[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]


                          THE COST OF COLLEGE:
                        STUDENT CENTERED REFORMS
                       TO BRING HIGHER EDUCATION
                              WITHIN REACH

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

                                HEARING

                               BEFORE THE

                         COMMITTEE ON EDUCATION
                               AND LABOR
                     U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION
                               __________

             HEARING HELD IN WASHINGTON, DC, MARCH 13, 2019
                               __________

                            Serial No. 116-9
                               __________

      Printed for the use of the Committee on Education and Labor
      
                  [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]      

           Available via the World Wide Web: www.govinfo.gov
                                   or
              Committee address: https://edlabor.house.gov
              
              
                              ___________

                    U.S. GOVERNMENT PUBLISHING OFFICE
                    
35-663 PDF                 WASHINGTON : 2019              


                    COMMITTEE ON EDUCATION AND LABOR

             ROBERT C. ``BOBBY'' SCOTT, Virginia, Chairman

Susan A. Davis, California           Virginia Foxx, North Carolina,
Raul M. Grijalva, Arizona            Ranking Member
Joe Courtney, Connecticut            David P. Roe, Tennessee
Marcia L. Fudge, Ohio                Glenn Thompson, Pennsylvania
Gregorio Kilili Camacho Sablan,      Tim Walberg, Michigan
  Northern Mariana Islands           Brett Guthrie, Kentucky
Frederica S. Wilson, Florida         Bradley Byrne, Alabama
Suzanne Bonamici, Oregon             Glenn Grothman, Wisconsin
Mark Takano, California              Elise M. Stefanik, New York
Alma S. Adams, North Carolina        Rick W. Allen, Georgia
Mark DeSaulnier, California          Francis Rooney, Florida
Donald Norcross, New Jersey          Lloyd Smucker, Pennsylvania
Pramila Jayapal, Washington          Jim Banks, Indiana
Joseph D. Morelle, New York          Mark Walker, North Carolina
Susan Wild, Pennsylvania             James Comer, Kentucky
Josh Harder, California              Ben Cline, Virginia
Lucy McBath, Georgia                 Russ Fulcher, Idaho
Kim Schrier, Washington              Van Taylor, Texas
Lauren Underwood, Illinois           Steve Watkins, Kansas
Jahana Hayes, Connecticut            Ron Wright, Texas
Donna E. Shalala, Florida            Daniel Meuser, Pennsylvania
Andy Levin, Michigan*                William R. Timmons, IV, South 
Ilhan Omar, Minnesota                    Carolina
David J. Trone, Maryland             Dusty Johnson, South Dakota
Haley M. Stevens, Michigan
Susie Lee, Nevada
Lori Trahan, Massachusetts
Joaquin Castro, Texas
* Vice-Chair

                   Veronique Pluviose, Staff Director
                 Brandon Renz, Minority Staff Director
                                 ------                                


                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on March 13, 2019...................................     1

Statement of Members:
    Scott, Hon. Robert C. ``Bobby'', Chairman, Committee on 
      Education and Labor........................................     1
        Prepared statement of....................................     4
    Foxx, Hon. Virginia, Ranking Member, Committee on Education 
      and Labor..................................................     6
        Prepared statement of....................................     7

Statement of Witnesses:
    Akers, Dr. Elizabeth, Ph.D., Senior Fellow, Manhattan 
      Institute..................................................    36
        Prepared statement of....................................    38
    Kvaal, Mr. James, President, The Institute for College Access 
      and Success................................................    41
        Prepared statement of....................................    43
    Parker, Ms. Jenae, Board Member, Student, Franklin University    29
        Prepared statement of....................................    31
    Morrison-Shetlar, Dr. Alison, Interim Chancellor, Western 
      Carolina University........................................    20
        Prepared statement of....................................    22
    Webber, Dr. Douglas, Ph.D., Associate Professor and Director 
      of Graduate Studies, Economics Department, Temple 
      University.................................................     9
        Prepared statement of....................................    11

Additional Submissions:
    Mrs. Foxx:
        Article: The Benefits of Starting College Early in High 
          School.................................................   105
    Fudge, Hon. Marcia L., a Representative in Congress from the 
      State of Ohio:
        Question for the record..................................   109
        Letter dated March 25, 2019 from the Council of Graduate 
          Schools................................................   110
    Levin, Hon. Andy, a Representative in Congress from the State 
      of Michigan:
        Letter dated March 8, 2019 from the Preserve the Public 
          Service Loan Forgiveness...............................   114
        Letter dated March 13, 2019 from the American Federation 
          of Teachers (AFT)......................................   119
    Shalala, Hon. Donna E., a Representative in Congress from the 
      State of Florida:
        Letter dated March 13, 2019 from CLASP...................   121
    Schrier, Hon. Kim, a Representative in Congress from the 
      State of Washington:
        Letter dated March 12, 2019 from the National Education 
          Association (NEA)......................................   125
    Takano, Hon. Mark, a Representative in Congress from the 
      State of California:
        Letter dated March 11, 2019 from the California Community 
          Colleges...............................................   127
    Taylor, Hon. Van, a Representative in Congress from the State 
      of Texas:
        Link.....................................................   129
    Questions submitted for the record by:
        Morelle, Hon. Joseph D., a Representative in Congress 
          from the State of New York.............................   131
        Omar, Hon. Ilhan, a Representative in Congress from the 
          State of Minnesota.....................................   131
        Sablan, Hon. Gregorio Kilili Camacho, a Representative in 
          Congress from the Northern Mariana Islands.............   131
        Stevens, Hon. Haley M., a Representative in Congress from 
          the State of Michigan..................................   131
        Mr. Taylor 



    Responses to questions submitted for the record:
        Mr. Kvaai................................................   136
        Dr. Morrison-Shetlar.....................................   142
        Dr. Webber...............................................   143


 
                 THE COST OF COLLEGE: STUDENT CENTERED
                   REFORMS TO BRING HIGHER EDUCATION
                              WITHIN REACH

                              ----------                              


                       Wednesday, March 13, 2019

                        House of Representatives

                   Committee on Education and Labor,

                            Washington, DC.

                              ----------                              

    The committee met, pursuant to notice, at 10:16 a.m., in 
room 2175, Rayburn House Office Building. Hon. Robert C. 
``Bobby'' Scott (chairman of the committee) presiding.
    Present: Representatives Scott, Davis, Courtney, Fudge, 
Sablan, Wilson, Bonamici, Takano, Adams, DeSaulnier, Norcross, 
Jayapal, Morelle, Wild, Harder, McBath, Schrier, Underwood, 
Hayes, Shalala, Levin, Omar, Trone, Stevens, Lee, Trahan, 
Castro, Foxx, Roe, Walberg, Guthrie, Grothman, Stefanik, Allen, 
Smucker, Banks, Walker, Comer, Cline, Fulcher, Taylor, Watkins, 
Wright, Meuser, Timmons, and Johnson.
    Staff present: Tylease Alli, Chief Clerk; Nekea Brown, 
Deputy Clerk; Ilana Brunner, General Counsel Health and Labor; 
Jacque Chevalier Mosely, Director of Education Policy; Sheila 
Havenner, Director of Information Technology; Elizabeth Hollis, 
Director of Finance and Personnel; Ariel Jona, Staff Assistant; 
Stephanie Lalle, Deputy Communications Director; Andre Lindsay, 
Staff Assistant; Max Moore, Office Aide; Merrick Nelson, 
Digital Manager; Veronique Pluviose, Staff Director; Katherine 
Valle, Senior Education Policy Advisor; Banyon Vassar, Deputy 
Director of Information Technology; Claire Viall, Professional 
Staff; Joshua Weisz, Communications Director; Cyrus Artz, 
Minority Parliamentarian, Marty Boughton, Minority Press 
Secretary; Courtney Butcher, Minority Coalitions and Members 
Services Coordinator; Bridget Handy, Minority Legislative 
Assistant; Blake Johnson, Minority Staff Assistant; Amy Raaf 
Jones, Minority Director of Education and Human Resources 
Policy; Hannah Matesic, Minority Director of Operations; Kelley 
McNabb, Minority Communications Director; Brandon Renz, 
Minority Staff Director; Alex Ricci, Minority Professional 
Staff Member; Mandy Schaumburg, Minority Chief Counsel and 
Deputy Director of Education Policy; and Meredith Schellin, 
Minority Deputy Press Secretary and Digital Advisor.

    Chairman SCOTT. The Committee on Education and Labor will 
come to order. I want to welcome everyone, and note for the 
record that a quorum is present. The committee is meeting 
together in a legislative hearing to hear testimony on the cost 
of college, student-centered reforms to bring higher education 
within reach. Pursuant to committee rule 7C, opening statements 
are limited to the chair and ranking member. This allows us to 
hear from witnesses sooner and provides all members with 
adequate time to ask questions. I now recognize myself for the 
purposes of making an opening statement.
    This morning marks the first of five bipartisan hearings 
which will inform our work on comprehensive reauthorization of 
the Higher Education Act. I want to thank the ranking member 
and her staff for working cooperatively with us to arrange all 
five of the hearings. I also want to thank our witnesses for 
being with us today to answer questions and provide their 
valuable expertise.
    Our timing could not be better. Yesterday's news was a 
powerful reminder that elements of our higher education system 
are in desperate need of repair. The alleged use of bribery and 
fraud to game the college admissions system illustrates a 
reality that our higher education--reality in our higher 
education system, that is students from wealthy families and 
students from--poor families are not treated fairly. It is 
important to note that all of the indicted people in this 
scheme are entitled to a presumption of innocence, but at least 
one has pleaded guilty. So, we know that the scheme was going 
on. The reality of this is maddening and inflammatory. It is 
illegal and systemic--is the illegal and systemic inequality of 
its college admissions. It, ultimately, deprived countless 
students of their chance to reach their full potential.
    Our education must be an engine of economic mobility for 
all students, not an instrument for preserving the elite status 
of wealthy families. In rewriting the Higher Education Act, we 
have an opportunity to address many factors that prevent 
students, particularly students of color and low-income 
families, from attending institutions of higher education, and 
those same factors often perpetuate racial and income 
inequality.
    This committee has a difficult challenge. The competing 
proposals released in the last Congress, the Republican PROSPER 
Act and the Democratic Aim Higher Act, illustrated the vast 
differences in our approach to higher education. This hearing 
will begin the process of finding areas of common ground. The 
goal of our work in this committee on the higher education is 
not just to write a new higher education bill, but it is to 
pass a comprehensive higher education bill. Accordingly, we 
propose to work together in a bipartisan way that produces a 
bill that can pass the House, pass the Senate, and be signed by 
the President. Students, families, taxpayers, and institutions 
of higher education deserve a good faith effort on our behalf 
to address the urgent challenges facing the higher education 
system.
    Today, we are discussing one of the biggest challenges, the 
rising cost of college. The cost of attending public colleges 
has risen dramatically in recent years. While--from 1990 to 
2015, the median household income increased by 12 percent, but 
the net cost of attending college increased by 81 percent.
    When President Johnson signed the Higher Education Act, he 
said, that a high school student anywhere in this great land of 
ours can apply to any college or any university in any of the 
50 States and not be turned away because the family is poor. 
That could have been the case in the 1960's and 1970's, but it 
is not the case today. In 1980, the maximum Pell Grant covered 
76 percent of the cost of attending a 4-year public college. 
Today, the maximum Pell Grant covers only 29 percent of that 
cost.
    There are many factors that have led to the rising costs of 
college, but none more significant than the decline of State 
investment in higher education.--You have a chart on higher 
education? This shows the change in investment from States. Red 
is how much less they are paying, and the blue is how much more 
they are paying. We can see that a decade ago, States paid, on 
average, about two-thirds of the cost of higher education. 
Today, States pay, on average, less than one-third of the cost. 
Going from two-thirds to one-third doubles the cost of 
education to the students, and it is only going to get worse. 
Adjusted for inflation, 45 States spent less per student in 
2018 than they did 10 years before, in 2008.
    As tuition continues to outpace both wages and Pell Grants, 
it should not be a surprise that students and their families 
are asking themselves if college is even worth the cost. The 
evidence and research demonstrate that given well-supported and 
responsive--responsible institutions of higher education, the 
answer is, overwhelmingly, yes. Yes, it is worth the cost. A 
college degree remains a good investment for students and 
families, as well as local communities and the national 
economy. Individuals with a bachelor's degree, typically, earn 
about a million dollars more than a high school graduate, over 
their lifetime. Individuals with an associate's degree earn 
about $400,000 more than a high school graduate over their 
lives.
    Two out of three jobs within the modern economy are filled 
by individuals who have more than a high school education, and 
we see in this chart those that--after the recession, you see, 
those with a college degree recovered. Those with just a high 
school diploma, on the bottom, did not do well. Those in the 
middle got kind of in between, but, you can see, those with 
college educations did much better during the recovery.
    A college-educated work force is also good for local 
economies. Evidence shows that for every dollar a State invests 
in higher education, it receives about $4.50 in return in 
higher tax revenue and lower spending on public assistance.
    Colleges also contribute to the cultural and financial 
strength of communities that are across the country. We know 
that universities represent the largest employers in 10 
different States around the country, and in rural areas they 
are, invariably, the largest employer in the county.
    We also know that economic competitiveness is, to a large 
extent, based on the availability of well-trained, well-
educated work force. Even though college enrollment and 
completion is a matter of economic competitiveness, only 48 
percent of Americans 25 to 34 have obtained some sort of 
postsecondary credential. In Canada and Japan, it is 60 percent 
have obtained some kind of postsecondary education; in Korea, 
70 percent.
    If we do not address the rising costs, we will not only 
lose our economic competitiveness, but a growing number of 
students and families will lose out on the benefits of a 
college degree. This is particularly true for low-income 
students and students of color, who already face significant 
barriers to attending college. Today, we will consider a broad 
range of solutions to make college more accessible and 
affordable to individuals from all backgrounds, including 
halting increases in college costs by encouraging more State 
and local investment in public institutions; restoring the 
purchasing power of Pell; and expanding eligibility, including 
short-term, high-quality programs that provide both valuable 
technical skills and a path to 2-and 4-year college degrees, so 
that students will be able to afford college; and making 
college--student loans cheaper and easier to pay off, while 
providing additional support for low-income students, such as 
Federal Work-Study, which empowers students to earn while they 
are in college.
    The evidence of the benefits of college degrees are all 
around us. In the recently completed 115th Congress, we found 
that all 100 United States senators had college degrees, and 
more than 90--about 94 percent of the members of the House held 
at least a bachelor's degree. We, of all people, should not be 
discouraging students from seeking the kind of education that 
got us here today.
    If we only tinker around the edges and do not make 
comprehensive steps to addressing access and affordability, we 
will fail to serve the students, parents, and communities we 
were elected to serve. In sum, we will fail the Nation, and 
that simply should not be an option. So, I look forward to our 
discussion, and now recognize the ranking member, Dr. Foxx.
    [The statement by Chairman Scott follows:]

    Prepared Statement of Hon. Robert C. ``Bobby'' Scott, Chairman, 
                    Committee on Education and Labor

    This morning marks the first of five bipartisan hearings, which 
will inform our work on comprehensive reauthorization of the Higher 
Education Act. I want to thank our witnesses for being here with us 
today to answer questions and provide their valuable expertise.
    Our timing could not be better. Yesterday's news was a powerful 
reminder that elements of our higher education system are in desperate 
need of repair. The alleged use of bribery and fraud to game the 
college admissions system illustrates a reality in our higher education 
system: Students from wealthy families and students from poor families 
are not treated fairly. It is important to note that all of the 
indicted people in this scheme are entitled to a presumption of 
innocence, but at least one has pleaded guilty, so we know the scheme 
was going on. The reality of this is maddening and inflammatory. It is 
the illegal and systemic inequality in college admissions and success 
that ultimately deprives countless students of the chance to reach 
their potential.
    Our education must be an engine of economic mobility for all 
students, not an instrument for preserving the elite status of wealthy 
families. In re-writing the Higher Education Act, we have an 
opportunity to address many factors that prevent students--particularly 
students of color and low-income families--from attending institutions 
of higher education and those same factors have too often perpetuated 
racial and income inequality.
    This Committee has a difficult challenge. The competing proposals 
released in the last Congress--the Republican PROSPER Act and the 
Democratic Aim Higher Act--illustrated the vast differences in our 
approach to higher education. This hearing will begin the process of 
finding areas of common ground. The goal of our work in this Committee 
in higher education is not just to write a new higher education bill, 
it is to pass a comprehensive higher education bill. Accordingly, we 
propose to work together in a bipartisan way that produces a bill that 
can pass the House, pass the Senate, and be signed by the President. 
Students, families, taxpayers, and institutions of higher education 
deserve a good-faith effort to address the urgent challenges facing the 
higher education system.
    Today, we are discussing one of the biggest challenges: The rising 
cost of college. The cost of attending public colleges has risen 
dramatically in recent years. From 1990 to 2015, the median household 
income increased by 12 percent, but the net cost of attending college 
increased by 81 percent.
    When President Johnson signed the Higher Education Act, he said, 
``that a high school senior anywhere in this great land of ours can 
apply to any college or any university in any of the 50 States and not 
be turned away because [their] family is poor.'' That could've been the 
case in the 1960's and 70's, but it is not the case today. In 1980, the 
maximum Pell Grant covered 76 percent of the cost of attendance at 
public 4-year colleges. Today, the maximum Pell Grant, which is the 
cornerstone of Federal student aid for nearly 7.5 million low-income 
students each year, covers just over 29 percent.
    There are many factors that have led to the rising cost of college, 
but none are more significant that the decline of State investment in 
higher education. A decade ago, States paid about two-thirds of the 
cost of higher education.
    Today, States pay, on average, less than one-third of the cost. 
Going from 2/3 to 1/3 doubles the cost of college to students and it's 
only going to get worse--45 States spent less per student in the 2018 
school year than in 2008.
    As tuition continues to outpace both wages and Pell Grants, it 
should not be a surprise that students and families are asking 
themselves if college is still worth the cost. The evidence and 
research demonstrate that, given well-supported and responsible 
institutions of higher education, the answer is an overwhelming yes. A 
college degree remains a good investment for students and families, as 
well as local communities and the national economy. Individuals with a 
bachelor's degrees typically earn about $1 million more than high 
school graduates over their lives. Individuals with an associate's 
degrees earn $400,000 more than high school graduates over their lives. 
And two out of three jobs in the modern economy are filled by 
individuals who have more than a high school education.
    A college-educated work force is also good for local economies. 
Evidence shows that for every $1 a State invests in higher education, 
it receives up to $4.50 in return in higher tax revenue and lowers 
spending on public assistance.
    Colleges also contribute to the cultural and financial strength of 
communities across the country. We know that universities represent the 
largest employers in 10 different States around the country and, in 
rural areas, they are invariably the largest employer.
    We also know that economic competitiveness is, to a large extent, 
based on the availability of a well-trained and well-educated work 
force. Even though college enrollment and completion are a matter of 
economic competitiveness, only 48 percent of Americans ages 25 to 34 
have obtained some sort of postsecondary credential. In Canada and 
Japan, 60 percent of young adults have obtained postsecondary 
education. In Korea, that figure reaches 70 percent.
    If we do not address the rising costs, not only will we lose our 
economic competitiveness, but a growing number of students and families 
will lose out on the benefits of college degree. This is particularly 
true for low-income students and students of color, who already face 
significant barriers to earning a college degree. Today, we will 
consider a broad range of solutions to make college more accessible and 
affordable to individuals from all backgrounds, including:
    * Halting increases in college costs by encouraging more State and 
local investment in public institutions.
    * Restoring the purchasing power of Pell Grants and expanding 
eligibility, including to short-term high-quality programs that provide 
both valuable technical skills and a path to a two-and 4-year degree, 
so that students will be able to afford college.
    * Making college loans both cheaper and easier to pay off, while 
providing additional support for low-income students such as Federal 
Work-Study, which empowers students to earn while in college.
    The evidence of the benefits of a college degree are all around us. 
In the recently completed 115th Congress, all Senators and more than 
nine in 10 members of the House of Representatives held at least 
bachelor's degrees. We, of all people, should not be discouraging 
students from seeking the education that got us here today.
    If we only tinker around the edges and do not take comprehensive 
steps to address access and affordability, we will fail to serve the 
students, parents, and communities who elected to serve. In sum, we 
will fail the nation--and that is simply not an option.
    I look forward to our discussion and I now recognize the Ranking 
Member, Dr. Foxx.
                                 ______
                                 
