an increase of approximately 33%.
    While H.R. 3039 (the ``Expanding Opportunities in Higher Education 
Act of 2003'') reauthorizes the HSIs programs, community colleges have 
two concerns.
      Community colleges emphatically object to the addition of 
proprietary schools to the program.
      Community colleges also find the legislation's 
authorization ceiling of $94 million for Fiscal Year 2004 inadequate. 
In fact, this year's funding will exceed the cap. However, community 
colleges do approve of the bill's elimination of the two-year ``wait-
out'' period for grantees.

Recommendations to Strengthen and Enhance Programs Designed to Meet the 
        Unique Challenges and Needs of Hispanic Students Through the 
        Reauthorization of the Higher Education Act (HEA):
    1.  Authorize substantial new federal funding to historically 
under-funded Hispanic-Serving Institutions (HSIs) and other Minority-
Serving Institutions to better address the digital and college degree 
divide between Hispanic students and other students in higher 
education.
    2.  Authorize $50 million under Title II for eligible HSIs to 
expand teacher education programs of high quality in academic areas of 
urgent national need.
    3.  Increase the authorized funding level for HSIs under Title V to 
$465 million to meet the needs of under funded HSIs and new HSIs 
emerging within the next five years.
    4.  Authorize $125 million for a new Part B under Title V for 
increased and improved graduate education at HSIs and support programs 
to recruit more Hispanic students to enroll in graduate programs so 
that community colleges can recruit these individuals as faculty to 
serve as role models and mentors for Hispanic students.
    5.  Authorize a program for faculty who have student loans to be 
``encouraged'' to teach in HSIs with a percentage of the student loan 
forgiven for each year they teach at a HSI.
    6.  Authorize $50 million for a Technology Enhancement Program that 
would close the ``digital divide'' at HSIs. The need for substantial 
new technology funding is especially critical for HSIs, which serve the 
country's youngest and largest ethnic population with the least access 
to technology.
    7.  Provide funding for increased professional development to 
better prepare faculty and staff to participate in strategies and 
initiatives to directly improve the teaching effectiveness of faculty 
serving the needs of Hispanic students. The curriculum alignment and 
students'' readiness to perform college-level work must be improved if 
Hispanic students are to achieve the college completion rates of other 
student groups.
    8.  Provide funding for increased linkages to the public schools in 
order to develop stronger ties between HSIs and public schools. 
Outreach efforts are needed to support the needs of first generation 
college students, to encourage Hispanic students to pursue higher 
education, and to smooth the transition from secondary to higher 
education.
    9.  Provide funds to support Developmental Studies programs to help 
the almost 50% of Hispanic students who are not ready for college 
develop the basic academic skills necessary to be successful in 
college. Many students in HSIs are first-generation college students; 
many are under-prepared and need supportive services to help them be 
successful.
    On behalf of the 15,284 Hispanic students served by South Texas 
Community College, I thank you for the opportunity to present the 
challenges before and the needs of our Hispanic student population. Let 
me restate a quote included in my testimony:
        ``If all ethnic groups in Texas had the same educational 
        attainment and earnings as white non- Hispanics, total personal 
        income in the state would be $44 billion higher, and the state 
        would realize an estimated $16 billion in additional tax 
        revenues.''
    Source: State-by-State Report Card, National Center for Public 
Policy on Higher Education
    I urge you to put an end to the inequity in funding of programs, 
services, and access to higher education to the millions of very 
talented and most deserving Hispanic students who rightfully deserve 
the opportunities available to others in the United States. Thank you.
                                 ______
                                 
    Chairman Hoekstra. Ms. de la Garza.

   STATEMENT OF ARIANA DE LA GARZA, STUDENT REPRESENTATIVE, 
                UNIVERSITY OF TEXAS-PAN AMERICAN

    Ms. de la Garza. Good morning. I am grateful for the 
opportunity to present my testimony before the Subcommittee on 
Select Education. I am a senior in the physician's assistant 
program here in the university, the University of Texas-Pan 
American and I'll be graduating in May 2004.
    I am from a migrant farm worker family and I have had many 
opportunities to participate in programs which have helped me 
to be successful in my postsecondary education. What I would 
like to concentrate on today is the challenges that many 
migrant and Hispanic students face when attending a college or 
university and to make recommendations on how you may be able 
to continue to support them in achieving their academic goals.
    First of all, I know that many migrant students leave the 
Valley during the summer months to work and lose touch with the 
financial aid and admissions officer. Because of this it is 
important for them to have programs focused on keeping in touch 
with them and reminding them of university and financial aid 
deadlines. The program that I know which does this the best is 
the College Assistance Migrant Program. I hope that as you 
consider the reauthorization of the higher education act you 
will continue to fund programs like CAMP which support migrant 
students.
    Second, Hispanic students need more programs which give 
them a strong step into college. I hope that you will continue 
to fund programs like GEAR-UP and the TRIO programs, Education 
Talent Search, Upper Bound program, Upper Bound math and 
science and Student Support Services, which currently provides 
support to low-income and first generation college bound 
students.
    Third, many Hispanic students, migrant in particular, come 
from a low income family--families where the parents do not 
have accurate information about financial aid. If students 
don't get financial aid they probably are not attending college 
full time. I hope that you will continue to fund personnel who 
can assist both Hispanic and migrant youth in obtaining 
financial aid. As I hope that more financial aid information 
can be presented in Spanish for parents.
    Fourth. From what I've seen many students are missing the 
opportunity to get the full college experience because they 
cannot afford to live on campus. They're working in order to 
pay their own bills and to contribute to the family income. 
When students work too many hours in order to make ends meet 
this cuts into their study time and consequently they get low 
grades and lose what financial aid they have. It is an endless 
cycle, once a student loses they work more hours and drop out 
of college--or drop down to one or two classes per semester. I 
hope as Congress looks at Federal financial aid for college 
students it will take into consideration the benefits 
associated with living on college campuses and will increase 
amount that is given to college students who reside in 
university housing.
    Fifth. I think many migrant Hispanic students need role 
models and mentors to help them be successful in post-secondary 
education and make them feel connected to the university they 
are attending. I hope that you will continue to promote and 
fund mentor programs which match upper level college students 
with entering freshmen and high school students.
    Sixth. I have talked with young female migrant students who 
have both the financial struggles and the cultural expectations 
that make it more difficult for them to achieve a baccalaureate 
degree. In my culture it's harder for a female to move away 
from home and from your family and travel a great distance to 
go to college. I hope that you will continue to fund 
universities like UT-Pan American which are located near large 
Hispanic populations, so that they will continue to offer 
quality post-secondary education to young Hispanic females.
    Seven. More migrant students are not--some migrant students 
are not yet legal residents or citizens. These students have 
attended public school in the United States and have achieved 
high grades, but then they are held back and discouraged from 
attending college due to high tuition rates and the inability 
to receive Federal assistance. I hope that you will support 
legislation like the DREAM Act, which gives hard working 
students the opportunity to continue their education.
    Thank you for this opportunity to be voice for migrant 
Hispanic students and to express these concerns and 
recommendations through my testimony.
    Chairman Hoekstra. Great. Thank you.
    [The prepared statement of Ms. de la Garza follows:]

Statement of Ariana M. de la Garza, Student Representative, University 
                         of Texas--Pan American

    Good Morning, I am Ariana M. de la Garza. I am a senior in the 
Physician Assistant Studies Program at the University of Texas-Pan 
American. As a representative of the students at UT-Pan American, I 
thank you for the opportunity to present my story and testimony before 
the Subcommittee on Select Education.
    I am from a migrant seasonal farmworker family. My mom and dad are 
originally from Mexico. My dad has worked as a machinist and seasonal 
farmworker in order to meet the expenses of our family of four. My dad 
began to do seasonal farmwork in his late 20's, he has worked in 
different crops in the Rio Grande Valley and also migrated to West 
Texas, Florida, Minnesota and Arizona to do seasonal farmwork. When I 
was in 8th grade, my dad lost his job, so we packed up and migrated to 
West Texas to hoe cotton. When I was in 9th grade we migrated to 
Minnesota and hoed sugar beets. During my 10th grade, we went back to 
West Texas and hoed cotton and peanuts. When we migrated, my whole 
family worked in the field. Unlike some migrant students, I was 
fortunate because my parents knew the value of an education, so they 
made sure that I got back on time for school in the fall. There was 
only one time, that I had to leave school a little early in the spring, 
so that we could travel up north.
    The living conditions in West Texas were much better than when we 
migrated to Minnesota. In Minnesota, we lived in a farmer owned trailer 
camp. The trailers had no toilet, no air conditioning and we had to 
cleanup in communal showers and use out houses. In West Texas, we 
rented a wooden house which had sewage and a water air conditioner. 
Also in Minnesota, we were paid by contract based on the number of rows 
completed at the end of the day. The rows were a mile long and it was 
very difficult to at least earn minimum wage. In West Texas we were 
paid by hour.
    During my high school education, I had the opportunity to be part 
of the Mission Migrant Club. Through the migrant club I had resources 
and people who provided academic counseling, trips to universities and 
laptops that we could check out. Through the migrant club, I also had 
the opportunity to attend a Close-Up Conference in Washington, D.C. My 
migrant counselor provided valuable information concerning college 
admissions and financial aid. Through the help of my high school 
counselor, I also took the opportunity to take some concurrent 
enrollment classes at UTPA, so that I could get a headstart with 
college credit.
    When I enrolled at UTPA as a full-time student for the Fall 1999 
term, I did so with the anticipation of participating in the College 
Assistance Migrant Program (CAMP). CAMP helped me to get a solid 
foundation during my first year at UT-Pan American. I attended a five-
day CAMP summer orientation which helped me to become more familiar 
with the UTPA campus. The CAMP staff was honestly interested in my 
success and in the success of other CAMP students. They provided 
tutoring, academic advice, financial aid assistance and counseling. The 
CAMP Center was my home base on campus, I felt comfortable enough to go 
there, ask questions and get help applying for scholarships. CAMP 
opened the door for me to stay on campus during my first year. Without 
CAMP I wouldn't have had the money to live on campus. Living on campus 
made me feel connected to the university, gave me more access to 
university resources and led me to a fuller college experience. I had 
the opportunity to join different student organizations, do community 
service, and participate in mentoring programs such as ESTRELLA project 
and UTPA Student Ambassadors. As an ESTRELLA cyber mentor I mentored 
high school migrant students. The program provided laptops to the 
students and I would communicate with my mentee via email. I answered 
her questions, sent important college information and encouraged my 
mentee to attend college. As a UTPA Student Ambassador, I mentored 
Freshmen and helped them to have a smoother transition to college and a 
successful entering Freshman year by involving them in university 
activities and providing them with important college information. By 
being a mentor, I took what I learned from CAMP about transitioning 
into college and shared that with others
    As I reflect on my own experience, the experience of other migrant 
students and the experience of Mexican American students in the Rio 
Grande Valley, I think that there are many challenges which deter us 
from succeeding in post-secondary education. A few of those challenges 
are:
    1.  Many students migrate during the summer months. During the time 
that they are migrating, they lose touch with the traditional financial 
aid and admissions offices. Migrant students need people like the CAMP 
staff who take special interest in tracking and contacting them while 
they are out of state. They need a home base to come back to while 
their family is still up North in the early months of the fall.
    2.  Hispanic students need more programs which give them a strong 
step into college. I was lucky because I was able to attend a college 
enrichment program, Health Careers Opportunity Program (HCOP), during 
the summer before I started at UTPA. This helped me to learn more about 
health careers and to be more prepared for college classes. I hope that 
you will continue to fund summer enrichment programs for Hispanic 
students and programs like GEAR-UP and TRIO which help Hispanic 
Students to start preparing for College early.
    3.  Many Hispanic students (migrants in particular) come from low 
income families where the parents do not have accurate information 
about financial aid. I was lucky because my high school migrant 
counselor and the CAMP staff gave me the information I needed in order 
to get the Pell Grant. Also, the CAMP staff knew me personally, so they 
wrote recommendation letters and helped me to apply for scholarships. 
With their help, I obtained the Gates Millennium Scholarship (which 
provided the money that I needed to continue to live on campus all four 
years). Many students and their parents don't get the information that 
they need and if students don't get financial aid they probably are not 
attending college full-time. I hope that you will continue to fund 
personnel who can assist both Hispanic and migrant youth in obtaining 
financial aid. I also hope that more financial aid information can be 
presented in Spanish for parents.
    4.  When students live at home, they are often expected to 
contribute to the family income; they often don't have access to 
computers; and they aren't able to get the full college experience. In 
the Rio Grande Valley, transportation is a big issue, there is not a 
well-developed transportation system. Students miss classes because 
they ``don't have a ride''. Its an endless cycle, when students work 
too many hours in order to make ends meet and consequently do not have 
the time to study, they get low grades and lose what financial aid they 
have. Once a student loses financial aid, they either drop out of 
college or their course load drops down to one or two classes per 
semester. I hope that as Congress looks at federal financial aid for 
college students it will take into consideration the benefits 
associated with living on college campuses and will increase the amount 
that is given to college students who reside in university housing.
    5.  Migrant and Hispanic students need role models and mentors to 
help them be successful in post-secondary education and make them feel 
connected to the university they are attending. During the time that I 
was in CAMP, I became a cyber-mentor through the ESTRELLA project. This 
gave me the opportunity to pass on the information that I learned from 
the CAMP staff to high school migrant students. I also became a UTPA 
Ambassador and mentored entering Freshmen. Both of these experiences 
taught me leadership skills and gave me the opportunity to give back to 
my community. I hope that you will continue to promote and fund mentor 
programs which match upper level college students with entering 
freshmen and high school students.
    6.  Young female migrant students have both the financial struggles 
and the cultural expectations that make it more difficult to achieve a 
baccalaureate degree. In my culture, it's harder for a female to move 
away from the family and travel a great distance to go to college. I 
hope that you will continue to fund universities like UT-Pan American 
which are located near large Hispanic populations, so that they will 
continue to offer quality post-secondary education to young Hispanic 
women.
    7.  Some migrant students are not yet legal residents or citizens. 
These students are long time residents of the United States. They have 
attended public school in the United States and have achieved high 
grades, but then they are held back from attending college due to high 
tuition rates. They are unable to receive the Pell Grant or participate 
in federal programs like CAMP. It's sad because students who have such 
potential to be successful in our society are discouraged because they 
don't have the money for college. I hope that you will support 
legislation like the DREAM Act which gives hardworking students the 
opportunity to continue their education.
    In May 2004, I will be graduating from the Physician Assistant 
Studies Program. When I become a certified and licensed physician 
assistant, I would like to practice in the Rio Grande Valley. As a 
bilingual health care provider I will be able to provide quality care 
to my community. Having a migrant background, I will also be able to 
understand the needs and struggles of migrant families that reside in 
the Rio Grande Valley.
    Finally, as you consider the reauthorization of the Higher 
Education Act, I hope that you will continue to fund programs like the 
College Assistance Migrant Program which support migrant students.
    I am grateful for this opportunity to be a voice for migrant and 
Hispanic students and to express these concerns and recommendations 
through my testimony.
                                 ______
                                 
    Chairman Hoekstra. I've got a question for you.
    Ms. de la Garza. Yes.
    Chairman Hoekstra. In our family we'd always get together 
Sunday morning after church for coffee. So my brother is there 
and my sister was there. It was a few years ago that we were--
What triggered this was your comment about, you know, living on 
campus. And I've got two kids in college right now, but at that 
time my brother had two in college. One of them was married and 
the--the one made the choice to go to a State college to live 
at home and to work, so they pretty much--she was covering all 
of her cost. And the other one had made the decision to go to a 
private liberal arts college, not to work and to live on campus 
so that she would be able to fully experience life on campus. 
And so we were having coffee and she says, you know, you're not 
giving me enough financial aid. And we kind of had the 
discussion. And I said, that's interesting because I'm not 
giving it to you, I'm the conduit in that it's coming through 
the Federal Government, but it happens to be your brother who 
is paying for your financial aid because they're working, 
contributing to their family or the amount of money that they 
can support for college. So actually he's paying so that you 
don't have to work. And that's just the kind of tradeoff.
    Those are the tough issues I'm sure that you've dealt with 
on the committee is how do you structure financial aid to be 
fair to the taxpayer and to the student and to the various 
student groups who--and different students who make different 
decisions which have significant financial ramifications. I 
don't know if there's a question there or not. But, you know, 
it is the difficulty that the two of us have and with our 
colleagues in Washington in designing a fair system. So do you 
live on campus now?
    Ms. de la Garza. Yes, I do.
    Chairman Hoekstra. OK. And do you receive financial aid? 
What financial aid do you receive?
    Ms. de la Garza. I receive the Pell grant. I also receive 
Texas grant. And I'm under a scholarship called Gates 
Millennium scholarship which cover the rest of my expenses.
    Chairman Hoekstra. All right, the programs that you talked 
about, TRIO, GEAR-UP and those types of things, did you 
participate in those programs?
    Ms. de la Garza. I participated in the CAMP program, 
College Assistance Migrant Program during the year 1999-2000. 
That is my entering freshman year. And because I had the 
opportunity to live on campus I was able to participate in 
school and be more active and give back to my community.
    Chairman Hoekstra. Sure.
    Ms. de la Garza. They provided me with the housing--the 
money for housing my first year, my entering freshman year.
    Chairman Hoekstra. Yeah. With the kids that you graduated 
with from school--I mean for those who decided not to pursue 
their education what were the major issues that they said, you 
know, I'm not going to go? Was it a lack of interest? A lack of 
culture in the family of kids going on to higher ed, or the 
money or--.
    Ms. de la Garza. It's a lot of factors. From the people 
that I've met, friends, it can be because they don't have the 
money to go. That's a main problem. I think that's the most 
important concern for the parents. They're thinking about how 
am I going to be able to support my child when they're in 
college. And if they're thinking about going to another 
college, which is not in the area that's even more difficult 
for them. It can be a factor of not having the information 
available, not knowing about the different resources that are 
out there for them, for example, of the scholarships which they 
can apply their junior and senior year in high school. Or not 
having the information about financial aid. Many times 
counselors get very busy. And especially with migrant students 
what I've noticed is they leave--I was a migrant student myself 
and sometimes they have to leave early to go and work during 
the summer and come back later on in the year. And many times 
migrant students miss opportunity to attend financial aids 
fairs that the high school provides. And also that's why it's 
so important to have people that are interested in helping 
migrant students. People that are interested in keeping in 
touch with them to let them know about the different deadlines 
and the different important information out there.
    Chairman Hoekstra. And as a migrant family how far did you 
travel from here?
    Ms. de la Garza. Minnesota.
    Chairman Hoekstra. So you'd be gone for three, four, 5 
months potentially?
    Ms. de la Garza. The whole summer, basically, yeah.
    Chairman Hoekstra. Well, summer in Minnesota the joke is 
only 1 week, but--.
    Ms. de la Garza. Yeah, it's shorter than that.
    Chairman Hoekstra. OK. I'd be very interested in getting 
those reports that you referenced and taking a look at those. 
You know, I think the statistics that Dr. Reed talked about it 
is--we're faced with this choice or the consequences of the 
decisions that we make if we--If we get these young people 
educated there's a higher probability that they will go into 
quality jobs. They'll become workers and Mr. Hinojosa and I are 
excited that when they become workers they become taxpayers and 
we all benefit. And the flip side is also true, if they don't 
become--if they don't necessarily get the education even more 
in the future--I don't know if there's a nice way to say it, 
but they actually become a drag on society and we all end up 
bearing the cost.
    Ms. Garcia. May I?
    Chairman Hoekstra. Yeah.
    Ms. Garcia. When I was a new community college president a 
hundred years ago, as you observed, I looked around to see who 
were the best community college presidents in the Nation. And I 
went to try and meet with them and talk to them and find out 
what it was that they were doing that was so significant. And I 
met the president of Miami-Dade University. And I had my little 
notebook and my pen and I was taking notes and asking him these 
questions that I thought would tell me what the secret was of 
being a good community college president. And finally I said 
what is the most important part of your work? His name is Bob 
McCabe. And I said, ``Dr. McCabe, what is the most important 
part?'' And he says, ``Maintaining and ensuring the democracy 
of our country.'' And I said, ``Excuse me'' and put down my 
pen. And he said, ``Well, this is how I see it.'' He had been 
president of Miami-Dade when the first Cubans came over. And it 
fell to him to try and create an ambience at Miami-Dade 
Community College that would receive that--those Cubans in a 
way that would engage them in college and then into society. He 
was in the middle of receiving the Haitians and so he was 
trying to make his staff trilingual so that they could provide 
information to the new immigrants. And he said, ``I see my job 
as providing a way for these immigrants, the newest wave of 
immigrants, whatever they are, to become citizens of this 
United States. Because I love democracy. And I know that the 
premise of democracy is founded on is an engaged population. 
And the moment we lose the majority of us who are engaged 
civically, through education, invested in the outcome we lose 
the very essence of our country. And I want to be involved in 
saving our democracy.'' And I thought that was the most 
important lesson that I learned from anyone. That's really what 
I think you hear of all the border institutions, whether it's 
on the Canadian border or on the Mexican border, and that is 
trying to provide that access for students in a very real way 
as a citizen, as a tax payer, as a voter, et cetera.
    One more comment on financial aid. Pell grant used to 
provide much more of a cost of going to school than it does 
now. To give you an idea of how much more, if we wanted to 
return Pell grant to its buying power that it had in the 70's 
we'd have to increase it for a student to $7,000 per student. 
Now in addition--that's just per student right now. In addition 
what we know is that there is this baby boom echo that is being 
described. That is there's more and more students coming to 
reach for that same Pell grant money. And so that student 
that's coming, that baby boom echo, looks more like Ms. de la 
Garza than it does like the student whose been at that trough 
before. So not only is Pell going to be strained to try and 
provide just the buying power it had three decades ago, but 
it's also going to be further strained in the future unless 
there's a tremendous amount of focus on increasing that.
    Chairman Hoekstra. I'm assuming that the $7,000--and that's 
the number we have too, that is the--that would be if we 
increased the Pell grants at the rate of inflation, not 
necessarily higher ed inflation; is that correct?
    Ms. Garcia. That's exactly right, sir.
    Chairman Hoekstra. And if we put it in at higher ed 
inflation it might actually even be higher?
    Ms. Garcia. Yes, sir, that's right.
    Chairman Hoekstra. Yeah, one of the--the other concerns 
that we have at a Federal level is we typically or quite often 
we refer to it as maintenance of effort. One of the things 
that's impacting your institutions is that it doesn't appear 
that there's maintenance of effort at the State level in that 
the States are significantly reducing their cost. So part of 
the reason that folks are asking for the Federal Government to 
increase is for us to catch up to perhaps the level that we 
were at before, but also then to make up that--that shortfall 
that's coming from the States. Is that accurate?
    Ms. Garcia. You may know Professor Duderstat or President 
Duderstat. He's from--I think it was maybe Indiana. It wasn't 
Michigan. I'm not sure where. One of those--.
    Chairman Hoekstra. One of those--.
    Ms. Garcia. --Midwestern States. With names difficult to 
pronounce because you don't have enough vowels in your--in your 
name. You think you're at a disadvantage. But he used this term 
to describe that phenomena of less and less State support. He 
said, ``We used to say we were State supported. We then went to 
saying we were State assisted. Then we began to say we were 
State regulated. And now we're State harassed.''
    Chairman Hoekstra. Well, I think that--We had a good 
discussion last night at dinner. I mean I think the thing that 
concerns me about some of the proposals affecting tuition is 
that we'd probably put in a system that wouldn't penalize a 
school for increasing at twice the rate of inflation if they 
justified to us how they got there. You know, saying our tax 
revenues went down, the money we got from the State went down, 
healthcare went up nineteen percent. And after you filed those 
thirty or forty pages and we had a bureaucrat in Washington 
evaluate it and you sat on pins and needles for three and 6 
months as to exactly what the result was going to be we'd 
probably send you back a letter asking for more information. 
And then we would--but they we'd send you back a letter saying, 
OK, that's OK. But you again would have utilized some valuable 
resources in filling out some paperwork that I'm not sure--well 
I'm positive it would have added no value to the role of your 
college or university, is--whether it's creating citizens or 
educating young people or whatever, but would have provided 
absolutely no value. And I think it would also be interesting 
if--whether there have been groups and taken a look at all of 
the mandates that we have imposed on colleges and universities 
and said, you know, if you streamline some of these things we 
might--we might not save a lot, but we might save one or 2 
percent. And my guess is that each of you in your colleges and 
universities are doing everything you can to save every penny 
and every nickel that you can. I don't know if any of you have 
looked at--We know that at K through 12 the cost of mandates 
from the State and Federal Government are a significant portion 
of the burden that these school districts bear. Have you taken 
a look at all at the Federal level?
    Ms. Garcia. If I may. The University of Texas system took 
on as an agenda this last--for the last two legislative 
sessions actually the issue of deregulation and asked all of us 
as component universities to submit all of those regs at the 
State level that we thought were cumbersome and produced very 
little output on the other end. And they've been successful in 
simply ticking them off and going through--.
    Chairman Hoekstra. Great.
    Ms. Garcia. And often--I think thirteen or fourteen regs 
one session and another one--and now a more significant 
regulation this year to the extent that one of the deregulation 
proposals that passed the State legislature was keeping 
indirect costs for universities. That is research indirect 
costs. Texas was one of the only States in the Nation that was 
having to return some of that indirect cost for research grants 
over to the State of Texas. We were not allowed to keep the 
administrative cost. Providing no incentive for universities to 
be aggressive in getting more research dollars. And that was 
accomplished. Now that helps the UT-Austins to the extent of I 
think $22 million this year. It has not helped the newer, 
growing institutions who don't have a strong research base, 
yes. But yes, sir, there was an attempt to do that at the State 
level. I don't know of one at the--.
    Chairman Hoekstra. Yeah, we ought to probably take a look 
at that at the Federal level. I just want to make one other 
comment and then yield to my colleague. I hope I've not 
offended anybody as to how I've referred to the Universities in 
Texas. OK? I sense that it's a--after listening now it's a 
single system, University of Texas, then delineated by location 
or some other secondary name?
    Ms. Garcia. A single system. It's the University of Texas 
system with fifteen components. Some of us are academic, some 
are medical schools.
    Chairman Hoekstra. All right, because in Michigan it's 
different, but we don't have--We have the University of 
Michigan and then--since I'm a graduate from there, then we 
have everybody else. But I mean it's not University of Michigan 
Ann Arbor and then University of Michigan East Lansing. It's 
kind of like we've got the University of Michigan, we've got 
Michigan State, we've got Grand Valley, Saginaw Valley and 
those types of thing. So if I've offended any of your 
institutions by how I've referenced or when I said ``University 
of Texas'' I thought Austin and the Longhorns. I apologize for 
any offense I may have caused.
    Ms. Garcia. We're the Scorpions.
    Chairman Hoekstra. Yeah.
    Mr. Hinojosa. Thank you. Mr. Chairman, I have been 
listening very intently and taking some of our conversation 
from last night's events and today's testimony and I can't help 
but think that we may not have this discussion if we did not 
have such a large national debt. I first got involved in 
education by running for and winning a position on the local 
school board and I thought that I could really make a 
difference in my community. And then someone urged me to 
consider going to the Texas State Board of Education and I ran 
for that position and I won it. And I said now I can really 
make a difference. And then I was appointed first to the South 
Texas Community College board and again I told the business 
community I think I can make a difference and help us move 
toward a well trained workforce. And now I'm on the college--
rather the Committee on Education in Congress where comparing 
the budget in the local school board with what I work with in 
Washington, which is in excess of $60 billion for our education 
budget. I really thought that I could solve a lot of the 
problems in the region that I represent, but there are some 
uncontrollable factors that I hadn't expected and that is we 
have spent so much money as a result of the war on terrorists. 
We have spent so much money, unexpected amounts on the war in 
Iraq and now the reconstruction of Iraq. As a result of that 
our national debt ceiling had to be raised by one more trillion 
that we can spend because we had already hit that debt ceiling 
of six trillion and now we have it at seven trillion. And our 
deficit on the budget I thought had been under control back in 
1998 when we balanced the budget and started paying off the 
national debt, but unexpected things occurred. Certainly can't 
be controlled by our Chairman, nor by me your congressman. And 
the interest that we are paying on the national debt will 
exceed $300 billion a year. Just the interest alone on the 
national debt. If we had that 300 billion because we had paid 
off the debt we wouldn't be having this discussion.
    Unfortunately the situation is different today and we have 
to deal with what we have. And so I'm going to move right into 
some comments and maybe a question or two to Ariana de la 
Garza. Your testimony has reminded me of the many times that 
I've heard migrant students tell us about the challenges and 
what they have done to overcome them and be able to graduate 
from high school and then go on to do great things getting 
through college. And you certainly are one of those wonderful 
role models that will be an example to so many of our students, 
that they shouldn't be complaining about having it tough to get 
up eight in the morning and go to school at eight thirty. You 
all would have to get up at three thirty in the morning and 
probably be in the fields helping your parents at the crack of 
dawn.
    So I heard you say that what you wanted us to consider 
doing is to continue to fund programs that have helped you 
overcome the obstacles. Programs like CAMP. Programs like TRIO. 
Programs like GEAR-UP. And so as you were talking I remembered 
also that 2 weeks we brought experts from throughout the 
country to Washington D.C., the Congressional Hispanic Caucus 
Institute held a hearing so that we could find out what were 
the most important concerns throughout the country from west 
coast to east coast. And they enumerated some twenty or twenty-
five concerns.
    But the assignment given to each group was to give us and 
prioritize the top three. And I'm going to share that with you 
so that you can see how close your testimony reflects what the 
national leaders in education for the Hispanic community said 
was important. No. 1 was parental involvement. No. 2 was 
college affordability. And No. 3 was to help children of 
immigrant parents with the DREAM Act.
    Without going into the details of those concerns the 
parental involvement is what has made it possible for those of 
us who are first generation college graduates to get there. 
Were it not for my father and my mother, Mexican immigrants as 
children back in the year 1910, we would not have graduated 
from high school. We would not have gone to college but for 
them.
    So I then go to this college affordability and it seems 
that that's where we spent the majority of the morning talking 
about how expensive it is. And parents are saying that the 
Federal Government should not be seven or 8 percent of the 
local education agency budget as it is today, that it should be 
twice that much. That the Federal Government should spend much 
more money. And the reason they say that is because they see 
that the State legislatures throughout the country have been 
cutting down the amount that they--who have the first, biggest 
responsibility of education, that they're making those cuts. So 
then they look to the Federal Government to make up that gap. 
And unfortunately all of my colleagues cannot be here to listen 
to this wonderful testimony that Congressman Hoekstra and I 
have heard this morning. But when they read the report I think 
it will probably be easier for us to be able to include in the 
Reauthorization Act of Higher Education for this next 5 years 
some of the ideas and some of the suggestions that this second 
panel, as well as the first one, have given us.
    So having said that I'm going to ask you, Ms. de la Garza, 
which of those three high priorities that I mentioned; parent 
involvement, college affordability and DREAM Act, which would 
you consider to be your highest priority?
    Ms. de la Garza. That is a difficult question because all 
three are important.
    Mr. Hinojosa. OK, that's a good answer, because they go 
hand-in-glove.
    Ms. de la Garza. Right.
    Mr. Hinojosa. If the parents come to the school and if they 
stay involved they will find ways sometimes to maybe get that 
extra amount that the Pell grant doesn't cover or some of the 
other expenses that Dr. Reed and Dr. Garcia pointed out, which 
can be maybe as much as 8,000 a year versus the 4,000 of the 
Pell grant.
    And of course the DREAM Act is one that I've heard some 
great speakers talk to us about the courage and the valor of 
immigrants who have come from other countries in Europe, and 
Mexico, and South America. Courage because they leave the 
comfort of home and family to come here, with or without 
documentation and work and send back money, remittances to the 
sending family back home. And so those folks have children here 
in the United States and those children go on to schools, maybe 
all the way K-12 or in some cases maybe the last 5 years, and 
they have the same genes of courage and creativity and how they 
can help our country. And if given an opportunity to access 
higher education I think that this kaleidoscope that we have in 
the United States of different ethnic groups will just keep on 
getting better and better and help us keep the prosperity that 
we have enjoyed in this last decade.
    So I'm delighted with what you contributed in your thoughts 
and your ideas and recommendations and we want to thank you for 
that.
    Ms. de la Garza. Thank you for this opportunity.
    Mr. Hinojosa. Dr. Garcia, you're always so eloquent and 
well informed at the national level because of your 
participation in so many of these committees and groups that 
you have been appointed to by Presidents of the United States. 
And so you give great education to us in this Committee so that 
we can go back to Washington and possibly get on the house 
floor or in our Committee and present facts that are real 
substantive so that we do a better job in the reauthorization 
of higher ed. And we want to thank you.
    Ms. Garcia. Thank you, sir, for the opportunity.
    Mr. Hinojosa. And Dr. Reed, I compliment you because the 
challenges that you've had have been awesome with very little 
money. And maybe you could tell me how is it that you have been 
able to get the business community and the banking community to 
collaborate with you and the board of trustees to be able to 
get us to where we are in the Rio Grande Valley, South Texas, 
that you serve with the community college? How have you done 
that?
    Dr. Reed. The business community recognizes the concept of 
investing and investing in the development of the workforce. 
That's the key reason why business and industry has stepped up 
to support the community college.
    Chairman, one of the very first investments we had a 
company called Parker Seal that manufactured O-rings for 
engines, left the community, left their building behind. And 
business and industry went together, acquired that facility for 
the college, 138,000 square foot facility, and that is now our 
technology center.
    We went to the voters and asked for 98.7 million. They 
weren't happy. They had to reach deep in their pockets, but 
they did support it, because they recognized it is an 
investment. Without preparing the workforce we will continue to 
attract jobs. And the jobs that we do have now they, too, are 
at peril to go offshore. And without that high tech workforce 
we're not going to have the stability in our workforce.
    Mr. Hinojosa. I am going to avoid asking more questions 
because we have reached noon and I know that the university has 
plans for lunch for everyone that is participating. And I 
cannot thank you enough for the wonderful information that you 
all have shared with us. We thank the people in the audience 
for your patience and your willingness to join us in this 
hearing and hope you will join us again this afternoon for the 
next group that is going to address the Select Education 
Subcommittee on issues that continue to be very important to 
this region. Thank you, Mr. Chairman.
    Chairman Hoekstra. Thank you, Mr. Hinojosa.
    Thank you very much to the panel. It was great having you 
here. It was very good testimony. Appreciate both of the 
committees that have been here. And the Subcommittee having no 
further business the Subcommittee will stand adjourned until 
the roundtable this afternoon. Thank you very much.
    [Whereupon, the Subcommittee was adjourned.]
    [Additional material submitted for the record follows:]

     Follow-Up Letter Submitted for the Record from Miguel Nevarez

October 16, 2003

The Honorable Peter Hoekstra
Chairman
Subcommittee on Select Education
Committee on Education and the Workforce
U.S. House of Representatives
2181 Rayburn House Office Building
Washington, D.C. 20515-6100

Dear Congressman Hoekstra,

    It was a pleasure hosting you and the Committee on our campus last 
week for Hearings on Hispanic Serving Institutions. During my 
testimony, you asked several questions that I was unable to provide 
you, but promised that I would submit to your office.
    Enclosed is The University of Texas-Pan American Financial Aid 
Student Profile. This profile was provided by our Financial Aid Office 
and provides specific information as to the need of our students, the 
amount covered by Pell grant and other types of financial assistance. 
The numbers speak for themselves.
    You also requested that I submit some suggestions on how the 
committee could address the problem of immigrant youth.
    Undocumented students attend public schools with the concurrence of 
the state and federal government, however, when those same students 
want to attend college, they are then between a rock and a hard place. 
They are not eligible for financial aid, they are not provided status 
to attend college as a foreign national, are not permitted to work, and 
are left with no place to go.
    There are several solutions to this problem and all of the 
solutions need to be debated and addressed by the federal government.
    The Supreme Court ruled that legal residency in the United States 
is not a requirement for enrollment in a K-12 public school. Students, 
regardless of immigration status, are allowed to attend and graduate 
from our public schools. If we are going to permit these students to 
attend and graduate from our public schools, then we need to afford 
them the same opportunities for a college education. Current law 
prevents these hardworking students from completing their education.
    Federal legislation is now needed so that immigrant students in all 
states can attend college and work legally upon graduation. These 
students would then be able to not only maximize their potential but 
also, begin paying back the investment that was made into their 
education. Without education or legal status, these students will be 
condemned to being at the bottom rungs of our economy.
    Thank you for the opportunity to provide this additional 
information.

Sincerely,

Miguel A. Nevarez
President

[GRAPHIC] [TIFF OMITTED] T0140.001

                                 ______
                                 

  Statement of Cornelia M. Ashby, Director, Education, Workforce, and 
                            Income Security

DISTANCE EDUCATION-Challenges for Minority Serving Institutions and 
        Implications for Federal Education Policy
Why GAO Did This Study
    The Higher Education Act of 1965 gives special recognition to some 
postsecondary schools--called Minority Serving Institutions--that serve 
a high percentage of minority students. These and other schools face 
stiff challenges in keeping pace with technology. One rapidly growing 
area, distance education, has commanded particular attention and an 
estimated 1.5 million students have enrolled in at least one distance 
education course.
    In light of this, GAO was asked to provide information on: (1) the 
use of distance education by Minority Serving Institutions; (2) the 
challenges Minority Serving Institutions face in obtaining and using 
technology; (3) GAO's preliminary finding on the role that accrediting 
agencies play in ensuring the quality of distance education; and (4) 
GAO's preliminary findings on whether statutory requirements limit 
federal aid to students involved in distance education.
    GAO is currently finalizing the results of its work on (1) the role 
of accrediting agencies in reviewing distance education programs and 
(2) federal student financial aid issues related to distance education.
What GAO Found
    There are some variations in the use of distance education at 
Minority Serving Institutions when compared to other schools. While it 
is difficult to generalize, Minority Serving Institutions offered at 
least one distance education course at the same rate as other schools. 
When Minority Serving Institutions offered distance education, they did 
so to improve access for students who live away from campus and provide 
convenience to older, working, or married students. Some Minority 
Serving Institutions do not offer distance education because classroom 
education best meets the needs of their students. Additionally, schools 
view the overall use of technology as a critical tool in educating 
their students and they generally indicated that offering more distance 
education was a lower priority than using technology to educate their 
classroom students. The two primary challenges in meeting technology 
goals cited by these institutions were limitations in funding and 
inadequate staffing to maintain and operate information technology.

[GRAPHIC] [TIFF OMITTED] T0140.007

    Accrediting agencies have taken steps to ensure the quality of 
distance education programs, such as developing supplemental guidelines 
for reviewing these programs. However, GAO found (1) no agreed upon set 
of standards for holding institutions accountable for student outcomes 
and (2) differences in how agencies review distance education programs. 
Finally, several statutory rules limit the amount of federal aid for 
distance education students. GAO estimates that at least 14 schools are 
not eligible or could lose their eligibility for federal student 
financial aid if their distance education programs continue to expand. 
While the number of schools potentially affected is relatively small in 
comparison to the more than 6,000 postsecondary institutions in the 
country, this is an important issue for the nearly 210,000 students who 
attend these schools. Several factors must be considered before 
deciding whether to eliminate or modify these rules. They include the 
cost of implementation, the extent to which the changes improve access, 
and the impact that changes would have on Education's ability to 
prevent schools from fraudulent or abusive practices.

    Mr. Chairman and members of the subcommittee:
    I am pleased to be here today to discuss issues related to distance 
education 1 and its implications for federal programs that 
support postsecondary schools serving a high percentage of minority 
students and for the federal student financial aid programs that 
exceeded $60 billion in 2003. For over 100 years, the Congress has 
recognized that some postsecondary institutions--including the 
University of Texas Pan-American--have unique roles to play in 
educating minority students. These schools serve a high proportion of 
minority students and have special designation under federal law as 
Minority Serving Institutions. 2 Like other postsecondary 
institutions, over the last decade, Minority Serving Institutions have 
faced the challenge of trying to keep pace with the changing face of 
technology in education. One rapidly growing area--distance education--
has commanded particular attention on campuses around the world. In the 
1999-2000 school year, an estimated 1.5 million postsecondary students, 
or about 1 in 13 students, enrolled in at least one distance education 
course, and the Department of Education (Education) estimates that the 
number of students involved in distance education has tripled in just 4 
years. The Higher Education Act of 1965, as amended, will be 
reauthorized within the coming year. Among other purposes, the act 
provides federal support for Minority Serving Institutions through 
Titles III and V, including support for technological improvements at 
these schools. Title IV of the act authorizes the federal government to 
provide grants, loans, and work-study wages for millions of 
postsecondary students each year; however, there are limits on some 
financial aid to distance education students.
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    \1\ The Higher Education Act of 1965, as amended, defines distance 
education as an educational process in which the student is separated 
in time or place from the instructor (20 U.S.C. 1093(h)).
    \2\ The three main types of Minority Serving Institutions are 
Historically Black Colleges and Universities, Tribal Colleges, and 
Hispanic Serving Institutions. Other types of Minority Serving 
Institutions include Alaska Native and Native Hawaiian serving 
institutions.
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    Given the changes in how education is being offered, you asked us 
to testify on the following issues: (1) the use of distance education 
by Minority Serving Institutions compared to non-Minority Serving 
Institutions; (2) the challenges Minority Serving Institutions face in 
obtaining and using technology and how Education monitors technological 
progress at these schools; (3) our preliminary findings on the role 
that accrediting agencies play in ensuring the quality of distance 
education programs; and (4) our preliminary findings on whether 
statutory requirements limit federal student aid for students involved 
in distance education. In addition to this statement, we are releasing 
a report today on distance education at Minority Serving Institutions. 
3 This report discusses many of these issues in more detail. 
We will issue a second report in December 2003 on accrediting agencies 
and statutory and regulatory issues related to distance education.
---------------------------------------------------------------------------
    \3\ U.S. General Accounting Office, Distance Education: More Data 
Could Improve Education's Ability to Track Technology at Minority 
Serving Institutions, GAO-03-900 (Washington, D.C.: Sept. 12, 2003).
---------------------------------------------------------------------------
    Our statement is based on responses to distinct surveys developed 
and sent to Historically Black Colleges and Universities, Hispanic 
Serving Institutions, and Tribal Colleges; data on distance education 
produced by Education; 4 analysis of Education databases; 
5 visits to seven accrediting agencies responsible for 
reviewing two-thirds of all distance education programs; and interviews 
with Education officials, accreditors, and officials of schools with 
substantial distance education programs. We performed our work between 
October 2002 and September 2003 in accordance with generally accepted 
government auditing standards.
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    \4\ U.S. Department of Education, Distance Education at Degree-
Granting Postsecondary Education Institutions: 2000-2001 (Washington, 
D.C.: July 2003).
    \5\ We analyzed Education's National Postsecondary Student Aid 
Study and the Integrated Postsecondary Educational Data System (IPEDS).
---------------------------------------------------------------------------
    In summary:
      There are some variations in the use of distance 
education at Minority Serving Institutions and other schools. While it 
is difficult to generalize across Minority Serving Institutions, 
Minority Serving Institutions tend to offer at least one distance 
education course at the same rate as other schools, but they differ in 
how many courses are offered and which students take the courses. Like 
other schools, larger Minority Serving Institutions tend to offer more 
distance education than smaller schools and public schools tend to 
offer more distance education than private schools. However, 
Historically Black Colleges and Universities and Tribal Colleges 
generally offered fewer classes, and a smaller percentage of minority 
students at Historically Black Colleges and Universities take such 
courses. When Minority Serving Institutions offered distance education, 
they did so to (1) improve access to courses for some students who live 
away from campus and (2) provide convenience to older, working, or 
married students. By design, some Minority Serving Institutions 
indicated that they do not offer distance education because they prefer 
classroom education to best meet the needs of their students.
      Minority Serving Institutions, like other schools, face 
stiff challenges in keeping pace with the rapid changes and 
opportunities presented by information technology. Minority Serving 
Institutions view the use of technology as a critical tool in educating 
their students and they generally indicated that offering more distance 
education was a lower priority than using technology to educate their 
classroom students. For example, all three types of institutions 
reported that their highest priority was providing more training for 
faculty in the use of information technology as a teaching method. 
Other priorities included improving network infrastructure, increasing 
the use of technology in classrooms, and guaranteeing that all students 
have access to a computer. More than four out of five Minority Serving 
Institutions indicated that they expect to have difficulties in meeting 
their goals related to technology. The two primary challenges cited by 
Minority Serving Institutions were (1) limitations in funding and (2) 
inadequate staffing to maintain and operate information technology. 
With respect to how Education monitors technological improvements at 
Minority Serving Institutions, we found that Education could develop 
better data to improve their ability to track technological 
improvements at Minority Serving Institutions. Specifically, we found 
that progress could be made by collecting more complete data on 
technology improvements across the three major types of Minority 
Serving Institutions and by developing baseline data to measure 
progress on the technological capacity at Minority Serving 
Institutions.
      Based on our ongoing work, we have preliminary findings 
on the role that accrediting agencies play in ensuring the quality of 
distance education programs and information on certain statutory 
requirements that limit federal financial aid to distance education 
students. Uncertainty about the quality of distance education programs 
has turned attention toward what accrediting agencies do to ensure the 
quality of distance education programs. Our preliminary analysis shows 
that while accrediting agencies have taken steps to ensure the quality 
of distance education programs, such as developing supplemental 
guidelines for reviewing distance education programs, there are two 
areas that potentially could merit further attention. First, there is 
no agreed upon set of standards that accrediting agencies use in 
holding postsecondary institutions accountable for student outcomes. 
Second, there are differences in their procedures for reviewing 
distance education programs--for example, some agencies require 
institutions to demonstrate comparability between distance education 
programs and campus-based programs, while others do not.
      Finally, also based on our preliminary work, we found 
that several statutory rules--designed to prevent fraud and abuse in 
distance education--limit federal aid for distance education students. 
We estimate that at least 14 schools are not eligible or could lose 
their eligibility for participation in the federal student financial 
aid programs if their distance education programs continue to expand. 
While the number of schools potentially affected is relatively small in 
comparison to the more than 6,000 postsecondary institutions in the 
country, this is an important issue for the nearly 210,000 students who 
attend these schools. Deciding whether to eliminate or modify these 
rules involves consideration of several other factors, including the 
cost of implementation, the extent to which the changes improve access 
to postsecondary schools, and the impact that changes would have on 
Education's ability to prevent institutions from fraudulent or abusive 
practices.
    We are currently finalizing the results of our work on (1) the role 
of accrediting agencies in reviewing distance education programs and 
(2) federal student financial aid issues related to distance education. 
A report on these issues will be available in December 2003.

Background
    Minority Serving Institutions vary in size and scope but generally 
serve a high percentage of minority students, many of whom are 
financially disadvantaged. In the 2000-01 school year, 465 schools, or 
about 7 percent of postsecondary institutions in the United States, 
6 served about 35 percent of all Black, American Indian, and 
Hispanic students. Table 1 briefly compares the three main types of 
Minority Serving Institutions in terms of their number, type, and size.
---------------------------------------------------------------------------
    \6\ These include institutions in U.S. territories, such as Puerto 
Rico, that are authorized to distribute federal student financial aid.

[GRAPHIC] [TIFF OMITTED] T0140.008

    The Higher Education Act of 1965, as amended, provides specific 
federal support for Minority Serving Institutions through Titles III 
and V. These provisions authorize grants for augmenting the limited 
resources that many Minority Serving Institutions have for funding 
their academic programs. In 2002, grants funded under these two titles 
provided over $300 million for Historically Black Colleges and 
Universities, Hispanic Serving Institutions, and Tribal Colleges to 
improve their academic quality, institutional management, and fiscal 
stability. Technology is one of the many purposes to which these grants 
can be applied, both inside the classroom and, in the form of distance 
education, outside the classroom.
    Technology is changing how institutions educate their students, and 
Minority Serving Institutions, like other schools, are grappling with 
how best to adapt. Through such methods as E-mail, chat rooms, and 
direct instructional delivery via the Internet, technology can enhance 
students'' ability to learn any time, any place, rather than be bound 
by time or place in the classroom or in the library. For Minority 
Serving Institutions, the importance of technology takes on an 
additional dimension in that available research indicates their 
students may arrive with less prior access to technology, such as 
computers and the Internet, than their counterparts in other schools. 
7 These students may need considerable exposure to 
technology to be fully equipped with job-related skills.
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    \7\ The Web-Based Education Commission, The Power of the Internet 
for Learning: Moving from Promise to Practice (Washington D.C.: 
December 2000).
---------------------------------------------------------------------------
    The growth of distance education has added a new dimension to 
evaluating the quality of postsecondary education programs. Federal 
statutes recognize accrediting agencies 8 as the gatekeepers 
of postsecondary education quality. To be eligible for the federal 
student aid program, a school must be periodically reviewed and 
accredited by such an agency. Education, in turn, is responsible for 
recognizing an accrediting agency as a reliable authority on quality. 
While the accreditation process applies to both distance education and 
campus-based instruction, many accreditation practices focus on the 
traditional means of providing campus-based education, such as the 
adequacy of classroom facilities or recruiting and admission practices. 
These measures can be more difficult to apply to distance education 
when students are not on campus or may not interact with faculty in 
person. In this new environment, postsecondary education officials are 
increasingly recommending that outcomes--such as course completion 
rates or success in written communication--be incorporated as 
appropriate into assessments of distance education.
---------------------------------------------------------------------------
    \8\ Education defines an accrediting agency as a legal entity, or 
that part of a legal entity, that conducts accrediting activities 
through voluntary, nonfederal peer review and makes decisions 
concerning the accreditation or preaccreditation status of 
institutions, programs, or both.
---------------------------------------------------------------------------
    The emphasis on student outcomes has occurred against a backdrop of 
the federal government, state governments, and the business community 
asking for additional information on what students are learning for the 
tens of billions of taxpayer dollars that support postsecondary 
institutions each year. While there is general recognition that the 
United States has one of the best postsecondary systems in the world, 
this call for greater accountability has occurred because of low 
completion rates among low-income students (only 6 percent earn a 
bachelors degree or higher), perceptions that the overall 6-year 
institutional graduation rate (about 52 percent) at 4-year schools and 
the completion rate at 2-year schools (about 33 percent) are low, and a 
skills gap in problem solving, communications, and analytical thinking 
between what students are taught and what employers need in the 21st 
Century workplace.
    For the most part, students taking distance education courses can 
qualify for financial aid in the same way as students taking 
traditional courses. 9 As the largest provider of student 
financial aid to postsecondary students, the federal government has a 
substantial interest in distance education. Under Title IV of the 
Higher Education Act of 1965, as amended, the federal government 
provides grants, loans, and work-study wages for millions of students 
each year. There are limits, however, on the use of federal student aid 
at schools with large distance education offerings. Concerns about the 
quality of some correspondence courses more than a decade ago led the 
Congress, as a way of controlling fraud and abuse in federal student 
aid programs, to impose restrictions on the extent to which schools 
could offer distance education and still qualify to participate in 
federal student aid programs. The rapid growth of distance education 
and emerging delivery modes, such as Internet-based classes, have led 
to questions about whether these restrictions are still needed and how 
the restrictions might affect students'' access to federal aid 
programs. Distance education's effect on helping students complete 
their courses of study is still largely unknown. Although there is some 
anecdotal evidence that distance education can help students complete 
their programs or graduate from college, school officials that we spoke 
to did not identify any studies that evaluated the extent to which 
distance education has improved completion or graduation rates.
---------------------------------------------------------------------------
    \9\ Students who took their entire program through distance 
education courses received an estimated $763 million in federal student 
aid in the1999-2000 school year. Students who took at least one 
distance education course may have also received federal student aid; 
however, the data sources used by National Postsecondary Student Aid 
Study do not distinguish aid awarded for distance education courses and 
traditional classroom courses.
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Distance Education Use Varies between Minority Serving Institutions and 
        Other Schools, with Some Minority Serving Institutions Choosing 
        Not to Offer Any Distance Education
    There are some variations in the use of distance education at 
Minority Serving Institutions and other schools. While it is difficult 
to generalize across the Minority Serving Institutions, the available 
data indicate that Minority Serving Institutions tend to offer at least 
one distance education course at the same rate as other schools, but 
they differ in how many courses are offered and which students take the 
courses. Overall, the percentage of schools offering at least one 
distance education course in the 2002-03 school year was 56 percent for 
Historically Black Colleges and Universities, 63 percent for Hispanic 
Serving Institutions, and 63 percent for Tribal Colleges, based on data 
from our surveys of Minority Serving Institutions. Similarly, 56 
percent of 2- and 4-year schools across the country offered at least 
one distance education course in the 2000-01 school year, according to 
a separate survey conducted by Education. 10 Minority 
Serving Institutions also tended to mirror other schools in that larger 
schools were more likely to offer distance education than smaller 
schools, and public schools were more likely to offer distance 
education than private schools. Tribal Colleges were an exception; all 
of them were small, but the percentage of schools offering distance 
education courses was relatively high compared to other smaller 
schools. The greater use of distance education among Tribal Colleges 
may reflect their need to serve students who often live in remote 
areas.
---------------------------------------------------------------------------
    \10\ The data from our survey and survey conducted by Education are 
not completely comparable because they cover two different time 
periods. Education's survey covered the 2000-01 school year while our 
survey covered the 2002-03 school year.
---------------------------------------------------------------------------
    In two respects, however, the use of distance education at Minority 
Serving Institutions differed from other schools. First, of those 
institutions offering at least one distance education course, 
Historically Black Colleges and Universities and Tribal Colleges 
generally offered fewer distance education courses--a characteristic 
that may reflect the smaller size of these two types of institutions 
compared to other schools. 11 Second, to the extent that 
data are available, minority students at Historically Black Colleges 
and Universities and Hispanic Serving Institutions participate in 
distance education to a somewhat lower degree than other students. For 
example, in the 1999-2000 school year, fewer undergraduates at 
Historically Black Colleges and Universities took distance education 
courses than students at non-Minority Serving Institutions--6 percent 
v. 8.4 percent of undergraduates--a condition that may reflect the fact 
that these schools offer fewer distance education courses. Also, at 
Hispanic Serving Institutions, Hispanic students had lower rates of 
participation in distance education than non-Hispanic students 
attending these schools. These differences were statistically 
significant.
---------------------------------------------------------------------------
    \11\ Historically Black Colleges and Universities and Tribal 
Colleges are generally smaller in size than postsecondary institutions 
overall. The average Hispanic Serving Institution, however, was more 
than two times larger than the average postsecondary institution in 
2000.
---------------------------------------------------------------------------
    We found that Minority Serving Institutions offered distance 
education courses 12 for two main reasons: (1) they improve 
access to courses for some students who live away from campus and (2) 
they provide convenience to older, working, or married students. The 
following examples illustrate these conditions.
---------------------------------------------------------------------------
    \12\ The two most common modes of delivering distance education for 
Minority Serving Institutions were (1) on-line courses using a computer 
and (2) live courses transmitted via videoconference.
---------------------------------------------------------------------------
      Northwest Indian College, a Tribal College in Bellingham, 
Washington, has over 10 percent of its 600 students involved in 
distance education. It offers distance education by videoconference 
equipment or correspondence. The College offers over 20 distance 
education courses, such as mathematics and English to students at seven 
remote locations in Washington and Idaho. According to College 
officials, distance education technology is essential because it 
provides access to educational opportunities for students who live away 
from campus. For example, some students taking distance education 
courses live hundreds of miles from the College in locations such as 
the Nez Perce Reservation in Idaho and the Makah Reservation in Neah 
Bay, Washington. According to school officials, students involved in 
distance education tend to be older with dependents, and therefore, 
find it difficult to take courses outside of their community. Also, one 
official noted that staying within the tribal community is valued and 
distance education allows members of tribes to stay close to their 
community and still obtain skills or a degree.
      The University of the Incarnate Word is a private 
nonprofit Hispanic Serving Institution with an enrollment of about 
6,900 students. The school, located in San Antonio, Texas, offers on-
line degree and certificate programs, including degrees in business, 
nursing, and information technology. About 2,400 students are enrolled 
in the school's distance education program. The school's on-line 
programs are directed at nontraditional students (students who are 24 
years old or older), many of whom are Hispanic. In general, the ideal 
candidates for the on-line program are older students, working adults, 
or adult learners who have been out of high school for 5 or more years, 
according to the Provost and the Director of Instructional Technology.
    Not all schools wanted to offer distance education, however, and we 
found that almost half of Historically Black Colleges and Universities 
and Hispanic Serving Institutions 13 did not offer any 
distance education because they preferred to teach their students in 
the classroom rather than through distance education. 14 
Here are examples from 2 schools that prefer teaching their students in 
the classroom rather than by the use of distance education.
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    \13\ Forty-four percent of Historically Black Colleges and 
Universities, 37 percent of Hispanic Serving Institutions, and 39 
percent of Tribal Colleges did not offer any distance education.
    \14\ Conversely, only 10 percent of Tribal Colleges that are not 
involved in distance education indicated that classroom education best 
meets the needs of their students.
---------------------------------------------------------------------------
      Howard University, an Historically Black University in 
Washington, D.C., with about 10,000 students, has substantial 
information technology; however, it prefers to use the technology in 
teaching undergraduates on campus rather than through developing and 
offering distance education. The University has state-of-the-art 
hardware and software, such as wireless access to the school's network; 
a digital auditorium; and a 24-hour-a-day Technology Center, which 
support and enhance the academic achievement for its students. Despite 
its technological capabilities, the University does not offer distance 
education courses to undergraduates and has no plans to do so. 
According to the Dean of Scholarships and Financial Aid, the University 
prefers teaching undergraduates in the classroom because more self-
discipline is needed when taking distance education courses. Also, many 
undergraduates benefit from the support provided by students and 
faculty in a classroom setting.
      Robert Morris College is a private nonprofit Hispanic 
Serving Institution located in Chicago, Illinois, that offers bachelor 
degrees in business, computer technology, and health sciences. About 25 
percent of its 6,200 undergraduates are Hispanic. Although the College 
has one computer for every 4 students, it does not offer distance 
education courses and has no plans to do so. School officials believe 
that classroom education best meets the needs of its students because 
of the personal interaction that occurs in a classroom setting.
    Among Minority Serving Institutions that do not offer distance 
education, over 50 percent would like to offer distance education in 
the future, but indicated that they have limited resources with which 
to do so. About half of Historically Black Colleges and Universities 
and Hispanic Serving Institutions that do not offer distance education 
indicated that they do not have the necessary technology including 
students with access to computers at their residences for distance 
education. A higher percentage of Tribal Colleges (67 percent) cited 
limitations in technology as a reason why they do not offer distance 
education. Technological limitations are twofold for Tribal Colleges. 
The first, and more obvious limitation is a lack of resources to 
purchase and develop needed technologies. The second is that due to the 
remote location of some campuses, needed technological infrastructure 
is not there'that is, schools may be limited to the technology of the 
surrounding communities. All 10 Tribal Colleges that did not offer 
distance education indicated that improvements in technology, such as 
videoconference equipment and network infrastructure with greater 
speed, would be helpful.