    Mrs. FOXX. Thank you, Mr. Chairman, and I thank you for 
your commitment to our working on this issue in a bipartisan 
fashion. This hearing cuts to the heart of why postsecondary 
education reform is necessary, and why it is so difficult to 
accomplish.
    It is necessary because college is so increasingly 
expensive.
    For decades, tuition and fees have risen higher than the 
cost of inflation. Because costs have always varied between 
different types of institutions, it is often hard to know what 
option would provide the best value for the unique needs of 
each student and their families. Here is a way to put the cost 
of college into perspective. If the price of cars had risen at 
the same rates tuition and fees have risen, the average car 
today would cost more than $80,000.
    The high cost of college is not a question for debate. It 
is a matter of fact. It is also why change is so difficult. 
High costs for all mean very, very high payouts for some. As a 
former college administrator, I know firsthand the complexity 
and the ripple effects of budget decisions at the institutional 
level. Sometimes it takes creativity and resourcefulness to 
manage an institution's finances well. Sometimes the easiest 
way to grow your budget is to use an old business mindset and 
simply pass cost to the consumer. In this case, the consumers 
are students and families, and they are not willing to take the 
high cost anymore. There are ways to protect students from 
absorbing the cost of institution level budget decisions, and I 
must say I do not believe every college administrator in the 
country is giving students the consideration they deserve when 
deciding how to manage institutional finances.
    Any discussion of college affordability must involve 
serious questions about institutional accountability. I hope we 
will hear more about that today, and I hope we will all have 
the courage to confront those who seek to maintain the status 
quo at the expense of students for their own benefit.
    The Federal Government's role in trying to help families 
pay for college is a classic example of the unintended 
consequences of good intentions. On top of the different types 
of grants available, the Federal Government deals in 5 loan 
programs, 9 repayment plans, 8 forgiveness programs, and 32 
deferment and forbearance options. Somehow, all these numbers 
and options have added up to more than $1.5 trillion dollars in 
student debt and counting, a number no Congress could have 
anticipated as each of these Federal aid options came online.
    These facts should be further indication that college costs 
are not simply a matter of supply and demand or loan amounts or 
interest rates, but a symptom of deeper systemic flaws in 
American postsecondary education systems and, perhaps more 
importantly, popular perceptions and values. I have long said 
we need bold reforms in postsecondary education, if we are 
going to make the system work for students again, and I have 
put those ideas forward. I believe in the necessity of 
comprehensive reform today more than ever. However, I am happy 
to acknowledge that there are few bright stars in the system as 
we know it. The comparative success of the Pell Grant program 
has made it the cornerstone of Federal student aid.
    In today's economy, there are ways to strengthen the Pell 
Grant program in ways that may not have been evident in 
previous decades, and that comes back to my point about public 
perceptions. If we consider ways to make Pell Grants applicable 
to shorter term, skills-focused programs that meet the needs of 
students and the communities in which they live, I believe we 
will see a higher, faster, and more satisfying return.
    All education is career education. American students view 
postsecondary education as a necessity, and they are not wrong 
in thinking that way. As we broaden our ideas of what 
postsecondary options can look like for students of every age, 
the question of how they will pay for it looms large. I am glad 
to see increasing public interest in this issue, and I welcome 
this hearing and these witnesses today. I yield back, Mr. 
Chairman.
    [The statement by Mrs. Foxx follows:]

Prepared Statement of Hon. Virginia Foxx, Ranking Member, Committee on 
                          Education and Labor

    This hearing cuts to the heart of why postsecondary education 
reform is necessary and why it is so difficult to accomplish. It's 
necessary because college is so increasingly expensive. For decades, 
tuition and fees have risen higher than the cost of inflation. Because 
costs have always varied between different types of institutions, it's 
often hard to know what option would provide the best value for the 
unique needs of each student and their families.
    Here is a way to put the cost of college into perspective: if the 
price of cars had risen at the same rates tuition and fees have risen, 
the average car today would cost more than $80,000. The high cost of 
college is not a question for debate, it is a matter of fact.
    That's also why change is so difficult. High costs for all mean 
very, very high payouts for some. As a former college administrator, I 
know firsthand the complexity and the ripple-effects of budget 
decisions at the institutional level. Sometimes, it takes creativity 
and resourcefulness to manage an institution's finances well. 
Sometimes, the easiest way to grow your budget is to use an old 
business mindset and pass costs along to the consumer. In this case, 
the consumers are students and families, and they are not willing to 
take the high costs anymore.
    There are ways to protect students from absorbing the costs of 
institution-level budget decisions, and I must say, I don't believe 
every college administrator in the country is giving students the 
consideration they deserve when deciding how to manage institutional 
finances. Any discussion of college affordability must involve serious 
questions about institutional accountability. I hope we'll hear more 
about that today, and I hope we'll all have the courage to confront 
those who seek to maintain the status quo, at the expense of students, 
for their own benefit.
    The Federal Government's role in trying to help families pay for 
college is a classic example of the unintended consequences of good 
intentions. On top of the different types of grants available, the 
Federal Government deals in five loan programs, nine repayment plans, 
eight forgiveness programs, and 32 deferment and forbearance options. 
Somehow, all these numbers and options have added up to more than $1.5 
trillion in student debt and counting--a number no Congress could have 
anticipated as each of these Federal aid options came online.
    These facts should be further indication that college costs are not 
simply a matter of supply and demand or loan amounts or interest rates, 
but a symptom of deeper systemic flaws in American postsecondary 
education systems and, perhaps more importantly, popular perceptions.
    I have long said that we need bold reforms in postsecondary 
education if we're going to make the system work for students again, 
and I've put those ideas forward. I believe in the necessity of 
comprehensive reform today more than ever. However, I'm happy to 
acknowledge that there are a few bright stars in the system as we know 
it. The comparative success of the Pell Grant program has made it the 
cornerstone of Federal student aid. In today's economy, there are ways 
to strengthen the Pell Grant program in ways that may not have been 
evident in previous decades, and that comes back to my point about 
public perceptions. If we consider ways to make Pell Grants applicable 
to shorter-term, skills-focused programs that meet the needs of 
students and the communities in which they live, I believe we'll see a 
higher, faster, and more satisfying return.
    All education is career education. American students view 
postsecondary education as a necessity, and they aren't wrong in 
thinking that way. As we broaden our ideas of what postsecondary 
options can look like for students of every age, the question of how 
they'll pay for it looms large. I am glad to see increasing public 
interest in this issue, and I welcome this hearing and these witnesses 
today.
                                 ______
                                 
    Chairman SCOTT. Thank you. Without objection, all other 
members who wish to insert written statements to the record may 
do so by submitting them to the committee clerk electronically 
by Tuesday, March 26th.
    I will now introduce our witnesses. Dr. Douglas Webber is 
associate professor of economics and the director of graduate 
studies at Temple University. He holds a Ph.D. and master's in 
economics from Cornell and undergraduate degrees in math and 
economics from the University of Florida. He has published on 
many topics in the field of labor economics, and current 
research focuses most heavily on higher education finance and 
the returns in and to investments in--return to an investment 
by going to college.
    Dr. Alison Morrison-Shetlar is the interim chancellor at 
Western Carolina University, where she serves as chief 
executive officer for the university, and oversees all major 
divisions of the university, including academic affairs, 
administration and finance, student affairs, and legal affairs. 
She has nearly 35 years of experience working in higher 
education in eight institutions in three countries, and in both 
public and private universities.
    Jenae Parker is the first in her family to graduate from 
college, obtained an associate in plant science, in human 
resources management, from Columbus State Community College, in 
December. She is now enrolled at Franklin University, a 4-year 
institution, where she plans to obtain her bachelor's degree in 
human resources management by the Fall of 2020. She is a 
student parent, and her 8-year-old daughter joins us in the 
front row today.
    Dr. Beth Akers is a senior fellow at Manhattan Institute. 
Prior to her role in Manhattan Institute, she was a fellow at 
the--Brookings' Institution's Center on Children and Families. 
Then a staff economist on President Bush's Council on Economic 
Advisors, where she worked on Federal student lending policy, 
as well as other education and labor issues. She received a 
B.S. in mathematics and economics from SUNY in Albany and a 
Ph.D. in economics from Columbia.
    James Kvaal is president of the Institute for College and 
College Access and Success, a nonprofit organization that works 
on the issues of affordability, accountability, and equity in 
education. He previously served as the deputy director of the 
White House Domestic Policy Council and has senior roles in the 
U.S. Department of Education, U.S. House of Representatives, 
and the U.S. Senate. He taught at University of Michigan's Ford 
School of Public Policy and attended Stanford University and 
Harvard Law School.
    We appreciate all the witnesses for being here today, and 
we look forward to your testimony. Let me remind the witnesses 
that we have your written statements, and they will appear in 
full in the hearing record pursuant to committee rule 7D and 
committee practice. Each of you is asked to limit your oral 
presentation to a 5-minute summary of your written statement.
    Let me remind the witnesses that Title 18, the U.S. Code 
Section 1001, makes it illegal to knowingly and willfully 
present false information to Congress, but before you begin 
your testimony, please remember to press the button on the 
microphone in front of you, so that you will be able to turn 
the microphone on, so that the members can hear you. As you 
begin to speak, the light in front of you will turn green. 
After 4 minutes, the light will turn yellow to signal that you 
have 1 minute remaining. When the light turns red, we would 
appreciate it if you could summarize your testimony and wrap 
up.
    We will let the entire panel make presentations before we 
move to member questions. When answering a question, please 
remember, again, to turn your microphone on.
    We will first recognize Dr. Webber.

 STATEMENT OF DOUGLAS WEBBER, ASSOCIATE PROFESSOR AND DIRECTOR 
  OF GRADUATE STUDIES, ECONOMICS DEPARTMENT, TEMPLE UNIVERSITY

    Mr. WEBBER. Chairman Scott, Ranking Member Foxx, and 
distinguished members of the committee, I sincerely thank you 
for the opportunity to testify today, and for your interest and 
devotion to college affordability. My name is Doug Webber and I 
am an associate professor of economics at Temple University, 
where I have focused on higher education finance and the 
returns to college investment.
    Affordability is about access, the value of a degree, and 
the risk associated with the investment. I say with great 
confidence that college is a risk worth taking for the vast 
majority of individuals and is worth the considerable public 
investment that we make in trying to ensure that a quality 
education is affordable for anyone who wants it.
    But the price of college has outpaced inflation over the 
past several decades, making college less affordable. The high 
prices and prospect of significant debt deter low-income 
students, including highly qualified, low-income, high school 
students from even--from ever enrolling. Higher debt loads and 
the fact that we have a complicated repayment system that does 
nothing to automatically place distressed borrowers into 
income-driven repayment plans have increased students' risks, 
particularly for students who do not complete a degree.
    The factors driving the increasing price of college are 
complex and vary greatly across sector. My research has found 
that at public institutions, State divestment is responsible 
for roughly 30 percent of tuition increases since the year 
2000, and 41 percent of increases since the Great Recession 
began in 2007. Possibly the biggest single driver is known as 
Baumol's cost disease. The returns to very high levels of 
education, such as a Ph.D., in the private sector have 
increased dramatically over time. For example, in my field of 
economics, the combination of modern computing technology and 
econometric scales taught in most Ph.D. programs have caused 
private sector salaries for economics Ph.D.'s to rise 
substantially. This increased competition from the private 
sector pushes up the salary that a university must offer to 
hire an economist. The difficulty here is that rising 
instructional costs are driven by market forces completely 
outside the control of universities.
    The problem is that as tuition has increased, low-income 
individuals have found themselves with little money to pay for 
college. For starters, the purchasing power of Pell Grants has 
declined considerably over time. The maximum available Pell 
Grant of $6,095 covers only 30 to 40 percent of the annual cost 
of attendance at the average 4-year public school. This is down 
from 80 percent in the 1970's. The decline in purchasing power 
is largely due to nontuition expenses, such as housing, food, 
and other school supplies. At the typical public institution, 
tuition comprises only a quarter of the full cost of 
attendance. As college prices have increased and the purchasing 
power of Pell Grants has decreased, more students are working 
during school. Seventy percent of college students work. Over 
half of those work more than 20 hours per week. This is 
problematic, as needing to work this much has been shown to 
lengthen the time it takes to get a degree and also reduces the 
likelihood of graduating.
    More students are taking out loans. Today, 69 percent of 
students borrow to pay for college, with the average 4-year 
college graduate owing roughly $30,000 in Federal and non-
Federal debt when they leave school. Although our system of 
need-based aid and loans is often needlessly complicated, it 
does help students enroll and graduate.
    To conclude, the picture of affordability is very complex. 
The financial value of a college degree has never been higher, 
but the downside risk has also increased over time, 
particularly for those who do not graduate, and, unfortunately, 
wealth and family background play an important role in college 
success. In one striking statistic, a high-achieving student 
from a low-income family is less likely to graduate from 
college than a low-achieving student from a high-income family.
    For more on how the wealth gap impacts student outcomes, 
especially along the dimension of race, see the excellent 
research of a colleague of mine from graduate school, Dr. 
Fenaba Adbo of the University of Wisconsin-Madison, and Dr. 
Jason Houle of Dartmouth University. I think there are many 
areas of bipartisan agreement that will lead to a better future 
for the students of this country, particularly as it relates to 
accountability, which is somewhat--something that I have done a 
lot of work on.
    Thank you all for this opportunity to come before you 
today. I am eager to help in any way that I can, both today and 
in the coming weeks and months. Thank you very much.
    [The statement of Dr. Webber follows:]
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    Chairman SCOTT. Thank you. Ms. Morrison-Shetlar?

   STATEMENT OF ALISON MORRISON-SHETLAR, INTERIM CHANCELLOR, 
                  WESTERN CAROLINA UNIVERSITY

    Ms. MORRISON-SHETLAR. Good morning. My name is Dr. Alison 
Morrison-Shetlar, and I am the interim chancellor of Western 
Carolina University, the westernmost institution of the 
globally recognized University of North Carolina system. Our 
mission is to serve our region and our community. Our student 
body reflects that. Approximately 43 percent of the Western 
Carolina students are Pell Grant recipients, and 40 percent are 
first generation college students.
    Western Carolina University has enjoyed great success over 
the last 7 years. Enrollment has soared to more than 11,600 
students. Freshman retention has increased from 71 percent to 
80 percent, and our 6-year graduation rate has risen from 50 to 
60 percent.
    As a regional comprehensive university, we know the lion's 
share of the work needed to lift families out of poverty 
happens at universities like ours. We take that responsibility 
very seriously. This past fall, Western Carolina implemented a 
bold and innovative program, created by a forward-thinking 
North Carolina legislator, to strengthen our crucial role as an 
engine of economic mobility, to make college more affordable 
for every student, and to provide access to truly affordable 
higher education that leads to timely graduation and a 
transformed future for our students.
    North Carolina has a long and proud history of generous 
support for its public universities, and ranks fifth nationally 
in both per pupil and per capita spending toward higher 
education.
    Our State recognizes that our universities drive economic 
development, create jobs, and unlock opportunities for our 
students and communities, large and small. With this in mind, 
North Carolina General Assembly has taken important steps to 
invest in, rather than divest from, public higher education. In 
2016, the General Assembly implemented a fixed tuition program 
across the system that guarantees a student's tuition will not 
change for eight consecutive semesters. The following year, a 
cap on student fees limited increases to no more than 3 percent 
per year, helping keep inflationary costs at a reasonable 
level. 2016 also saw the creation of NC Promise, one of the 
country's boldest moves in providing a radically affordable 
college education.
    NC Promise sets tuition at $500 per semester for in-State 
students and $2,500 per semester for out-of-State students at 
three UNC system institutions: Elizabeth City State University, 
the University of North Carolina at Pembroke, and Western 
Carolina University. The State pays the difference between what 
it used to cost before NC Promise to the tune of $51 million 
this first year alone. For context, that is around one and a 
half times Tennessee's investment in their innovative free 
community college program, Tennessee Promise.
    The goals for NC Promise are clear: increase access to 
higher education, improve affordability, reduce student debt, 
and continue to grow North Carolina's economy. I hear from my 
students every day that this program is a game changer. It is 
opening doors. It is changing the trajectory of their lives. It 
is setting them up for success beyond their expectations, and 
NC Promise's impact on decreasing student debt is significant.
    NC Promise is unique compared to most access programs 
nationally because it is a first-dollar scholarship. That means 
the tuition price comes down before any other financial aid is 
awarded. Under NC Promise, Pell Grants, State scholarships, and 
institutional aid go a lot further. For example, at Western, 
the program allows an in-State student who graduates in 4 years 
to save approximately $12,000. That is nearly equivalent to the 
total cost of attendance for one full academic year.
    So, is NC Promise working? Unequivocally, the answer is 
yes. At Western Carolina University, in fall 2018, total 
undergraduate enrollment grew by 6.6 percent. At UNC Pembroke 
and Elizabeth City, the two other--UNC Promise institutions, 
enrollments grew by 14 percent and 19 percent, respectively. At 
Western Carolina University, the number of first-time, full-
time freshman increased by 10.5 percent, and transfer of 
students by 40.5 percent.
    In a survey of our fall 2018 entering class, almost a third 
of our new students with significant financial needs said that 
if it had not been for NC Promise, they would not have been 
able to attend any college or university. These numbers are 
hard to ignore. All three NC Promise institutions are located 
in historically underserved parts of North Carolina. Pembroke 
and Elizabeth City are both historically minority-serving 
institutions. This program is a target intervention that lifts 
up the communities and families who need it the most.
    There should also be no question that an educated 
leadership ready for work force is absolutely essential for 
economic development. We know that an affordable college degree 
can transform a student's future. North Carolina's overall 
investment in higher education and the groundbreaking NC 
Promise program is a resounding win for all: students win; 
their families win; the businesses that call our State home 
win, and we are a step closer to creating a thriving economy 
and a better life for all of our citizens.
    Thank you very much for the opportunity to speak with you 
today.
    [The statement of Dr. Morrison-Shetlar follows:]
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    Chairman SCOTT. Thank you. Ms. Parker?