Minority Serving Institutions Face Sizable Challenges in Using 
        Technology, Including Distance Education, and Education's 
        Efforts to Monitor Technology Could Be Improved
    Minority Serving Institutions, like other schools, face stiff 
challenges in keeping pace with the rapid changes and opportunities 
presented by information technology and Education could improve how 
technological progress is monitored. Minority Serving Institutions view 
the use of technology as a critical tool in educating their students. 
With respect to their overall technology goals, Minority Serving 
Institutions viewed using technology in the classroom as a higher 
priority than offering distance education. (See fig. 1.) Other 
priorities included improving network infrastructure and providing more 
training for faculty in the use of information technology as a teaching 
method.

[GRAPHIC] [TIFF OMITTED] T0140.009

    Minority Serving Institutions indicated that they expect to have 
difficulties in meeting their goals related to technology. Eighty-seven 
percent of Tribal Colleges, 83 percent of Historically Black Colleges 
and Universities, and 82 percent of Hispanic Serving Institutions cited 
limitations in funding as a primary reason for why they may not achieve 
their technology-related goals. For example, the Southwest Indian 
Polytechnic Institute in Albuquerque, New Mexico, serves about 670 
students and it uses distance education to provide courses for an 
associates degree in early childhood development to about 100 students. 
The school uses two-way satellite communication and transmits the 
courses to 11 remote locations. According to a technology specialist at 
the school, this form of distance education is expensive compared to 
other methods. As an alternative, the Institute would like to establish 
two-way teleconferencing capability and Internet access at the off-site 
locations as a means of expanding educational opportunities. However, 
officials told us that they have no means to fund this alternative.
    About half of the schools also noted that they might experience 
difficulty in meeting their goals because they did not have enough 
staff to operate and maintain information technology and to help 
faculty apply technology. For example, officials at Dine College, a 
Tribal College on the Navajo Reservation, told us they have not been 
able to fill a systems analyst position for the last 3 years. School 
officials cited their remote location and the fact that they are 
offering relatively low pay as problems in attracting employees that 
have skills in operating and maintaining technology equipment.
    Having a systematic approach to expanding technology on campuses is 
an important step toward improving technology at postsecondary schools. 
About 75 percent of Historically Black Colleges and Universities, 70 
percent of Hispanic Serving Institutions, and 48 percent of Tribal 
Colleges had completed a strategic plan for expanding their technology 
infrastructure. Fewer schools had completed a financial plan for 
funding technology improvements. About half of Historically Black 
Colleges and Universities and Hispanic Serving Institutions, and 19 
percent of Tribal Colleges have a financial plan for expanding their 
information technology.
    Studies by other organizations describe challenges faced by 
Minority Serving Institutions in expanding their technology 
infrastructure. For example, an October 2000 study by Booz, Allen, and 
Hamilton determined that historically or predominantly Black colleges 
identified challenges in funding, strategic planning, and keeping 
equipment up to date. An October 2000 report by the Department of 
Commerce found that most Historically Black Colleges and Universities 
have access to computing resources, such as high-speed Internet 
capabilities, but individual student access to campus networks is 
seriously deficient due to, among other things, lack of student 
ownership of computers or lack of access from campus dormitories. An 
April 2003 Senate Report noted that only one Tribal College has funding 
for high-speed Internet.
    Education has made progress in monitoring the technological 
progress of Minority Serving Institutions; however, its efforts could 
be improved in two ways. First, more complete data on how Historically 
Black Colleges and Universities and Tribal Colleges use Title III funds 
for improving technology on campus, and thus, the education of 
students, would help inform program managers and policymakers about 
progress that has been made and opportunities for improvement. 
Education's tracking system appears to include sufficient information 
on technology at Hispanic Serving Institutions. Second, although 
Education has set a goal of improving technology capacity at Minority 
Serving Institutions, it has not yet developed a baseline against which 
progress can be measured. If Education is to be successful in measuring 
progress in this area, it may need to take a more proactive role in 
modifying existing research efforts to include information on the 
extent to which technology is available at schools.
    Committee hearings such as this, reinforce the importance of 
effective monitoring and good data collection efforts. As the Congress 
considers the status of programs that aid Minority Serving 
Institutions, or examines creating new programs 15 for 
improving technology capacity at these institutions, it will be 
important that agencies adequately track how students benefit from 
expenditures of substantial federal funds. Without improved data 
collection efforts, programs are at risk of granting funds that may not 
benefit students.
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    \15\ In April 2003, the Senate passed S. 196, Minority Serving 
Institution Digital and Wireless Technology Opportunity Act of 2003 to 
strengthen technology infrastructure at Minority Serving Institutions. 
If enacted, this statute would create a new grant program at the 
National Science Foundation for funding technology improvements at 
institutions that serve a high percentage of minority students.
---------------------------------------------------------------------------
Accrediting Agencies Have Made Progress in Ensuring the Quality of 
        Distance Education Programs; However, Two Areas May Merit 
        Attention
    Accrediting agencies have made progress in ensuring the quality of 
distance education programs. For example, they have developed 
supplemental guidelines for evaluating distance education programs and 
they have placed additional emphasis on evaluating student outcomes. 
Additionally, the Council on Higher Education Accreditation--an 
organization that represents accrediting agencies--has issued guidance 
and several issue papers on evaluating the quality of distance 
education programs. Furthermore, some accrediting agencies have called 
attention to the need for greater consistency in their procedures 
because distance education allows students to enroll in programs from 
anywhere in the country. While progress has been made, our preliminary 
work has identified two areas that may potentially merit attention.
      While accrediting agencies have made progress in 
reviewing the quality of distance education programs, there is no 
agreed upon set of standards for holding schools accountable for 
student outcomes. In terms of progress made, for example, the Council 
on Higher Education Accreditation has issued guidance on reviewing 
distance education programs. In addition, some agencies have endorsed 
supplemental guidelines for distance education and four of the seven 
agencies have revised their standards to place greater emphasis on 
student learning outcomes. Not withstanding the progress that has been 
made, we found that agencies have no agreed upon set of standards for 
holding institutions accountable for student outcomes. Our preliminary 
work shows that one strategy for ensuring accountability is to make 
information on student achievement and attainment available to the 
public, according to Education. The Council on Higher Education 
Accreditation and some accrediting agencies are considering ways to do 
this, such as making program and institutional data available to the 
public; however, few if any of the agencies we reviewed currently have 
standards that require institutions to disclose such information to the 
public.
      The second issue involves variations in agency procedures 
for reviewing the quality of distance education. For example, agency 
procedures for reviewing distance education differ from one another in 
the degree to which agencies require institutions to have measures that 
allow them to compare their distance learning courses with their 
campus-based courses. Five agencies require institutions to demonstrate 
comparability between distance education programs and campus-based 
programs. For example, one agency requires that ``the institution 
evaluate the educational effectiveness of its distance education 
programs (including assessments of student learning outcomes, student 
retention, and student satisfaction) to ensure comparability to campus-
based programs.'' The two other agencies do not explicitly require such 
comparisons.

Certain Statutory Requirements Limiting Federal Aid to Students 
        Involved in Distance Education May Cause Some Students to Lose 
        Eligibility for Such Aid
    Finally, we found that if some statutory requirements--requirements 
that were designed to prevent fraud and abuse in distance education--
remain as they are, increasing numbers of students will lose 
eligibility for the federal student aid programs. Our preliminary work 
shows that 9 schools that are participating in Education's Distance 
Education Demonstration Program 16 collectively represent 
about 200,000 students whose eligibility for financial aid could be 
adversely affected without changes to the 50 percent rule--a statutory 
requirement that limits aid to students who attend institutions that 
have 50 percent or more of their students or courses involved in 
distance education. As part of the demonstration program, 7 of the 9 
schools received waivers from Education to the 50 percent rule so that 
their students can continue to receive federal financial aid. We 
identified 5 additional schools representing another 8,500 students 
that are subject to, or may be subject to, the rule in the near future 
if their distance education programs continue to expand. These 5 
schools have not received waivers from Education.
---------------------------------------------------------------------------
    \16\ The Congress created the demonstration program in the 1998 
amendments to the Higher Education Act to study and test possible 
solutions to federal student aid issues related to distance education. 
The program has authority to grant waivers on certain statutory or 
regulatory requirements related to distance education and the federal 
student financial aid programs.
---------------------------------------------------------------------------
    While the number of schools currently affected is small in 
comparison to the over 6,000 postsecondary schools in the country, this 
is an important issue for more than 200,000 students who attend these 
schools. In deciding whether to eliminate or modify these rules, the 
Congress and the Administration will need to ensure that changes to 
federal student aid statutes and regulations do not increase the 
chances of fraud, waste, and abuse to federal student financial aid 
programs.
    Mr. Chairman, this concludes my testimony. I will be happy to 
respond to any questions you or other members of the Subcommittee might 
have.
                                 ______
                                 

Statement of Sylvia Reyna Hatton, Ph.D., Executive Director, Region One 
                        Education Service Center

Introduction
    There are two significant descriptors that characterize Hispanics 
in the United States: rapidly growing numbers and a history of 
educational disadvantage. In South Texas as in other parts of this 
country, Hispanics constitute a majority of the public school students. 
The future, however, is much brighter for these young people enrolled 
in public schools today across this country. Decades of research, 
serious dialogue and coordinated support from local, state and national 
sources have resulted in the intentional focus of meeting the needs of 
all learners. Teachers, administrators and staff working 
collaboratively with parents, communities and universities are better 
equipped today for dealing with the challenges of serving a population 
of learners from diverse linguistic, cultural and economic backgrounds. 
Great strides have been made and must be maintained in order to insure 
the future economic prosperity and leadership vitality of this great 
country.
    Funding for Hispanic Serving Institutions (HSIs) has empowered our 
institutions of higher education to act creatively in responding to the 
needs of Hispanic students, particularly those from low socioeconomic 
backgrounds. From its inception to the present, HSIs have made 
significant contributions to the educational literature regarding 
strategies that work in increasing the number and quality of Hispanic 
graduates from higher education. Yet, more remains to be accomplished. 
The success models created through this funding initiative must be 
expanded to include the Kindergarten through 12 grades system of 
education (K-12). The K-12 system of public education must embrace a K-
16 philosophy of education if we are to significantly increase the 
number of Hispanic students, particularly low-income students, who are 
academically prepared to pursue and complete a higher education degree.
    Our failure to acknowledge the changing demographics and to 
accommodate the changes in population will be to the detriment of our 
country's economy. The Hispanic population is the fastest growing group 
in the United States, and Hispanics are youngest of all racial and 
ethnic groups. Special attention to this population is merited and I 
believe that HSIs are the appropriate vehicle to address this critical 
area. HSIs have the structure and the resources necessary to respond to 
this critical need. These institutions have talented and knowledgeable 
staff, reside in high Hispanic communities, already have established 
relationships with the public school districts and have community and 
business networks that support new and innovative strategies.
    The K-12 public school system has likewise invested local, state, 
and federal resources targeted on this particular group of young 
students. Our goals in public education are to improve the high school 
graduation rates and the successful transition into higher education 
for all of our students. Region One Education Service Center (ESC), the 
state education agency for which I work, has been blessed with several 
state, foundation and federal grants aimed at supporting the goals 
stated above within our service area. Today, I would like to share with 
you one such project, because I believe that it best represents the 
type of initiative that should be blended into HSIs in the future. It 
can make a difference for significant numbers of low income and 
Hispanic students. But first, I would like to share with this 
distinguished panel some background about Region One ESC in order to 
establish a rationale for the K-16 philosophy I propose and to provide 
the background for the initiative I am here to support.

Background
    Region One Education Service Center (ESC), one of twenty regional 
service centers established in Texas to provide a variety of school-
related services to designated school districts, has enjoyed a thirty-
five year history dedicated to service to a primarily economically and 
educationally disadvantaged student population. The Region One ESC is 
uniquely positioned in southernmost area of Texas situated on the US/
Mexico border and has the responsibility of serving thirty-eight (38) 
school districts, 15 charter schools and 1 juvenile detention facility 
that includes 330,000 students and over 26,000 education professionals 
on 472 campuses spread over a seven county area. This predominantly 
rural education community is considered one of the most economically 
depressed areas in the United States. Census data from 2000 lists the 
population for this area as 1.2 million people, larger that the state 
of Rhode Island, with land area equal to the size of Maryland and 
reports the majority (85%) of the population classified as Hispanic.
    Statistics for this region would seem grim to many people. The 
poverty rate for the general population is 36.5%, but is even higher 
(45%) among school-aged children. The unemployment rate is 13%, two-
thirds (66%) of the adult population has less than a high school 
education, compared to 25% in the U.S.; and less than 8% have a college 
degree compared to 20% in the US. Additionally, the Region One ESC area 
serves as home base for over 43% of the migrant students in Texas 
public schools.

[GRAPHIC] [TIFF OMITTED] T0140.002

    Yet, Region One ESC has been able to address the challenges/
barriers to student success through a continued commitment to 
collaborate and network with various educational entities to provide 
equitable accessible education for all students. Region One ESC has 
developed a close relationship with the schools, parents, business and 
community leaders in the region, working in a targeted way to identify 
the needs of the schools through a comprehensive network of Regional 
Advisory Councils. Superintendents, university administrators, and 
business and community leaders serve on Advisory Councils to the 
Executive Director, Curriculum Directors from each district form the 
Curriculum Council with the Associate Executive Director for 
Instruction, and teacher representatives from each campus meet with 
Education Specialists to form the Teacher Advisory Councils. These 
networks of representatives at each level meet monthly to address areas 
of educational need and to develop action plans toward improved student 
performance. The Region One ESC also has a close working relationship 
with area Institutions of Higher Education, including South Texas 
Community College, Texas A & M University Kingsville, Texas State 
Technical College, University of Texas at Brownsville, and University 
of Texas Pan American. Region One ESC also works closely with 
employers, community and business leaders to plan and prepare for the 
future.
    This successful network is just one of the many initiatives at 
Region One ESC that has captured the respect and recognition of 
educational entities at the local, state, and national level. Examples 
of national collaborations include recent partnerships with The 
Smithsonian Institute in Washington, D.C. in the creation of culturally 
sensitive curriculum, and a new partnership between the Region One ESC 
GEAR UP Partnership and the National Hispanic Institute in the 
provision of targeted camps in the area of leadership for students in 
the project.
    Through its various partnerships, and with financial support from 
the local, state, and federal foundations and government levels, Region 
One ESC has been able to share, sustain, and develop academic 
initiatives that support the core belief that all students, regardless 
of their personal backgrounds, are entitled to have equitable access to 
a quality education. The overarching goal of all regional initiatives 
is to improve the education levels of youth in our communities to 
insure a higher quality of life for all of our citizens. To this end, 
while no other region in Texas matches our student demographics, the 
Region One ESC student performance results on the state mandated 
assessment program, have historically exceeded the state average 
performance for every group: White, Hispanic, African-American, 
Economically Disadvantaged and Migrant.
    These results do not happen by accident. In this region, great 
strides have been made in teacher preparation and development, 
curriculum and instruction enhancements, strengthening of parental 
involvement and expansion of effective assessment and accountability 
processes. We have discovered strategies that work; but we have also 
discovered that it requires fiscal resources and policy support to 
achieve good outcomes. One example of an initiative that has proven 
hugely successful is a federally funded innovative program entitled 
GEAR UP (Gaining Early Awareness and Readiness for Undergraduate 
Programs).
    During the 1999-2000 academic year, Region One ESC was awarded a 
federal grant to implement strategies aimed at improving the high 
school graduation and college participation rates of students in 25 
middle schools. Currently in its fifth year of implementation, the GEAR 
UP: Right Choices for Youth project has instituted a variety of 
strategies and activities to insure student success in accomplishing 
that goal stated above. This project also offers us a model that can be 
replicated through HSIs to bring to fruition a K-16 service model to 
the benefit of many Hispanic and low income clients

GEAR UP: Right Choices for Youth
    Our institutional core beliefs and established cohesive network of 
the Region One ESC provide a rich foundation for the GEAR UP: Right 
Choices for Youth Partnership, an initiative funded by the U.S. 
Department of Education. The GEAR UP partnership, funded at $3.4 
million yearly for a five year period, includes local universities, 
community organizations, twenty-five middle schools and twenty-three 
high schools. The 6,140 targeted students in this partnership are 96% 
Hispanic, 86% economically disadvantaged, 23% Limited English 
Proficient, and 68.7% At-Risk collectively (see Table 1). At least 65% 
of the cohort students are potential first generation to attend 
college. This is a significant statistic in this project and provides 
the underlying basis for providing campus-wide interventions. Without 
the services provided by the Region One GEAR UP project, many of these 
students will not receive the information or the guidance needed to 
adequately prepare for post-secondary enrollment. Thus, it becomes 
imperative that GEAR UP and like initiatives be funded at the federal 
level to create and sustain a cohesive K-16 pipeline for students who 
might otherwise not have the requisite information or opportunity to 
participate in the pre-collegiate and collegiate experience.

[GRAPHIC] [TIFF OMITTED] T0140.003

    The Region One ESC GEAR UP: Right Choices for Youth Partnership, 
implemented in coordination with existing early intervention programs, 
establishes a structure to deliver services through three major 
components: mentoring/tutoring, counseling/outreach, and support 
services. The project began by restructuring the delivery of services 
at the middle school during the 1999-2000 school year. As cohort 
students completed the 7th and 8th grade year of middle school, the 
project helped their middle schools establish an awareness and focus 
for post-secondary preparation. Cohort students participated in 
targeted activities such as tutoring, mentoring, and a student Advisory 
component that provided activities to engage students in developing 
instrumental knowledge about college and academic skills such homework 
tips and study skills. Student Advisory was a new concept introduced at 
the cohort campuses by the GEAR UP project using a curriculum 
specifically developed by the project. These initiatives continue to be 
successful and have become part of the middle school culture even after 
the cohort students have progressed to high school.
    The 2002-03 school year was the fourth year of implementation and 
GEAR UP students have completed their first year in high school. The 
GEAR UP project has continued by restructuring the high school 
curriculum and by restructuring the delivery of services to increase 
the academic performance of low-income students, enabling them to make 
the ``right choices'' early to pursue a recommended course of study for 
post-secondary education.
    A targeted focus for services at cohort high schools has been to 
align the math and English curricula to provide a rigorous preparation 
for advanced courses. Campus stakeholders have, through this 
partnership, intentionally examined the ability of their campus to 
provide quality, equitable Advanced Placement courses through the use 
of the Advanced Placement Capacity Assessment Tool (APCAT). Curricula 
have been strengthened toward this end through the provision of 
curriculum tools and staff development connected with the College Board 
Pacesetter English, and Think Five Calculus. The partnership has also 
supported students toward continued college awareness and preparation 
through a high school Advisory Curriculum, Covey's Student Achievement 
Workshop, and customized student planners, college visits, summer 
residential college experiences, and job shadowing.
    An integral part of the GEAR UP intervention is including parents 
in activities as partners in their children's educational success. All 
cohort high schools have an outreach component in which parents are 
invited to meetings and given information through brochures, 
``platicas'' (chats), and activities on the requirements for their 
children to attend college. Among the topics broached in these meetings 
are the role of Advanced Placement courses as prerequisites for college 
attendance, graduation requirements, college enrollment requirements, 
and the financial aid process. Additionally, parents have accompanied 
students on college visits to learn first hand about the college 
campus. The project focus has been to provide parents with as many 
first hand experiences and as much information as possible to support 
their children through the college preparatory process.

Framework & Guiding Assumptions
    The Region One GEAR UP: Right Choices for Youth Partnership 
operates under the leadership of project director Tina Atkins and four 
lead education specialists, Elsie De Leon, Elva Garcia, Sylvia Leal, 
and Sara Whitaker, at the regional level who lead interventions to 
support the project goals. A core belief among this leadership team is 
that it is possible to affect every child, teacher, parent and 
administrator touched by this partnership, and that the actions 
undertaken by this team matter and have tremendous impact. Region One 
GEAR UP: Right Choices for Youth operates under the following guiding 
assumptions:
      All students can learn, and we can significantly impact 
that learning,
      All students must have equitable access to high quality 
education,
      All students must have equitable access to a college 
preparatory curriculum,
      Students that falter need direction, support, and 
opportunities, and the school environment must accommodate this need,
      Parents and educators inherently want to help students 
succeed, and given proper access to appropriate information will make 
good decisions regarding children's futures,
      Implementation of new strategies require time and 
support, and that on-going development requires systemic approaches.
    These student-centered guiding assumptions are at the core 
foundation of each intervention provided. Interventions provided are at 
many different levels, with schools, parents, teachers, and communities 
working in a collaborative manner to ensure the best for every child. 
This cohesive network is best described through a circular student-
centered model that provides a rationale for several interventions 
implemented simultaneously to support the desired outcome (see Figure 
1).
    The model illustrates the fact that:
      students need and merit interventions to improve academic 
performance,
      educators need to implement best practices that will 
impact students academic performance,
      parents need to be knowledgeable of key information that 
empowers them to support their children, and
      the community must be aware of educational endeavors.
    Activities are embedded in each component, creating a web of 
services that together support overall project goals.

[GRAPHIC] [TIFF OMITTED] T0140.004

    A vital element to this support system is the GEAR UP facilitator, 
funded by the project and assigned at each campus site. This position 
created through GEAR UP, provides the backbone needed to integrate, 
implement and ultimately sustain efforts to restructure the high 
school's delivery of services. These facilitators have fully processed 
the meaning of the guiding assumptions and manifest them through 
careful and strategic implementation of each intervention customizing 
them to specific campus needs. These facilitators work closely with the 
campus administration in support of project goals and initiatives. 
While these positions were intended to be temporary catalyst for 
change, many principals have found these facilitators invaluable in 
providing a renewed focus on college preparatory initiatives. These 
facilitators play an active role in offering teachers, students, and 
parents the support needed to increase student academic performance 
toward creating a pathway to post-secondary education. Campus-based 
activities they perform include meeting with classroom teachers to 
support curriculum, monitoring student academic progress, coordinating 
university visits, recruiting and monitoring tutoring and mentoring 
activities, and coordinating parent meetings and activities.

[GRAPHIC] [TIFF OMITTED] T0140.005

    The GEAR UP project has developed an elaborate set of educational 
interventions that rely heavily on an intricate web of partnerships all 
contributing resources to all 23 high schools. These interventions may 
be categorized into the following seven areas:
      Breaking Barriers to Advanced Placement Success
      College Preparatory English Curriculum for All
      Empowering Students for Academic Success
      Exploring Options: High School Today, College Tomorrow
      Parent Involvement: Creating a Path of Student 
Achievement
      Creating a Web of Communication
      Linking Students, Parents, and Teachers to the 
Information Highway
    Currently, the Region One Education Service Center GEAR UP 
Partnership serves 6140 high risk, minority, and economically 
disadvantaged students from 23 schools in 23 school districts along the 
southernmost Texas-Mexico border. Students within this partnership 
moved from the middle school setting into their Sophomore year of high 
school. GEAR UP campus based facilitators followed students into this 
new setting, providing ongoing support and services to the children, 
their parents, teachers, and schools.
    Salient features of the partnership include:
      cohesive, ongoing initiatives that are intentionally 
linked and scaffolded from activity to activity, year to year, as 
opposed to one time, isolated experiences;
      Initiatives designed to systemically reform the 
participating schools, creating a sustainable framework for future 
success, as opposed to commercially available software and materials 
that are only available as long as funding lasts; and
      research-based policies, practices and activities 
designed to supplement and compliment existing school and community 
structures, as opposed to initiatives that operate in isolation of 
existing practices and structures.
    Services for the partnership are classified into three major 
components: Mentoring/Tutoring, Counseling/Outreach, and Supportive 
Services. Each component has specific initiatives designed to provide a 
sustainable, cohesive network of support to students, parents and 
educators.

Results
    The initial three years of service to students focused upon college 
and career awareness, while at the same time intentionally providing 
rigorous, content-based professional development academies to teachers 
in the areas of mathematics, science, language arts, and social 
studies. This past year, while these efforts continued, a definite and 
narrow focus occurred in the areas of English Language Arts, 
Mathematics, and Technology.
    Through Region One GEAR UP's innovative partnership with The 
College Board, seventeen of twenty-three high schools radically altered 
their English Language Arts program by implementing the Pacesetter 
curriculum tool with all of their GEAR UP students, with the intent of 
providing a rigorous, direct pipeline for these pupils into Advanced 
Placement English coursework. After this very positive first year of 
implementation, all of these schools plus five of the remaining six 
schools have indicated their wish to participate in this initiative 
with 10th graders in 2003-2004. Region One Pacesetter teachers 
participated in challenging, year-long professional development with 
monthly teacher to teacher study groups that occurred via 
videoconferencing across district lines. GEAR UP English teachers also 
had the opportunity to participate in videoconferencing to address 
``Curriculum Conversations'' with the Director of English Language Arts 
from the Texas Education Agency, learning about new curriculum and 
assessment standards implemented in the State of Texas.
    In a second unique collaboration, Region One GEAR UP partnered with 
the Charles A. Dana Center at the University of Texas at Austin to 
provide campus administrators and teachers at 21 of 23 campuses with 
assessment tools to investigate the individual campus capacity to 
provide Advanced Placement coursework to upcoming GEAR UP students. 
These campuses were charged with creating action plans toward 
equitable, rigorous and accessible AP programming. Additionally, 
through this partnership, vertical mathematics teams were trained to 
provide aligned, challenging math pathways toward success. Professional 
development efforts began with Calculus teachers in anticipation of 
increased participation in Calculus by GEAR UP students. These teachers 
formed a network with the Dana Center via videoconferencing to discuss 
areas of common concern in the area of mathematics. GEAR UP staff met 
with Algebra I teachers to identify needs, and as a result of this 
effort, a specific Algebra/Geometry initiative is currently in the 
planning stages with Region One and the Dana Center.
    Technology played an integral part in the delivery of GEAR UP 
services in 2002-2003, providing students with heretofore-unavailable 
mentoring services via videoconferencing technology provided through 
the partnership. Over 1,775 Region One GEAR UP students participated in 
these sessions, linking mentors with multiple schools to provide 
students the opportunity to interact with college students and career 
professionals to investigate education and career options. Students 
linked with both local mentors and mentors from over 1,000 miles away. 
Approximately 757 teachers also participated in ongoing videoconference 
curriculum networking sessions between and among districts. Over 15,000 
people visited the Region One GEAR UP webpage. Approximately 5,000 GEAR 
UP students explored colleges and careers, and completed surveys via 
this site this year. Teachers received supplemental services to 
Pacesetter, and parents gained information about GEAR UP through a 
bilingual site designed specifically for them.
    For the first time ever at the high school level, freshmen 
participated in Advisory lessons at least one hour a week, with the 
majority of the schools placing a specific, daily, 20 minute Advisory 
period or providing a semester-long class on the schedule. Students 
continued to use GEAR UP planners daily, and they participated in a 
myriad of activities, including face-to-face mentoring, university 
visits and conferences, tutoring by college and university students, 
and residential university-based academic and leadership camps. Parents 
participated in regional conferences and in campus and community-based 
sessions to learn about college and financial aid options, recommended 
paths of high school study, and student learning needs.
    Spring 2002 data reflected that the number of Region One GEAR UP 
students passing state mandated Texas Assessment of Academic Skills 
(TAAS) increased by 34% in Reading and by 28% in Mathematics. This 
increase occurred despite the fact that the TAAS underwent a 
legislatively required change in the past two years as the State 
curriculum framework and assessment shifted in a significantly more 
rigorous direction.
    New partnerships were formed with Texas A&M Kingsville, Texas A&M 
College Station, and the National Hispanic Institute, all of whom 
provided residential academic summer camps for over 600 Region One GEAR 
UP students on university campuses. This is in addition to multiple 
camps that occurred last summer at local college and university 
campuses in the areas of engineering, music, health science, 
leadership, pre-law, and robotics. For the third year in a row, 
community partner KRGV TV5, the Rio Grande Valley's ABC affiliate 
broadcast ``GEAR UP'' features, providing the Rio Grande Valley 
community with a weekly look at the GEAR UP story, and Region One GEAR 
UP entered into an agreement with SureScore, Inc. to provide online 
college preparatory services to partnership campuses which will remain 
with those campuses at no cost after funding ends.
    The interventions and services offered through the Region One ESC 
GEAR UP Partnership would not be possible without funding provided at 
the federal level. Students, especially those students who are first 
generation college-bound, students of color, and students of poverty, 
must have a direct, discrete pipeline through the K-12 educational 
system into college. This system must include components that give 
students the instrumental knowledge necessary to enter college, the 
academic background to succeed in college, and the financial resources 
to make post-secondary education a possibility. GEAR UP, and like 
programs, therefore become a necessary requisite toward this end.

Conclusion
    Hispanic Serving Institutions (HSIs) must continue to have access 
to the fiscal resources required to recruit, prepare and support the 
growing numbers of Hispanic students entering our public schools today. 
The success of these students has a direct relationship with the 
success of our nation. This is not the time to short change HSIs, but 
rather to create new strategies and innovations targeted at improving 
the education levels of this rapidly growing demographic group. This is 
the time to invest in proven strategies and to create new avenues for 
serving our Hispanic youth. Further, the interventions must begin much 
earlier in their lives. Successful participation in higher education 
requires dedicated and focused attention to a rigorous academic course 
of study. Students while in middle school and high school must be 
engaged in an advanced curriculum. Supplemental proven strategies /
activities, including more time for learning, personal counseling, 
mentoring, parent engagement and early exposure to higher education 
must be provided. Particularly, youngsters from low-income backgrounds 
require these types of direct assistance and support. The earlier the 
intervention begins, the greater the success potential for our Hispanic 
youth. Embracing a K-16 service philosophy for HSI funding initiatives 
will enable to yield better outcomes in the future. The beneficiaries 
will be our citizens, our communities and our country.
                                 ______
                                 

Statement of Christine Johnson, Ph.D., President, Community College of 
                                 Denver

    Thank you, Chairman Hoekstra, Representative Hinojosa and other 
distinguished members of the House Subcommittee on Select Education, 
for allowing me to testify on behalf of our nation's Hispanic-Serving 
Institutions at this important hearing on the higher education needs of 
our country's youngest and largest ethnic population. I applaud your 
leadership in bringing this national field hearing to a region of the 
country with a predominantly Hispanic population to address the 
aspirations of a population that will so profoundly impact our nation's 
future economic success and security.
    Certainly, our nation's Hispanic-Serving Institutions, or HSIs, 
will play a critical role in shaping that future in serving the largest 
concentrations of Hispanic higher education students in the country. 
Our two-year HSIs have a particularly compelling role, since more than 
half of all Latino higher education students attend community colleges. 
As the first Latina to serve as the president of a college in Colorado, 
the Community College of Denver, a Hispanic-Serving Institution, I can 
attest to the enormous challenges we face in serving a population that 
also continues to suffer the lowest high school and college graduation 
rates of any major population group.
    The Community College of Denver is blessed with the most diverse 
student body of any college in Colorado, with a 58 percent minority 
enrollment. Sixty-two percent of our enrollment is female. Like every 
Hispanic-Serving Institution, we pride ourselves not on exclusivity, 
but on the principles of openness, fairness and access to opportunities 
that are the very foundations for our great Democracy.
    The Community College of Denver is also a member of the Hispanic 
Association of Colleges and Universities, which, on behalf of the 
nation's Hispanic-Serving Institutions, has formally presented Congress 
with an exhaustively researched series of recommendations for 
reauthorization of the Higher Education Act. I urge your Subcommittee 
to embrace and endorse these recommendations in final legislative 
language for amendments to the five-year reauthorization of this Act.
    Honoring the contributions of our country's Hispanic-Serving 
Institutions must also include recognition of the urgent federal 
funding needs of our institutions of higher learning, especially in 
this era of domestic uncertainties straining our local, private and 
state funding resources. At no other time has the inequity in federal 
funding for our HSIs proven so stark. We cannot hope to see real 
progress in the national call to substantially increase Hispanic 
college graduation rates until we at least reach parity in federal 
funding for those colleges and universities that serve the largest 
concentrations of Hispanic higher education students.
    Nearly 50 percent of the 1.8 million Hispanics in higher education 
are enrolled at HSIs today, and a higher percentage of them are 
projected to enroll at HSIs in the years ahead. Consequently, the 219 
institutions now defined as HSIs are increasing their absolute members 
and proportion of Hispanic students from year to year. Furthermore, 
given the rapid Hispanic population growth, it is projected that nearly 
100 more HSIs will emerge within the next five years. Within the next 
HEA reauthorization cycle, HSIs are expected to surpass the 300 mark.
    Authorized and appropriated funding levels for HSIs under Title V 
of the Higher Education Act historically have been grossly inadequate 
to meet the capacity-building needs of these institutions that are the 
backbone of Hispanic higher education. Data from the Integrated 
Postsecondary Education Data System (IPEDS) of the National Center for 
Education Statistics (NCES) documents that HSIs, on average, receive 50 
cents per student for every federal dollar provided to every other 
degree-granting institution.
    H.R. 3039, the ``Expanding Opportunities in Higher Education Act of 
2003,'' addresses many of the education needs of the nation's fastest-
growing college-age population within Title V, the federal government's 
chief vehicle for targeting federal funds to our HSIs as the result of 
the landmark legislation introduced by the Honorable Ruben Hinojosa of 
Texas and adopted by Congress during the last reauthorization cycle.
    On behalf of the nation's two-year HSIs, I urge Congress to insert 
final language into Title V amendments for the next reauthorization 
cycle in line with the recommendations of the Hispanic Association of 
Colleges and Universities, or HACU, the leading voice for the nation's 
Hispanic higher education community. The Community College of Denver is 
a member of HACU.
    The ``Expanding Opportunities'' bill would authorize Congress to 
spend $94 million for federal Fiscal Year (FY) 2004 in Title V funds 
for undergraduate development at HSIs--a minimal increase over the 
current $93 million funding level. HACU proposes a $465 million Title V 
undergraduate funding authorization level for fiscal year 2004 to allow 
HSIs to at least approach funding parity with other federally funded 
higher education institutions.
    HACU, which represents more than 350 colleges and universities in 
26 states and Puerto Rico, also proposes a first-time $125 Title V 
authorization funding level for graduate education development at HSIs. 
The ``Expanding Opportunities'' bill includes no funding authorization 
language for the development of a new graduate program in Title V of 
the HEA, as originally included in earlier legislation proposed to the 
108th Congress by the Honorable Ruben Hinojosa of Texas, Ranking Member 
of this Subcommittee, within the ``Next Generation Hispanic-Serving 
Institutions'' bill.
    Hispanics already make up one of every three workers joining the 
U.S. workforce today; by 2025, Hispanics will make up one of every two 
new workers joining the U.S. workforce, according to projections from 
the U.S. Department of Labor. We must accord our largest ethnic 
population the opportunity to achieve the advanced skills and knowledge 
imperative to building a better future for our nation. Yet, less than 5 
percent of Hispanics obtain graduate or professional degrees. H.R. 3039 
does not address this critical challenge with such enormous 
implications for our nation's economic future.
    I join HACU in praising the authors of H.R. 3039 for including 
provisions within the ``Expanding Opportunities'' bill that would 
remove ``onerous and unnecessary'' regulatory burdens of current Title 
V language now impeding the efforts of HSIs to obtain Title V funds. 
The ``Expanding Opportunities'' bill would eliminate a two-year wait 
period now required before HSIs with Title V grants can apply for new 
Title V grants. The bill would also remove a 50 percent low-income 
assurance requirement now included in the definition of HSIs.
    I am in opposition to a provision within H.R. 3039 that would unify 
the current definition of what constitutes an ``institution of higher 
education.'' The result of combining not-for-profit institutions and 
for-profit institutions into one definition is cause for concern 
because it would allow, for the first time, more than 107 proprietary 
schools or ``for-profit'' education institutions to become eligible for 
Title V and Title III-A grants. Because the existing community of non-
profit HSIs already is so seriously under-funded, adding a new and 
growing category of HSIs at this time would only further dilute the 
already inadequate pool of federal funds now available to HSIs.
    I also strongly oppose efforts to further dilute the availability 
of federal funds to existing HSIs and other two-year institutions like 
Community College of Denver by eliminating the law that currently 
prevents proprietary schools from receiving more than 90 percent of 
their revenue from Title IV student aid programs. The 90-10 rule 
already represents a dilution of historical definitions of higher 
education institutions with its enactment during the previous 
reauthorization of the Higher Education Act. This current 
reauthorization cycle is not an opportune time to visit expanding the 
potential pool of institutions already competing for inadequate federal 
funding.
    As the president of a two-year Hispanic-Serving Institution, I 
would also urge you to embrace a component of the earlier legislation 
by the Honorable Ruben Hinojosa of Texas to allow two-year/four-year 
articulation initiatives to be funded by institutions with Title V 
grants. Such articulation initiatives create a proven pipeline of 
support systems to ease the transition of under-served, under-
represented populations from their first, often first-generation entree 
into higher education through two-year, four-year and advanced degree 
programs. Advanced educational attainment is essential to meeting the 
complex needs of our global, high technology economy. A national 
investment in two-year/four-year articulation initiatives is a proven, 
practical, cost-effective means to obtain real results in raising the 
advanced knowledge and skills, and taxpayer base, of our diverse 
citizenry.
    Please consider these amendments based on exhaustive research and 
the consensus of the leadership of our nation's HSIs, as formally 
recommended by HACU on behalf of our community of HSIs:
    1.  To authorize $50 million ``and such sums as may be necessary'' 
under Title II for eligible HSIs to expand teacher education programs 
of high quality in academic areas of urgent national need.
    2.  To increase the authorized funding level for HSIs under Title V 
to $465 million ``and such sums as may be necessary'' to meet the 
pressing needs of exceedingly under funded HSIs and new HSIs emerging 
within the next five years.
    3.  To authorize $125 million ``and such sums as may be necessary'' 
for a new Part B under Title V for increased and improved graduate 
education at HSIs.
    4.  To allow two-year/four-year articulation initiatives to be 
eligible for Title V funding.
    5.  To authorize $50 million ``and such sums as may be necessary'' 
for a Title V Technology Enhancement Program that would close the 
``digital divide'' at HSIs.
    6.  To authorize under Title VI $30 million annually ``and such 
sums as may be necessary'' for an Institute for Pan-Hispanic 
International Studies through HSI consortia and $20 million for a 
Hispanic International Scholars and Fellows program.
    7.  To authorize $45 million ``and such sums as may be necessary'' 
to create a graduate fellowship program that would involve HSIs and 
non-HSIs in partnerships to increase Hispanic participation and success 
in areas of national priority.
    Hispanic Americans, and the Hispanic-Serving Institutions that 
serve the largest Hispanic population centers in this country, will 
play a profound role in advancing economic prosperity and social 
progress for not just the next five years of the reauthorized Higher 
Education Act, but for the next generation. Please provide our HSIs the 
support they must have to ensure a brighter future for their students 
and for all Americans.
                                 ______
                                 

   Statement of Dan R. Jones, Ph.D., Provost and Vice President for 
          Academic Affairs, Texas A&M International University

    Thank you, Chairman Hoekstra and Representative Hinojosa for the 
opportunity to provide written comments on behalf of Texas A&M 
International University. Although young in comparison to other 
institutions, we are proud to serve a student body with 90% minority 
enrollment and 89% Hispanic enrollment. Of the entering freshmen 
classes, 65-70% are first generation college students. The University 
is fortunate to count on two major grants under Title V. Without this 
support, we would have been unable to provide the needed services to 
retain our first year students and set them solidly on the path to 
degree completion.
    Because our state is quickly becoming a majority minority state, we 
are committed to providing opportunities to ensure an educated populace 
that will positively impact the economy of our State and the nation.
    As a developing institution, we recognize the importance of federal 
funds in the delivery of student support services and financial aid. 
Therefore, the following recommendations are submitted for your 
consideration:
    1.  Eliminate the two-year wait-out period between Title V grant 
applications.
    2.  Include first-time legislative language and appropriations for 
graduate education funding for HSIs under Title V.
    3.  Include international education initiatives under Title V.
    4.  Substantially increase undergraduate funding for HSIs under 
Title V of the HEA.
    5.  Fully fund the Federal Pell Grant to the authorized maximum of 
$5,800.
    6.  Ask Congress to allow the use of prior-prior year tax 
information to allow an earlier application process with automated 
verification through IRS, DOE and other appropriate agencies.
    7.  Allow a combined student and parent income and assets in the 
need analysis process which would simplify the federal needs analysis 
methodology.
    Your support of these recommendations will allow us to meet the 
challenges of access, affordability and success.
                                 ______
                                 

Statement of Leticia C. Hinojosa, Special Assistant to the Commissioner 
     of Higher Education, Texas Higher Education Coordinating Board