    STATEMENT OF JENAE PARKER, STUDENT, FRANKLIN UNIVERSITY

    Ms. PARKER. Chairman Scott, Ranking Member Foxx, and the 
members of the committee, thank you for the opportunity to 
testify. The price of college is a subject I know a lot about, 
and so does my 8-year-old daughter, Journey Marie. On TV, 
college looks like a lot of fun. Students live in dorms, eat 
pizza on campus, relax at the gym between classes. It is really 
seems like a mini vacation, but that image is nothing like what 
I have experienced in real life. I suspect the reality is far 
more common than the media stories. It needs to be a greater 
part of the conversation about the real college experience that 
Americans are having.
    I am 29. I am a parent, like nearly one in four college 
students. I am also a single parent, like 14 percent of 
students. Eleven years ago, I graduated from high school and 
went to the University of Toledo. Money was so tight that I did 
not have a comforter when I arrived on campus. The university 
cost over $25,000 per year, and all I got was a Pell Grant of 
$4,300. I borrowed $20,000 in Federal and in private loans, and 
worked at Starbucks, a grill, and also Target. It was 
exhausting. I could not focus on school and, 2 years later, I 
dropped out.
    Time passed. I got married. I had Journey, and I also got 
divorced. In 2013, I was working full-time and decided to try 
college again, this time at Columbus State Community College. I 
juggled full-time work and full-time college while raising my 
daughter and caring for my mother, who had fallen ill.
    I loved school, but when my mom passed away, I had to also 
care for my two teenage brothers. Again, it seemed college was 
not in the cards for me.
    The third time, I enrolled in college part-time, and worked 
several part-time jobs. It was slow, but it was the only way I 
could afford school. Many people think community college is 
already free, but Journey and I know that is not true.
    Our bills got so tight we ran out of money for food, and 
this was not about ramen. We lacked enough money to eat 
regularly. Then we were evicted. I thought this was my fault, 
but then I realized that 50 percent of college students are 
also dealing with food and housing insecurity. More than one in 
10 are homeless. Are we all just not college material or have 
we all done something wrong?
    Eventually, I found a college staff member who referred me 
to childcare, health insurance, food stamps, a scholarship, and 
housing in Scholar House, and I succeeded. In December 2018, I 
earned my associate's and transferred to Franklin University, 
where I am now pursuing a bachelor's in human resource 
management, and I also plan on a graduate degree in psychology.
    It seems that for Pell recipients like me, the only way to 
attend college and eat is to use food stamps, but what happens 
to the millions of students who cannot get that help? The U.S. 
Government Accountability Office recently said that 2 million 
students are having trouble paying for college, but not getting 
help from SNAP. Like me, most are first-generation students. 
Many are also single parents.
    For me to go to college and to focus, I have to know that 
my child is safe, but 95 percent of campuses with childcare 
have long waiting lists, and some campuses do not have 
childcare at all. I am here today because of my daughter. I am 
also here for students like me around the country and students 
like those that Journey will become. I know the odds are low 
that Journey and I will ever escape poverty, but I also know 
that college education--a college education helps, and we will. 
I am clearly willing to work for this bachelor's degree, but on 
days when money is tight and the bills are due, I wonder why I 
am paying for the price for a badly broken system. What would 
happen if Congress instead built a college financing system 
that matched the strength and ambition of today's students, 
like myself? I hope my story makes clear how desperately we 
want to improve our lives, and how very real the struggle of 
paying for college has become.
    Thank you for your time.
    [The statement of Ms. Parker follows:]
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    Chairman SCOTT. Thank you. Dr. Akers?

    STATEMENT OF ELIZABETH AKERS, SENIOR FELLOW, MANHATTAN 
                           INSTITUTE

    Ms. AKERS. Good morning, Chairman Scott, Ranking Member 
Foxx, and members of the committee. My name is Beth Akers, and 
I am a senior fellow at the Manhattan Institute, where I 
conduct research on higher education in the United States with 
a focus on finance. I have now worked in this space for over a 
decade; first, in my position as staff economist for the 
Council of Economic Advisors and at the Brookings Institution, 
as a fellow in both governance and economic studies. Thank you 
for the opportunity to share my testimony here today.
    College is expensive and getting more so every year. This 
inflation, combined with the growing enrollment among less 
well-off students, is driving student borrowing to tick up year 
after year. The current outstanding balance of $1.5 trillion is 
the highest level in history, but it is important to remember 
that spending on higher education is, at least on average, 
worth it. The increase in earnings that comes from having a 
college degree tends to outweigh the upfront cost of 
enrollment. This makes debt a reasonable mechanism for helping 
students to pay for college. For those who do go on to see a 
positive return on their spending, the problem of affordability 
is an issue of liquidity or being able to borrow from their 
future earnings, and not an issue of price.
    This notion is borne out by the statistics. While the 
popular media has frequently told stories of borrowers 
struggling with repayment, like the dental student who managed 
to amass $1 million in student debt, the vast majority of 
borrowers have small balances, reasonable payments relative to 
their income, and are eligible to take advantage of safety nets 
that will reduce or stop payments in times of financial 
hardship. The reality is that few borrowers have astronomical 
balances. As of 2015, just 5 percent of borrowers had balances 
in excess of $100,000, and many of those borrowers had 
completed graduate or professional programs that would lead to 
high-paying careers. While it is the responsibility of the 
media to cover the dire circumstances of the few, I am afraid 
that this has distorted our collective impression of the 
magnitude of the college cost problem, but knowing they are in 
the minority will provide little comfort to borrowers who find 
themselves underwater on their educational spending, nor should 
the infrequency of this problem cause policymakers to turn a 
blind eye.
    Sadly, many students are spending on college, only to end 
up worse off financially than if they had not gone in the first 
place. College is risky, and it is this risk, not the price of 
college, that is untenable. The system of higher education 
finance that we have in place today is not fundamentally out of 
sync with the challenges we face, but a small number of 
important policy changes could bring it closer in line with our 
collective objectives.
    First, we need to shore up the safety net for borrowers, 
and redesign it so that it operates effectively and is fiscally 
sustainable. It should be simple in design and foolproof to 
utilize, such that all students, not just those who are 
intensely financially savvy, can factor its existence into 
their enrollment and spending decisions. To accomplish this, we 
need to replace the existing system of Federal lending with a 
single loan program that collects loan repayment through a plan 
that ties monthly payments to a borrower's income.
    There will always be a tension between providing a safety 
net and diminishing the incentive for people to be self-
sufficient. Moral hazard is inevitable, but smart program 
design can ensure that safety nets are as efficient as possible 
and do not create incentives for perverse behavior, like those 
that exist in the current system.
    We also need to work to mitigate the financial risk of 
college enrollment by empowering consumers with better 
information. The introduction of the college scorecard during 
the Obama Administration was a tremendous step forward. We 
should continue these efforts by improving and expanding the 
information that is available to students as they shop for 
college. And before we consider increased spending on 
subsidies, we need to make our current spending work harder for 
students and taxpayers by moving dollars from hidden and 
inefficient channels, like tax benefits and interest rate 
subsidies, to places they will do the most good. I believe all 
Federal subsidies to higher education should be delivered 
through a single means-tested grant program that delivers the 
most aid to the least well-off students.
    With these primary changes in place, we should also look 
for ways to support new, low-cost business models that can put 
downward pressure on prices at all institutions. Innovation in 
higher education marketplace is currently limited by the 
constraints on access to Federal financial aid. It is 
challenging for innovative startups to compete with traditional 
institutions, where their students cannot access Federal grants 
or subsidized student loans. We should continue the work 
started with the EQUIP Program under the Experimental Sites 
Initiative to explore how best to extend Federal student aid 
dollars to new, low-cost providers.
    Lastly, I urge you to reject the growing demand to make 
college free. Universality would be justified if there were 
fundamental barriers to a functioning marketplace in higher 
education, but no market failure exists that is not rectifiable 
through subsidies, provision of credit, and appropriate 
regulation. Embracing universality and postsecondary education 
would come at a tremendous financial cost, but would also rob 
us of the byproducts of a competitive marketplace: innovation, 
quality, and adequacy of supply.
    Thank you for the opportunity to be here today. I look 
forward to answering all of your questions.
    [The statement of Dr. Akers follows:]
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    Chairman SCOTT. Thank you. Is it Dr. Kvaal? Thank you.
    Mr. KVAAL. Yes.
    Chairman SCOTT. Dr. Kvaal.

STATEMENT OF JAMES KVAAL, PRESIDENT, THE INSTITUTE FOR COLLEGE 
                       ACCESS AND SUCCESS

    Mr. KVAAL. Yes, thank you. Chairman Scott, Ranking Member 
Foxx, and members of the committee, thank you for the great 
privilege of being here today. American colleges and 
universities are nearly unmatched in their potential to create 
opportunity and raise living standards, but over the last 
generation, we have had a sea change in how we pay for college. 
States have cut funding for public colleges and universities, 
and that drives up tuition for the three-quarters of students 
who attend public universities and community colleges.
    Higher costs mean many students do not enroll. There is a 
long line of research that suggests that each additional 
thousand dollars in costs reduce enrollments by 3 to 5 
percentage points. Other students work long hours or enroll 
part-time, often at the expense of academic success. Some go 
hungry or homeless. Only 58 percent of our students earn a 
degree within 6 years. The most common reason they give for 
dropping out is to earn more money. It is not surprising then 
that students with high earning parents are five times more 
likely to hold a college degree. Latino adults are only half as 
likely to hold a college degree as other Americans, and black 
adults only two-thirds as likely.
    Growing college costs have also created a concentrated 
crisis in student debt. While most students benefit from 
college and repay their loans, millions of students fall behind 
on their loans, default, or see their balances grow over time 
because their payments are smaller than accrued interest. 
Struggling borrowers tend to have smaller loans, often because 
they dropped out of college. Others successfully completed but 
attended low-quality programs. For example, one study found 
that certificate programs at for-profit colleges leave students 
worse off, on average, because their increased learnings are 
smaller than their student debts.
    Over 1 million students a year default on their loans, 
suffering punitive consequences that can drive them deeper into 
debt. The experience of black borrowers, in particular, is 
deeply disturbing. Seventy percent of black borrowers are 
projected to eventually default. These problems were a 
generation in the making and reversing them will not happen 
quickly. However, I offer three recommendations.
    First, Congress should set a goal of doubling the Pell 
Grant, which is the level needed to end disparities in college 
affordability. It may not be able to double the Pell Grant 
immediately, but it should at least increase Pell Grants faster 
than inflation every year. It should also make them a true 
entitlement to protect them from the economic cycle.
    Second, Congress should build a new relationship with 
States. Federal efforts to make college more affordable simply 
cannot succeed without robust State investments alongside them. 
A new partnership with States should prioritize low-income 
students, consider the full cost of college, not just tuition, 
and address inequities in how States fund the colleges, 
enrolling the most low-income students and students of color.
    Finally, Congress should make it easier to repay loans as a 
share of income. Students in income-driven repayment plans are 
less likely to fall behind on their loans. They actually pay 
back more as a result, and they are financially healthier 
overall. However, improvements in IDR are needed. The five 
existing programs should be combined into a single plan that 
sets payments for all borrowers at 10 percent of income, above 
a living allowance. It should be easier for students to enroll 
and to certify their incomes, and after 20 years of payments, 
any remaining balance should be forgiven.
    Some final observations. First, too many unnecessary 
defaults occur because of the low quality of the private 
companies that collect student loans for the Department of 
Education. I urge Congress to hold these companies to high 
standards.
    Second, the Public Service Loan Forgiveness Program 
encourages graduates to become teachers, nurses, service 
members, first responders, but the program is far too 
complicated and poorly run. In the first round of applications, 
99 percent of applicants were denied. We should retain this 
program, but we should simplify it.
    Finally, the issue of affordability is intertwined with the 
question of accountability for student outcomes. Some colleges 
routinely leave students with unaffordable loans. I urge the 
committee to carefully consider how accountability can improve 
the value that colleges offer students and taxpayers.
    After decades of shifting the cost to students, it is 
important to remember that we all have a stake in helping more 
Americans graduate. Investing in Pell Grants, partnering with 
States, and ensuring loans are affordable are a realistic path 
to help bring about the society we want.
    Thank you very much.
    [The statement of Mr. Kvaal follows:]
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    Chairman SCOTT. Thank you, and I thank all our witnesses 
for their testimony. Now, we begin with our members' 
questionings. I will reserve my questions to the end and call 
on the chair of the Higher Education Subcommittee, Ms. Davis.
    Mrs. DAVIS. Thank you. Thank you, Mr. Chair. I appreciate 
it. Thank you all for being here, particularly our student, who 
is here to represent someone who is more close to this process 
than some of us are. And I want to also mention very briefly, 
because, you know, we can all imagine how many students and 
parents are anxiously awaiting those letters on admissions 
today, and how, in many ways powerless, they must be feeling 
when they know they have worked hard, played by the rules, and 
yet, we have this scandal that we are all going to be 
following, and it hurts many communities, even in San Diego. I 
know that the news is hitting hard.
    I wanted to go--first to Dr. Webber. And you were 
mentioning in your testimony how public institutions respond to 
State budget cuts by increasing their tuition and cutting 
spending. Can you just talk a little bit more how the cutting 
of spending actually can be far more detrimental to students in 
some cases than even the increase in tuition?
    Mr. WEBBER. Absolutely. Well, thank you for that question. 
And I also wanted to briefly mention that I am legally blind, 
so I sincerely apologize if I am not making eye contact with 
you at this moment.
    So, spending matters quite a bit for graduation, and there 
are many low, low resourced institutions that, you know, simply 
are not able to provide the services that, especially, you 
know, many at-risk students currently need for graduating. And, 
you know, as we have, you know, talked about already today, the 
students who are at the greatest risk in terms of student debt 
are the ones who do not get the degree. So, to the extent that 
spending cuts hurts the likelihood of graduation, that is, 
potentially, even more damaging than a rising upfront cost.
    Mrs. DAVIS. How do you think, and maybe others can answer 
this, too, that our public institutions have addressed this 
problem? What are they doing, specifically?
    Mr. WEBBER. So, I think there are many different ways that 
different States have, you know, tried to address this. So, 
there are a number of States that have implemented Promise 
programs, like--
    Mrs. DAVIS. Right. We did hear from--mm-hmm.
    Mr. WEBBER [continuing]. like North Carolina. I mean, my 
colleague to my left might be better equipped at addressing 
that than me.
    Ms. MORRISON-SHETLAR. I think the investment of the State 
has been unprecedented for North Carolina, and as a result, 
being able to ensure that the students receive the kind of 
support that they need to be successful is paramount. And so 
having the option to increase the number of students and, 
therefore, increase the need for these resources or increase 
the number of students and decrease these resources goes 
counterproductive to the success of the students.
    Mrs. DAVIS. Right, and I know that you addressed, briefly, 
and others, just how that matters to the outcomes because we 
have students who, unfortunately, are taking longer and, in 
some cases, that might be okay, but it also costs them a lot 
more to do that and it has a greater burden on the institution. 
How have the outcomes been represented in that way?
    Ms. MORRISON-SHETLAR. So, North Carolina's system has a 
series of metrics as part of their strategic plan, and we are 
held to those and we are accountable for those. And with North 
Carolina Promise, what we are finding, even in the first year, 
that we have had an increase in enrollment of low-income and 
rural students, and that metric is something, as I say, we are 
held accountable to. To be able to see that increase because of 
a reduction in the cost of attendance really means that we have 
to make sure that we have the resources available to make sure 
that they are successful in their time to graduation. So, we 
are also seeing retention as being a big component of this, and 
resources need to be put in place so that we can continue to 
retain our students, so that they are successful, graduate on 
time, and then leave to get good jobs, where they can then 
become good citizens of the community.
    Mrs. DAVIS. Mm-hmm. Dr. Kvaal, you were talking about 
accountability, as well. I think you have all kind of mentioned 
that in terms of the ability of students who actually attend 
some of the for-profit institutions to be able to graduate, and 
to be able to pay back loans because they are earning a 
reasonable amount of money that represents their effort. Could 
you speak about our military, and how, in fact, we know our 
veterans, our active duty personnel, and, certainly, their 
families are affected by this, that they have really been 
shortchanged on many levels and are really a target of some of 
these institutions? How is that affecting them?
    Mr. KVAAL. Well, we have seen some of the deceptive and 
high-pressure recruiting tactics at for-profit colleges, focus 
on service members and veterans, and there are, really, two 
reasons for that. One is GI Bill benefits and military 
education benefits can be quite generous. The second reason is 
for-profit colleges, by law, can only receive up to 90 percent 
of their revenue from Federal student aid, but that limitation 
does not apply to veterans or military benefits. So, for every 
veteran they enroll with GI Bill benefits, they can enroll an 
additional nine students with Federal student loans, and so 
that has led to some of the extreme pressure on military 
service members and veterans.
    Mrs. DAVIS. Thank you. I know, Mr. Chairman, that the time 
is up, and perhaps, at some point, we can talk about how the 
Federal Government can address that better. Thank you.
    Chairman SCOTT. Thank you. The ranking member will defer. 
Dr. Roe?
    Mr. ROE. Thank you, Mr. Chairman, and, first of all, Ms. 
Parker, you hang in there. You are going to make it. I am going 
to confess that if it were not for the small university, Austin 
Peay, in my hometown of Clarksville, Tennessee, I would not be 
sitting here today. I went to dinner the other night, on 
Eighth, not a very expensive place, and two of us, my wife and 
I, had dinner, no alcohol, and that cost more than a quarter of 
college. I was able to go to college. I stayed home. I worked 
the whole time I was in school and medical school to graduate 
in 7 years with both of those, with zero debt, with a father 
who was a factory worker and a mother who was a bank teller. 
So, college was very affordable then. You could actually work 
your way through school.
    The average medical student where I taught, at Quillen 
College of Medicine in Johnson City, graduates with $175,000 in 
debt. That is a huge debt. I think the question is: is college 
going to be relevant anymore? And I think it is a question to 
ask, I think, at Western Carolina. And, by the way, East 
Tennessee State beat you guys the other day, in basketball. I 
want to point that out, and I do want to offer my condolences 
to you for losing Coach Larry Hunter. I have booed him many 
times at basketball games, but a good, a great man.
    In Tennessee, we have decided that education had to be 
affordable for our citizens. So, we put the Tennessee Promise 
in and Tennessee Reconnect. You can now go to community college 
in our State for free, and I will just give you a couple little 
things. At our local TCAT, which is our technical school, at 
one of them, I just saw the other day, 77 percent finish on 
time, 97 percent are placed in a job, and 100 percent graduate 
with no debt. So, you can go out in our State, and then, if you 
go to--if you go from community college to a 4-year college, 
East Tennessee State University, Tennessee Tech, Austin Peay, 
wherever, you have the Hope Scholarship to help you. So, we 
have tried to make it affordable for our students in our State, 
and I think it is being successful. I really do, and we are 
paying for that with our Lottery Scholarship.
    Another confession, I have served on two foundation boards, 
been the president of one, and I think the college investment 
is the best investment I ever made, without a doubt. I have not 
heard any of you all talk about it. I know you know Dr. Zeppos 
at Vanderbilt University, who complains about the 
administrative cost, and at Vanderbilt it adds about $10,000 or 
$11,000. They spend $150 million a year complying with Federal 
mandates and check the box. I heard no one talk about that, or 
did not see it in your testimony, how much is added to FASFA 
with 100-plus questions, and on and on. Could we streamline 
that for you all and help with the cost a little bit because a 
lot of the reporting does not add any value to the students? 
Anyone can take that question.
    Ms. AKERS. That is something I can chime in on. So, I 
think, something to think about with the administrative costs, 
we often see people pointing their finger at this as, 
potentially, the driver of the rising costs that are getting 
passed onto students. I think we want to realize that if we 
were looking at an institution that was providing tremendous 
outcomes for students, and they happen to have the large 
expenditures on administration, we probably would not be 
questioning whether or not that is an appropriate place for the 
institution to be doing their spending. What happens inside the 
school is somewhat of a black box in terms of their finances. I 
think what we want to be concerned most with is the outcomes 
that they are producing.
    The thing that I want to ask is what is it about the demand 
side of the equation that is enabling these institutions to 
drive up their spending because of the increases in revenue 
that is coming from the increased sticker price and tuition 
that students are actually charged?
    Mr. ROE. All that Ms. Parker is worried about, it was like 
when I sent my children to college. All I was interested in, 
when I drew the bottom line, was how much of a check do I have 
to write you all, and that check keeps getting bigger and 
bigger, and I looked at the inflation rate. I thought we were 
bad in medicine. We were actually pretty good compared to 
colleges. Colleges increased their costs almost 8 percent per 
year for the last 40 years, annually. That is a huge increase, 
and it is putting college out of the reach of people like Ms. 
Parker. And I think colleges are going to have to rethink, with 
all of the technology that is on this PDA I have got in my hand 
right here, I can learn a lot at no cost.
    So, if you look at going to Georgetown, I just pulled it 
up, I do not want to pick on them, but at $75,000 a year, if 
you then go teach school at Johnson City, Tennessee, that is 
hardly a return on your investment. Then if you end up being an 
investment banker in New York, it probably is, but you may want 
to be a teacher. So, you are going to have to rethink where you 
go.
    And I think another thing that we are doing, that I think 
both sides of the aisle do, is to educate these young people 
when they come in, about you do not have to borrow the maximum 
amount of money. You can borrow this much to get along because 
you are going to have to pay for it, sooner or later.
    Mr. Chairman, my time has expired.
    Chairman SCOTT. Thank you. The gentleman from Connecticut?
    Mr. COURTNEY. Thank you, Mr. Chairman, and for holding this 
hearing early in the Congress. Hopefully, this is going to be 
the year that the 116th Congress reauthorizes the Higher Ed. It 
was 2008 was the last time, and we are way overdue for an issue 
that, again, every part of the country is looking for help and 
action.
    First of all, I just wanted to note for, you know, my 
friend from Tennessee cited the Vanderbilt report. Actually, if 
you sort of drill down a little bit, in terms of the numbers 
that they used, in terms of the $146 million, in terms of added 
costs, most of those regs that they identified were, actually 
had to do with the research component of universities and 
colleges, and, you know, for things on human subjects, which, I 
think, all of us would probably agree that is not a bad idea. 
So, you know, that number, which, again, there is a report, I 
do not dispute that, but the number is actually a little more 
complicated than, I think, some of the reporting on it.
    So, I checked this morning. The U.S. Treasury is selling 
10-year notes for 2.6 percent. I always sort of use it as a 
benchmark when we talk about the Stafford Student Loan Program 
because those are 10-year term notes that the government 
offers. Again, even today, we are still getting back around 4 
to 5 percent in terms of--from students. So that, that 
differential, that delta, between what the government is paying 
when it borrows versus what students are paying when they 
borrow from the same government, it is, again, just pure sort 
of windfall for the Federal Government. GAO reported that 
between the years of 2007 and 2012, the Federal Government had 
a windfall of about $66 billion in terms of that differential 
that is there.
    This morning, myself along with a lot of my colleagues on 
this committee are reintroducing the Bank on Students Emergency 
Loan Refinancing Bill. Senator Warren is introducing a 
companion bill in the Senate, which would allow people, both 
private and--both public and private student loans, to write 
down their interest rate to 3.7 percent, which was the rate 
back in 2016. We know from last year's analysis by CBO that 
would put about $50 billion into the pockets of students and 
folks who have graduated and who are struggling with student 
loans. It is not, you know, the panacea, but, certainly, if you 
look--if you talk to middle class people, who, you know, are 
trying to lower their monthly expenses, obviously, refinancing 
their home mortgage, car loans, credit card debt. I mean, that 
is a tool that is normal, and yet--but in the student loan 
market because it is restricted in the public side by law, and 
in the private side by the fact that you have to have equity to 
go in and refinance, you need a--you know, some other piece of 
property in terms of writing it down. This is the year we 
should move forward on that. It is just, at least, one way of 
trying to stop the bleeding.
    And I guess, Dr. Kvaal, I guess, you have talked, again, 
about these sort of the horror numbers in terms of default. At 
least being able to refinance down an interest rate, I think, 
would provide some mitigation of that problem. Would you agree?
    Mr. KVAAL. Yes.
    Mr. COURTNEY. Okay, and I do not know if anyone would 
disagree, but I think that would, hopefully, be the case.
    Ms. Parker, you talked about your story. Thank you for 
being here. And I do not mean to, but, you know, the private 
student loan interest rates are far higher than even the 
inflated Stafford rates, and maybe just could comment, if 
having that ability to write down the interest rates would be a 
benefit to you and your friends?
    Ms. PARKER. Thank you. I--yes, it would be a benefit to 
myself and my peers--
    Mr. COURTNEY. Congresswoman Shalala is very excited about 
this bill, obviously, so--
    Ms. PARKER. I have accrued now, and you said in private?--
    Mr. COURTNEY. Both private and public can write down to 3 
percent--
    Ms. PARKER. I am at about $66,000, and I have an 
associate's degree--
    Mr. COURTNEY. Right--
    Ms. PARKER. So, yes, it would be beneficial to merit.
    Mr. COURTNEY. Well, thank you--
    Ms. PARKER. Mm-hmm.
    Mr. COURTNEY [continuing]. and I do not know if--
    Ms. MORRISON-SHETLAR. I would agree, and also I would want 
to say that the North Carolina Promise is a first-dollar plan, 
whereas other free programs tend to be last-dollar and rely on 
existing aid first. So, the North Carolina Promise is actually 
better and more generous, particularly for low-income students, 
so, and I think your comment, financial literacy is something 
that we also need to be making sure that we are educating our 
students and will.
    Mr. COURTNEY. I guess we are about to run out of time, but, 
again, it was part of the Aim Higher Act, last year and, 
hopefully--we are very optimistic this is the year to move 
forward on it.
    Thank you very much. I yield back.
    Chairman SCOTT. Thank you. The gentleman from Michigan, Mr. 
Walberg?
    Mr. WALBERG. Thank you, Mr. Chairman, and thanks to the 
panel for being here. This, of course, is an unbelievably 
important subject for us to be considering, and financial 
literacy absolutely is something that we have not done well, 
and we are seeing the challenges of that.
    Dr. Morrison-Shetlar, I often hear that the FAFSA form is a 
real obstacle to students in continuing their education. I have 
supported legislation that would allow the IRS to share income 
information with the Education Department, thereby making it 
easier for students, and as families, to accurately complete 
the FAFSA form and access student aid.
    This policy would also improve accuracy and cut down on the 
time that student aid administrators spend verifying a family's 
income.
    Dr. Morrison-Sheltar, has it been your experience at the 
Western Carolina University that the FAFSA form can act as an 
obstacle for students? And, second, what advice do you have for 
us to simplify FAFSA in any HEA reauthorization?
    Ms. MORRISON-SHETLAR. I am in complete agreement that the 
FAFSA and the protocol to complete the FAFSA is, for some 
people, an insurmountable position. A lot of our students, 
particularly at Western Carolina University, are first 
generation. They come from low-income backgrounds, and when 
faced with the questions that are on the FAFSA in which they 
have to remember or they do not have the information, they just 
do not do it and, as a result, they do not apply, and, 
therefore, they do not go to university or college. And so to--
for my recommendation for all of the Federal grants and 
applications, we do simplify them, help people with the 
process, if needed, and we do that at Western Carolina 
University when people approach us.
    And so, yes, I would love to see us streamline those 
compliance, make sure that is streamlined and allows people the 
opportunity to get the education that they deserve and have 
earned as their right.
    Mr. WALBERG. Thank you. Dr. Akers, would you have any 
addition to that from your experience?
    Ms. AKERS. Absolutely. I would adore simplification of the 
FAFSA. I think that your initial comments about financial 
literacy are critically important. Just to cite some evidence 
from some of my earlier research, we know that, through survey 
data, that students are shockingly underinformed about their 
own financial circumstances. So, only about half of students in 
their first year of college education know how much they are 
paying for their degree, and about a third of students are able 
to accurately tell you how much they have borrowed. So, to me, 