    Mr. Chairman, Ranking Member Ruben Hinojosa, and members of the 
Committee, I want to first thank the Subcommittee for inviting the 
Texas Higher Education Coordinating Board (THECB) to provide testimony, 
today, on higher education issues, which are important to Texas and the 
nation.--On behalf of Commissioner Don Brown and our board, I welcome 
you to the great state of Texas - the home state of not only the 
Honorable, Senator Ruben Hinojosa, but also of President George W. Bush 
and Secretary of Education Rod Paige.
    The THECB is pleased to submit this testimony for official record 
relative to the Reauthorization of the Higher Education Act of 1965, as 
amended.--The focus on my testimony will be on the Texas Higher 
Education Plan: Closing the Gaps by 2015. I will note that our Deputy 
Director, Ms. Teri Flack, has provided background testimony to the 
House Education and the Workforce Committee, in July. My testimony 
provides further details about this historic statewide plan and 
addresses specific state-federal partnerships that will advance greater 
access to higher education and success to Texas students.
    Hispanic student participation and success in higher education is 
critical to the future of Texas. State trends indicated that:
      Texas is growing an unskilled, under-educated population 
that cannot meet the demands of a technology-based workplace.
      An average household income in Texas is expected to 
decline.
    In response to this alarming situation, the Texas Higher Education 
Plan, Closing the Gaps, was written in the Fall of 2000. (Attachment 1) 
The Plan calls for reversing these trends by focusing on four goals 
over a fifteen-year period. These goals are:
      By 2015, close the gaps in participation rates across 
Texas to add 500,000 more students
      Close the gaps in success, increase by 50 percent the 
number of degrees, certificates and other identifiable student 
successes from high quality programs
      Close the gaps in excellence, increase the number of 
nationally recognized programs or services at college and universities 
in Texas
      Close the gaps in research, increase the level of federal 
science and engineering research funding to Texas Institutions by 50 
percent to $1.3 billion
    To ensure progress in closing the gaps benchmarks were developed 
and measure to assess progress towards the goals of the plan were 
identified by each institution and higher education as a whole. Data on 
progress is reported annually by state, region, system and institution. 
An annual review of the progress is made by institutions, governing 
boards, the Coordinating Board and Legislature. Periodic adjustment to 
the strategies is made to maximize progress toward the goals.
    The first two goals of Closing the Gaps, calling for participation 
and success in higher education, specifically address the need of 
growing Hispanic college-aged population in Texas. The participation of 
Hispanic students in higher education begins with recruitment and 
admission into higher education institutions. Many students are non-
traditional, either returning to college and/or entering college for 
the first time not directly from high school. Data shows that Hispanic 
students entering college directly upon high school graduation has 
increased from 2000 to 2002, from 25.8% to 26.7% of all high school 
students entering public colleges or universities. (Attachment 2) 
Although this increase may appear to be positive, in view of the total 
number of high school graduates in 2002, only 99,541 or 44.2% of 
graduates went on to higher education. Of those entering 
undergraduates, 25.7% were Hispanic students. (Attachment 3)
    The total Texas higher education enrollment for Fall 2002 was 
986,545 students. (Attachment 4) This is a growth of 115, 013 students 
more in 2002. (Attachment 5) Of those enrolled in higher education more 
students enroll in two-year colleges. (Attachment 6) Some students seek 
only certificates and an Associate's degree while others go on to 
transfer to a four-year institution. Thirty-one percent or 36,340 
students, of the total increase in student enrollment were Hispanic. 
(Attachment 7) The biggest growth of Hispanic students is in South 
Texas with of the Alamo and South Texas Community Colleges having at 
combined 35% of the growth. (Attachment 8) Twelve of the one hundred 
and eleven higher education institutions accounted for the 49% Hispanic 
enrollment increase from 2000 to 2002 in the State (Attachment 9).
    Individual four-year, two-year and Health-Related Institutions'' 
total actual enrollments for 2000 and 2002 indicate a growth. The 
actual 2000 and 2002 enrollments for Hispanic students by institution 
and targets for 2005, 2010 and 2015 show and predict a steady increase. 
(Attachment 10) However, in spite of the 2002 growth in Hispanic 
student participation in higher education, the 2005 Hispanic Target 
remains a challenge. If the growth of Hispanic students in Texas 
remains constant only 54,510 Hispanic students will be enrolled in 
higher education institutions missing the target by 11,756 Hispanic 
students. (Attachment 11)
    The recruitment and participation of Hispanic students in higher 
education is not the only problem facing Texas Hispanic students. The 
successful completion of certificates and degrees by Hispanics is also 
troublesome. Individual higher education institutions'' actual awards 
of Associate's and Bachelor's degrees to Hispanics for 2000 and 2002 
generally show a slight increase (Attachments 12 and 13) However, in 
comparison to the total number of Associate and Bachelor degrees 
awarded, the number going to Hispanics is small. The number of Doctoral 
degrees awarded to Hispanics is even more dismal. (Attachment 14)
    Growth in degrees awarded must be sustained and increased in order 
to meet the 2015 total target of degrees awarded. Actual degrees 
awarded in 2002 show that another 305 Associate's degrees must be 
awarded annually by 2005 to stay on course with an additional 8,558 
Bachelor's degrees awarded by 2005. The number of Doctoral degrees 
awarded in 2002 was below the number awarded in 2000 by 90 degrees. 
Therefore, by 2005, a total of 261 Doctoral degrees must be awarded to 
catch up to the target. (Attachment 15)
    Progress toward the 2005 target for Hispanics in combined 
Associate's, Bachelor's and Doctoral degrees awarded in 2002 shows that 
a combined 2,188 degrees must be awarded annually to Hispanics by 2005 
in order to meet the targets for degrees as set forth in Closing the 
Gaps. (Attachment 16)
    In Texas closing the gaps is not merely a plan for higher 
education. A Uniform Recruitment and Retention (UR&R) Strategic Plan is 
received from each higher education institution with enrollment and 
graduation goals reflecting the Texas population, or, the institution's 
region that contains larger proportions of the state's historically 
underrepresented groups. Each community and technical college's 
enrollment and graduation goals reflects the population of its service 
area.
    The uniform recruitment and retention strategy is designed to 
identify, attract, enroll and retain students who reflect the 
population of Texas. To this end, the committee found strategic 
enrollment management principles to be useful. The UR&R Strategic Plans 
serve as documentation of the institution's efforts in closing the gaps 
and as a self review of efforts made that should continue to receive 
support and those that may need adjustments. The areas that are 
reported and planned for include:
      Marketing Plan
      Recruitment/Admissions Strategies
      Retention/Graduation Strategies
      Initiatives and Actions to Improve Diversity and Services 
to Underrepresented Student Populations
      Funding of Initiatives
      Evaluation Information /Benchmarks and performance 
measures, Goals and Measurement of Goals/List of Surveys: External, 
Internal, Other Data Reports)
    An infrastructure has been put into place that supports 
institutions of higher education for the recruitment and retention of 
Texas students entering higher education. This infrastructure is 
evident in the institutions plans. Presented here are highlighted 
legislative initiatives, although not inclusive, to provide an overview 
of strategies being acted upon for closing the gaps and which will 
assist in the growing of Hispanic students in higher education in 
Texas.
    1.  High School Recommended Program--The Recommend High School 
Program is the default curriculum in high schools. All students will be 
required to take this curriculum unless parents take special steps and 
sign opting out of the requirement. This begins in Fall of 2004. The 
preparation of students to not only participate but to succeed in 
higher education is critical. This academic preparation begins while 
the student is in P-12. (Attachment 17) Currently efforts discussions 
are taking place to align the curriculum between P-12 and higher 
education. Transfer issues are also being discussed for smoother and 
successful transition from community colleges to four year 
institutions.
    2.  College for Texans Campaign - The College for Texans Campaign 
is administered by the Coordinating Board. It is a statewide campaign 
to ensure that parents and students understand the importance of higher 
education and how to prepare for it academically and financially. The 
campaign was publicly launched in November 2002. Major components of 
the campaign are:
        Community-Based Outreach: The campaign staff has provided 28 
        train-the-trainer sessions in all regions of the state. The 
        training provided an orientation to the GO Kit developed by the 
        campaign, which contains activities for children and their 
        parents, preschool through high school. Although the training 
        was primarily targeted for our 250 community-based organization 
        outreach contractors, an estimated 1,300 people participated in 
        the first phase of training sessions.
        GO Theatre: The campaign contracted with one high school and 
        seven higher education GO Theatre Motivational Performance 
        Teams. Teams provided at least 10 performances in high schools 
        with low college-going rates before August 31, 2003. Each team 
        received intensive training in campaign messages and 
        motivational theatre techniques into which they developed 
        original performance sketches that inform and motivate students 
        about seeking a higher education.
        GO Centers: The first 26 GO Centers were opened in August 2003 
        with the opening of the public school academic year. Dozens 
        more GO Centers will be started in the fall and spring of 2003-
        04. The purpose of the GO Centers is to recruit and train 
        college students, college-bound high school students and 
        community volunteers to work on a sustained basis with first-
        generation high school students who need extra support and 
        technical assistance for the process to go to college.
        Advertising and Earned Media: The spring advertising campaign 
        began on March 10, 2003 and ran for eight weeks in major 
        markets and six weeks in secondary markets (TV and radio). 
        Print ads were purchased in African-American and Hispanic print 
        media, as well as major papers in El Paso and the Rio Grande 
        Valley. In addition, the campaign implemented promotional 
        contracts with minor league baseball teams in El Paso, San 
        Antonio, Round Rock and Midland. Media appearances statewide 
        promoted the Recommended High School Program in news and public 
        affairs programs on TV and radio in 19 media markets. In 
        August, a new radio campaign educating parents about Texas 
        Essential Knowledge and Skills (TEKS) and Texas Assessment of 
        Knowledge and Skills (TAKS) and how to help their children 
        succeed in them will be released in several targeted markets. 
        The advertising company also assisted in getting media 
        attention to the launching of GO Centers in August.
        Reel Life Video Contest and Cool Jobs Videos: The campaign 
        launched a statewide contest for college students to make 
        autobiographical videos about the barriers they overcame to get 
        to and succeed in college, or to produce biographical videos 
        about fellow students. The campaign will host an awards event 
        for the winners in the beginning of 2004, and winners will be 
        presented with prizes such as mini-DVD cameras, donated by 
        corporate sponsors. The campaign is also producing a series of 
        short videos on ``cool jobs'' that require post-secondary 
        training. The Reel Life and Cool Jobs videos will be shown in 
        middle and high schools on a network of public school closed-
        circuit TV systems.
        Student and Parent Educational Materials: The campaign worked 
        with one of the top early childhood education specialists in 
        the country, Dr. Nell Carvell, Director of the Preschool 
        Teacher Training and Learning Therapy Center at SMU, to develop 
        the next phase of campaign activities for preschool children. 
        The campaign produced an extensive set of activities in the GO 
        Kit I and is providing new activities targeted to various ages 
        each year of the campaign in GO Kit II. The new Kit was 
        completed in August, and a pilot test of the activities is 
        being conducted in Head Start programs in Dallas and the Rio 
        Grande Valley (English and Spanish) this fall and continuing in 
        the spring of 2004. After needed adjustments are made to the 
        curriculum, it will be launched statewide in the fall of 2004.
        In addition, the next phase of parent education materials focus 
        on understanding TEKS and TAKS and how to help a child achieve 
        success on them is being addressed through PSA's, training and 
        other materials.
        Children's Book Project: Phase I of this project was completed 
        in July. The final stage of writing will take place September 
        through December of 2003 and the book will go to UT Press in 
        January 2004 for publishing. The book will be publicly 
        introduced in the fall of 2004. Free distribution of this book 
        will be made to middle school age students, community based 
        organizations and other partners.
    3.  Texas Success Initiative (TSI)--This program replaces the Texas 
Academic Skills Program (TASP), which was a test, and program that was 
considered punitive in nature to students who failed the test or parts 
of the test because they were under prepared. Students were unable to 
take college credit courses until they passed all parts of the TASP 
although they were admitted into colleges and universities. The TASP 
required that the student take developmental education courses and 
retest. The key components of TSI are assessment, advising, 
developmental education, and accountability. However, unlike the TASP, 
the TSI requires an individual analysis of students'' deficiencies and 
tailored assistance.
    4.  Freshman Success Program--This is a pilot program focusing on 
the retention of high risk students. These students are first 
generation students who are from low-income families and are under 
prepared. The pilot must address academic needs, emotional and 
behavioral needs as well as financial needs. Cultural barriers that may 
affect success in college will also be addressed in the development of 
the program.
    5.  Community College Baccalaureate Degree Pilot Project--Three 
community colleges will participate in the pilot. Students may earn a 
Bachelor's degree in applied science and technology through 2011. The 
rationale for this pilot is that more students are enrolling in 
community colleges first and then transferring to a four-year 
institution.
    6.  School Loans - School loan forgiveness programs are to be 
phased out. The loan repayment programs are to be implemented.
    7.  B-On Time Student Loan Program--The B-On Time Program 
encourages students to graduate with a ``B'' average and on time in 
order to have a school loan forgiven (an exception to previous state.). 
Time will determine the success of the program. However, it is 
anticipated that institutions adjusting to decreased funding will have 
no option but to cut course offerings which in turn drive the course 
loads students take per semester and determining when students 
graduate.
    8.  Texas College Work-study--The THECB appreciates the importance 
of affording students the opportunity to work, part time, while 
attending a postsecondary education institution. In addition to the 
federal work study funding, Texas allocates additional funds work-study 
funds for students. --For the current budget biennium, the legislature 
appropriated a 131% increase in funding for the state work study 
program. --
    9.  Equalization Grant--A 14% decrease in Equalization Grants to 
independent colleges was passed.
    10.  TEXAS Grant - Although there was a 21% funding increase in the 
Toward EXcellence, Access, & Success (TEXAS) Grant, funding remains 
inadequate. An estimated 14,000 eligible new students will not be 
funded in fiscal year 04. An estimated 11,000 additional eligible new 
students will not be funded in 2005. New students from families with 
incomes above $40,000 will not be able to receive a TEXAS Grant.
    11.  Tuition Deregulation - Legislation was passed that allows for 
the deregulation of tuition. Each institution of higher education will 
address this issue as it impacts the student enrollment and revenues 
for that institution. If assumptions about tuition increases are 
correct, the number of new TEXAS Grant eligible students who will not 
be served will increase substantially each year.
    12.  College Readiness Standard--In l999 the 76th Legislature 
passed legislation requiring a more rigorous assessment and 
accountability system for the Texas Public Schools and the students 
they serve. The new statewide testing program, the Texas Assessment of 
Knowledge and Skills (TAKS), replaced the Texas Assessment of Academic 
Skills (TAAS), and requires for the first time that students have an 
exit-level assessment in grade 11. In addition, the 11th grade exit-
level test must, by law, include a higher education readiness 
component.
    Performance on the 11th grade exit-level tests will be used to 
assess not only a student's preparedness for graduation from a Texas 
public high school, but also the student's readiness for college-level 
work. The Coordinating Board is responsible for setting the college 
readiness score. The legislature intended for students, while in high 
school, to have the opportunity to be assessed to determine their 
readiness for college, and then if not ready, for them to receive the 
assistance they need to become ready. The expectation is that this will 
lead to closer alignment between academic expectations of high school 
graduates and entering college freshmen.
    13.  Texas Strategic Plan to Address the Teacher - A highly 
qualified teaching workforce is critical to the success of the state's 
higher education plan and the future of the state. The Strategic Plan 
is a shared vision and commitment to eliminating the Texas teacher 
shortage. Collaboration among P-16 Partners will be essential to 
reaching the goals and the objectives of the plan.
    14.  Middle College Pilot - The Commissioner of education, in 
consultation with the Coordinating Board, is to establish the Middle 
College Education Pilot Program for students who are at risk of 
dropping out of school or who wish to accelerate high school 
completion. A very attractive stipulation of this legislation is that 
it allows a participating student to not only complete a high school 
diploma and but also an associate's degree at the time of graduation. 
The program will provide for concurrent/dual enrollment during the 11th 
and 12th grades. Included in the articulation agreements with Texas 
institutions of higher education, high school students will be provided 
access to higher education and training opportunities on campus. 
Student flexibility in class scheduling and academic mentoring will be 
part of the program. This took effect on September 1, 2003.
    15.  Recruitment and Retention Conference - The Texas Higher 
Education Coordinating Board holds annual conferences on recruitment 
and retention of students for higher education. The conference 
showcases P-16 efforts throughout the state. The College for Texans GO 
Campaign has a significant presence as all of the community based 
organizations gathered to strategize next steps. Other features 
included GO Theater orientation, GO Center orientation, and College for 
Texans Train-the Trainer sessions for GO Kit I.
    Dr. Steve Murdock, State Demographer updated participants on the 
growing changes of Texas. The Uniform Recruitment and Retention 
Strategy workshop included best practices taken from several uniform 
recruitment and retention strategic plans submitted by Texas colleges 
and universities. This year there was also an opportunity for 
institutions to submit an application for the First Generation Student 
Request for Proposal, funded by federal dollars. This federal grant 
will assist with college enrollment workshops as well as establishing 
GO centers.
    Also this year, a session on Effective Recruitment and Retention of 
Hispanic Students with Dr. William Segura, President of Texas State 
Technical College System; Wilbert Bryant, Deputy Assistant Secretary 
for Higher Education Programs at the US Department of Education; and 
Dr. Edwin Dorn, Dean of the LBJ School of Public Affairs at The 
University of Texas at Austin was held.
    16.  Higher Education Assistance Program - The continuation of 
assistance and financial aid to prospective students from high schools 
with low college going rates has been reauthorized. These enrollment 
workshops have been very successful. The Coordinating Board gratefully 
acknowledges the volunteer work and assistance provided by the Texas 
Association of College Admissions Counselors, who greatly expanded the 
total number of workshops that were provided and students served during 
2002 and 2003. Their direct work and assistance in 22 workshops around 
the state reached a total of 1,331 high school students. An overall 
total of 2,006 high school students were served in 28 workshops around 
the state with the opportunity to have small group and one-to-one 
direct assistance (in Spanish and English) to complete their 
application for the local community college, the common application and 
their Free Application for Federal Student Aid (FAFSA) was a 
significant intervention.
    The spring semester of the 12th grade year is not too late for 
providing direct assistance to graduating seniors. In high schools with 
low college-going rates, significant numbers of seniors in their final 
semester of public education had not taken any action to enroll in 
college. The 78th Texas Legislature has continued the pilot program for 
two more years.
    17.  Early High School Graduation Scholarships - The Early High 
School Graduation Scholarship Program by provides an eligible student 
with state credit to pay tuition and mandatory fees at a public or 
private institution of higher education. A person's eligibility for 
this credit ends on the sixth anniversary of the date the person 
becomes eligible for the program. The legislation requires the 
Coordinating Board to establish rules to allow additional time for 
eligible students to use the state credit due to hardship or other good 
cause that prevents the person from enrolling in or continuing 
enrollment in an eligible institution during the required period of 
time.
    The amount of state credit depends on the length of time it takes a 
student to graduate under the Recommended High School Program and 
whether a high school student earns credit in concurrent/dual 
enrollment program. A person is exempt from the curriculum requirement 
if the person's transcript indicates that the person was unable to 
complete the curriculum due to unavailability of the courses, conflicts 
in course scheduling, lack of enrollment capacity, or another cause not 
within the person's control.
    A school district is also entitled to a one-time credit of varying 
amounts if a student from the district uses any part of the state 
credit for a certain dollar amount. The commissioner of education shall 
distribute money from the foundation school fund to the eligible 
districts. This act took effect on September 1, 2003.
    18.  Dual enrollment - Universities and Technical Colleges, along 
with Community Colleges will waive all or part of the tuition and fees 
for high school students enrolled in a dual credit course. These are 
high school students taking college level course work. Dual enrollment 
provides for these contact hours to be used to determine the 
institution's proportionate share of state appropriations, even if the 
institutions waive all or part of the tuition or fees. It also 
increases the amount of tuition that can be pledged to the payment of 
bonds issued by community college districts from $15 per student/per 
semester to 25% of the tuition collected from each student.
    19.  P-16 Council--The P-16 Council is composed of the commissioner 
of education, the commissioner of higher education, the executive 
director of the Texas Workforce Commission, and the executive director 
of the State Board for Educator Certification. The purpose of this 
council is:
        1.  to advise the two boards on the coordination of 
        postsecondary career and technology education and
        2.  the articulation of and collaboration on P-16 issues 
        impacting the education of Texas students.
    20.  H.B. 400--The Commissioner of Education and the Commissioner 
of Higher Education, respectively, collaborated on the requirements for 
partnership plans between public schools and higher education 
institutions to increase college-going rates. Each institution of 
higher education and high school submitted plans to the Texas Education 
Agency outlining plans to assist students in their preparation for and 
their motivation to attend attain a higher education. High schools were 
identified as being in the lowest 10% of college-going rates.
    21.  Top 10% - After the 1996 decision by the Fifth Circuit Court 
of Appeals in Hopwood v. State of Texas, which ended affirmative action 
in public-university admissions in the state, the enrollment of 
minority students plummeted at the University of Texas at Austin. For 
example, from 1996 to 1998, the number of Hispanic freshmen dropped 
from 932 to 891. To rectify the problem, the Texas Legislature, guided 
by the Mexican-American and African-American leadership, guaranteed 
admission to state universities for all high-school graduates who 
finish in the top 10 percent of their class.
    The Top 10% Plan was started in 1997 is believed to demonstrate the 
percentage plan can sustain, and even improve, the enrollment of 
disadvantaged minority students. The enrollment of minority students 
surpassed those enrolled under affirmative-action policies. The overall 
increase has been reflected in greater racial diversity in the most 
coveted majors, like business, engineering, and the sciences.
    Further, the plan has opened up the flagship campuses, the 
University of Texas at Austin and Texas A&M University at College 
Station, to students who would not have even applied in the past. 
Before the percentage plan took effect, students from only about 10 
percent of the more than 1,500 Texas high schools made up 75 percent of 
each entering class at the Austin campus. Most of those feeder schools, 
both public and private, were in wealthy suburban districts with high 
per-pupil expenditures, state-of-the-art facilities, and many advanced 
classes. Meanwhile, other students struggled in racially segregated, 
inadequately financed schools with few amenities. In addition, Texas's 
percentage plan has diminished the importance of standardized tests, 
which provide a one-dimensional picture of student potential and often 
overlook valuable attributes of leadership and character.
    Across all racial groups, the top-10-percenters at the University 
of Texas at Austin have performed as well as other students who have 
SAT scores that are 200 to 300 points higher. Minority students who 
were admitted under the plan have improved grade-point averages in 
their majors. Also, the number of students who return after their first 
year is higher among those who entered under the plan. By turning the 
spotlight on the vast inequalities at the elementary and secondary 
level, we hope that the 10-percent plan can help improve public 
education for all students.
    This past legislative session efforts were made to repeal the Top 
10% Rule. Had it not been for filibustering, the rule would have been 
struck from statute. There is talk that legislators will again attempt 
to repeal the rule that allows for diversity in higher education.
    Further, possibilities for enhancing the participation and success 
of Hispanic students in Texas would include:
    1.  The opportunity to hire more Hispanics throughout P-16 that 
reflect the face of Texas students.
    2.  The on-going Texas State Board for Educator Certification 
interstate articulation on teacher certification so that the Texas 
teacher shortage may be eliminated.
    3.  The continued participation of Texas in the collaboration and 
exchange of ideas and information facilitated by the Southern Regional 
Education Board (SREB)
    4.  The establishment of P-16 Councils at the local levels 
involving universities, colleges, public school systems and communities 
working collaboratively on issues of student academic preparation and 
financial aid for higher education.
    Texas appreciates the generous support of the federal government 
for our students. Among much support we look forward to its 
continuation and just as importantly, the solidification of good 
communication and collaboration between the federal government, all 
Texas education agencies and local education agents for the benefit 
students. Because Texas is becoming majority Hispanic, such support 
would serve to enhance the growing Hispanic college-age student 
population.
    1.  Texas applauds the significant legislation, No Child Left 
Behind Act, with particular attention to highly qualified teachers and 
to the incremental academic achievement of students. Texas educators 
have begun to implement strategies to meet the requirements deemed 
essential for a better educated Texas.
    2.  It can be anticipated that Hispanic student participation in 
higher education will decrease as institutions address deregulation of 
tuition. With cuts in state funding to institutions, affordability will 
be impacted because institutions will have to make up the difference 
some how. The State of Texas is highly reliant on the federal student 
financial programs for ensuring financial access to higher education 
for economically disadvantaged students. According to the Texas 
Guaranteed Student Loan Corporation's (TG) ``State of Student Financial 
Aid in Texas'', the federal programs compose 90% of all direct, need-
based student financial aid awarded annually to Texas students. Two-
thirds of the $3 billion awarded annually in student financial aid is 
in the form of federal student loans. Obviously both of these figures 
are higher than the national averages of 70% and 57% respectively. --
    Also, the state's student loan program - the Hinson-Hazelwood 
Student Loan Program - now uses TG Electronic Funds Transfer process to 
allow students who obtain their student loans from the state program 
now have all of the same advantages as those borrowers who obtain their 
student loans through the private sector. Suffice to say, the federal 
programs play an important part in the student financial component of 
Texas' ``Closing the Gaps'' initiative.
    3.  The continuance of the federally funded Teacher Quality Grant 
funds to Texas would ensure that critical areas such as science, math 
and reading will be the focus of professional development for public 
school teachers. Such professional development allows for better 
teaching and better teaching allows for better learning for students 
who need to be college ready upon high school graduation. The Teacher 
Quality Grants Program under Title II of the 2001 No Child Left Behind 
Act, places major emphasis upon teacher quality as a factor in 
improving student achievement. It does so by providing teachers and 
other staff access to professional development in core academic 
subjects. The 2003 federal grant allocation to the Coordinating Board 
of approximately $5.6 million is assigned for distribution to public 
and private institutions of higher education and nonprofit 
organizations within the state which demonstrate effectiveness in 
meeting program goals. Grants are awarded to support professional 
development in core academic areas of greatest statewide need; for 
2003-2004 those areas are mathematics, science, and reading.
    For federal Fiscal Year 2003, the U.S. Department of Education 
stipulates that Teacher Quality funds must be awarded to projects based 
on criteria set forth in Title II of the No Child Left Behind Act, as 
well as priorities established by the federally approved State Plan 
under that act.
    4.  The continuance of the federally funded First Generation Grant 
funding to Texas through the Texas Workforce Commission, Texas 
Education Agency and Texas Higher Education Coordinating Board would 
ensure that many Hispanic students are given the assistance to prepare 
for and succeed in higher education. The First Generation College 
Student Initiative in Texas supports Closing the Gaps. One of the 
specific activities of this grant is the college enrollment workshops 
for high schools in areas with low college going rates. The outreach 
and coordination of these workshops between institutions of higher 
education, public schools and local workforce development boards will 
be in many of the GO Centers. The average size of these competitive 
awards will depend on the number of proposals submitted and accepted. 
We estimate awarding 35-40 proposals in the amounts of $30-50,000 each.
    5.  Continuation of federal dollars to the Hispanic Serving 
Institutions of Texas (Attachments 18 & 19) which serve the targeted 
student population that data shows is critical to the future of Texas.
    In conclusion, Texas is very proud to have designed a higher 
education plan, Closing the Gaps. We are particularly because the 
plan's first two goals of the plan, participation and success, focus on 
recruiting and retaining students in higher education. The initiatives 
highlighted in this statement work towards closing the gaps but are 
fairly new, and therefore, the jury is still out with regard to 
specific success data. However, these legislative initiatives are being 
tracked, reports are made to the legislators periodically, and review 
of benchmark success is made across all higher education institutions. 
We believe these initiatives can be replicated. Similar goals and 
strategies may be considered for inclusion in the Higher Education 
Reauthorization Act.
    Texas congratulates and thanks this committee for taking the time 
and interest to reach out into the American communities to hear direct 
testimony. I paraphrase an unknown wise person, ``too often the 
education pendulum goes from one fad to another in education, from 
phonics to whole language and back to phonics, from subject-based to 
holistic learning, from curriculum-based to child-centered learning, 
from neighborhood to magnet to charter schools, from old to new to 
whole math, from English-only to bilingual education to language 
immersion. What is certain is that education suffers from a lack of 
scientifically sound studies.'' It is the depth and breathe of your 
hard work for this very important committee that, when taken back the 
Washington, formulates good and meaningful legislation for the people 
of America. The reauthorization of the Higher Education Act promises:
        ``To give people the power to reason. The capacity to make 
        informed judgments. The ability to solve problems. The vision 
        to think clearly and imaginatively. So that people will be 
        prepared to deal with ambiguity, uncertainty, the unexpected 
        and to confront the unknown''.the best schools can be 
        everywhere.''
    Author of quote is unknown.

                    Recommended High School Program

      English Language Arts and Reading (4 credits)
      Mathematics (3 credits)
      Science (3 credits)
      Social studies (3 1/2 credits)
      Economics (1/2 credit)
      Physical Education (1 1/2 credits)
      Health Education (1/2 credit)
      Languages other Than English (2 or 3 credits)
      Fine Arts (1 credit)
      Speech (1/2 credit)
      Technology Applications (1 credit)
      Electives ( 3 1/2 credits or 2 + credits)

                              INSTITUTIONS

    There Are 140 public and independent institutions of higher 
education in Texas:
      50 public community college districts (with more than 70 
campuses)
      31 public four year universities
      4 public two-year, upper-division universities and 
centers
      4 campuses of the Texas State Technical College System 
(including three extension centers)
      3 public two-year, lower-division Lamar State Colleges
      37 independent four-year college and universities
      8 public health-related institutions
      1 independent medical school
      2 independent junior colleges

     HISPANIC COLLEGES AND UNIVERSITIES (PUBLIC & PRIVATE) IN TEXAS

      Bee County College
      Del Mar College
      El Paso Community College
      University of the Incarnate Word
      Laredo Community College
      Mountain View College
      Oblate School of Theology
      Odessa College
      Our Lady of the Lake University--San Antonio
      Palo Alto College
      Saint Edward's University
      Saint Mary's University
      San Antonio College
      South Plains College
      South Texas Community College
      Southwest Texas Junior Community College
      St. Phillip's College
      Sul Ross State University
      Texas A&M International University - Laredo
      Texas A&M University--Corpus Christi
      Texas A&M University--Kingsville
      Texas Southmost College
      Texas State Technical College--Harlingen Campus
      The University of Texas at Brownsville
      The University of Texas at El Paso
      The University of Texas at San Antonio
      The University of Texas - Pan American
      University of Houston - Downtown

    [GRAPHIC] [TIFF OMITTED] T0140.006
    
                                 ______
                                 

Statement of Jimmy Parker, on behalf of the Texas Student Financial Aid 
   Administrators and the Association of Texas Lenders for Education

    Mr. Chairman and Committee Members:
    Thank you for the opportunity to provide comments on behalf of the 
Texas Student Financial Aid Administrators (TASFAA) and the Association 
of Texas Lenders for Education (ATLE). TASFAA is an organization of 
student financial aid professionals from postsecondary institutions 
across the State representing public, private, community colleges, and 
proprietary sectors. ATLE is an organization of student loan 
professionals representing Lenders across the State that participate in 
the Federal Family Education Loan Program (FFELP). These two 
organizations in conjunction with the Texas Guaranteed Student Loan 
Corporation (TG) have worked together in preparing recommendations for 
the Reauthorization of the Higher Education Act (HEA) representing the 
Texas Student Financial Community.
    The reauthorization proposal from the Texas student financial aid 
community is comprehensive in nature and reflects our recommendations 
on numerous issues. However, for our purpose today we will concentrate 
on several areas that are believed to be our most critical. We believe 
these areas to be issues that can have an immediate effect on the needy 
students who depend on Federal need based financial aid funds to attend 
college. Also, these issues can have an effect on the institutions 
involved in the awarding process by providing funds to students when it 
is needed and allow them to maintain active participation in the 
default aversion practices to support the FFELP.
    In addition the Texas student financial aid community supports the 
ongoing activities in our State concerning Closing the Gaps initiative. 
This initiative involves several components, including student 
financial aid, outreach and academic preparedness. The initiative also 
includes the goal of the recruitment, retention, and graduation of an 
additional 300,000 students (beyond the 200,000 increase expected 
through overall population growth) by 2015. It is our hope that certain 
aspects of this initiative can be incorporated into the reauthorization 
process to focus support to programs that will target student financial 
aid, academic preparation, outreach and awareness activities to 
encourage students to seek and obtain a postsecondary education.
Issues and Recommendations
    Federal Pell Grant--Increase the amount of the authorized maximum 
grant to the 1976 buying power level - $7,066--an increase of $1,266 
over the 1998 Reauthorization, and an increase of $3,016 over the 
actual maximum grant. The premier federal need-based grant program 
should be fully funded to the 2003 authorized annual maximum of $5,800. 
Ideally, the congress should raise and fund the authorized annual 
maximum grant to $7,600, thereby restoring the buying power of the 
original grant.
    Federal Perkins Loan--Increase the authorized funding to $200 
million, and increase of $100 million over the 1998 Reauthorization and 
2001 actual funding levels. Increase the annual maximums to $5,500 for 
undergraduates and $10,000 for graduate and professional students, with 
cumulative maximums increased to $27,500 and $67,500, respectively. 
There have been numerous bills filed to increase loan forgiveness or 
cancellation benefits for borrowers in critical need areas and the 
Perkins Loan already has these provisions in place and has a long and 
successful track record. Allow institutions that have opted out of 
participation in the program to continue to collect outstanding loans 
and use the proceeds to establish a campus-based student aid endowment 
fund to use to supplement funding for other need-based SFA programs.
    Federal Family Education Loan Program--Student loan maximums for 
first and second year borrowers have not been significantly increased 
since 1986 ($2,500 annual maximum to $2,625 in 1992 for first year 
borrowers). The Congress should simplify the FFELP by adopting a 
uniform annual loan maximum for dependent borrowers with an additional 
$5,000 for independent undergraduate borrowers. Research indicates that 
graduate and professional students are low risk for loan defaults, the 
Texas SFA community recommends that these borrowers should be able to 
borrow up to the cost of education.
    The Texas SFA community encourages the repeal of the 3 percent 
student loan origination fee and the 1 percent guarantee fee. The 
origination fee was originally established by the congress in 1981 as a 
temporary revenue source to address a federal budgetary shortfall. All 
but a handful of the 36 FFELP guaranty agencies have voluntarily 
eliminated the 1 percent guarantee fee. Repeal of both fees would save 
borrowers money and allow each borrower to receive the full loan amount 
each is eligible to receive.
    Restore the exemptions that allow single and undelayed student loan 
disbursements of low default rate schools. These provisions have been 
addressed in HR12 and the Texas SFA community strongly recommends 
passage which allow schools with lower than 10 percent student loan 
default rates to disburse loan funds in a single disbursement and 
immediately to first time borrowers.
    Student loan consolidation issues should be reviewed thoroughly by 
looking at all aspects associated with this program. These issues 
should included the original purpose, benefits, and conditions of the 
1985 student loan consolidation program, cost to lenders and holders, 
parity with the Federal Direct Loan Program, and appropriate level of 
taxpayer subsidization for consolidated student loans after the 
borrower leaves school. All of these issues must be considered while 
balancing the interests of the borrower (convenience and cost) and the 
provider (cost of funds and student loan portfolio valuation 
volatility). However, in balancing the interests, we urge the congress 
to consider the cost to the federal government and to the other need-
based student aid programs. One central issue here is whether it is 
better public policy to spend marginal public dollars to continue to 
subsidize former students, or to spend these funds assisting current 
and future economically disadvantaged students with need-based student 
aid.
    Several bills before Congress also address what is referred to as 
the single holder rule specifically HR942. In this case a borrower who 
has all their loans with one lender must look at that lender for 
consolidation and may not seek a consolidation loan with another 
lender. In recent years we have seen enormous growth in companies that 
specialize in doing consolidation loans. We believe these companies 
would welcome the removal of the single holder rule since it would 
greatly enhance their opportunity to gain loans. However, we should 
understand these companies do not normally make conventional student 
loans and therefore have no need to provide outreach activities for 
students and parents or provide educational materials on the financial 
aid process since they are dealing with borrowers who have finished 
school and not those who are needing information concerning 
opportunities available to them to attend school. We also believe these 
companies are pushing the fact that the student can lower their monthly 
payments but do not mention or thoroughly explain the fact that by 
consolidating it could lengthen the repayment terms on their student 
loan from the standard 10 years to 20 or 30 years. Although the 
borrower may save in the short run with lower monthly payments it could 
cost them more in the long run in interest, even at a lower rate, due 
to the extended repayment terms. We also believe the borrower may not 
be given information about the loss of deferments that can occur with 
consolidation loans since these companies are in the business to do 
consolidation loans and in some cases this is their only purpose.
    Another aspect of the single holder rule that is not talked about 
very often is the possible effect on the school default rates and the 
consequences that can occur. Schools generally have no control over the 
final holder of the loan since most lenders sell their loans when they 
reach repayment status so they can make additional loans. Therefore the 
final holder of the loan or the servicer they use to service these 
loans in repayment status can have an effect on the school and 
ultimately the student. Schools with high default rates could lose 
funding for all Title IV funds or could have restrictions placed on the 
handling of the funds to students for certain default rates. In Texas 
most schools will maintain a lender list for students and this list 
will indicate lenders who do a good job of servicing loans or lenders 
who use a servicer that does a good job of servicing the loans in 
repayment. This is one of the few ways a school can impact their 
default rate. Currently schools with a default rate of 10% or higher 
must put a 30 day delay on the issuance of the first disbursement of a 
student loan for first time, first year borrowers and also have 
multiple disbursements for students who will be attending one semester 
of a loan period. There was a provision that allowed schools with a 
default rate below 10% in the most recent three-year period to be 
exempted from this provision. This provision expired October 2002 and 
is now being addressed in HR12, the ``Fed Up Higher Education Technical 
Amendments Act of 2003'', sponsored by McKeon that would make it 
permanent. This causes severe difficulties for students who count on 
these funds to pay their educational expenses, but must wait 30 days 
for their first disbursement. The removal of the single holder rule 
will make the research of the schools useless concerning the listing of 
lenders who use servicers that work diligently to maintain a low 
default rate.
    Federal need analysis issues--The Texas SFA community agrees with 
the Congress that a review of the FAFSA and need analysis should be 
reviewed to simplify the aid application process. There are a number of 
issues we believe should be addressed to help in this matter.
    We encourage the Congress to allow the use of prior-prior year tax 
information in the need analysis process. This will allow the SFA 
application process to begin earlier, automate income verification 
through data exchanges with IRS, ED, and other appropriate agencies, 
and outreach and awareness activities to begin earlier.
    Combine student and parent income and assets in the need analysis 
process. This would eliminate the distinction between ``student'' 
assets and income and ``parent'' assets and income, and replace both 
terms with ``family'' assets and income. By doing this it would 
simplify the federal methodology, no longer penalize families who save 
for their child's college education in their child's name, and benefit 
low income families in which a child's income plays a significant role 
in supporting the family and is, therefore, not available to pay for 
educational costs.
    Retain the definition of ``independent student''.
    Include veterans' benefits in the need analysis process. This would 
provide for consistent treatment of veterans benefits (all chapters) as 
income in the need analysis process. This would simplify the SFA 
packaging process.
    College tuition prepayment plans be treated the same as 529 college 
savings plans (as an asset of the account holder, instead of as a 
resource) in the need analysis process. This will be an added incentive 
for families to save for their children's postsecondary education.
    Thank you for your support in providing access to higher education 
for needy students and the student financial aid community.
                                 ______
                                 