this is a pretty important crisis that we have in higher 
education finance today.
    Mr. WALBERG. So, a wake-up call of--for instance, Ms. 
Parker, of $66,000, as you mentioned that. It is amazing. When 
you first started, did you expect anything like that to be the 
case in the process?
    Ms. PARKER. Not only did I not expect it, I, honestly, had 
no idea.
    Mr. WALBERG. No.
    Ms. PARKER. The financial illiteracy piece is a good--
    Mr. WALBERG. Yes. Yes.
    Ms. PARKER. It is a big piece because I just was not aware.
    Mr. WALBERG. Yes.
    Ms. PARKER. I was not informed.
    Mr. WALBERG. Yes. You make the example point very clearly 
that, why we have to move forward on this. Dr. Akers, in your 
testimony, you note that, in some cases, the students are 
spending money on college, only end up worse off financially 
than if they had not gone to college in the first place. In 
looking at the Federal Student Aid System, I am concerned about 
perverse incentives to overborrow. Can you expand a bit on what 
those perverse incentives are, and discuss ways we could 
address them in reauthorization and do it in such a way that I 
can explain it to my adult children in caring for their--my 
grandkids as they come up?
    Ms. AKERS. Sure. So, the most glaring, perverse incentive 
that exists in the current financial aid regime is that 
borrowers who anticipate that they will be eligible for student 
loan forgiveness at the end of either 10 or 20 years, whether 
they are in public or private sector, basically, face no 
marginal cost for every additional dollar that they are 
borrowing. So, consider I am a student at a very high-cost 
institution. I have some understanding of what my career path 
is going to be after I finish, maybe because I am in a 
profession, like law or medicine, where careers are 
relatively--or earnings are relatively well-known. I may reach 
a point in my borrowing, if I have been at high-cost 
institutions, where every additional dollar that I take on in 
debt to support my lifestyle, for instance, will very likely, 
or with almost certainty, be forgiven. And so, in that case, I 
have incentive to borrow as much as I am able to borrow through 
the Federal Lending Program.
    What is the solution to this? I think we need to consider 
limits on the eligibility for loan forgiveness, both in PSLF 
and income-driven repayment plans, like IBR and Pay as You 
Earn. Capping those, I think, would diminish that perverse 
incentive considerably.
    Mr. WALBERG. Okay. Well, thank you.
    Chairman SCOTT. Thank you.
    Mr. WALBERG. I yield back.
    Chairman SCOTT. The gentlelady from Ohio, Ms. Fudge?
    Ms. FUDGE. Thank you so very much, Mr. Chairman, and thank 
you all for being here today; Ms. Parker from Ohio, as well. It 
is a pleasure to see you, and to watch your daughter have such 
great pride when she hears you speak.
    Ms. Parker, surely, if we can provide $13 billion to 
farmers because of the President's bad losing trade war with 
China, we can help you. Surely, if we can give $1-1/2 trillion 
in tax cuts to the wealthiest people in this country, surely we 
should be able to help you and some of those very people we 
have just seen in the news cheat to get their children in 
college and you have done it the hard way. So, I am confident 
that you are going to be successful.
    I am confident that you are going to see your way out of 
poverty because you have worked hard. You are committed and a 
lot of these cheaters are not. So, be confident. Just claim 
that, all right, because you are going to be successful.
    Dr. Kvaal, do you think that it is important for us to 
discuss loan forgiveness as we talk about income-driven 
repayment plans?
    Mr. KVAAL. I do.
    Ms. FUDGE. And what should that be? What should that 
discussion be like?
    Mr. KVAAL. Well, my view is that students who are paying 
everything they are supposed to pay over a period of 20 years 
should, at that point in time, have the opportunity to have the 
rest of their student loan forgiven. Twenty years is a very 
long time. We know that student debt affects your credit score. 
It makes it difficult to save for mortgage. After 20 years, you 
may be trying to save for your children's education, and I 
think there is an opportunity there, where we need to say that 
we have collected what we can collect from the student.
    Ms. FUDGE. So, is there something that we can do in a 
shorter period than 20 years to help somebody like Ms. Parker?
    Mr. KVAAL. Well, I think there is a--there are a couple of 
things that people that qualify--that should qualify for 
special help. I think one is people who go into public service 
careers, and we know that student debt is an obstacle and does 
affect career choices, and that can make it a challenge to 
recruit people into the military and to teaching careers. It 
impacts the diversity of those public service work forces.
    I think a second category is people who have been cheated 
by their colleges, and there are, currently, over 100,000 
borrowers who have applications pending at the Education 
Department claiming fraud or some other illegal conduct at 
their college. Those people need to have their loans forgiven 
as well.
    Ms. FUDGE. Thank you. Just one more question for you, Dr. 
Kvaal. Grad PLUS loans. How do you believe that Grad PLUS loans 
assist with students in underrepresented communities, or even 
fields, for that matter, can get to graduate school, and what 
effect would there be if we eliminated them altogether?
    Mr. KVAAL. Well, Graduate PLUS loans are an important 
source of finance for many people pursuing graduate and 
professional degrees, especially people whose families are low 
in wealth, including communities of color. And we expanded 
access to Federal loans for these communities because we were 
concerned that, otherwise, they would borrow higher cost 
private loans that have interest rates that can be as high as 
13 or 14 percent.
    Ms. FUDGE. Dr. Morrison-Shetlar, since you represent a 
university that deals with a lot of first-time and low-income 
students, what do you think we should be looking at to try to 
reduce the ongoing, and sometimes it is exorbitant, rate that--
of loans that people have to take out? What do you think we 
should be doing differently? Is it increasing Pell Grants? Is 
it doing--just give me your ideas.
    Ms. MORRISON-SHETLAR. I certainly would approve of reducing 
the cost to a student to be able to attend, and attend their 
dream of a--of an education. There are a lot of grants, as we 
heard, loans out there. I would like to see those simplified in 
terms of applications and more investment in those.
    Pell Grants is a really good example. With over 40 percent 
Pell Grant--Pell-eligible students at Western Carolina 
University, we could see a tremendous amount of reduction in 
indebtedness with all of the results that occurs from that: 
people graduating on time, not having to do three or four jobs 
to be able to make it through, which distracts from their time 
of really focusing on their education and their future careers. 
So, I would like to see what we are all currently doing 
expanded, and make sure that it is the easy--and relevant to be 
able to apply for those opportunities.
    Ms. FUDGE. Thank you very much, and I am going to close, 
again, with Ms. Parker. You know, we live in a country where 
people say if you work hard, you will be successful and you 
will do well. I want you to know that those people who believe 
people like you are lazy--you are a perfect example of someone 
who is not. I wish you all the very best. I yield back.
    Chairman SCOTT. Thank you. The gentleman from Kentucky, Mr. 
Guthrie?
    Mr. GUTHRIE. Thank you, Mr. Chairman, for yielding time, 
and thank you for the panelists for being here today. This is 
an important hearing, and I appreciate the chairman for calling 
it.
    So, Dr. Akers, according to a study by the Brookings 
Institute, only a quarter of first year students could 
accurately report how much they had borrowed, and 14 percent of 
students who had borrowed money thought they had no debt at 
all. This information problem is very concerning to me, which 
is why I have introduced a bipartisan counseling bill with my 
friend, Congresswoman Bonamici from Oregon, in the last three 
Congresses to enhance financial aid awareness and 
understanding. The bill would require more detailed and annual 
counseling for Federal aid recipients throughout their 
education. Can you discuss the benefits of counseling students 
on their financial aid?
    Ms. AKERS. Sure. So, a lot of folks are looking into the 
fact that the provision of information about the cost that 
students are facing and the aid that they are receiving is 
unnecessarily difficult to digest. So, the students were--
discussed just recently are receiving, right now, their 
acceptance letters to universities and also their financial aid 
award packages. These packages are not often, like, complete 
transparent about the difference between loans and grants, and 
I think this is leaving students questioning what exactly their 
financial circumstances are. Obviously, it is leaving them 
questioning that because we were able to document that using 
survey data. So, if we want students to be able to police the 
market for higher education using their dollars, that is 
choosing to spend at institutions that are delivering good 
outcomes for students, they need to understand what it is they 
are paying. They need to understand what it is they are 
borrowing.
    We also, of course, want them to understand what it is that 
institutions are delivering to students that they have served 
previously. So, I think it is critically important to the 
system, and also just to individual students themselves.
    Mr. GUTHRIE. Thank you very much. And, Dr. Webber, with 
$1.4 trillion in outstanding Federal loan debt, there is no 
doubt that students are struggling with student debt. In your 
testimony, you noted the large amount of misinformation on who 
is suffering the most from taking on loan debt. Can you please 
explain what level of education students with $60,000 or more 
debt are seeking compared to the average balance of defaulted 
loans?
    Mr. WEBBER. Sure. So, on average, the typical student who 
has, you know, more than, say, $100,000 in debt, first, they 
are very rare. We are talking about 5 percent of borrowers. 
Most of them are people who have gone to graduate school and 
received, you know, professional degrees, med school that are 
going to pay off in spades. Not all of them. And, you know, I 
do not want to minimize the problems that some have, but it is 
somewhat of a distraction from the much, much larger problem of 
people who have, say, between $5,000 and $10,000 in debt, but 
did not graduate, attended a, you know, low value institution 
and under-resourced institution, and said--because the vast 
majority of the college premium is tied up in actually getting 
the degree, then, you know, having $5,000 or $10,000 in debt, 
which is not dischargeable in bankruptcy, you are going to be 
much, much more likely to default under that scenario than 
someone with, you know, a graduate or professional degree and 
much more debt.
    Mr. GUTHRIE. Thank you very much. And Dr. Morrison-Shetlar, 
I was interested in your testimony about the partnership with 
regional community colleges, and could you elaborate on this? I 
know, in Kentucky, a lot of people are getting their 2-years 
degree and then moving on. They matriculate direct, straight 
into our 4-year universities with the transferring credit. And 
when I was in the State legislature, I worked with someone to 
do dual credit, and we actually have people graduating from 
high school with their associate's degree if they want to do--
move forward. Since they are with no debt, I think that there 
is some cost to it, but it is not, typically, if they went, 
graduated from high school and went. So, could you explain what 
you guys are doing to keep college costs down by working with 
community colleges?
    Ms. MORRISON-SHETLAR. Most certainly. The great thing about 
Western Carolina University is that we work with all of our 
community colleges. We set up MOUs through particular tracts of 
education, so that students, when they go to the community 
college, know what they need to take at the community college 
that will count toward their 4-year degree, should they choose 
to go on and do that. And so we work very closely with the 
presidents and with the admissions office and with the advising 
office, which I think is a key component to anyone transferring 
from one institution to another. At Western, we have--42 
percent of our students are transfer students, and we make sure 
that the curriculum alignment is in place, and that, also, the 
advising that they are getting at the community college is 
enough affiliation with that at Western Carolina University. 
So, a seamless transfer is really, really important. Curriculum 
alignment is really, really important.
    Mr. GUTHRIE. Thank you. I appreciate everybody for being 
here, and the chairman for calling this meeting. My time has 
expired, so I yield back.
    Chairman SCOTT. Thank you. The gentleman from the Northern 
Mariana Islands, Mr. Sablan?
    Mr. SABLAN. Thank you very much, Mr. Chairman. Thank you 
for holding this hearing. Good morning to all the panelists. 
Welcome, Journey. I hope that you will remember forever this 
moment in your life, and how your mother is sharing her story 
with us because that story is, has you as a part in it, a major 
part.
    I would also like to take an opportunity, the privilege, to 
recognize in the audience a student from the Northern Marianas, 
who is attending school here in Washington, DC, Olivia. So, 
your name is on the record for good. She does not like that, 
but anyway.
    I come from a place where we have a community college, a 2-
year college. Ninety percent of our students qualify for a Pell 
Grant. And when I went to college, I was, had to come here as a 
foreign student. My father had a family of seven children to 
raise, and was making $1.00, $1.25 an hour, and he lost his 
job. I could not just go and get a job because I needed to get 
immigration to approve it as well. So, it was not easy for me 
to finish college, to be very honest.
    Ms. Parker, congratulations. I mean, well, you are in my 
prayers, too. You will succeed, also.
    I agree with--but Chancellor Morrison-Shetlar, you may not 
know this, but, again, my district, in the Northern Mariana 
Islands and American Samoa, are the only two U.S. jurisdictions 
without a 4-year public university. It holds a single community 
college. Our students face the cost of nonresident tuition at 
4-year institutions, as well as the extra travel cost to attend 
school in Hawaii, 4,000 miles away from home, or almost 8,000 
miles away from your school. And as a member of this Committee, 
I have worked and I continue to work on legislation to help 
reduce the cost for my constituents. I must compliment your 
State for committing the resources, to be able to offer, make 
college affordable, and also make sure the students are 
nurtured, too.
    I will submit my questions for the record, but as a 
university chancellor, do you believe the Federal Government 
has a role to play in assisting students with unique college 
costs, such as those from the Marianas and American Samoa?
    Ms. MORRISON-SHETLAR. The Federal Government has a number 
of things in place, and, as I mentioned earlier, I think the 
way to help people is to make sure that those grants and loans 
that are available are able to be easily attained. At North 
Carolina, we subsidize the in-State students up to the $500 per 
semester. We also have a $2,500 for out-of-State, but we also 
are, have an 18 percent cap on the number of out-of-State 
students that we can take into North Carolina--
    Mr. SABLAN. I--
    Ms. MORRISON-SHETLAR [continuing]. and I think that is 
something that one has to be aware of when we are funding the 
students at North Carolina. I will say that we are very 
fortunate at Western Carolina University, and within the 
system, actually. Fifty percent of the students who come from 
out of State to North Carolina end up staying in the State of 
North Carolina--
    Mr. SABLAN. Mm-hmm.
    Ms. MORRISON-SHETLAR [continuing]. and so that is a great 
investment in North Carolina, and allows people to give back to 
the economy within North Carolina.
    Mr. SABLAN. Right. Thank you. And for me, we prefer that 
you educate our students and then they come back home and use 
what they learn.
    But, Ms. Parker, college students in the Marianas and 
across the country are juggling work, parenting, and school. In 
fact, one in four students nationwide are parents. More than 
one in three are older than 25, and almost two out of three 
work while in college. So, what supports made it easier for you 
to remain in college, persist?
    Ms. PARKER. Thank you, and thank you for your wishes 
earlier. I have been supported--I have been connected to 
resources, and that is what has been able to get me to 
completion. For example, the biggest help, I would say, was 
being connected to the jobs and family services representative 
on campus. I went to visit the representative for childcare 
costs. I needed help getting childcare costs to be approved 
while I was in school, and Journey was in daycare at the time. 
When I went to speak to the job and family services 
representative, she also let me know that I could enroll for 
additional benefits, so the healthcare, the food stamps. And 
then I was also referred to, in that same department, not 
through her, specifically, but to Scholar House for the student 
parent housing. It, takes a platform of all of those put 
together for me to be able to get to completion.
    Mr. SABLAN. Thank you, and thanks, Mr. Chairman. My time is 
up. I will submit questions for the record. Thank you, 
everyone.
    Chairman SCOTT. Thank you. The gentleman from Georgia, Mr. 
Allen?
    Mr. ALLEN. Thank you, Mr. Chairman, and thank you for, 
again, for this hearing. It is important to find out what has 
actually got us to this point, and then try to fix it. It is a 
difficult situation.
    We have got 7.4 million jobs open in this country right 
now, and we got college graduates that cannot get a job. I 
cannot, for the life of me, understand that. And everywhere I 
go, people need people and, now, this is not necessarily, a 
college graduate. It is just, you know, skilled people. And, of 
course, the Chairman put up a chart up there about the 
difference in the wages of college graduates versus those who 
maybe have technical training and all that. That gap, in my 
opinion, is narrowing very quickly. I know that when I was in 
college, I had the opportunity to learn how to weld, and 
through that skill I was going to co-op, and through that skill 
and working basically double time and help for my parents, I 
was able to get through it. And, of course, I thought it was 
terribly expensive back then, and I am sure I missed out on 
some of the college experience, but I had no college debt 
thanks to my great family and their support. So, I cannot 
imagine, Ms. Parker, what you have been through.
    And also to straighten out one other thing that came up 
here today, and I just have to do this, is that I did notice 
that you were on the Food Safety Nutrition Program. One of my 
colleagues brought up the farm bill. Eighty percent of the farm 
bill is funding the Safety Net Nutrition Programs. It is not 
greedy farmers. We are just trying to keep our farmers in 
business, so we can produce the best, safest, most efficient 
food supply. It is a few--it is a national security actually. 
So, since you are here, and you are learning from us and we are 
learning from you, I thought you probably needed to know that.
    So, with that, you know, Dr. Akers, your testimony mentions 
ways to bring private capital back into the student loan space, 
increase our competitive market participation in student 
lending. And can you expand on those issues and discuss any 
challenges policymakers should think about while considering 
private sector participation and student learning--lending?
    Ms. AKERS. Sure. Is the question about private sector 
participation in provision of education or in the financing?
    Mr. ALLEN. Well, in the financing. For example, we were 
told that the student loan rate is somewhere between 7 and 8 
percent, and I know that--I mean, I come from the business 
world, and we borrow money for much less than that. Now, 
obviously, you might have to get, you know, some, you know, 
like a small business government-backed loan, but at least you 
could reduce the interest rate substantially and provide a--you 
know, where Ms. Parker could go and say, well, the government 
is charging me this, and you are going to charge me, give her 
choices.
    Ms. AKERS. Mm-hmm.
    Mr. ALLEN. And also, the financial institutions, I think, 
would do a much better job at least. I have to do a portfolio 
and tell them how I am going to have to pay the money back. 
Maybe they could educate Ms. Parker on how to really pay that 
money back.
    Ms. AKERS. Sure. So, there is a bit of a misconception 
about the idea that private sector capital was previously 
involved in the Federal Student Lending Program. So, depending 
on how long you have been involved in this issue, we previously 
were providing Federal student loans through the FFEL Program, 
in which the loans were originated and financed by the private 
sector, but those loans were originated using terms that were 
prescribed by legislation. So, in essence, Department of 
Education was outsourcing to the private market the creation of 
those loans. Those loans were not private sector or private 
loans in any broader sense because they were not underwritten. 
So, what you are talking about is the process by which a 
private lender looks at a particular borrower and assesses 
their ability to repay in the future. That does not happen in 
the Federal Lending Program for student borrowers and did not 
happen, even when private capital were involved. The way 
forward, to think about private capital in higher education 
finance, I believe, is in the realm of income share agreements.
    So, income share agreements are a relatively newly employed 
mechanism that are an alternative to loans that can help 
borrowers finance their education. So, rather than taking out a 
loan and having fixed payments to repay over 10 years, or 
whatever the term of the loan is, a borrower takes cash up 
front in exchange for a promise to pay a fraction of their 
income over a set period of time, and so this provides an 
insurance policy for students that if they face low income or 
no income, for whatever reason, they are not on the hook for an 
unaffordable financial obligation, and it also puts some skin 
in the game for institutions. So, in thinking about private 
capital, going forward, I think that is the place to focus 
attention.
    Mr. ALLEN. Well, again, for--I had an amendment on the past 
bill markup to somehow put financial, actually, education into 
the student loan program. So, you know, like, folks like Ms. 
Parker would understand, you know, what she is up against.
    So, Mr. Chairman, I am out of time. I yield back. Thank 
you.
    Chairman SCOTT. Thank you. The gentlelady from Oregon, Ms. 
Bonamici?
    Ms. BONAMICI. Thank you, Chairman Scott, and to Ranking 
Member Foxx, for holding this hearing. Thank you to all of our 
witnesses. Ms. Parker and Journey, and, especially, thank you 
to you for being here and telling your story, and reminding us 
that the costs of higher education are not just about tuition, 
housing, childcare. There are so many other costs as well.
    I also worked my way through. I started at 2 years of 
community college, then 2 years of college, 3 years of law 
school with a combination of grants, loans, and work study, and 
ended up, because it was a long time ago, with a manageable 
amount of debt. And my first job was with the Federal 
Government, not with a law firm where I could have made more 
money. And, unfortunately, that is not the story I hear 
frequently today. So, I am really glad that we are having this 
hearing, especially when we are talking about students who 
remain underrepresented, but I am also glad that there seems to 
be a general recognition about the importance of higher 
education among people here today.
    We certainly need a short-term solution for people like Ms. 
Parker with existing debt, but we also need long-term solutions 
to make sure that anyone who wants to go to college can do so 
without being burdened with debt.
    So, Mr. Kvaal, nice to see you. The Federal Work Study 
Program allows students to get work study experience and 
financial aid, and I have introduced the Opportunities for 
Success Act to reform the Federal Work Study Program, to 
modernize the funding formula, which has not been done for 
quite some time, and also to make sure that work is going to, 
the work study jobs are helping to align students, work with 
their career goals and interests. We want the aid to go to the 
students most in need. So, what are your suggestions about how 
to make sure that institutions are serving the largest number 
of low-income students and helping to align their interests 
with their work study jobs?
    Mr. KVAAL. Ms. Bonamici, thank you for the question. I 
share your support for the work study program. Work is an 
important strategy for getting students through college, both 
because it fills important gaps in financial aid budgets, but, 
also, research shows that modest amounts of work can actually 
help retain students and give them an opportunity to explore 
career interests and improve their earnings potential after 
college. The challenge we have, though, is many students are in 
the same low-wage work force as other low-income Americans, and 
we know those jobs are very unstable, can be difficult to get 
scheduled. So, to have an opportunity for a work study program, 
where jobs are designed around schedules, the students, they 
are often on campus. They are connected to career and academic 
interests. It is very valuable.
    The existing work study program funds colleges largely, 
historically, and it does--no longer sends the money where 
there are large numbers of low-income students. So, for 
example, New York University gets a larger allocation than CUNY 
does. In fact, if you are a low-income student at a 4-year 
private university, you are more likely to get work study than 
a low-income student at a public university, even with--we know 
public universities disproportionately enroll low-income 
students. So, I think that--
    Ms. BONAMICI. Thank you, and I want to get another couple 
questions in, but--
    Mr. KVAAL. I apologize--
    Ms. BONAMICI [continuing]. I think the message that it is 
time to update the funding formula. Thank you, also, for 
mentioning my Simple Act that I have been working on to--I plan 
to reintroduce this bill, which will protect many borrowers 
from default by getting more students and keeping more students 
in income-driven repayment. And you mentioned the importance of 
automating the annual income recertification process, and also 
automatically enrolling severely delinquent borrowers. These 
are both changes in the Simple Act. Can you talk a little bit 
about how this will help students?
    Mr. KVAAL. Yes. The income-driven repayment is a really 
important safety net. It allows us to tell students we think 
loans are an excellent investment, but if it does not pay off, 
we can guarantee that loan payments will be affordable. There 
are very important changes that need to be made to the program, 
to simplify the program for students, make it easier to enroll, 
auto enroll delinquent students. And so I think the Simple Act 
has a lot of potential to reduce loan delinquency and default 
and make a real difference.
    Ms. BONAMICI. Thank you so much. And I also heard retention 
several times this morning, and that is a significant issue, 
especially if we look at the students with debt. If they do not 
graduate, they are much less likely to be able to pay that 
back. So, who wants to talk about the importance of GEAR UP and 
TRIO and programs that help with retention? Who--Dr. Morrison-
Shetlar?
    Ms. MORRISON-SHETLAR. All of those programs help with 
retention, and it is key that if you have students who have 
debt that you get them through the process, and you get them to 
a point where they can start to work and earn money and pay 
back those debts, and those programs that you are talking about 
are essential. They are--they include things like financial 
literacy. They include things like working. If you are going to 
work, work in something that will get you the experience that 
will help you to succeed in your career. So, there are career 
pathway experiences. And so all of those things help with 
retention and just making sure that students can focus on their 
studies and get their work done without having to work on two 
or three jobs, really, really is important. So, all of--any 
program that will help students be able to focus and get 
through their degrees and be successful, I am fully supportive 
of.
    Ms. BONAMICI. Thank you, and I am over time. I yield back. 
Thank you, Mr. Chairman.
    Chairman SCOTT. Thank you. The gentleman from Pennsylvania, 
Mr. Smucker?
    Mr. SMUCKER. Thank you, Mr. Chairman. Question for Dr. 
Shetlar. I would like to learn just a little bit more about 
your transfer program, which helps students prepare for several 
high-demand career fields that you described. How did you 
determine what jobs are in high demand in the work force?
    Ms. MORRISON-SHETLAR. So, within Western North Carolina, we 
do surveys. We look to see what jobs are available, in 
particular what jobs are needed. And so, in our particular 
area, healthcare is a big industry, and one in which we are--
severely need for the citizens of Western North Carolina. And 
so we make sure, as an institution, that we are providing the 
right programs with the right qualifications and the right 
experiences, so that students will then graduate and then go 
into those careers and be successful, and that lifts up the 
whole economic development of our region.
    Mr. SMUCKER. Yes. Can you talk a little bit more about the 
agreements that you have in place with some of the partner 
colleges? Was it difficult to reach those agreements, or talk a 
little bit about how that came about?
    Ms. MORRISON-SHETLAR. Well, we all have the same goal in 
mind: for our students to be successful. And to do that, we 
need to make sure that we have curriculum alignment. If you are 
taking 2 years of community college and earning your A.A. 
degree, then those credits transfer into your 4-year degree, 
and then you can go through as seamlessly as possible. Advising 
is really key on that. So, we do joint advising between the 
community colleges and the university, making sure that the 
advisors know what to say to the students if they even are 
thinking about going to a 4-year degree because a lot of 
students go to community colleges not thinking that they are 
even going to have that dream. And so advising is a real 
component.
    And then making sure that those memorandums of 
understanding between the colleges and the universities are 
clear and updated regularly as curriculum changes to meet the 
needs of a growing industry, like healthcare.
    Mr. SMUCKER. Yes. Well, in your mind, what could other 
regions learn from you? What obstacles would they have to 
setting up similar arrangements?
    Ms. MORRISON-SHETLAR. It is all about communication. It is 
all about the best for the student, and making sure that 
pathway is one that is affordable, that--and this is where NC 
Promise, I think, has been fabulous because the cost of NC 
Promise is--to the student can be similar to a community 
college cost. And, therefore, if a student has managed to get 
through the 2 years, then, with the cost of that, to be able to 
transfer to Western Carolina University, for example, is an NC 
Promise school, means that they are already on that pathway. 
They know that they can afford it. They know how much debt they 
are going to incur, and they know that they are going to get a 
high-quality education provided by high-quality faculty and 
staff, who make sure that they have the experiences that they 
need to be successful.
    Mr. SMUCKER. Thank you. Dr. Akers, innovation in any 
industry is critical to increasing competition amongst 
providers in delivering a high-quality product to consumers at 
a low price, and it appears that, you know, colleges and 
universities--we know education is changing, but, in some ways, 
continue to use the same model that has been in existence for a 
long, long time, for decades and maybe longer. How can we be 
helpful or to--maybe to what extent do you think the Federal 
Government sort of constrains what colleges and universities 
can do? How can we work with you to encourage more innovation 
in higher education?
    Ms. AKERS. Sure. So, in order for a new institution to come 
into existence, they need to be able to find and retain 
students. It is challenging for them to do that in the current 
space because they are competing with institutions who have 
eligibility for very generous aid through the Pell Grant 
Program and access to subsidized student loans.
    The way to potentially allow them access to Federal student 
aid is through the Experimental Sites Initiative and the EQUIP 
Program. So, this is an effort that was started under the Obama 
Administration, to allow innovative institutions that do not 
fit the standard model of what higher education looks like in 
this country and, therefore, do not achieve the standards that 
are necessary to gain access to financial aid. It allowed them 
to partner with traditional institutions and to sort of play 
with Federal student aid and experiment. That effort was not 
largely successful, perhaps because of the way it was designed.
    I would encourage that the Federal Government continue to 
support those types of initiatives that do not just open the 
floodgates and allow Federal student aid to be utilized by, you 
know, these new and exciting business models without, you know, 
any accountability, but rather to continue to test out and 
using different sites and trial programs for these new programs 
that have a proven track record of success.
    Mr. SMUCKER. Great. I look forward to working with you on 
that, but my time is up. Thank you.
    Chairman SCOTT. Thank you. The gentleman from California, 
Mr. Takano?
    Mr. TAKANO. Thank you, Mr. Chairman. I do appreciate that 
you are holding hearings on this important topic. I want to 
thank all of the panelists for being here today, but I want to 
begin my question with Mr. Kvaal. It is good to see you again 
and thank you for being here to share your recommendations on 
improving college affordability.
    I have a letter from Chancellor Oakley of the California 
community colleges that describes how the California community 
colleges have been hit hard, particularly by the for-profit 
closures in the State of California. And when, so, what happens 
is when for-profit companies suddenly shutter, the community 
colleges, which are already under-resourced, how they mobilize 
to provide support to affected students. So, without objection, 
I would like to enter this into the record.
    The ability of the community colleges to properly serve 
these students is severely hampered by the poor-quality 
education--the poor quality of education that the students 
receive at the for-profit institution, and by the debt load 
students carry after attending one of these schools. I have 
heard too many stories about students attempting to transfer 
their credits, only to find out that almost none of their 
credits actually transferred, and that they are nearing the 
maximum--their maximum loan limit, impeding them to continue 
their education, in this case at community colleges. So, Mr. 
Kvaal, what can the Federal Government do to provide better 
upfront accountability of for-profit institutions to better 
protect students?
    Mr. KVAAL. Thank you for the question, Mr. Takano. We have 
seen, over the last few years, for-profit colleges enrolling 
over 100,000 students close and leave them in the bind. So, the 
instances you mentioned, in California, are only the latest in 
a long chain that began with Corinthian. It is important to 
have strong accountability protection, such as the Gainful 
Employment Rule, which requires that typical graduates of for-
profit programs be able to repay their loans; the Borrower 
Defense Rule, which holds colleges accountable for illegal 
conduct, such as fraud; the Incentive Compensation Rule, which 
prohibits deceptive and high-pressure recruiting; and the 90-10 
Rule, which requires at least 10 percent of students being 
willing to pay for the education out of their own pocket. So, 
there are important accountability rules. Many of them are 
being neglected by the current administration, and others need 
to be strengthened by Congress.
    Mr. TAKANO. Yes, I am aware of the neglect and, actually, 
the rollback of protections, and I understand in the chairman's 
Aim Higher Act that we actually work to strengthen some of the 
protections you mentioned. How do we ensure that students are 
not left with burdensome debt after a for-profit closure?
    Mr. KVAAL. Well, one important step is to make sure that 
students have their loans discharged after a school closes. The 
current law gives them the right to choose whether to transfer 
or get their loans discharged. Many students never actually do 
either, so it is important to guarantee them that automatic 
right to have the school discharged. We need to adequately fund 
tuition relief funds, so that students have that means, and we 
also should not keep students in the dark. So, you know, when 
the Argosy College and these other colleges closed last week, 
it was not a surprise to the executives at those colleges. It 
was not a surprise to the Department of Education, but it was a 
surprise to a lot of the students who were borrowing and 
dipping into their savings to go to those schools.
    Mr. TAKANO. That is amazing. I want to talk about Income 
Share Agreements, or ISAs, that are contracts between college 
students and investors, in which an investor agrees to pay a 
portion of a student's tuition for a portion of the student's 
future income after graduation. Speaking frankly, I see ISAs as 
another way to push the private market onto students, which has 
never resulted in positive outcomes. In an effort to shore up 
profits, the private market has been inclined to irresponsible 
and unfair practices when lending to vulnerable students, which 
is what led us to include consumer protections in the Dodd-
Frank Act in 2010. Given the history of the private market and 
college financing, I am concerned with the potential abuse of 
students through ISAs. Mr. Kvaal, what are some of the other 
pitfalls of ISAs?
    Mr. KVAAL. Well, I share your concerns, Mr. Takano. I think 
that private loans, including ISAs, will always have higher 
costs and weaker consumer safeguards than Federal student loans 
do. ISAs, in particular, are not transparent, and because 
students have very different earning trajectories, sometimes 
because of labor market discrimination, ISAs have the potential 
to have higher costs for some types of students and even 
exclude some students from some types of programs or colleges.
    Mr. TAKANO. Well, my time has expired. Mr. Chairman, I 
yield back. Thank you.
    Chairman SCOTT. Thank you. Thank you. The gentleman from 
Kansas, Mr. Watkins?
    Mr. WATKINS. Thank you, Mr. Chairman. Thank you all for 
being here. So, I represent Eastern Kansas. It is agrarian, and 
then there is lots of poverty issues there, and I know, 
personally, what it is like to try and, oh, deal with mounting 
school debt. So, it seems to me, the solution was a pro-
economic growth policy, characterized by low taxes and low 
regulation that allows the economy to thrive, and does it work? 
Well, our pro-growth economic policy has led to record low 
unemployment. We are enjoying over 7 million job openings. The 
Labor Department, when reporting on hiring competition, says 
that here is an increase in average hourly pay by 3.4 percent 
from last year, which is the highest in a decade. Given the 
strong economy, Dr. Akers, are you seeing States beginning to 
thoughtfully reinvest into their higher education institutions, 
given the strong economic performance nationally?
    Ms. AKERS. Yes. It does seem that there was a decline in 
State support of higher education following the Great 
Recession, and we have seen recent indication of an increase in 
investment.
    Mr. WATKINS. Thank you, Doctor. Chancellor Morrison-
Shetlar, staying with the excessive red tape subject, would you 
speak to any burdensome Federal regulations on the higher 
education community that could be cut, so that you can spend 
more focus on students and education?
    Ms. MORRISON-SHETLAR. One of the main issues that we have 
is just the cost of compliance, meeting the compliance 
regulations and needs. It would be great if we could either 
keep the amount of compliance that we have, that we have to 
report on, or decrease it. That would certainly help us with 
the burden of that because we are actually having to hire 
people to be able to help us with that, rather than using those 
resources to invest in education.
    Mr. WATKINS. Great. Thank you. Thank you, Chancellor, and 
thank you all for being here. Mr. Chairman, I yield back my 
time.
    Chairman SCOTT. Thank you. The gentlelady from North 
Carolina, Dr. Adams?
    Ms. ADAMS. Thank you, Mr. Chairman. The clock, there was 
some extra time on there. Let me thank all of you, first of 
all, for being here and for your testimony.
    Ms. Parker, I am very moved by your story. I am a retired 
professor of 40 years at Bennett College in Greensboro, North 
Carolina, where I worked with young women just like you. I went 
to school, like you, and took my children with me, and I know 
the struggle, but, of course, when I was in school, many, many 
years ago, the cost was not nearly what it is today.
    Dr. Morrison, thank you for what you do for our students in 
North Carolina.
    Mr. Chairman, I would like to submit, for the record, a 
letter from CLASP, an organization that supports low-income 
students.
    Chairman SCOTT. Without objection.
    Ms. ADAMS. Thank you. Let me ask, first of all, Chancellor 
Morrison-Shetlar, you helped create the North Carolina Promise 
Program. I was a member of the North Carolina House when that 
discussion came up. I was a little concerned, as well, about 
not only the fact, I think, we always need to try to make 
college affordable. Access and affordability really are key for 
students. Having worked at a private institution, knowing a lot 
about our historically black colleges and universities in North 
Carolina, I had a concern about the cost that the college would 
incur, and with $500 that the students pay.
    Do you have any information about, you know, I know 
Elizabeth City is one of the schools. They are a fine 
university. I had an opportunity to talk with the Chancellor 
fairly--but I am curious about that, and I know how it is a 
game changer for students, but in terms of the struggle for 
universities?
    Ms. MORRISON-SHETLAR. This is a very ambitious program and 
the State has stepped forward and, this first year alone, $51 
million have been put toward the success of this program. And 
so the universities are subsidized and given the money by the 
State to make sure that there is no impact on the quality of 
the education that the institutions are able to provide.
    Ms. ADAMS. Mm-hmm. I also know that, you know, with the 
universities, and this is supposed to be for, what, 3 years for 
the students? Is that correct?
    Ms. MORRISON-SHETLAR. No. For the students, it is the 
time--the whole time that they are in the university.
    Ms. ADAMS. Oh, Okay. Okay. Okay. I was trying to figure 
that out. Let me ask what considerations did you give in terms 
of helping to get this program started?
    Ms. MORRISON-SHETLAR. As soon as we heard about it, we 
wanted to work very closely with our legislators to make sure 
that it was functional for the universities and, most 
importantly, that it was something that was transformational 
for our students to have, particularly Western North Carolina. 
We have a lot of low-income students. We are a very rural area. 
The other three--the other two institutions are also in rural 
areas. We wanted to make sure that the right people were able 
to access this kind of--
    Ms. ADAMS. Right.
    Ms. MORRISON-SHETLAR [continuing]. program--
    Ms. ADAMS. Okay.
    Ms. MORRISON-SHETLAR [continuing]. and so the ability to 
let people know that this was available to them, that an 
education was available to them, was important.
    Ms. ADAMS. Thank you, ma'am. Dr. Kvaal, this hearing has 
focused a lot of attention on the hardships of students of 
color and what they face in terms of the student aid space. Our 
Nation's minority-serving institutions provide a quality 
education to a sizable portion of black and brown students, and 
do so at a fraction of the cost of most flagship public 
universities. But despite the fact of what I just said, the 
President's budget level funds Title 3 and 5 and allows 
important mandatory funds to expire. In your opinion, if we 
were to increase Federal investment in our Nation's MSIs, is it 
your thinking that we could close some of the gaps in terms of 
access, affordability, and completion among students of color 
compared to their counterparts?
    Mr. KVAAL. Yes. We know those funds get--those institutions 
get much less funding per student, and it is not a surprise 
that is one reason why their graduation rates are not as high 
as some other institutions.
    Ms. ADAMS. Okay. One quick question, and I think maybe Dr. 
Akers spoke to this, in terms of the student understanding the 
financial aid packages. What can we do to help them better 
understand it? And if we can get Ms. Parker to make a quick 
response, too, because she commented about that as well.
    Ms. PARKER. I think that it is important that, 
specifically, when students are going from high school to 
college, to also educate their parents because if you are 
talking about students from low economic backgrounds, it is a 
generational effect. That is something that is happening before 
it even got to that one student.
    Ms. ADAMS. Okay.
    Ms. AKERS. I think that higher education is an incredibly 
complex product, and so, while I hate to have a recommendation 
for heavy-handed approach about how institutions should be 
delivering their financial aid award letters, I think it is 
justified that we direct some sort of standardization in the 
provision of that information to students.
    Ms. ADAMS. Great. Thank very much. Mr. Chair, I yield back.
    Chairman SCOTT. Thank you. The gentlemen from--excuse me, 
the gentleman from Texas, Mr. Wright?
    Mr. WRIGHT. Thank you, Mr. Chairman, and thank all of you 
for your testimony today. And Dr. Morrison-Shetlar, what you 
described as very similar that North Carolina is doing, and I 
want to compliment your State, is similar to what the 
university in my district has done, University of Texas at 
Arlington. It is 55,000 students, including online courses. It 
is the fastest growing campus in the UT System, which is a very 
large system in Texas and second only to Austin. But here is 
the interesting thing: it has the lowest debt, average debt, 
for a graduating student of any college or university, private 
or public, in Texas, and one of the lowest in the United 
States. The average is like $14,700 of debt. And one of things 
they did is similar to what you talked about in terms of 
partnerships with community colleges, but they did something 