Statement of Mary Alice Reyes, Ed.D., Director, University of Texas Pan 
                        American GEAR UP Project

    Chairman Hoekstra, Ranking Member Ruben Hinojosa, and members of 
the Committee, thank you for providing me the opportunity to submit 
written testimony regarding the importance of increased funding for 
Hispanic Serving Institutions (HSI's) such as The University of Texas 
Pan American and the impact of the University's GEAR UP Project upon 
the status of middle and high school students' preparation and 
readiness for attending college.
    Having served in the public schools in the Rio Grande Valley for 30 
years in numerous capacities, including as a school superintendent in 
one of the poorest school districts in the state of Texas, I can 
personally attest to the great need that exists for Hispanic students, 
especially those from low-income families, to not only graduate from 
high school, but to be prepared to enter and succeed in postsecondary 
education.
    Historically, Hispanic students have lower participation rates in 
higher education than the population as a whole (1). However, although 
Hispanic enrollment has tripled in the last twenty years, Hispanic 
students enter postsecondary institutions at much lower rates than 
white students, thus perpetuating the disparity that still exists 
despite the progress noted (2). Hispanic students comprise 10.1 percent 
of the undergraduates, but only 6.3 percent have received a bachelor's 
degree. One reason cited for this underrepresentation among Hispanic 
students in postsecondary education is lower high school graduation 
rates and inadequate college preparation (3). Only 52 percent of 
Hispanic students graduate from high school of which 9 percent are 
minimally prepared for college (4). Similarly in South Texas, Hispanic 
students are among the least likely to graduate from high school and 
only a fraction of these students enroll and complete a college degree. 
Consequently, the level of educational attainment in the South Texas 
region lags behind the state and the nation creating a gap that if not 
addressed will seriously affect the social and economic future of the 
area.
    According to William Harvey, the director of the Office of 
Minorities in Education for the American Council on Education, ``the 
gaps relate to some of the real fundamental social and economic 
conditions in this country. We know that individuals in underserved 
communities are less likely to have the preparation in elementary and 
secondary school to prepare them for college, and those communities are 
clustered among folks of color.
    In South Texas, not only are those communities clustered primarily 
among Hispanic families, but fortunately, they are also clustered 
around The University of Texas Pan American (UTPA), a Hispanic Serving 
Institution which is working with a diligent sense of urgency to make 
higher education accessible and possible for all who dream of acquiring 
a college degree. It is through the collaborations established by UTPA 
including sustainable partnerships with local school districts, 
business and community organizations, and other institutions of higher 
education, that this dream is becoming a reality for students served in 
the area, across the state of Texas, nationally, and internationally. 
However, as starkly documented above, the challenges of preparing more 
Hispanic students to enter and succeed in college are still 
overwhelming. Additional resources including an increased federal 
investment, is critical to the work that must be done now and in the 
future to address the gap in educational attainment in our area.

University of Texas Pan American - Si Se Puede! GEAR UP Project
    One such federal investment has come in the form of The University 
of Texas Pan American Si Se Puede! GEAR UP Project, a grant from the 
U.S. Department of Education whose mission is to significantly increase 
the number of low-income students who are prepared to enter and succeed 
in postsecondary education. The project served 6993 students in 7th 
grade in 23 middle schools representing 12 school districts during the 
first year of implementation. In this our third year of implementation, 
services have been provided for 6930 students in 17 high schools. Of 
these students, 98 percent are Hispanic, 88 percent are economically 
disadvantaged, 25 percent are considered limited English proficient, 
and 17 percent have been identified as migrant.
    Formed as a partnership with school districts, businesses, 
community organizations, and institutions of higher education, GEAR UP 
has created the infrastructure to provide services which will enable 
students to prepare for higher education by pursuing a recommended 
program of rigorous study. Since its inception in 2001, this project 
has served a cohort of students through intervention strategies such as 
tutoring, mentoring, college awareness and preparation including 
financial aid information, academic and career counseling, and 
leadership and cultural development. Students have toured college 
campuses and participated in residential summer camps all intended to 
expose them to college life and to the possibility of a college 
education.
    Recognizing the critical role that parents play in their children's 
decisions regarding college preparation (5), the project has 
implemented ``Las Platicas,'' or conversations, a parental involvement 
program recognized nationally for its effectiveness in providing 
parents information regarding college entrance requirements, college 
cost and affordability, and financial aid opportunities. Through 
trained parent volunteers supported by the GEAR UP Coordinator and 
Parent Liaison on each high school campus, the importance of preparing 
for a college education resonates at parent meetings, conferences, and 
home visits.

Rigorous Curriculum and Academic Performance
    The main objective of the UTPA GEAR UP Project is to improve 
students' academic performance because it is one of the most potent 
predictors of enrollment in college (6). Our preliminary benchmark data 
indicate that since the project began providing services to the cohort 
of students as 7th graders, a higher percent passed the state mandated 
test in 8th grade than in 7th grade. The test results also indicate 
that 90 percent of the cohort students passed the reading subtest in 
the 8th grade, an 8 percent increase from the previous year before the 
project interventions were implemented. In addition, the average score 
in mathematics has increased from 82.9 to 87.7 which indicates a higher 
level of academic performance.
    Course enrollment incorporating rigorous curriculum is a 
particularly strong predictor of college enrollment for Hispanic 
students (7, 8). Advanced course enrollment of GEAR UP students is 
steadily increasing in English and science, however, the trend is 
particularly evident in advanced mathematics. Enrollment in advanced 
mathematics in 9th grade increased by 54 percent from the previous 
year.

Aspirations for Attending College
    Educational aspiration is one of the most influential predictors of 
educational attainment. Students who aspire to go to college are more 
likely to enroll and complete a college degree. Furthermore, the higher 
the level of aspiration, the greater the likelihood of enrolling in 
college (9).
    Through the project activities, GEAR UP has developed a college-
going culture as evidenced by the high level of aspiration to go to 
college among our students. According to a survey of 9th grade GEAR UP 
students, 93 percent aspired to attend some form of education beyond 
high school, and 69 percent aspired to seek a bachelor's or graduate 
degree.

College Knowledge
    Although Hispanic students' knowledge about college requirements 
and preparation is lower than other students as compared nationally, 
GEAR UP students' knowledge about college has increased over time. 
Whereas only 63.4 percent of students were familiar with a 4-year 
college or university in the 7th grade, over 80 percent of the students 
are now aware of these institutions as options for their future. There 
was also a significant increase in the number of students who were 
knowledgeable about college entrance requirements.

College Cost and Affordability
    As reported by the National Center for Education Statistics in 
2001, students and their parents perceive a college education as 
unaffordable (10). However, students and their parents very often 
overestimate the cost of attending college. Although these estimates 
still remain high, 9th grade GEAR UP students and their parents 
reported much lower costs this year than they have in previous years. 
GEAR UP is dedicated to breaking down this barrier of college cost and 
affordability that still exists among our low-income parents.

Parental Involvement
    Current research supports the important role of the family's 
involvement in their children's education in general and in their 
preparation for college in particular. Family support and encouragement 
play a critical role in a child's decision to enroll in college. 
Furthermore, students whose parents are involved in their education 
demonstrate a higher level of academic achievement (11, 12, 13, 14, 
15).
    The GEAR UP Project is continually providing services to increase 
parental capacity and support for their children. The project has 
worked diligently to provide information on college preparation, 
college entrance requirements and financial assistance. Parents' 
knowledge about college requirements increased by 30 percent since they 
have been engaged with GEAR UP. The GEAR UP staff at each high school 
campus is instrumental in structuring a program for parents that builds 
knowledge and self efficacy in helping their children prepare for 
success in college. Often, parent meetings are held in the local 
community, including parents' homes, in an effort to involve as many 
parents as possible in the process.
    One of the most important predictors of students' educational 
aspirations is their parents' expectations. Students whose parents 
expect them to get a college degree are more likely to enroll and 
succeed in college. Parents of high school children place an especially 
high importance on a college education, and Hispanic parents give 
college an even higher priority than do white parents (1). Parents of 
GEAR UP students are no exception, 80 percent indicate that they expect 
their children to acquire a bachelor's or other graduate degree. 
Although parental expectations seem to decline as students progress 
through the grades (10), our parents' expectations have remained high 
over time.
    We have established a close relationship with our parents having 
worked with them and their children since the 7th grade. Consequently, 
they feel more comfortable in engaging with the school community. Over 
80 percent of the parents have visited their children's school, 70 
percent have attended parent meetings, and 60 percent have participated 
in school activities.

Conclusion
    I have highlighted a few aspects of the UTPA GEAR UP Project and 
their impact on student achievement and parental engagement. In 
addition to these components, the project provides professional 
development for teachers, and other student activities such as cultural 
experiences, leadership development, and opportunities for community 
service.
    Given the success of GEAR UP in preparing students to not only 
aspire to go to college, but to succeed once enrolled, it is clear that 
this program must continue for not just this cohort of students, but 
for generations of students to come. Support from the federal 
government is critical for this to be accomplished. Local communities 
of South Texas that continue to lag behind the rest of the state and 
nation in quality of life-per capita income, employment rates, and 
level of educational attainment, simply cannot generate the investment 
necessary to ensure the program continues at the same level of 
implementation. Furthermore, the federal government can and must ensure 
equitable access, so critical to closing the college participation gap 
that separates those who have access from those who do not. This 
investment will reap great benefits through increased buying power, 
increased tax revenues, shrinking welfare rolls, and reduced child 
poverty rates. Therefore, it is not only a matter of economics, it is a 
matter of the quality of life for an entire region, the state of Texas 
and the nation.
    The words of one of our GEAR UP students summarizes the impact that 
college access programs such as GEAR UP have on the hopes and dreams of 
our young people. Cesar Armendariz, a sophomore at Juarez Lincoln High 
School in La Joya, Texas said, ``GEAR UP has helped me understand the 
choices that I have for colleges that I might attend in the future. 
With GEAR UP's help and the help of my counselors, I hope to be the 
first in my family to graduate from college.'' We simply must do 
everything we can to fulfill these hopes and dreams of a college 
education for Cesar and for others like him who seek only the 
opportunity to improve the quality of their lives so that they may 
contribute to society as productive citizens of this great country. 
This commitment is fundamental to our social and economic development, 
both as individuals and as a society (16).

Policy Recommendations
    I submit the following recommendations for the Committee's 
consideration.
    1.  Increase funding for HSI's such as the University of Texas Pan 
American to continue to provide access to underserved populations.
    2.  Increase and continue funding GEAR UP to include six years in 
the funding cycle which if started at the 7th grade, would enable the 
support to continue through the students' graduation from high school 
and enrollment in college.
    3.  Increase funding to HSI's for Freshmen Success initiatives to 
continue to support students through their first year in college, so 
critical to their eventual completion.
    4.  Increase funding for research and evaluation to determine best 
practices in college preparation and access especially with our 
Hispanic students and parents.

References
(1) Public Agenda Online. (2000). Great Expectations: How the Public 
        and Parents--White, African American, and Hispanic--View Higher 
        Education. May. http://www.publicagenda.org/specials/highered/
        highered.htm
(2) Gandara,.P. & Bial, D. (2001). Paving the way to Postsecondary 
        Education: K-12 Intervention Programs for Undrrepresented 
        youth. Washington, DC: US. Department of Education, National 
        Center for Educational Statistics.
(3) Perna, L. (2000) Racial and Ethnic Groups Differences in College 
        Enrollment Decisions.New Directions for Institutional 
        Research.17 . 65-83.
(4) Greene, J. & Forster, G. (2003). Public High School Graduation and 
        College Readiness Rates in the United States. Center for the 
        Civic Innovation at the Manhatten Institute. No. 3, September.
(5) Hossler D. & Stage, F. (1992). Family and High School Experience 
        Influences on the Postsecondary Educational Plans of Ninth-
        Grade Students. American Educational Research Journal, 29(2), 
        425-451.
(6) Mehan, H., Villanueva, I., Hubbard, L., & Lintz, A. (1996). 
        Constructing School Success: The Consequences of Untracking 
        Low-Achieving Students. New York: Cambridge University Press.
(7) National Center for Educational Statistics. (2001). High School 
        Academic Curriculum and the Persistence Path Through College. 
        (http://nces.ed.gov/publserch/pubsinfo.asp?pubid=2001163).
(8) Warburton, E., Bugarin, R., & Nuez, A. (2001). Bridging the Gap: 
        Academic Preparation and Postsecondary Sources of First-
        Generation Students. Education Statistics Quarterly. 3(3), 73-
        77.
(9) Hossler, D., Braxton, J. & Copersmith, G. (1989). Understanding 
        Student College Choice. In John C. Smart (ed.), Higher 
        Education: Handbook of Theory andResearch. Vol. 5. New York: 
        Agathon Press.
(10) National Center for Educational Statistics. (2001). Parental 
        Involvement in Schools.Indicator 54. Washington , DC: U.S. 
        Department of Education. Office of Educational Research and 
        Improvement.
(11) Catsambis, S. (1998). Expanding Knowledge of Parental Involvement 
        in Secondary Education: Its Effects on High School Academic 
        Success. Center for the Education of Students Placed at Risk, 
        Johns Hopkins University, report 27, Fall.
(12) Chavkin, N. F. (1993). Families and Schools in a Pluralistic 
        Society. New York: State University of New York Press.
(13) Christenson, S. L., Rounds, T., & Gorney, D. (1992). Family 
        Factors and Student Achievement: An Avenue to Increase 
        Students' Success. School Psychology Quarterly, 7, 178-206.
(14) National Center for Educational Statistics. (1994). Parental 
        Involvement in Education.Indicator of the Month (NCES-94-693). 
        Washington. DC. (ERIC Documentation Reproduction Service No.ED 
        374923.
(15) Epstein, J. ( 2001). Building Bridges of Home, School, and 
        Community: The Importance of Design. Journal of Education for 
        Students Placed at Risk. 6(1&2), 161-168.
(16) Education Commission of the States (2003). Closing the College 
        Participation Gap. April. www.ecs.org
                                 ______
                                 

      Statement of George C. Torres, Assistant Vice President for 
  Congressional/Legislative Relations, Texas Guaranteed Student Loan 
                              Corporation

    Mr. Chairman and Committee Members:
    Thank you for inviting the Texas Guaranteed Student Loan 
Corporation (TG) to offer testimony before you today.
    As a preface, in proposing its recommendations for the 
Reauthorization of the Higher Education Act (HEA), TG and the student 
financial aid communities in Texas, Arkansas, Louisiana, New Mexico, 
and Oklahoma--Texas Association of Student Financial Aid Administrators 
(TASFAA), the Southwest Association of Student Financial Aid 
Administrators (SWASFAA), and the Association of Texas Lenders for 
Education (ATLE)--all recognize:
    *  the extremely tight financial constraints and priorities facing 
the Congress with respect to discretionary spending and the limits this 
imposes on funding student financial aid, and related programs; and,
    *  that the cost of a postsecondary education assessed by 
institutions to the student and family, and the provision of need-based 
student financial aid are related to one another and should be 
considered together in developing a unified and meaningful federal 
postsecondary education access policy.
    With respect to the first point, we simply request that the 
congress make every effort to continue to support those existing 
federal programs, and examine the feasibility of establishing new 
programs that rely on a partnership with the states and private sector, 
that promotes access to postsecondary education, and that recognizes 
the shifting changing national demographics and the implications this 
has for policies that promote and provide access to postsecondary 
education.
    On the second point, several studies published since the beginning 
of this decade including:
    *  The Advisory Committee on Student Financial Aid's two reports, 
Access Denied: Restoring the Nation's Commitment to Equal Educational 
Opportunity and Empty Promises: The Myth of College Access in America;
    *  The Lumina Foundation's Restricted Access: The Doors to Higher 
Education Remain Closed to Many Deserving Students; and,
    *  The Education and the Workforce Committee's own The College Cost 
Crisis all describe the most critical, double sided, issue facing this 
HEA Reauthorization--the increasing cost of postsecondary education, 
and the inability of current need-based student financial aid to meet 
the unmet financial need of thousands of academically qualified 
students--many from historically underrepresented populations who will 
soon comprise the majority of the population and workforce in many 
parts of the country--seeking to obtain a college education. The key 
difference in the studies is the emphasis each places on college cost, 
on one side, or student financial aid and unmet on the other.
    Therefore, the above mentioned student financial aid communities 
applaud and support the overall general Committee objectives expressed 
through the proposed College Affordability in Higher Education Act of 
2003, HR 3180 - College Opportunity for All Act, and HR 3039--The 
Expanding Opportunities in Higher Education Act--as first steps toward 
meaningful discussion in addressing these twin issues, in collaboration 
with the states, postsecondary, and student financial aid communities. 
Such a discussion should result in a framework that successfully 
encourages through regulatory relief, and other measures and 
incentives, effective voluntary postsecondary cost efficiencies, 
coupled with adequate funding of need-based student financial aid and 
work study, less reliance on student loans and student debt, and 
innovative programs--perhaps like Texas' Closing the Gaps initiative--
that successfully encourage the recruitment, retention, and graduation 
of students who may not ordinarily consider a postsecondary education 
through a combination of lowering costs, increased financial support, 
and outreach and awareness programs.
    If such a comprehensive approach to enrolling and graduating more 
students from underrepresented populations is to be successful, 
Hispanic-Serving Institutions (HSIs) need to play a necessary role in 
the effort, and would be a primary beneficiary of the increased 
enrollment from a substantial part of the target population.
    In 2001, the southwest student financial aid communities decided to 
collaborate on the development of a set of initial recommendations 
concerning the Reauthorization of the Higher Education Act and submit 
them to the Congress as representative of the student financial aid and 
postsecondary access issues of most important to this region.
    These recommendations are being updated on a continual basis as the 
Reauthorization process unfolds.
    These specific recommendations are attached for your review and 
include all of the major issues, e.g., program funding authorizations, 
student loan maximums, student loan fees, distance education, voluntary 
flexible agreements, etc., and will serve as the primary input to the 
Subcommittee. We feel that most, if not all, pertain to the needs of 
HSIs in terms of improving access, affordability, and academic quality.
    My brief comments today focus on
    *  the HEA Reauthorization-related legislation already filed and 
pending before the Congress; and,
    *  a request already submitted to the full Committee concerning 
Texas'' Closing the Gaps initiative that we in Texas feel can serve as 
a model for postsecondary education recruitment, retention, and 
graduation of students from historically underrepresented populations, 
which, in turn, impacts HSIs like UT- Pan American.
    Of the 219 HSIs in the United States, 35 are Texas institutions and 
enroll 20% of the Hispanic postsecondary education enrollment in Texas. 
These institutions play a crucial role - enrolling 50% of the Hispanics 
pursuing a college degree. This is especially true in Texas which has 
the 2nd highest percentage of Hispanic population in the country, and 
will be a majority minority state before 2020, with the Hispanic 
population and workforce pool accounting for 42% of the population. 
Today, one out of every three new workers in the labor force is 
Hispanic, and the Hispanic population is the youngest, largest ethnic 
and fastest growing population segment in the country. Already, in 
Texas, Hispanic children are the majority school population in grades 
K-6, and, during the period 1990--2000, Hispanic population in Texas 
grew 64%. Since 2000, Hispanics account for 70% of the population 
growth in Texas. According the Dr. Steve Murdock, Texas'' chief 
demographer, as early as 2006, Texas combined minority population may 
constitute the majority population of the state.
    Within this national and regional environment, certainly among the 
major priorities of the Congress for this HEA Reauthorization should be 
on how best to ensure that adequate:
    *  programs that encourage children within this population shift to 
prepare for a postsecondary education exist and are accessible;
    *  need-based student financial aid is available to them, since 
most are low income: and,
    *  if not increased, support for HSIs is continued to meet the 
increased demand for their services.
    For HSIs, The Congress should consider the recommendations already 
submitted by the Hispanic Association of College and Universities that 
build on the already increased support for Titles II, V, and VI the 
Congress and Administration have demonstrated since the 1998 HEA 
Reauthorization, along with HR 3180, HR 2238, HR 3039, HR 3076, and 
those bills listed below.
    In the current Reauthorization, the Texas, Arkansas, Louisiana, New 
Mexico, and Oklahoma student financial aid associations have endorsed 
in writing and encourage the 108th Congress to seriously consider, in 
addition to the legislation already mentioned, the following bills:
    *  HR 12 which proposes to make several technical changes to the 
HEA that respond to the FEDUP initiative initiated by the 21st Century 
Competitiveness Subcommittee that simplify and enhance access to and 
the administration of federal student financial aid programs.
    *  HR 438 and 2211 which propose to assist school teachers with 
repayment of their student loan debt and strengthen teacher education 
standards should be passed. These initiatives should have the effect of 
encouraging young, bright, and enthusiastic students to enter the 
teaching profession which will, in turn, improve K-12 education and 
produce mare academically prepared students--White, Black, and 
Hispanic--for postsecondary education at all colleges and universities.
    *  HR1304 which proposes to convert the current student loan 
interest deduction to a credit equal to 50% of the interest paid during 
the taxable year.
    *  HR 1306 which proposes to expand student loan forgiveness to 
borrowers who are employed full-time in public service jobs, e.g., 
teachers, child care workers, nurses, mathematics, science, and 
bilingual education teachers, and child welfare workers, and other 
qualified workers who work in shortage areas and serve needy 
communities.
    *  HR 2238 which proposes to build on Title V of the Higher 
Education Act by further strengthening Hispanic-Serving Institutions at 
the graduate level.
    *  HR 2956 which proposes to direct the Advisory Committee on 
Student Financial Aid to recommend ways to simplify the student 
financial aid application and delivery process.
    *  HR 3076 which proposes to include in the graduate fellowship 
programs established under Title VII, graduate programs for teachers in 
shortage areas.
    Of particular interest to the Texas student financial aid community 
is the Closing the Gaps effort initiated in Texas in 2001 to enroll, 
retain, and graduate an additional 500,000 students from Texas colleges 
and universities by 2015. Most of these are to come from the soon to be 
majority minority community. Because of the focus of this effort, HSIs 
have an important role to play in the Closing the Gaps program if a 
significant increase in a substantial portion of the target population 
is to be achieved and sustained.
    Since 2001, the Texas Legislature has appropriated no less than 
$957 million to support those parts of the Closing the Gaps initiative 
that have as their purpose to provide financial access and enroll, 
retain, and graduate more students primarily from underrepresented 
populations from Texas colleges and universities. Yes, Texas, like 
almost all other states and the federal government, is experiencing 
severe budget problems. There is no question that without these 
problems, more could be done in the areas of education and health and 
human services. It is also true that Texas--more than most other states 
has the resources, capacity, and potential to do more in these areas. 
Hopefully, Texas will begin to move in a direction that more fully 
capitalizes on these resources and capacities more effectively in the 
near future.
    However, in light of the budget constraints, Texas'' state 
political leadership is continuing to support the Closing the Gaps 
effort, and certainly appears to be committed to continue this effort, 
if for no other reason, because Texas'' future social and economic 
well-being is inextricably linked to ensuring the success of these 
efforts.
    The Closing the Gaps statewide effort concerning outreach, 
awareness, recruitment, and retention is a statewide effort--mostly 
voluntary - including professionals, student financial aid directors, 
college admissions officers, registrars, middle and high school 
counselors, private sector lenders, the state guarantor, etc. 
Associations representing these areas are active partners with the 
Texas Higher Education Coordinating Board in planning, developing, and 
carrying out the multiple strategies on the Closing the Gaps effort.
    TG's role in participating in the Closing the Gaps effort actually 
predates the beginning of that effort. TG's state statutory mandate is 
to coordinate these types of activities, along with default prevention 
efforts, in conjunction with our Texas student financial aid partners. 
Since the inception of the Closing the Gaps effort, TG has continued 
its outreach, awareness, and default aversion activities and 
incorporated them into our role within the Closing the Gaps effort.
    Among the outreach, awareness, and default prevention activities TG 
is involved in within the Closing the Gaps effort are:
    *  TG, in cooperation with the Texas FFELP community, established a 
state cohort default rate and compliance function in the late 1980's, 
predating the establishment of the federal rate, which began the 
state's steady student loan default rate decline.
    *  Several years ago, in cooperation with the Texas FFELP 
community, TG improved a state student loan default aversion model, 
first developed right here by the University of Texas--Pan American 
student financial staff, that involves enrollment management techniques 
that identify the key characteristics of the average student loan 
defaulter and high-risk borrower who then receives intense, focused, 
and continual in-school and out-school borrower counseling utilizing 
institutional support services.
    *  TG is the statewide coordinator for an independent advisory 
group (The Council for the Management of Educational Finance) whose 
membership is composed of representatives from the Texas student 
financial aid community that meets several times each year to identify 
ways to improve default aversion in the student loan programs. Among 
its meetings, this group hosts an annual meeting for student loan 
servicers from around the country to meet over two days to share ideas 
and practices that are effective in lowering student loan default and 
delinquency rates.
    *  Since 2001, TG has provided over $1 million in need-based grants 
to Texas colleges and universities to award to needy students.
    *  TG administers the Texas Financial Aid Information Hotline (877-
782-7322), established by the state legislature in 1999, a free, one-
stop-shop service that offers comprehensive information about federal 
and state student financial aid and admission to colleges and 
universities in Texas.
    *  TG sponsors the Mapping-Your-Future (www.mapping-your-
future.org), Adventures in Education (www.adventuresineducation.org), 
and Jobgusher (www.jobgusher.com) websites that provide comprehensive 
information concerning obtaining a postsecondary education, applying 
for student financial aid, and career planning.
    *  TG produces a comprehensive student financial aid resource for 
Texas policymakers and others who are interested in the state of 
student financial in Texas (www.tgslc.org/pdf/statefinaid.pdf).
    *  Specifically, with respect to the Closing the Gaps effort in 
Texas, TG has contributed funds to the effort, assisted in developing 
the public awareness GO Campaign, assisted in the implementation of the 
Texas Uniform Recruitment and Retention Plan, developed the core 
content of the English and Spanish versions of GO Campaign's Training 
Tool Kit for Community-Based Organizations, participated in training 
workshops throughout the state, and provided the Spanish version of the 
website for Closing the Gaps.
    In summary, these aspects of the Closing the Gaps campaign are 
strongly supported by the State of Texas and the higher education and 
student financial aid communities. We, the Texas student financial aid 
community, are convinced that that these types of programs that 
currently exist have significant potential for encouraging states and 
institutions in making a greater effort to diversify their higher 
education enrollments with students from historically underrepresented 
populations.
    We therefore strongly encourage the Subcommittee to consider 
similar language to that attached for inclusion into the Higher 
Education Reauthorization legislation to ``help and encourage states to 
fulfill the promises made in initiatives like'' Closing the Gaps.
    Thank you for your support and continuing advocacy for access to 
higher education opportunities for all, and, on behalf of the Texas and 
southwest student financial aid communities.