really, what I think is special. And I wanted you to comment on 
this because the president of the university and the president 
of the community college, the school superintendents in the 
area came together, and in order to try and lower that cost for 
the students, the high school students can go to the community 
college and take courses and get college credit, which, when 
they get to UT Arlington is then recognized and accepted by the 
university, and a lot of students are taking advantage of that. 
Can you speak to that in terms of your experience? Do you all 
engage the high schools in North Carolina to any degree?
    Ms. MORRISON-SHETLAR. I cannot speak directly from what the 
schools do directly with the community colleges, but the idea 
is absolutely fabulous, and in any way that we can make sure 
that students have a seamless transfer from the K through 16 is 
really, really a great thing to be thinking about. So, I would 
like to learn more about it.
    Mr. WRIGHT. Great, and I yield the rest of my time back to 
Dr. Foxx.
    Mrs. FOXX. Thank you very much. Dr. Webber, you discussed 
noncompletion in your testimony, and call it the biggest risk 
associated with going to college. Are you familiar with the 
revenue theory thesis, where institutions are spending on 
faculty prestige and influence instead of on support services 
to help students graduate? I am particularly interested in your 
opinion on the effects highly priced academic programs have on 
perceived educational quality and student access.
    Mr. WEBBER. Well, thank you for the question. It is very 
important. First, I would say that there is mixed evidence as 
to the impact of very highly priced educational programs. 
Certainly, there are impacts of truly increased college 
quality. There are large earning impacts from, say, going to a 
high-quality State flagship university versus a regional 
comprehensive, for any number of reasons. There are, I think, 
are--I do not think that there is strong evidence to suggest 
that these so-called fancy universities, the, you know, very 
highly priced private institutions, that there is a causal 
effect of, you know, higher earnings or anything from those.
    Mrs. FOXX. I'm interested in the existing research behind 
the trends in the value proposition of college. We have all 
heard college graduate earnings outpace peers who attain a high 
school education. However, according to the Federal Reserve 
Bank of Saint Louis, the economic return on college is unequal 
across the population and diminishing across successive 
generations of college graduates. Dr. Akers, what can we do to 
restore the return on investment to higher education and make 
the prospect of college less risky?
    Ms. AKERS. So, there is a vast body of evidence estimating 
very large positive returns. Higher education, of course, there 
is a dispersion of what those returns are across the different 
classes of students, particularly with respect to their 
family's wealth. I think the most important thing to consider 
in maintaining the value that we have seen historically on 
higher education is ensuring that prices do not continue to 
creep up at the rate that they have been growing. I believe 
that the most important tool we have for doing that is in 
empowering consumers with information, so that they can make 
informed choices about where to spend, to the extent that they 
understand where spending is worth it and where it is not. They 
can put pressure on the institutions themselves to keep price 
in line with value.
    Mrs. FOXX. Thank you, Mr. Chairman. Thank you, Mr. Wright.
    Chairman SCOTT. Gentlewoman's time has expired. The 
gentlelady form Connecticut, Ms. Hayes.
    Ms. HAYES. Good afternoon everyone, and thank you, Chairman 
Scott, for holding this very critical hearing. Ms. Parker, your 
story is my story. You are me. So, I, everything that you said 
resonates with me, and I am so in credibly familiar with the 
idea of going through community college and working three jobs 
because this is my experience.
    I will disagree with you on one thing. You said the odds 
are that you will not lift yourself out of poverty. You already 
are lifting yourself out of poverty, so I hope you know that.
    Again, I could take the whole 5 minutes because this is so 
deeply personal to me, but two things that I want to, first, 
clarify this idea that graduate debt is a choice. I have to 
push back on that. All I ever wanted to be was a teacher. I 
went to community college, went back and got a bachelor's 
degree. In order to be an entry level teacher and maintain 
Connecticut certification, you have to obtain a master's degree 
within your first 5 years, and then professional certification. 
So, in order for me to get an entry level job, I needed a 
postgraduate degree. So, it is not a choice.
    And then the other thing that, I could feel the energy 
coming off of you when the comment was made that we could find 
other jobs, you know, maybe welding or career training. I was 
told the same thing 15 years ago, and I went and became a 
certified nurse's aide and I worked my way through school. But 
my question then and my question now is exactly the same. Do I 
not get to dream? Do I not get to have aspirations? Do I not 
get to provide a professional future for my children?
    So, I, on purpose, chose professors that would allow me to 
bring my kids to class. You know, I, on purpose, did those 
things. And what I will tell you, Ms. Parker, is that in the 
space of 7 years, I went from being the first person in my 
family to ever graduate from college to being a second-
generation college-educated family because from my daughter, 
she saw me every day going to school, and it was never an 
option. And she went to college and she, too, is a teacher now. 
So, if you ever question what this means and why it is 
important, your daughter is seeing, through you, what the 
possibility is, and you do get to dream.
    So, my question, I guess, is for Chancellor Morrison-
Shetlar. When we are talking about eliminating programs, like 
the Federal Supplemental Opportunity Grants, or TRIO, or GEAR 
UP, are those programs directly attacking low-income families, 
in your opinion? Because one of the things I was told when I 
could not get a loan or a grant was to have my mother or my 
family fill out a PLUS Loan or Parent Loan. If I am already 
working three jobs and helping to take care of my family, my 
mother did not have the capacity to fill out a loan on my 
behalf. So, it just perpetuates this idea of generational 
poverty. It says if you already do not have it, you cannot have 
access to it. So, is the elimination of these programs, in your 
opinion, a direct attack on low-income families?
    Ms. MORRISON-SHETLAR. I think that the problem is exactly 
as you mentioned it. Anything that prevents people from being 
able to apply for any aid or support at all is attack on 
student learning and the ability to progress in their careers. 
And that is why I am so proud of what North Carolina's doing in 
terms of capping things, like a 3 percent cap on fees, making 
sure that we have got State investment in the cost of 
attendance for students. So, any program that puts barriers 
toward people applying for support to be educated I think is 
attacking student learning.
    Ms. HAYES. Thank you. And for the remainder of my time, Ms. 
Parker, actually, you figured it out a lot sooner than I did. 
My children were older than Journey when I decide to go to back 
to community college, but I still would have to create 
opportunities for childcare and to bring them to class to do 
different things. What do you think would happen to other 
students if programs like the Child Care Access and childcare 
that currently exists were further eliminated?
    Ms. PARKER. Thank you. First of all, thank you. I think it 
would give us, or I am saying a student parent, the opportunity 
to move forward and progress and, like you said, break through 
generational barriers that have been placed upon us. I think 
that if I know that there is a safe place for my child while I 
am in class, I would have the bandwidth to focus more on what 
my studies are. Thank you.
    Ms. HAYES. Mr. Chairman, I would like to rest my time, or 
no time.
    Chairman SCOTT. Thank you. The gentleman from Wisconsin, 
Mr. Grothman?
    Mr. GROTHMAN. Sure. We have heard that part of the reason 
for the increase in tuition is there is a lessening of 
government support for the schools and they have to make it up 
in tuition, but I think you said that was 30 percent of the 
upper. Tuition has gone up dramatically, though, even without 
that. To what do you attribute that, or how are we spending 
more money today compared to 30 years ago for an equivalent 
degree? Where is that cash going?
    Mr. KVAAL. I will take this. So, the numbers are about 30 
percent is due to State divestment since the year 2000, and 
since the beginning of the Great Recession in 2007, it is about 
41 percent State divestment is responsible for. There are, 
across sectors, many different reasons. I mentioned the 
competition with the private sector salaries, that in order to 
hire a highly trained professor, universities--
    Mr. GROTHMAN. Okay
    Mr. KVAAL [continuing]. have to compare--have to compete 
with the private sector. One thing that is often mentioned is, 
you know, so-called wasteful spending at universities. This is 
really concentrated only among, you know, the universities 
that--you know, the Harvards, the--you know, this amenity 
spending is, you know, concentrated among a small set of 
universities that--
    Mr. GROTHMAN. Harvard is more wasteful than the other 
universities? That is what you are telling us? We should not 
take that waste program versus being typical?
    Mr. KVAAL. I guess what I am saying is that the 
universities that make the--make the New York Times for the 
lazy river, so to speak, educate a very, very small percentage 
of the students in this country and are not all representative 
of where most people are being educated.
    Mr. GROTHMAN. Okay. Kind of give you a followup question 
there. One of the faculty members of my universities, they felt 
that over time, not research personnel, but there had been, 
say, over the last 30, 40 years, a significant increase in 
nonteaching personnel at the universities, and that is why the 
students are being pounded for the side tuition. Has there been 
a significant increase in nonteaching personnel over the last 
40 years?
    Mr. WEBBER. There has, and I would say that there is--you 
know, this is in part, but this is some student-centered 
spending, that, you know, there are services to students that 
are not being offered, necessary services, that are not--that 
are being offered now, that were not being offered, you know, 
decades ago, that helped students, especially middle--first 
generation of students graduate.
    Mr. GROTHMAN. Okay. Question for you. I think there is a 
feeling over time that sometimes people take out more student 
loans than are necessary. I do think it is a good idea to rank 
universities as to how their students are doing on student 
loans, but do you think, if we are going to begin to do that or 
the rankings are going to begin to appear, if we should allow 
the universities themselves some say into how much loans the 
students are taking out? And I think there is a feeling among 
some professionals, and this was true when I went to school, 
like 40 years ago, that sometimes people take out more loans 
then are necessary to a certain extent to support a lifestyle. 
Would you be in favor of universities saying, you would have to 
have the universities sign off before you got a loan?
    Mr. WEBBER. I am very in favor of more accountability, and 
I am also in favor of his proposal.
    Mr. GROTHMAN. Good. That is great. One other thing. We talk 
about, you know, loan--or Pell Grants for, you know, certain 
demographics. Frequently, people from, say, middle class homes 
or kids from married families, they may not be getting a lot 
from their parents, but you could argue, and I have had parents 
complain about this, that some people who live one lifestyle 
are more likely to get grants than people who live another 
lifestyle. Do you think that is perhaps unfair?
    Mr. WEBBER. I--sorry. I do think that is unfair. I think 
that it is easy to focus on anecdotes of, you know, this person 
is getting something that, you know, maybe they ``do not 
deserve.'' I do not think that is representative of the, you 
know, general situations in--
    Mr. GROTHMAN. People getting penalized for getting married, 
for example, that sort of thing, or having married parents? Do 
you think that is unfair? We will ask Ms. Shetlar. Do you think 
that is unfair?
    Ms. MORRISON-SHETLAR. I think individuals come to 
university or college with different backgrounds and different 
support mechanisms. I am first generation and come from a 
modest background, and was grateful for the grants and loans 
that were available to me. And so I think it is hard to paint 
everyone with one brush stroke. I think it is some of an 
individual choice, in some cases, but sometimes a set of 
circumstances occurs.
    Mr. GROTHMAN. So, you are in favor of discrimination or?
    Ms. MORRISON-SHETLAR. I am not in favor of discrimination.
    Mr. GROTHMAN. Okay.
    Chairman SCOTT. The gentleman's time has expired. Thank 
you. The gentleman from California, Mr. Harder?
    Mr. HARDER. Thank you so much, all, for being here on such 
an important subject. Dr. Kvaal, I would love to start with 
you. Can you share with us, once again, what the aggregate 
amount of student debt is now in the United States?
    Mr. KVAAL. $1.5 trillion.
    Mr. HARDER. And I know I have not been here that long. It 
was not that long ago since I was in college myself. When I was 
in college in 2006, do you recall where the aggregate debt was 
then?
    Mr. KVAAL. I do not, but it was substantially less than $1 
trillion.
    Mr. HARDER. I think it was around about $500 billion. Does 
that sound about right?
    Mr. KVAAL. It does.
    Mr. HARDER. So, in other words, in the last 10 years, since 
I got out of school, the aggregated amount of student debt in 
this country has tripled in the last 10 years? Is that fair?
    Mr. KVAAL. Yes.
    Mr. HARDER. And while we have done that, I think it is 
interesting to note that we have also been disinvesting at the 
same time in some of the Federal support services that are 
really critical. So, in 1980, my belief is there--my 
understanding is that the Pell Grant covered--the maximum Pell 
Grant was about 76 percent of the cost of attendance for a 4-
year school, about 76 percent in 1980, is that--
    Mr. KVAAL. Yes.
    Mr. HARDER [continuing]. around correct? Do you know where 
it is today?
    Mr. KVAAL. It is about a quarter.
    Mr. HARDER. Got it. So, in other words, the amount of 
student debt has tripled over the last 10 years, and over the 
last 30 years or so, we have gone from, about 40 years, we have 
gone from about 76 percent of the cost of attendance of a Pell 
grant, has slipped to about a quarter?
    Mr. KVAAL. That is right.
    Mr. HARDER. Is that fair?
    Mr. KVAAL. That is right.
    Mr. HARDER. And I would love to get the student perspective 
on this as well, Ms. Parker, and thank you so much for being 
here. It is interesting, day today, because we are about 24 
hours after a, you know, real scandal in higher education, 
where we have seen, I think, a renewed sense of the inequality 
in our higher education system. To your belief, did your 
parents bribe any school administrators or coaches to get you 
in to school?
    Ms. PARKER. No.
    Mr. HARDER. Are you sure there is no, like, endowed 
building, a couple million dollars that helped get you into 
Franklin?
    Ms. PARKER. I guarantee there is none.
    Mr. HARDER. There is not in my alma meter either. And what 
did you study when you were in school?
    Ms. PARKER. This most recent time?
    Mr. HARDER. Yes.
    Ms. PARKER. Human resource management.
    Mr. HARDER. And before you decided to study that, did you 
have access to reliable data that told you this is what you are 
going to make after 4 years of a program of study?
    Ms. PARKER. If I had access to the data, it was not 
something that I had background knowledge of knowing to do.
    Mr. HARDER. Got it. Would that have been helpful in making 
a decision about what to study?
    Ms. PARKER. Yes.
    Mr. HARDER. And, Mr. Kvaal, would you agree that students 
today applying to college do not necessarily have the 
information that they need to enroll in school?
    Mr. KVAAL. Yes.
    Mr. HARDER. And what is your sense of sort of the 
fragmentation of our information in the transparency that we 
give to students and parents in making what is one the most 
important financial decision of their life? How is that?
    Mr. KVAAL. Woefully inadequate.
    Mr. HARDER. Why do you think that is?
    Mr. KVAAL. Well, one reason is the Department of Education 
is prohibited from collecting data on students who do not 
receive student aid, which is about 30 percent of students, and 
so we only know what we make colleges report to us. We do not 
know how well students succeed after they transfer or they 
articulate to a different program. We only have limited insight 
into how well they do in the work force, and so there are a lot 
of really critical questions that just cannot be answered by a 
student deciding where to enroll right now.
    Mr. HARDER. And I used to teach community college, I taught 
Business 101, how to write a business plan, start a company, at 
Modesto Junior College, in my community. What about community 
college students? You mentioned 4-year students. What access to 
information do you have if you are doing a 2-year degree?
    Mr. KVAAL. Well, it varies by State, but, again, it is hard 
to know whether our 2-year college graduate will go on to earn 
a 4-year college degree, or how likely that is. Again, access 
to labor market data for those earning occupational degrees is 
hard to come by, very rare at a program level, which is really 
what you want, and rare to get disaggregated by student 
characteristics.
    Mr. HARDER. And so, is there any Federal standard that sort 
of standardizes the amount of information that students have 
when they are getting a 2-year--when their 2-year degree, or 
even a set of standards to know, you know, what are the college 
graduation rates at one university versus--or one 2-year degree 
or 4-year degree as opposed to another? Is there any sort of 
standardization in that? So, you sort of--as you are making one 
of the most important financial and lifelong decisions, you 
have sort of a good understanding where you get the most bang 
for your buck?
    Mr. KVAAL. There is--the Department of Education operates 
what is called the College Score Card. Again, though it is 
limited in the data that it has. So you mentioned graduation 
rates, and what the department measures is students enrolling 
for the first time as full-time students, and so the success of 
many students, like Ms. Parker, would not be in captured in 
those statistics.
    Mr. HARDER. So, in other words, we really have two problems 
going here. One is we have the cost of education that has been 
skyrocketing while we have been disinvesting in higher 
education, and the second is there is no information. This is 
why I am actually sponsoring a bill that tries to make sure 
that we are standardizing some of these decisions, and I look 
forward to working across the aisle with some colleagues to 
meet that reality.
    Thank you so much, and I yield back my time.
    Chairman SCOTT. Thank you. The gentleman from Pennsylvania, 
Mr. Meuser.
    Mr. MEUSER. Thank you, Chairman Scott and Dr. Foxx, for 
holding a hearing on this extremely important issue of college 
affordability. Thank you to all of our witnesses, very much, 
for taking the time to share your expertise with this 
committee.
    As we have heard this morning, tuition fees at our 
institutions of higher education are rising well over the 
inflation rate, by at least 3 percentage points, and it is 
almost an automatic increase virtually every year, and most 
institutions that cost goes up, and this has been happening for 
20 years at least, maybe more. Despite the vast number and 
growing number of job openings in our economy, we have a skills 
gap that must be addressed, and yet our costs continue to soar.
    The average cost of attending a private 4-year institution 
or 4-year university is $50,000. So, I will start with the 
$50,000 question, if you will, or in actually in Ms. Parker's 
case, the $66,000 question. What is being done to rein in these 
costs? I know some of this has been addressed. What is being 
done to truly provide a value or a return on the investment, 
lowering costs, best education, appropriate and effective job 
placement by these institutions, by these schools?
    Dr. Webber, I will ask you.
    Mr. WEBBER. Thank you for the question. One of the biggest 
things that I can say, at Temple University, first, is an 
initiative called Fly in 4, which is trying to keep students on 
track to graduate in a reasonable timeframe. And if it--if they 
take longer than the 4 years, but they have met certain 
performance goals, then their--they will not have to pay for 
classes after this point as long as they have been, you know, 
meeting certain benchmarks.
    In terms of the, you know, job placement, I think that the 
best place for, you know, colleges of all types to invest in is 
internship programs, that they have returns to a strong career 
placement and internship program are very, very large. And I 
can say that, you know, in my college, there has been a strong 
push toward making partnerships with businesses in the local 
community and really investing in this.
    Mr. MEUSER. Great. I am certainly a fan of Temple 
University, and I really hear some great things, and I think 
your applications rate are a reflection of that. So go out--
    Mr. WEBBER. I am a big fan as well--
    Mr. MEUSER [continuing]. so go Owls. All right, very good. 
Dr. Akers, another university that does very well is Purdue 
University. Mitch Daniels has done some remarkable things there 
and his staff, lowering costs, just making the school more 
attractive and definitely delivering on job placement. Are 
other schools following this model, and maybe you could comment 
on that?
    Ms. AKERS. Sure. So, one of the innovations I am 
particularly interested in, that McShane Analysis brought to 
Purdue, is the Back a Boiler Program, which is their college-
specific income share agreement. What that does, in the case of 
Purdue, is takes university funds and basically invests in 
students. So, the institution is putting their own finances at 
risk and aligning the incentives, so that when their students 
succeed, they succeed as an institution. We have seen--they 
were the first to start a program like that.
    We have seen other traditional institutions following suit 
and creating income share agreements as well. The University of 
Utah was second, the most recent large university to go in that 
direction. Purdue is also leader in their recent action of 
acquiring Kaplan, in that they are of--a dramatic expansion of 
their online education program. I think this is a space where 
traditional institutions have underutilized the potential for 
technology to lower the cost of their provision of education. 
So, I am hoping that we will see other schools following suit 
in that area, as well.
    Mr. MEUSER. All right, terrific. Thank you. And Dr. 
Morrison-Shetlar, I just want to focus on vocational skill 
learning, as well as the filling the jobs gap that exists. Now, 
you mentioned in your written testimony the importance of 
vocational and career education. What sort of resources, what 
percentage of resources go toward your technical end of your 
school, and do the students receive the same level of student 
loans for vocational skills?
    Ms. MORRISON-SHETLAR. The NC Promise Program makes sure 