                            Closing the Gaps

    The Secretary is authorized under this Chapter to establish a pilot 
program in partnership with States and postsecondary institutions of 
higher education that recognizes the fact:
    1.  that the postsecondary education underreprepresented 
populations (primarily Hispanic and Black) are projected to increase 
from 24 percent of the country's population today to 34 percent in 
2025;
    2.  the percentage of these populations represented in grades K 
through 12 has increased by 55 percent since 1972, with Hispanic 
enrollment alone increasing 250 percent;
    3.  the postsecondary participation rates of Hispanics and Blacks 
are less than 15 percent, contrasted with 67 percent for Anglos;
    4.   the populations that will make up a significant percentage (or 
majority) of the potential labor pool in 20 years, or sooner, will be 
composed of young adults from those populations--minority and largely 
low-income who are the fastest growing and most underrepresented in the 
nation's postsecondary educational institutions; and,
    5.   if current trends continue, a growing unskilled and under-
educated population that cannot meet the demands of the workplace, an 
increase in demand for spending on job training, welfare, and Medicaid, 
lost ground in the global marketplace, and a lower average family 
income are likely to occur.
    The program will reward those states and institutions with 
competitive matching grants and regulatory relief that develop and 
implement successful and innovative initiatives with measurable goals 
that promote access, retention, and graduation rates for 
underrepresented populations, and that have already established a 
comprehensive approach to increasing enrollment, retention, and 
graduation rates of students from postsecondary education to ``close 
the gaps'' in participation, success, and excellence by addressing 
students'' academic, emotional, behavioral, and financial needs, as 
well as, cultural barriers that may affect their admission to and 
success in postsecondary education.
    Elements of the pilot program are:

Participation
    States and institutions that establish affordability policies that 
ensure academically qualified students who are able to succeed in 
postsecondary education are provided with the financial access and 
resources to enter and graduate from a college or university using a 
combination of:
      need-based grants;
      work-study;
      targeted tuition and fee exemptions and waivers;
      affordable tuition and fees that are set and adjusted 
through a rational methodology;
      institutional incentives that increase affordability for 
students through administrative efficiencies in the postsecondary 
educational system;
      enhanced academic preparation for admission to 
postsecondary educational institutions by requiring the high school 
college preparatory high school curriculum as the default curriculum 
for all entering freshmen students;
      programs that focus on recruiting, preparing and 
retaining well-qualified K- 12 teachers;
      statewide comprehensive programs that promote the 
benefits and availability of a postsecondary education and the 
availability of financial assistance through the media and toll free 
information centers; and
      link tuition increases to increases in participation, 
diversity, and graduation rates.
Success
    States and institutions that establish programs and policies that 
will promote and increase the probability of success of students in 
postsecondary education through:
      goals to increase postsecondary enrollment in critical 
areas, e.g., teaching, engineering, computer science, health, nursing, 
with targeted recruitment, retention, and graduation rates;
      permanent partnerships among the business community, 
postsecondary education, and low performing middle and high schools to 
provide mentoring and tutoring services to increase the postsecondary 
education going rates of students from underrepresented populations;
      linking tuition increases to increases in participation, 
diversity, and graduation rates; and
      encouraging high school students to enroll in freshman 
courses to strengthen the K - 16 initiatives.

Excellence
    Access and quality are two sides of the same coin. Emphasizing one 
at the expense of the other produces mediocrity. In the same way that 
the overall goal of the No Child Left Behind Act is to promote 
excellence in K--12, so should it be within K--16. In order to 
encourage states and institutions to provide support for academic 
excellence within their postsecondary educational institutional systems 
to fully achieve the goal of enrolling, retaining, and graduating more 
students who will be prepared to enter the workforce, the pilot program 
will:
      reward states that make efforts to establish ``high 
quality'' academic postsecondary educational programs;
      reward states that increase the number of nationally 
recognized degree programs or schools;
      offer institutions or states the opportunity to identify 
one or more high demand/shortage degree programs to improve to a level 
of nationally recognized excellence and provide incentives to 
institutions or states as the steps to reach that goal are achieved; 
and
      fund competitive grants to match state/institutional/
business contributions for acquiring software and maintaining 
instructional laboratories.
    In developing plans, institutions and states are encouraged to 
leverage programs already in place, including those sponsored in whole 
or in part by TRIO or GEAR UP, or other programs established and funded 
by state legislatures, and through private grants, gifts, and 
contributions.
    Plans will also include performance-based measures.

Eligibility
    The Secretary in consultation with institutions and states that 
have successful programs in place, will develop and promulgate criteria 
and regulations to implement this Section.
    In order to be eligible to participate in this program an 
institution or state will demonstrate to the satisfaction of the 
Secretary in the plan submitted that a program will provide 
comprehensive services as described above and will have the support of 
the state legislature, institutional system, or other locally-based 
network.

  TEXAS PROPOSALS FOR THE REAUTHORIZATION OF THE HIGHER EDUCATION ACT

    The Texas Student Financial Aid Community's Reauthorization 
Proposals:
    Strengthen need-based student financial aid programs
    Enhance outreach, awareness, recruitment, and retention programs
    Continue funding authorization increases for minority-serving 
institutions
    Expand the availability of student loans
    Increase flexibility for schools in awarding student financial aid 
funds
    Urge complete parity between the Federal Family Education Loan 
Program (FFELP) and Federal Direct Loan Program (FDLP)
    Encourage a complete and thorough review of the student loan 
consolidation program
    Standardize student loan forgiveness and forbearance policies

INTRODUCTION
    The Texas student financial aid community, including 
representatives from the Texas Association of Student Financial 
Administrators (TASFAA), Association of Texas Lenders for Education 
(ATLE), and Texas Guaranteed (TG) have worked over the past several 
years to build an informal coalition among Texas-based student 
financial aid (SFA) associations to identify issues, develop positions, 
and advocate these positions at the state and national levels. This 
approach is continuing with respect to the 2003 Higher Education Act 
(HEA) Reauthorization.
    At the national level, we will work in conjunction with the 
National Council for Higher Education Loan Programs, National 
Association of Student Loan Administrators, Education Finance Council, 
Consumer Bankers Association, and the National Association of Student 
Financial Aid Administrators, as well as staff and members of the Texas 
Congressional Delegation. The purpose of this approach is to develop a 
consensus among the Texas student financial aid community on primary 
recommendations concerning student financial aid and access issues that 
the community would like to see addressed during the 2003 
Reauthorization of the Higher Education Act. In addition to readily 
available background information and research, the 2002 TASFAA regional 
rallies, association conferences, and the Internet were used as the 
primary vehicles to solicit and receive input from the Texas SFA 
community to develop this paper.
    The Texas SFA community's primary interests during the next HEA 
Reauthorization include:
       Strengthening the existing federal need-based SFA 
programs,
       Targeting funds to underrepresented low income 
populations,
       Improving the administration of the SFA programs, and
       Exploring ways that Texas' Closing the Gaps initiative 
can be supported through the federal programs.
    Closing the Gaps involves several components, including student 
financial aid, outreach, and academic preparedness. The initiative also 
includes the goal of the recruitment, retention, and graduation of an 
additional 300,000 students (beyond the 200,000 increase expected 
through overall population growth) by 2015. However, as a complement to 
these state efforts, the federal Title IV student financial aid 
programs and programs like TRIO and GEAR-UP will be extremely important 
in ensuring that adequate need-based student aid, financial aid 
information, and support services are available to successfully carry 
out this important initiative.
    In Texas, where, after decades of being one of the least expensive 
states to obtain a postsecondary education, the average resident cost 
of attending a four-year public university is now 99.4 percent of the 
national average ($12,690 vs. $12,771), $2.7 billion in student 
financial aid is awarded annually, with 87 percent of this amount 
coming from the federal Title IV student assistance programs.
    It is the Texas SFA community's position that the recent and 
growing trends toward merit-based student financial aid, and the use of 
income tax credits and deductions, college savings programs, and 
prepaid tuition programs, are of greatest concern. While these tools 
are useful for a particular segment of society, they do little to 
assist truly needy families and students in accessing and obtaining a 
postsecondary education.
    The minority population (Hispanic and African American) of the 
United States is projected to increase from 24 percent today to 34 
percent in 2025. The percentage of Hispanics and African Americans 
enrolled in grades Kindergarten through 12 has increased by 55 percent 
since 1972, with Hispanic student enrollment increasing by 250 percent 
during this period. The figures for minority populations are even 
greater for several states in the South and Southwest. These 
populations are the fastest growing and most underrepresented in 
postsecondary education. Many of these students and families are also 
low-income.
    The Congress' own Advisory Committee on Student Financial Aid 
(ACSFA) has issued two reports since the 1998 HEA Reauthorization - 
Access Denied: Restoring the Nation's Commitment to Equal Educational 
Opportunity (February 2001) and Empty Promises: The Myth of College 
Access in America (June 2002). Both of these reports present a 
compelling case that the primary reason most low-income, academically 
prepared high school graduates in the U.S. do not choose to enter 
postsecondary education because of a lack of financial resources. Both 
reports provide a solid basis for strengthening the federal student 
financial aid programs to address this issue, which is especially 
relevant to underrepresented minority populations.
    Therefore, from a Texas perspective, this HEA Reauthorization 
should focus on support for programs that will target student financial 
aid and efforts (e.g., academic preparation, outreach, and awareness 
activities) to encourage these populations to seek and obtain a 
postsecondary education. Cost remains a barrier to access to 
postsecondary education for too many academically qualified students, 
and these recommendations seek to address this barrier.
    The Congress can do this by using the Reauthorization process to 
establish a long-term plan that:
       Provides increased support and incentives to the states 
to strengthen middle and secondary school academic preparation for 
postsecondary education, with emphasis on the needs of the 
underrepresented and growing population sectors;
       Increases the authorized funding levels for the Title IV 
need-based student financial aid programs and funds these programs at 
higher levels, striking a balance between programs to assist middle-
income students and families and low-income students and families; and
       Identifies ways to strengthen, through better 
coordination and funding, federal and state post secondary outreach and 
awareness programs targeted at underrepresented and growing 
populations.

ISSUES AND RECOMMENDATIONS
    Priority issues and recommendations from the Texas SFA community 
are:
    1. Restore the buying power of the federal need-based student 
financial aid programs. Pell Grant Program - Increase the amount of the 
authorized maximum Grant to the 1976 buying power level - $7,066 - an 
increase of $1,266 over the 1998 Reauthorization, and an increase of 
$3,066 over the actual maximum grant. The premier federal need-based 
grant program should be fully funded to the 2003 authorized annual 
maximum of $5,800. Ideally, the Congress should raise and fund the 
authorized annual maximum grant to $7,600, thereby restoring the buying 
power of the original grant.
    To help pay for these increases, the Congress should explore 
changing or repealing the Hope and Lifetime learning tax credit 
programs (which are not targeted at needy students and families) to 
provide additional funding for the Pell Grant.
    Supplemental Educational Opportunity Grant Program (SEOG) - 
Increase and fund the authorized funding for the SEOG to $1 billion, an 
increase of $325 million since the 1998 Reauthorization, and an 
increase of $309 million over actual 2001 funding. Allow institutional 
flexibility and professional judgment for awarding a portion of SEOG 
funds to non-Pell-eligible students who still demonstrate significant 
financial need. (Title IV, Part A, Sections 413A, 413B, and 413C)
    Additionally, the Congress may want to express its intent that 
institutions should front-load need-based grants to younger, freshmen, 
first-time students within the constraints of program funding, in order 
to minimize the student loan debt that these higher risk students may 
incur. (Title IV, Part A, Section 401(b))
    The Texas SFA community recommends making both the Pell Grant and 
SEOG programs entitlement programs, if possible, with the maximum 
annual grant indexed to the cost of education, consumer price index, or 
some other appropriate index.
    Federal Work-Study Program - Increase and fund the authorized 
funding to $1.3 billion, an increase of $300 million over the 1998 
Reauthorization and an increase of $289 million over actual 2001 
funding.
    In recognizing the significant value of community service, the 
Texas SFA community recommends that the current community service 
level, mandated at 7 percent, be maintained and that designated funding 
- similar to that provided for the Job Location Development Program - 
be granted to institutions to encourage them to voluntarily exceed the 
mandated percentage to meet local needs, expand institutional community 
service capacity, and take advantage of opportunities which may exist 
in their areas of service. (Title IV, Part C, Section 441, Sections 446 
- 448)
    Perkins Loan Program - Increase the authorized funding to $200 
million, an increase of $100 million over the 1998 Reauthorization and 
2001 actual funding levels. Increase the annual maximums to $5,500 for 
undergraduates and $10,000 for graduate and professional students, with 
cumulative maximums increased to $27,500 and $67,500, respectively. 
Allow institutions that have opted out of participation in the program 
to continue to collect outstanding loans and use the proceeds to 
establish a campus-based student aid endowment fund to use to 
supplement funding for other need-based SFA programs. Repeal the 
requirement that requires requests for forbearances to be in writing. 
Allow a defaulted borrower who voluntarily made all past and currently 
due payments to regain Title IV eligibility for all SFA programs. 
(Title IV, Part E, Sections 461, 462(e)(3)(a), 464(a)(2)(A), and 465)
    Leveraging Educational Assistance Partnership Program - Increase 
and fund the authorized level of funding to $150 million, an increase 
of $45 million over the 1998 Reauthorization level, and an increase of 
$95 million over actual 2001 funding. (Title IV, Part A, Section 415A)
    Federal TRIO Programs - Increase and fund the authorized funding to 
$1.5 billion, an increase of $800 million over the 1998 Reauthorization 
level, and an increase of $770 million over actual 2001 funding. (Title 
IV, Part A, Section 402A)
    Aid for Institutional Development (Title III & Title V 
institutions) - Increase and fund the authorized funding to $815 
million, an increase of $303 million over the 1998 Reauthorization, and 
an increase of $423 million over actual 2001 funding.
    Federal student loan programs - The Texas student financial aid 
community encourages the Congress to continue to support the largest of 
the student financial aid programs - the Federal Family Education Loan 
Program (FFELP) and Federal Direct Loan Program (FDLP). Student loan 
maximums for first- and second-year borrowers have not been 
significantly increased since 1986 ($2,500 annual maximum to $2,625 in 
1992 for first-year borrowers). The Congress should simplify the FFELP 
and FDLP by adopting a uniform annual loan maximum for dependent 
undergraduate borrowers of $5,500 with an additional $5,000 for 
independent undergraduate borrowers. Because research indicates that 
graduate and professional students are low risk for loan defaults, the 
Texas SFA community recommends that these borrowers should be able to 
borrow up to the cost of education.
    In addition, to allow institutions to address individual costs and 
needs, and control student debt and student loan defaults, the Texas 
SFA community recommends that schools be given the flexibility to set, 
by institutional policy, annual student loan maximums that are below 
the statutorily set maximums.
    The Congress should establish complete parity between the two 
federal loan programs in the areas of income contingent repayment, in-
school loan consolidation, loan discharge for death and disability, and 
borrower benefits provisions. Establish a single interest rate for all 
Stafford loans (FFELP and FDLP) that applies to loans made after 1994 
and for in-school, grace, and repayment. Increase the amount of student 
loan debt that can be forgiven for school teachers that teach in high 
demand areas.
    In addition, to enhance the effectiveness of the campus-based 
programs, allocation of new funding for these programs should be based 
on the number of Pell Grant recipients on each campus.
    The Texas SFA community also strongly urges the Congress to do all 
it can to refocus its attention on the crucial need-based SFA programs, 
thereby reversing the 25-year trend toward reliance on loan and merit-
based aid. (Parts B and D of Title IV)
    2. Restore the exemptions that allow single and undelayed student 
loan disbursements by low default rate schools.
    The Congress is urged to reauthorize these two provisions which 
allow schools with lower than 10 percent student loan default rates to 
disburse loan funds in a single disbursement, immediately, to first-
time borrowers.(Title IV, Part B, Section 428G(a)(3) and (b)(1))
    3. Revise the Return of Title IV funds provisions - (Title IV, Part 
G, Section 484B).
    The Texas SFA community recommends that the Congress adopt the 
amendments proposed in HR 4866, with the change that a student not be 
required to return amounts of $250 or less.
    4. Allow institutional flexibility.
    Allow institutions to transfer a portion of Title IV funds among 
Title IV programs, based on the student's SFA needs.
    5. Reauthorize student loan interest rates and review student loan 
consolidation.
    The current interest rate formula for FFELP loans should be 
reauthorized. (Title IV, Part B, Section 427A(a) (l))
    With respect to loan consolidation, the Congress should thoroughly 
review all of the issues associated with this program. These should 
include:
       First and foremost, the findings and recommendations of 
the General Accounting Office study currently underway;
       Before changing the single holder rule through ad hoc 
legislation(HR 3273/S 2650), the Congress should consider how 
effectively schools are using the provision in their student loan 
default prevention efforts;
       The original purpose, benefits, and conditions of the 
1985 student loan consolidation program (convenience for the borrower 
through conventional combining of multiple loans at a single fixed 
interest rate);
       The interest rate (fixed vs. variable);
       Cost to lenders and holders (the 1.05 percent holder and 
.50 lender taxes) and parity with FDLP consolidation policies (income-
contingent repayment, in-school consolidation, death & disability 
discharge provisions);
       Borrower eligibility (the opportunity to consolidate 
only once, rather than to be able to reconsolidate at lower interest 
rates);and
       The issue of the appropriate level of taxpayer 
subsidization for consolidated student loans after the borrower leaves 
school.
    All of these issues must be considered while balancing the 
interests of the borrower (convenience and cost) and the provider (cost 
of funds and student loan portfolio valuation volatility). However, in 
balancing the interests, we urge the Congress to consider the cost to 
the federal government and to the other need-based student aid 
programs. After all, the central issue here is whether it is better 
public policy to spend marginal public dollars to continue to subsidize 
former students, or to spend these funds assisting current and future 
economically disadvantaged students with need-based student aid. (Title 
IV, Part B, Sections 427A(k)(4) and 428C(f ))
    Student loan consolidation was originally intended to be a borrower 
benefit only in the sense that it provided a mechanism to simplify the 
repayment of multiple loans by a borrower through refinancing the debt 
through consolidation. This intent seems to have been lost over time, 
and it should be revisited.
    6. Provide equity in student loan forgiveness.
    Amend Title IV, Part B, Sections 428J and 428K in the FFELP 
provisions to parallel Part E, Section 465 in the Perkins Loan Program 
for student loan forgiveness for certain borrowers, including teachers.
    Increase the amount of student loan debt that can be forgiven for 
certain teachers.
    Despite the new accountability system put in place for K-12 
education in Texas, many Texas teachers are still uncertified to teach 
in their subjects, particularly in predominantly low income, minority 
high school math, science, and foreign language classes. Providing 
increased student loan forgiveness may attract more qualified 
individuals into the teaching profession.
    7. Repeal student loan fees.
    The Texas SFA community encourages the Congress to repeal the 3 
percent student loan origination fee and the 1 percent guarantee fee. 
The origination fee was originally established by the Congress in 1981 
as a temporary revenue source to address a federal budgetary shortfall. 
All but a handful of the 36 FFELP guaranty agencies have voluntarily 
eliminated the 1 percent guarantee fee. Repeal of both fees would save 
borrowers money and allow each borrower to receive the full loan amount 
each is eligible to receive. (Title IV, Part A, Subpart 2)
    8. Enhance outreach programs.
    Postsecondary education outreach and awareness programs are 
important and college work-study programs which have as part of their 
purpose to provide postsecondary education outreach/awareness 
activities to low-income students and families, e.g., TRIO; GEAR-UP; 
HEP-CAMP; and Learning Anytime, Anywhere. The Congress should identify 
opportunities to make these programs even more effective and fund them 
at the authorized levels.
    9. Eliminate tax credits and other alternatives to direct student 
financial aid.
    These programs complicate an already overly complicated tax code in 
an effort to deliver student financial aid to students and families. 
The Texas SFA community believes that increased funding for the 
existing need-based grant and work-study programs is a far more 
effective means of delivering student financial aid directly to 
students who are most in need of financial assistance, and recommends 
that the Congress increase authorized levels for these programs and 
fund them at the authorized levels rather than continuing to support 
tax credits and other alternatives to directly applied student 
financial aid.
    10.Review student privacy issues.
    There has been substantial discussion concerning adequate 
protection of consumer information, with differing requirements among 
the states, which, with respect to the student loan programs, can 
hamper the exchange of borrower data among schools, lenders, and 
guaranty agencies that is used in carrying out delinquency and default 
prevention efforts, and in the collection of defaulted student loans. 
The Texas SFA community strongly encourages the Congress to include in 
its HEA Reauthorization process a thorough review of this issue and 
clarification in the HEA that borrower data must be shared among all 
Title IV participants for appropriate purposes in carrying out the 
administrative provisions of Title IV of the HEA and for use in 
assessing how effective federal, state, and institutional student 
financial aid programs are.
    11.Standardize the use of student loan repayment forbearances.
    The Texas student financial aid community encourages the Congress 
to standardize the student loan forbearance provisions among all 
student loan programs and to simplify the method for requesting and 
granting forbearances by allowing oral requests by the borrower and 
requiring a response by the holder within 30 days of receipt of the 
request. (Title IV, Part B, Section 428(c)(3) and Part E, Section 
464(e))
    12.Remove barriers to distance education.
    The role of distance education offered by postsecondary educational 
institutions has expanded dramatically during the past 20 years. It has 
proven to be an especially attractive, efficient, and effective option 
for nontraditional students seeking an advanced degree, professional 
certification, or retraining in a different field. In Texas, distance 
education has served as a valuable tool to train new K-12 school 
teachers. However, with respect to student financial aid, several 
technical issues have been allowed to go unaddressed, and the Congress 
is strongly urged to address them during this Reauthorization. These 
involve removing barriers that hinder the use of student financial aid 
for students taking course work delivered via telecommunications 
technology coupled with the assurance that sufficient oversight of the 
administration, quality, cost, and outcome measures for distance 
education courses are in place.
    The Texas SFA community strongly encourages the Congress to review 
the results of the Education Department's evaluations of the Distance 
Education Demonstration Program authorized in 1998. The Congress should 
address the long overdue issue of identifying programs that can 
appropriately and effectively be delivered via telecommunications, 
while ensuring the safeguard of federal student aid funds. If 
sufficient safeguards are or can be included, the provisions included 
in HR 1992/S1445 - The Internet Equity & Education Act - should be 
included in the Reauthorization legislation. (Parts G and H of Title IV 
and Part A of Title I)
    13.Include prepaid tuition plans in the need analysis process.
    The Texas SFA community strongly recommends that college tuition 
prepayment plans be treated the same as 529 college savings plans (as 
an asset of the account holder, instead of as a resource) in the need 
analysis process. This will be an added incentive for families to save 
for their children's postsecondary education. (Title IV, Part F, 
Section 480(j))
    14.Include veterans' benefits in the need analysis process.
    The Congress is strongly urged to amend the HEA to provide for 
consistent treatment of veterans benefits (all chapters) as income in 
the need analysis process. This will simplify the SFA packaging 
process. (Part F of Title IV)
    15.Use prior-prior year income tax return information in the need 
analysis process.
    The Texas SFA community urges the Congress to allow schools to use 
prior-prior year tax information in the need analysis process. This 
will allow:
       The SFA application process to begin earlier;
       Schools to use actual, rather than estimated, income 
information;
       Automated income verification through data exchanges 
with IRS, ED, and other appropriate agencies;
       Outreach and awareness activities to begin earlier. 
(Title IV, Part F, Sections 475 and 476)
    16.Combine student and parent income and assets in the need 
analysis process.
    The Texas SFA community urges the Congress to eliminate the 
distinction between ``student'' assets and income and ``parent'' assets 
and income, and replace both terms with ``family'' assets and income. 
Doing so would:
       Simplify the federal methodology,
       No longer penalize families who save for their child's 
college education in their child's name, and
       Benefit low-income families in which a child's income 
plays a significant role in supporting the family and is, therefore, 
not available to pay for educational costs. (Part F of Title IV)
    17.Change the treatment of recipients of Temporary Assistance for 
Needy Families (TANF) or other public assistance benefits in the need 
analysis process.
    Since these applicants have already passed a needs-test to qualify 
for public assistance benefits, they should not be required to do so 
again to receive SFA funds. The Congress should amend the HEA to 
require that the Free Application for Federal Student Aid (FAFSA) 
include a box that low-income applicants can simply check to indicate 
that they are receiving public assistance and, therefore, able to 
forego the rest of the FASFA process. (Part F of Title IV)
    18. Retain the definition of ``independent student.
    The Congress should retain the current definition used on the 
FAFSA.
    19.The Student Adjustment Act (HR 1684)
    The Texas SFA Community encourages the Congress and Administration 
to follow the example of Texas and a few other states, to include this 
legislation as a part of the HEA reauthorization.
    This bipartisan bill proposes to provide each state with the 
authority to determine state residency for higher education purposes 
and to authorize the cancellation of removal and adjustment of status 
of certain alien college-bound students who are long term U.S. 
citizens. One of the key benefits of this legislation will be to allow 
long-term alien resident children to gain lawful permanent resident 
status and to eligible to pay in-state postsecondary education tuition.
    20.Reauthorize Section 428A--VOLUNTARY FLEXIBLE AGREEMENTS WITH 
GUARANTY AGENCIES
    The Secretary of Education has cited VFAs as an effective means 
that have allowed experimentation with new, innovative ways to deliver 
and finance FFELP guarantor services, including default aversion. This 
Section has only been in place for about 2 years and should be given a 
chance to prove itself. This recommendation has been supported by 
virtually all higher education associations, including the National 
Association of Student Financial Aid Administrators (NASFAA).
    21.Reauthorize Section 491--ADVISORY COMMITTEE ON STUDENT FINANCIAL 
ASSISTANCE
    The ACSA, established as a part of the 1986 HEA reauthorization, 
has proven to be an important and effective nonpartisan advisory body 
to the Congress on key student financial aid and postsecondary 
educational access issues. It has a proven track record and should be 
continued and the Texas community urges its continuation.
    22.Reauthorize Section 492 - REGIONAL MEETINGS AND NEGOTIATED 
RULEMAKING
    This process has proven to be extremely effective in developing and 
implementing the myriad of changes that result from reauthorization, 
bringing in input from the entire education community in a formal, 
structured process.
    23.Sections 475- 478--Allocation formulas for campus-based programs
    Adopt the NASFAA recommendations to review and update the campus-
based student financial aid programs allocation formulas. Adjusting the 
formulas will allow funding from these programs to be more effectively 
targeted to institutions in areas of the country that are most impacted 
by increases in population growth among those groups historically 
underrepresented in postsecondary education.
    24.Closing the Gaps
    Establish a state/federal/institutional partnership pilot program 
that will provide regulatory relief and financial incentives to states 
and institutions that develop and implement initiatives designed to 
increase enrollment, retention, and graduation rates of high need 
students through targeted student financial assistance, outreach and 
awareness programs, and mentoring and tutoring programs using 
university/middle and high school partnerships.
    25. Finally the Texas student financial aid community strongly 
urges the 108th Congress to pass the following Reauthorization-related 
bills introduced after the submission of the initial Texas 
Reauthorization position paper:
    HR 12, as introduced. HR 12 is important to institutions and 
students, and the technical changes and extensions should be 
implemented as soon as possible prior to taking up the complex issues 
certain to be associated with the next HEA reauthorization;
    HR 438 and HR 2211. These bills propose to provide increased 
student loan repayment relief to school teachers who teach in high 
demand or shortage areas and strengthen postsecondary education teacher 
preparation;
    HR 2238 (The Next Generation Hispanic Serving Institutions Act). HR 
2238 proposes to build on Title V by strengthen the academic curriculum 
offered by the 189 Hispanic-Serving Institutions by establishing a new 
graduate education provision;
    HR 2956 (Financial Aid Simplification Act). This bill proposes to 
direct the federal Advisory Committee on Student Financial Aid to 
conduct a study on ways to simplify the financial aid application and 
delivery processes and make recommendations to the Congress.
    College Opportunity Act. This bill proposes to increase the 
authorized funding levels for the Title IV student financial aid 
programs, Title III and Title V, TRIO, GEARUP, and proposes a new loan 
forgiveness program for student loan borrowers who are employed in 
public service jobs (HR 1306).
CONCLUSION
    The Texas Student Financial Aid community appreciates the 
opportunity to provide input to the Congress on the upcoming 
Reauthorization of the Higher Education Act. We hope that the Congress 
finds the information contained in this paper helpful in its 
consideration of the issues that will soon come under its review once 
again.
    The Texas SFA community also acknowledges that current and future 
economic circumstances as well as national priorities may limit the 
Congress'' ability to approve and fund all of the proposals recommended 
in this paper. As the Congress develops its positions, the Texas SFA 
community will adapt its priorities accordingly. It is our hope that 
the Congress will focus its efforts on the priorities that provide the 
most assistance possible to the neediest populations of students.
    Thank you for your hard work toward the improvement of the federal 
student financial aid programs that provide so many students with the 
opportunity to pursue their educational dreams.

 SWASFAA PROPOSALS FOR THE REAUTHORIZATION OF THE HIGHER EDUCATION ACT 
                                SWASFAA)

    The Southwest Association of Student Financial Aid Administrator's 
Reauthorization Proposals:
       Strengthen Need-Based Student Financial Aid Programs
       Enhance Outreach, Awareness, Recruitment, and Retention 
Programs
       Continue Funding Authorization Increases for Minority-
Serving Institutions
       Expand the Availability of Student Loans
       Increase Flexibility for Schools in Awarding SFA Funds
       Urge Complete Parity between the FFELP and FDLP
       Encourage a Complete and Thorough Review of the Student 
Loan Consolidation Program and
       Standardize Student Loan Forgiveness and Forbearance 
Policies

I N T R O D U C T I O N
    The Southwest Association of Student Financial Aid Administrators 
(SWASFAA) has worked over the past several years to identify SFA 
issues, develop positions, and advocate these positions at the state 
and national levels.
    This approach is continuing with respect to the 2003 HEA 
Reauthorization.
    At the national level, SWASFAA works in conjunction with the 
National Association of Student Financial Aid Administrators, National 
Council for Higher Education Loan Programs, Education Finance Council, 
Consumer Bankers Association, as well as other regional student aid 
associations. The purpose of this approach is to develop a consensus 
among the regional student financial aid community on primary 
recommendations concerning student financial aid and access issues that 
the community would like to see addressed during the 2003 
Reauthorization of the Higher Education Act.
    In addition to using readily available background information and 
research, association conferences and the Internet were used as the 
primary vehicles to solicit and receive input from the SWASFAA SFA 
community to develop this paper.
    SWASFAA's primary interests during the next HEA Reauthorization 
include:
       Strengthening the existing federal need-based SFA 
programs,
       Targeting funds to underrepresented low income 
populations,
       Improving the administration of the SFA programs, and
       Exploring ways that Texas'' Closing the Gaps initiative 
can be supported through the federal programs.
    Closing the Gaps involves several components, including student 
financial aid, outreach, and academic preparedness. The initiative also 
includes the goal of the recruitment, retention, and graduation of an 
additional 300,000 students (beyond the 200,000 increase expected 
through overall population growth) by 2015. However, as a complement to 
these state efforts, the federal Title IV student financial aid 
programs and programs like TRIO and GEAR-UP will be extremely important 
in ensuring that adequate need-based student aid, financial aid 
information, and support services are available to successfully carry 
out this important initiative. In the five state SWASFAA region, where, 
after decades of being one of the least expensive regions to obtain a 
postsecondary education, the average resident cost of attending a four-
year public university in these states is now 89% of the national 
average ($11,227 vs. $12,771). Over 80% of the need-based, direct 
student financial aid awarded to students attending a college or 
university in the region comes from the federal Title IV student 
assistance programs.
    It is SWASFAA's position that the recent and growing trends toward 
merit-based student financial aid, and the use of income tax credits 
and deductions, college savings programs, and prepaid tuition programs, 
are of most concern. While these tools are useful for a particular 
segment of society, they do little to assist truly needy families and 
students in accessing and obtaining a postsecondary education.
    The minority population (Hispanic and Black) of the United States 
is projected to increase from 24% today to 34% in 2025. The percentage 
of Hispanics and Blacks enrolled in grades K through 12 has increased 
by 55% since 1972, with Hispanic students increasing by 250% during 
this period. The figures for minority populations are even greater for 
several states in the South and Southwest.
    These are the populations that are the fastest growing and the 
populations that are most underrepresented in postsecondary education. 
Many of these students and families are also low-income.
    The Congress' own Advisory Committee on Student Financial Aid 
(ACSFA) has issued two reports since the 1998 HEA Reauthorization--
Access Denied: Restoring the Nation's Commitment to Equal Educational 
Opportunity (February 2001) and Empty Promises: The Myth of College 
Access in America (June 2002). Both of these reports present a 
compelling case that the primary reason most low-income, academically 
prepared high school graduates in the U.S. do not choose to enter 
postsecondary education because of a lack of financial resources. Both 
reports provide a solid basis for strengthening the federal student 
financial aid programs to address this issue, which is especially 
relevant to underrepresented minority populations.
    Therefore, from SWASFAA's perspective, this HEA Reauthorization 
should focus on support for programs that will target student financial 
aid and efforts (e.g., academic preparation, outreach, and awareness 
activities) to encourage these populations to seek and obtain a 
postsecondary education. Cost remains a barrier to access to 
postsecondary education for too many academically qualified students, 
and these recommendations seek to address this barrier.
    The Congress can do this by using the Reauthorization process to 
establish a long-term plan that:
       Provides increased support and incentives to the states 
to strengthen middle and secondary school academic preparation for 
postsecondary education, with emphasis on the needs of the 
underrepresented and growing population sectors;
       Increases the authorized funding levels for the Title IV 
need-based student financial aid programs and funds these programs at 
higher levels, striking a balance between programs to assist middle-
income students and families and low-income students and families; and
       Identifies ways to strengthen, through better 
coordination and funding, federal and state postsecondary outreach and 
awareness programs targeted at underrepresented and growing 
populations.

ISSUES AND RECOMMENDATIONS
    Priority issues and recommendations from the Texas SFA community 
are:
    1. Restore the buying power of the federal need-based student 
financial aid programs.
    Pell Grant Program - Increase the amount of the authorized maximum 
Grant to the 1976 buying power level - $7,066 - an increase of $1,266 
over the 1998 Reauthorization, and an increase of $3,066 over the 
actual maximum grant. The premier federal need-based grant program 
should be fully funded to the 2003 authorized annual maximum of $5,800. 
Ideally, the Congress should raise and fund the authorized annual 
maximum grant to $7,600, thereby restoring the buying power of the 
original grant.
    In order to help pay for these increases, the Congress should 
explore changing or repealing the Hope and Lifetime learning tax credit 
programs (which are not targeted at needy students and families) to 
provide additional funding for the Pell Grant.
    Supplemental Educational Opportunity Grant Program (SEOG) - 
Increase and fund the authorized funding for the SEOG to $1 billion, an 
increase of $325 million since the 1998 Reauthorization, and an 
increase of $309 million over actual 2001 funding. Allow institutional 
flexibility and professional judgment for awarding a portion of SEOG 
funds to non-Pell-eligible students who still demonstrate significant 
financial need. (Title IV, Part A, Sections 413A, 413B, and 413C)
    Additionally, the Congress may want to express its intent that 
institutions should ``front-load needbased grants to younger, freshmen, 
first-time students within the constraints of program funding, in order 
to minimize the student loan debt that these higher risk students may 
incur. (Title IV, Part A, Section 401(b))
    If possible, SWASFAA recommends making both the Pell Grant and SEOG 
programs entitlement programs with the maximum annual grant indexed to 
the cost of education, consumer price index, or some other appropriate 
index.
    Federal Work-Study Program - Increase and fund the authorized 
funding to $1.3 billion, an increase of $300 million over the 1998 
Reauthorization, and an increase of $289 million over actual 2001 
funding.
    In recognizing the significant value of community service, SWASFAA 
recommends that the current community service level mandated at 7% be 
maintained and that a set-aside of funds similar to that provided for 
the Job Location Development Program be granted to institutions to 
encourage them to voluntarily exceed the mandated percentage to meet 
local needs, expand institutional community service capacity, and take 
advantage of opportunities which may exist in their areas of service. 
(Title IV, Part C, Section 441, Sections 446 - 448)
    Perkins Loan Program - Increase the authorized funding to $200 
million, an increase of $100 million over the 1998 Reauthorization and 
2001 actual funding levels. Increase the annual maximums to $5,500 for 
undergraduates and $10,000 for graduate and professional students, with 
cumulative maximums increased to $27,500 and $67,500, respectively. 
Allow institutions that have opted out of participation in the program 
to continue to collect outstanding loans and use the proceeds to 
establish a campus-based student aid endowment fund to use to 
supplement funding for other need-based SFA programs. Repeal the 
requirement that requires requests for forbearances to be in writing. 
Allow a defaulted borrower who voluntarily made all past and currently 
due payments to regain Title IV eligibility for all SFA programs. 
(Title IV, Part E, Sections 461, 462(e)(3)(a),464(a)(2)(A), and 465)
    Leveraging Educational Assistance Partnership Program - Increase 
and fund the authorized level of funding to $150 million, an increase 
of $45 million over the 1998 Reauthorization level, and an increase of 
$95 million over actual 2001 funding. (Title IV, Part A, Section 415A)
    Federal TRIO Programs - Increase and fund the authorized funding to 
$1.5 billion, an increase of $800 million over the 1998 Reauthorization 
level, and an increase of $770 million over actual 2001 funding. (Title 
IV, Part A, Section 402A)
    Aid for Institutional Development (Title III & Title V 
institutions) - Increase and fund the authorized funding to $815 
million, an increase of $303 million over the 1998 Reauthorization, and 
an increase of $423 million over actual 2001 funding.
    Federal student loan programs--SWASFAA encourages the Congress to 
continue to support the largest of the student financial aid programs--
the Federal Family Education Loan Program (FFELP) and Federal Direct 
Loan Program (FDLP).
    Student loan maximums for first- and second-year borrowers have not 
been significantly increased since 1986 ($2,500 annual maximum to 
$2,625 in 1992 for first-year borrowers). The Congress should simplify 
the FFELP and FDLP by adopting a uniform annual loan maximum for 
dependent undergraduate borrowers of $5,500 with an additional $5,000 
for independent undergraduate borrowers. Because research indicates 
that graduate and professional students are low risk for loan defaults, 
SWASFAA recommends that these borrowers should be able to borrow up to 
the cost of education.
    In addition, to allow institutions to address individual costs and 
needs, and control student debt and student loan defaults, the SWASFAA 
SFA community recommends that schools be given the flexibility to set, 
by institutional policy, annual student loan maximums that are below 
the statutorily set maximums.
    The Congress should establish complete parity between these two 
programs in the areas of income contingent repayment, in-school loan 
consolidation, loan discharge for death and disability, and borrower 
benefits provisions. Establish a single interest rate for all Stafford 
loans (FFELP and FDLP) that applies to loans made after 1994 and for 
in-school, grace, and repayment. Increase the amount of student loan 
debt that can be forgiven for school teachers that teach in high demand 
areas.
    In addition, to enhance the effectiveness of the campus-based 
programs, allocation of new funding for these programs should be based 
on the number of Pell Grant recipients on each campus.
    SWASFAA also strongly urges the Congress to do all it can to 
refocus its attention on the crucial need-based SFA programs, thereby 
reversing the 25-year trend toward reliance on loan and merit based 
aid. (Parts B and D of Title IV)
    2. Restore the exemptions that allow single and undelayed student 
loan disbursements by low default rate schools.
    The Congress is urged to reauthorize these two provisions which 
allow schools with lower than 10% student loan default rates to 
disburse loan funds in a single disbursement, immediately, to first-
time borrowers.(Title IV, Part B, Section 428G(a)(3) and (b)(1))
    3. Revise the Return of Title IV funds provisions'' (Title IV, Part 
G, Section 484B).
    SWASFAA recommends that the Congress adopt the amendments proposed 
in HR 4866, with the change that a student not be required to return 
amounts of $250 or less.
    4.Allow institutional flexibility.
    Allow institutions to transfer a portion of Title IV funds among 
Title IV programs, based on the student's SFA needs.
    5. Reauthorize student loan interest rates and review student loan 
consolidation.
    The current interest rate formula for FFELP loans should be 
reauthorized. (Title IV, Part B, Section427A(a) (l))
    With respect to loan consolidation, the Congress should thoroughly 
review all of the issues associated with this program. These should 
include:
       First and foremost, the findings and recommendations of 
the General Accounting Office study currently underway;
       Before changing the single holder rule through ad hoc 
legislation (HR 3273/S 2650),the Congress should consider how 
effectively schools are using the provision in their student loan 
default prevention efforts;
       The original purpose, benefits, and conditions of the 
1985 student loan consolidation program (convenience for the borrower 
through conventional combining of multiple loans at a single fixed 
interest rate);
       The interest rate (fixed vs. variable);
       Cost to lenders and holders (the 1.05% holder and .50 
lender taxes) and parity with FDLP consolidation policies (income-
contingent repayment, in-school consolidation, death & disability 
discharge provisions);
       Borrower eligibility (the opportunity to consolidate 
only once, rather than to be able to reconsolidate at lower interest 
rates);and
       The issue of the appropriate level of taxpayer 
subsidization for consolidated student loans after the borrower leaves 
school.
    All of these issues must be considered while balancing the 
interests of the borrower (convenience and cost) and the provider (cost 
of funds and student loan portfolio valuation volatility). However, in 
balancing the interests, we urge the Congress to consider the cost to 
the federal government and to the other need-based student aid 
programs. After all, the central issue here is whether it is better 
public policy to spend marginal public dollars to continue to subsidize 
former students, or to increase appropriations to programs that benefit 
needy current and future students. (Title IV, Part B, Sections 
427A(k)(4) and 428C(f ))
    Student loan consolidation was originally intended to be a borrower 
benefit only in the sense that it provided a mechanism to simplify the 
repayment of multiple loans by a borrower through refinancing the debt 
through consolidation. This intent seems to have been lost over time, 
and it should be revisited.
    6. Provide equity in student loan forgiveness.
    Amend Title IV, Part B, Sections 428J and 428K in the FFELP 
provisions to parallel Part E, Section 465 in the Perkins Loan Program 
for student loan forgiveness for certain borrowers, including teachers.
    Increase the amount of student loan debt that can be forgiven for 
certain teachers.
    Despite the new accountability system put in place for K--12 
education in Texas and other states, many teachers are still 
uncertified to teach in their subjects, particularly in predominantly 
low income, minority high school math, science, and foreign language 
classes. Providing increased student loan forgiveness may attract more 
qualified individuals into the teaching profession.
    7. Repeal student loan fees.
    SWASFAA encourages the Congress to repeal the 3% student loan 
origination fee and the 1% guarantee fee. The origination fee was 
originally established by the Congress in 1981 as a temporary revenue 
source to address a federal budgetary shortfall. All but a handful of 
the 36 FFELP guaranty agencies have voluntarily eliminated the 1% 
guarantee fee. Repeal of both fees would save borrowers money and allow 
each borrower to receive the full loan amount each is eligible to 
receive. (Title IV, Part A, Subpart 2)
    8. Enhance outreach programs.
    Postsecondary education outreach and awareness programs are 
important and college work-study programs which have as part of their 
purpose to provide postsecondary education outreach/awareness 
activities to low-income students and families, e.g., TRIO, GEAR-UP, 
HEP-CAMP, Learning Anytime, Anywhere.The Congress should identify 
opportunities to make these programs and fund them at the authorized 
levels.
    9. Eliminate tax credits and other alternatives to direct student 
financial aid.
    These programs complicate an already overly complicated tax code in 
an effort to deliver student financial aid to students and families. 
SWASFAA believes that increased funding for the existing need-based 
grant and work-study programs is a far more effective means of 
delivering student financial aid directly to students that are in most 
need of financial assistance, and recommends that the Congress increase 
authorized levels for these programs and fund them at the authorized 
levels rather than continuing to support tax credits and other 
alternatives to direct student financial aid.
    10. Review student privacy issues.
    There has been substantial discussion concerning adequate 
protection of consumer information, with differing requirements among 
the states, which, with respect to the student loan programs, can 
hamper the exchange of borrower data among schools, lenders, and 
guaranty agencies that are used to carry out delinquency and default 
prevention efforts, and in the collection of defaulted student loans. 
SWASFAA strongly encourages the Congress to include in its HEA 
Reauthorization process a thorough review of this issue and 
clarification in the HEA that borrower data must be shared among all 
Title IV participants for appropriate purposes in carrying out the 
administrative provisions of Title IV of the HEA and for use in 
assessing how effective federal, state, and institutional student 
financial aid programs are.
    11. Standardize the use of student loan repayment forbearances.
    SWASFAA encourages the Congress to standardize the student loan 
forbearance provisions among all student loan programs and to simplify 
the method for requesting and granting forbearances by allowing oral 
requests by the borrower and requiring a response by the holder within 
30 days of receipt of the request. (Title IV, Part B, Section 428(c)(3) 
and Part E, Section 464(e))
    12. Remove barriers to distance education.
    The role of distance education offered by postsecondary educational 
institutions has expanded, dramatically during the past 20 years. It 
has proven an especially attractive, efficient, and effective option 
for nontraditional students seeking an advanced degree, professional 
certification, or retraining in a different field. For example, in 
Texas, distance education has served as a valuable tool to train new K-
12 school teachers. However, with respect to student financial aid, 
several technical issues have been allowed to go unaddressed, and the 
Congress is strongly urged to address them during this Reauthorization. 
These involve removing barriers that hinder the use of student 
financial aid for students taking course work delivered via 
telecommunications technology coupled with the assurance that 
sufficient oversight of the administration, quality, cost, and outcome 
measures for distance education courses are in place.
    SWASFAA strongly encourages the Congress to review the results of 
the Education Department's evaluations of the Distance Education 
Demonstration Program authorized in 1998. The Congress should address 
the long overdue issue of identifying programs that can appropriately 
and effectively be delivered via telecommunications, while ensuring the 
safeguard of federal student aid funds. If sufficient safeguards are or 
can be included, the provisions included in HR 1992/S1445--The Internet 
Equity & Education Act--should be included in the Reauthorization 
legislation. (Parts G and H of Title IV and Part A of Title I)
    13. Include prepaid tuition plans in the need analysis process.
    SWASFAA strongly recommends that college tuition prepayment plans 
be treated the same as 529 college savings plans (as an asset of the 
account holder, instead of as a resource) in the need analysis process. 
This will be an added incentive for families to save for their 
children's postsecondary education. (Title IV, Part F, Section 480(j))
    14. Include veterans' benefits in the need analysis process.
    The Congress is strongly urged to amend the HEA to provide for 
consistent treatment of veterans benefits (all chapters) as income in 
the need analysis process. This will simplify the SFA packaging 
process. (Part F of Title IV)
    15.Use prior-prior year income tax return information in the need 
analysis process.
    SWASFAA urges the Congress to allow schools to use prior prior year 
tax information in the need analysis process. This will allow:
       The SFA application process to begin earlier;
       Schools to use actual, rather than estimated, income 
information;
       Automated income verification through data exchanges 
with IRS, ED, and other appropriate agencies;
       Outreach and awareness activities to begin earlier. 
(Title IV, Part F, Sections 475 and 476)
    16. Combine student and parent income and assets in the need 
analysis process.
    SWASFAA urges the Congress to eliminate the distinction between 
``student assets and income and parent assets and income, and replace 
both terms with ``family assets and income. Doing so would:
       Simplify the federal methodology,
       No longer penalize families who save for their child's 
college education in their child's name, and
       Benefit low-income families in which a child's income 
plays a significant role in supporting the family and is, therefore, 
not available to pay for educational costs. (Part F of Title IV)
    17. Change the treatment of recipients of Temporary Assistance for 
Needy Families (TANF) or other public assistance benefits in the need 
analysis process.
    Since these applicants have already passed a needs-test to qualify 
for public assistance benefits, they should not be required to do so 
again to receive SFA funds. The Congress should amend the HEA to 
require that the Free Application for Federal Student Aid (FAFSA) 
include a box that low-income applicants can simply check to indicate 
that they are receiving public assistance and, therefore, able to 
forego the rest of the FAFSA process. (Part F of Title IV)
    18. Retain the definition of ``independent student.
    The Congress should retain the current definition used on the 
FAFSA.
    19.The Development, Relief, and Education for Alien Minors Act 
(DREAM Act--S. 1291)
    Finally, the Southwest Association of Student Financial Aid 
Administrators encourages the Congress and Administration to follow the 
example of Texas and a few other states, to include this legislation as 
a part of the HEA reauthorization. This bipartisan bill proposes to 
provide each state with the authority to determine state residency for 
higher education purposes and to authorize the cancellation of removal 
and adjustment of status of certain alien college-bound students who 
are long term U.S. citizens. One of the key benefits of this 
legislation will be to allow long-term alien resident children to gain 
lawful permanent resident status and to eligible to pay in-state 
postsecondary education tuition.
    20.Reauthorize Section 428A--VOLUNTARY FLEXIBLE AGREEMENTS WITH 
GUARANTY AGENCIES
    The Secretary of Education has cited VFAs as an effective means of 
allowing experimentation with new, innovative ways to deliver and 
finance FFELP guarantor services, including default aversion. This 
section has only been in place for 2 years and should be given a chance 
to prove itself. This recommendation has been endorsed by virtually 
every higher education association, including the National Association 
of Student Financial Aid Administrators (NASFAA).
    21.Reauthorize Section 491--ADVISORY COMMITTEE ON STUDENT FINANCIAL 
ASSISTANCE
    The ACSFA was established as a part of the 1986 HEA reauthorization 
has proven to be one of the best nonpartisan resources for information 
concerning student financial aid policy and promoting access to 
postsecondary education. It has a proven track record and deserves to 
be continued.
    22.Reauthorize Section 492--REGIONAL MEETINGS AND NEGOTIATED 
RULEMAKING
    This process has proven to be a very effective means of developing 
and implementing rules by soliciting, receiving, and considering input 
from all segments of the higher education community through a formal, 
structured process. It is still a work in progress, but has improved 
with time.
    23.Sections 475- 478--Allocation formulas for campus-based programs
    SWASFAA recommends the adoption of the NASFAA recommendations to 
review and update the campus-based student financial aid programs 
allocation formulas. Adjusting the formulas will allow funding from 
these programs to be more effectively targeted to institutions in areas 
of the country that are most impacted by increases in population growth 
among those groups historically underrepresented in postsecondary 
education.
    24.Closing the Gaps
    Establish a state/federal/institutional partnership pilot program 
that will provide regulatory relief and financial incentives to states 
and institutions that develop and implement initiatives designed to 
increase enrollment, retention, and graduation rates of high need 
students through targeted student financial assistance, outreach and 
awareness programs, and mentoring and tutoring programs using 
university/middle and high school partnerships.
    25.Finally, SWASFAA strongly urges this session of the 108th 
Congress to pass the following Reauthorization-related bills introduced 
after the submission of the initial SWASFAA position paper:
    HR 12, as introduced. The technical changes and extensions in the 
bill are important to institutions and students and deserve to be 
implemented and continued as soon as possible, before the complex 
reauthorization issues are considered.
    HR 438. This bill, passed by the House, proposes to increase the 
amount of student loan debt eligible to be forgiven to $17,500 for 
school teachers teaching in shortage areas.
    HR 2238 (The Next Generation Hispanic Serving Institutions Act). 
This bill proposes to extend Title V of the Higher Education Act to 
graduate education at the 189 Hispanic Serving Institutions of higher 
education.
    HR 2956 Financial Aid Simplification Act). This bill proposes to 
direct the federal Advisory Committee on Student Financial Aid to 
conduct a study on ways to further simplify the student financial aid 
application and delivery processes, and to recommend changes to the 
congress.
    College Opportunity Act. This bill proposes to increase the 
authorized funding levels for Title IV student financial aid programs, 
Title III, Title V, TRIO, GEARUP, and proposes a new student loan 
forgiveness program for student loan borrowers who are employed in 
public service jobs (HR 1306).
    As a part of this mission, the members of SWASFAA have developed 
this initial set of issues and recommendations for the upcoming 
Reauthorization of the Higher Education Act.

C O N C L U S I O N
    The Southwest Student Financial Aid community appreciates the 
opportunity to provide input to the Congress on the upcoming 
Reauthorization of the Higher Education Act. We hope that the Congress 
finds the information contained in this paper helpful in its 
consideration of the issues that will soon come under its review once 
again.
    The SWASFAA community also acknowledges that current and future 
economic circumstances as well as national priorities may limit the 
Congress's ability to approve and fund all of the proposals recommended 
in this paper. As the Congress develops its positions, SWASFAA will 
adapt its priorities accordingly. It is our hope that the Congress will 
focus its efforts on the priorities that provide the most assistance 
possible to the neediest populations of students.
    Thank you for your hard work toward the improvement of the federal 
student financial aid programs that provide so many students with the 
opportunity to pursue their educational dreams.

A B O U T S W A S F A A
    The Southwest Association of Student Financial Aid Administrators 
(SWASFAA) is a professional association composed of student financial 
aid professionals from postsecondary educational institutions in 
Arkansas, Louisiana, Oklahoma, New Mexico, and Texas.
    SWASFAA promotes professional preparation, effectiveness, 
recognition, and association of its individual members, and works with 
schools, government agencies, the private sector, foundations, and 
other organizations that have as an interest, the promotion and support 
of student financial aid and access for all students and families to 
postsecondary education.

                                 
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