that every degree that a student wants to pursue is affordable, 
and that means reduction in tuition, particularly, for in-State 
students to $500. The other things that we have done in terms 
of making sure that the students leave with less debt, for 
example, is that with that reduction in tuition, this is about 
$3,000 savings per year for our in-State students. The other 
things that we have done, we have had a 3 percent cap on our 
fees, so per year, so that those fees do not keep increasing, 
as you mentioned. And I think that is really important to say, 
and across the system we have an eight-semester fixed tuition 
program. And so when people are coming in to get a degree, 
whatever kind of degree they are getting, they are getting the 
skills that they need.
    It was previously mentioned by my colleague here, 
internship programs, experiential learning opportunities, which 
allow anyone who are in any field of education to be able to 
show, while their getting their degree, that they have the 
skills that they need to be successful. We are also seeing that 
our students are getting jobs based on the experiences that 
they are getting. And so with--the cost perspective of the 
State of North Carolina is decreasing the cost for students, so 
that they can then get the experiences they need, get the jobs 
that they need when they graduate, and give back to the 
economy.
    Mr. MEUSER. Thank you. Thank you, Mr. Chairman.
    Chairman SCOTT. The gentlemen's time has expired. The 
gentlelady from Georgia, Ms. McBath?
    Mrs. MCBATH. Thank you, Mr. Chairman. And before I begin 
asking my questions, I would like to echo my colleague, Mr. 
Harder's, comments, but first by responding to the references 
made about the need to reduce administrative burden on 
colleges. It is important to keep in mind that Federal 
regulation and oversight provides vital protections for our 
students. This is particularly important for low-income 
students and students of color, who are more likely to be 
burdened by unmanageable debt and to be victims of fraud and 
abuse by unscrupulous institutions.
    There are, however, some bipartisan proposals for reducing 
compliance costs, such as the College Transparency Act. This 
bill would lift the ban on the collection of student level data 
and make it easier for colleges to satisfy their reporting 
requirements. The College Transparency Act would also provide 
students and families with better information on the 
educational and work force outcomes, which gets at some of the 
problems about transparency that were raised earlier today.
    It is true that the demographics of postsecondary students 
are more diverse today than ever before. More women are 
attending and graduating from college than men. In Georgia, the 
State which I represent, 59 percent of college students are 
women. Across the country, we are also seeing increases in the 
number of students of color and students with a disability 
attending college. These trends are very, very exciting, but we 
still have so much more to do to address the systemic 
inequalities that still exist today. Low-income students and 
students of color are disproportionately affected by the costs 
of education and the lack of available funding, resulting in 
lower rates of matriculation, retention, and graduation.
    In Georgia, and across the country, most Americans will 
need to attain a postsecondary degree to achieve or maintain a 
middle-class income. In fact, by 2020, 65 percent of the jobs 
in my State alone will require some level of higher education, 
specifically 22 percent will require a bachelor's degree. If a 
college degree continues to be the surest path to economic 
mobility in our society, we need to make sure that everyone has 
the resources, especially financial resources that they need. 
That is why it is critical for us to invest in Pell Grants.
    In Georgia's Sixth congressional District, over 6,000 
students received Pell Grants for the 2018 and 2019 school 
year, totaling nearly $30 million. And for the State of 
Georgia, more than 20--excuse me, more than 230,000 Pell Grants 
were awarded to students. This brings the total for the State 
to just over $900 million.
    Now, I am proud to say that Georgia State University, an 
institution with campuses in my district, is one of the many 
institutions in Georgia to make great strides to narrow the 
funding gap for low-income and first-generation students. At 
Georgia State, 51 percent of the students are receiving Pell 
Grants.
    However, for first-generation college students, navigating 
the financial burdens is not the only obstacle that they face. 
Students face a culture shift from the comfort of their 
hometowns and neighborhoods to an environment where many 
students may not look like them, come from the same background, 
or belong to the same socioeconomic class. When we talk about 
higher education, we need to keep those challenges in mind, and 
I want us also to think beyond tuition costs when talking about 
completing a college degree. We speak of mental health in K 
through 12 schooling, but what happens once those students move 
on to postsecondary education? What happens to those students 
who receive free or reduced lunch? It is one thing to get a 
student to college, it is another thing to get them through 
college. As we begin these conversations, I hope we will 
consider the funding needed to help those students navigate 
their college experience.
    An accessible, affordable education is crucial to the 
advancement of our society and to the future and wellbeing of 
people that we are here to represent. We cannot expect greater 
returns on our society unless we are willing to invest more in 
our schools and the future of our country, our students. Today, 
students are more diverse than ever before, and I am thrilled 
to see so many first-generation college students, like Ms. 
Parker, blazing the trail as the first in their families to 
attend college.
    Ms. Parker, as you said, balancing multiple priorities can 
be exhausting and very stressful. We know that mental health 
supports are critical for students on our college campuses. Can 
you please talk a little bit more about anything that has 
helped you manage your stress level while going to school and, 
also, what more do you think that we, this body, can do to 
address mental health on college campuses?
    Ms. PARKER. Thank you. Last year, I attended counseling 
services through Columbus State's campus and, I guess, coming 
from my community, mental health is not something that is 
addressed regularly. So, once I realized--like, once I found 
out about the counseling services, what they offered, I was, 
like--the first session I did not understand why I was there, 
but I was, like, I guess that might be good for me. But 
throughout the time, I realized how much I needed to--how much 
I needed that counseling. All the things that I had been going 
through over the years of trying to make my way through 
college, how that was burdensome to me. I think mental health--
it should be a conversation that, on college campuses, that is 
a normal conversation instead of being stigmatized, and not 
just meant for career services--I am sorry,--counseling 
services, not just meant for that area of the institution. I 
think that is something that should be talked about in advising 
or in TRIO Services because no matter who the student is 
talking to, they see them as an advisor. It does not matter if 
they are a president, if they are in admissions, you know, if 
there is an instructor. There is still a way to connect with 
the student, and they look at you as advisor, as someone that 
they can, you know, lean into. That is--it should be a platform 
of a regular conversation, what mental health is, and how it is 
needed to be able to balance all of what you have going on, the 
student.
    Mrs. MCBATH. Thank you.
    Chairman SCOTT. Thank you, the gentlelady's time has 
expired. The gentleman from Idaho, Mr. Fulcher?
    Mr. FULCHER. Thank you, Mr. Chairman. I was just going to 
raise a topic that I have not heard much about, and just going 
through your testimony I have not seen, and in my home State of 
Idaho, there has been a couple of things that has worked in a 
positive way to drive down the overall impact of cost. One is 
just, is competition. We have got a community college that was 
put in place in close proximity to our largest university and 
since it was put in place, the growth, student growth, has 
exploded there, and the prevailing increase rate of the 4-year 
university greatly slowed down. So, that was one thing.
    The second thing was the implementation of a dual credit 
system, and I was--selfishly, I was a proponent of that at the 
State level, and it has really taken off. And so I would like 
to maybe ask Ms. Parker, just because you have a compelling 
story and the demographic that you grew up in is just different 
than the typical demographic in my home State, and so, first of 
all, just a question for you: if you would have had, or maybe 
you did have, an opportunity to receive college credit while in 
high school, would that have been something that you would have 
pursued in your circumstance?
    Ms. PARKER. I believe in my high school, my senior year is 
when Columbus Day partnered with my high school to offer the 
college credit. One, so, it was my senior year, and I was 
already afraid of college. Going back, knowing what I know now, 
yes, I would have, but I did not take advantage of it at that 
time. But, mind you, I am a first-generation student, so.
    Mr. FULCHER. I understand. That is okay. So, and this 
really could be for anyone, but perhaps I will just ask Dr. 
Webber. Have you seen any other States or any other track 
records where the dual credit system was advantageous or 
helpful in driving down the overall cost of college?
    Mr. WEBBER. Yes, I think so, and my home State of Florida, 
where I grew up, has a robust dual credit system that I took 
advantage of. I had, I think, 12 or 15 credits from, you know, 
my local community college. And the, you know, the general cost 
of college in Florida is--it is one of the lowest in the 
country. So, now, that is--there are other reasons for that, as 
well, but I do think that part of the, you know, the effect is 
a robust dual credit system.
    Mr. FULCHER. Great. Thank you, Mr. Webber.
    Mrs. FOXX. Would the gentleman yield?
    Mr. FULCHER. Yes, I yield my time, Dr. Foxx.
    Mrs. FOXX. No. I am not--I am going to ask you a question--
    Mr. FULCHER. Yes.
    Mrs. FOXX [continuing]. or give you some information.
    Mr. FULCHER. Please.
    Mrs. FOXX. You hit on an issue I wanted to bring up, 
eventually, and I am really pleased, and while you are here, I 
wanted to say it. There is an article that came out February 
10th that says that a student that takes at least one dual 
credit course in high school is three times as likely to 
graduate from college as students who do not take college 
credits courses in high school. The study also had the higher 
first, second, and third year GPAs. So, I want to compliment 
the gentleman on bringing up the issue because it is something 
that is proving to be very, very successful for students. So, 
thank you for bringing up the issue, and I will yield my time 
back to you.
    Mr. FULCHER. Thank you, Doctor.
    Chairman SCOTT. Did the gentlelady want to put that in the 
record?
    Mrs. FOXX. Thank you, Mr. Chairman, I would like to put 
that in the record.
    Chairman SCOTT. Without objection.
    Mr. FULCHER. Thank you, Dr. Foxx. I think the data in our 
home State would validate that, and I yield to Mr. Chairman.
    Chairman SCOTT. The gentleman has yielded back his time. 
The gentleman's time has expired. The gentlelady from 
Washington, Dr. Schrier.
    Dr. SCHRIER. Thank you, Mr. Chairman. First, I would 
reiterate, I agree with my colleagues that we have a Running 
Start Program in Washington State that has been incredibly 
successful. It reduces the cost of college, lets kids get an 
early start. It is, unfortunately, not available so much to 
people in rural areas, but it is a great start.
    We have heard about college tuition rates. Just for 
perspective, I do not think I am that old, but, in the 
eighties, when I went to college, I took a couple classes at a 
community college for $5 a credit. Yes, and I went to UC 
Berkeley for $2,000 a year, and I graduated from medical school 
with about $60,000 of debt, which it pales in comparison to 
anything that students today are facing. I came out with an 
M.D., to pay off the same debt that Ms. Parker now is facing 
without that potential salary earnings.
    And so I have often said that the way we spend our money is 
a reflection of our values, and we have just heard about how 
college education leads to a million dollars more in lifetime 
earnings, leads to a much bigger tax base, and will ultimately 
pay itself off. And I have always felt that an investment in a 
home and in education are the only two good kinds of debt.
    And so I wanted to ask because, Dr. Kvaal, you mentioned, 
ultimately, over time, doubling the amount that we give in Pell 
Grants. I would note that at the University of Washington we 
have about an 80 percent graduation rate for students receiving 
Pell Grants, which I think is phenomenal compared to a lot of 
the numbers we have been hearing. Why not just go for it 
immediately, given what a good investment college education is, 
and the ultimate payoff in tax revenues for our country?
    Mr. KVAAL. Great. I am for it, and, in fact, the studies 
show that investments in Pell pay for themselves in terms of 
increased economic growth, and so it is a very worthwhile--it 
would be a very worthwhile investment for Congress to make.
    Ms. SCHRIER. Thank you. And then I would also just note, 
and then I will yield back my time in a moment, but that the 
costs of college today are so different for a person like me, 
who happened to come from a middle class household and did not 
have huge expenses, and Ms. Parker, who grew up with adversity 
and just--the system is just so rigged. I mean, as we saw 
yesterday, with the wealthy parents paying their way and false 
test scores and everything else to get their kids into college, 
who will have a cakewalk, and would have had a cakewalk either 
way, and Ms. Parker, who has to work and raise a child and get 
through college, that it just is--I do not think I could have 
made it through Berkeley doing what you are doing, and I just 
want to recognize that the cost of college is overwhelming and 
I applaud you for your efforts. I yield back my time to the 
Chairman.
    Chairman SCOTT. Thank you. Let me ask just, you know, one 
question. Maybe Dr. Kvaal, there has been a reference to the 
private income-based repayment plan, where you make a deal with 
a private investor to get a percentage of your income. How do 
those work, and why would anybody prefer that than the Federal 
income-based repayment that we already have?
    Mr. KVAAL. I think there is--thank you for the question, 
Mr. Chairman. I think there is very little reason for any 
student to prefer a private income share agreement to a Federal 
student loan because of the option of income-driven repayment, 
which will be a better option for almost every student, if not 
every student. The Federal Government has lower cost of 
capital. It has economies, a scale in collecting those loans, 
and, as a result, they offer better rates to students than 
private lenders will.
    Chairman SCOTT. Is there any--would the private income 
base--with the public income base repayment, you can just 
decide if you got a real good job, just to pay off the loan and 
be finished with it. Do you have that option with the private 
deals?
    Mr. KVAAL. Not necessarily. Oftentimes, you have to pay 
back several times more than the value that--of your education.
    Chairman SCOTT. Thank you. Yields back. The gentlelady 
yields back the balance of her time.
    Ms. SCHRIER. May I take back the balance of my time?
    Chairman SCOTT. Yes.
    Ms. SCHRIER. I have a letter from the NEA that I would, 
respectfully, request to submit--
    Chairman SCOTT. Okay--
    Ms. SCHRIER [continuing]. and thank you, and I will yield 
back to whoever would like my time.
    Chairman SCOTT. Without objection. Gentleman from South 
Dakota?
    Mr. JOHNSON. Thank you, Mr. Chairman. Ms. Parker, in your 
testimony, because it is just a neat story, I know it has been 
a hard story for you, but it is a neat story to see your 
persistence. And at the end of your written testimony, you note 
that you know the odds are low that Journey and I will ever 
escape poverty, and I just want to echo Ms. Fudge and Dr. Roe 
and others who said you are going to make it. You are going to 
make it. And I know that because I think it is as true now as 
it was when President Coolidge said it, but this is what 
President Coolidge said, ``Nothing in this world can take the 
place of persistence. Talent will not. Nothing is more common 
than unsuccessful men with talent. Genius will not. Unrewarded 
genius is almost a proverb. Education alone will not. The world 
is full of educated derelicts. Persistence and determination 
alone are omnipotent.''
    Ms. Parker, boy, do you have persistence, and you are going 
to make it and Journey is going to make it. And I know that you 
have traveled far, and that there are miles yet to go in your 
journey, but, boy, are you going to make it. And so, through 
that journey, I know you have learned a lot. I have got three 
boys. One of them is 13. You know, he has not really started to 
think about what is going to happen after high school yet, but 
I would love to get you guys connected. Now, he is not here 
today, but if he was, and if he says, Ms. Parker, what advice 
do you have for me, about how--what I can be doing to have a 
successful experience, whether that is related to affordability 
or other measures of student success, what would you tell him, 
ma'am?
    Ms. PARKER. Get connected to as many resources as you can 
because that is my experience. I do not know how to do it 
without it. I do not know any other way, and to always be 
mindful that, just because someone told you that this is the 
way it is, that does not mean that has to be what it is. Ask 
questions and continue to stay persistent.
    Mr. JOHNSON. Ask questions. Boy, that--I think that is very 
well said. I mean, you would need to be your own advocate--
    Ms. PARKER. Right.
    Mr. JOHNSON [continuing]. at times in this system. We have 
talked about how complicated it is to navigate. The system is 
too complicated, but there have been times that you had to be 
your own advocate, I assume?
    Ms. PARKER. Yes, for years.
    Mr. JOHNSON. Mm-hmm.
    Ms. PARKER. Until I have realized now, later in my 
educational journey, that, okay, there should have been a, you 
know, a stepping point, all those years, where I could have 
been caught and helped and guided.
    Mr. JOHNSON. So, there is, you know, we have talked a fair 
amount today, also, about that there is kind of a lack of 
transparency, and it is hard to understand grants versus loans. 
Some of the other panelists talked about that. Part of it is 
also that we are kind of dealing with monopoly money. When 
you're a young person and you are trying to think about paying 
something back over 10 or 20 or more years, it is hard to 
really, really--to really understand the financial impact that 
it can have. Is there a moment, maybe there wasn't, but was 
there moment when you really realized, oh, my gosh, this is 
real money and I owe it?
    Ms. PARKER. I understood that when I was 17 going to the 
University of Toledo. Yet I was only taught to survive. So, it 
was taking out the loans to make basic needs met in order to 
still stay in school. I went to school with no money. Like I 
said, I did not have a comforter for my bed. That was real. 
When I got there, and I arrived and I see all my peers and 
everyone setting up their room. They came, I mean, they had--I 
don't even think they came from money. I knew they had money 
because they had a comforter on their bed. I did not know what 
``come from money'' meant, until I seen an extensive amount, 
you know?
    Mr. JOHNSON. You talked in your testimony, and I was glad 
you did, about how hard you have worked and how many part-time 
jobs, and at times more than a few of them, and we have also 
heard from other panelists that can sometimes have a negative 
impact on student success. But I have got to think, right now, 
it would be hard for you to make it if you did not--if you were 
not working. Employment is a key part of your success story 
now, I would assume. Is that right?
    Ms. PARKER. Yes. It is an important part of my success 
story, and it also has given me experience. So, although I was 
working all these jobs in, you know, in school, I was--I am 
able to apply the experience that I have worked in all these 
jobs to--is relevant to me now and in my career.
    Mr. JOHNSON. Well, this has been very well said. The 
panelists have done a great job. Ms. Parker, you have done a 
great job, and I think, yes, we do need to talk about what is--
we do need to have robust conversation about what is the role 
the government in aiding student success and in increasing 
affordability, but you are a great example of somebody who is 
also doing what you can on your end. Hard work, curiosity, 
being your own advocate, being persistent. I mean, there are a 
lot of things that students need to own to be successful, and, 
ma'am, you are owning them.
    Mr. Chairman, if I can, I would like to yield back a little 
time to the ranking member?
    Mrs. FOXX. Mr. Chairman, to be fair, there is not enough 
time to ask a question.
    Chairman SCOTT. Thank you. The gentleman's time has 
expired. Let's see, gentlelady from Florida, Ms. Shalala.
    Ms. SHALALA. Thank you very much, Mr. Chairman. First, I 
would like to introduce into the record a letter from CLASP, 
the Center for Law and Social Policy. To the panel, and I think 
you have done an excellent job, but tuition is more complicated 
than just what the sticker price is because so many of the 
colleges and universities in this country, with probably the 
exception of the for-profit institutions, discount tuition in a 
variety of ways. Sometimes it is a scholarship, sometimes it is 
just offering a lower price, and so it is hard to analyze 
whether tuition alone is the factor. And it seems to me that 
one of the things that we have learned is these wrap around 
services that Ms. Parker has indicated that made a real 
difference for her: access to housing, access to other kinds of 
income and support services, in addition to the fact that she 
took a job. So, could you talk a little about what the actual 
tuition is, and how analysts treat that in relationship to 
student success?
    Mr. WEBBER. So, I think that--you bring up a very good 
point. There is the sticker price of tuition, what it says on 
the website, and I do want to say, this matters. It does deter 
people from who just see the prospect of this, these really big 
numbers with--and they are very reluctant to take out so much 
debt, and that they are not aware of, you know, the financial 
aid that they are actually going to receive, but then, what 
students actually pay. One of the problems is that what they 
actually pay is going to differ from year to year. It is not 
clear what they are going to get from 1 year to the next.
    The, you know, the financial aid packages that there is so 
much fine print that, you know, you might--you know, it expires 
after 4 years or it expires--you lose it if you fall below 
certain thresholds, and it is incredibly complex, and this is a 
real burden to students, I think.
    Ms. SHALALA. Thank you very much. Mr. Kvaal, according to 
research examining nationally representative data on student 
demographics, we found that while academic programs at for-
profit colleges are more similar to those at public community 
colleges, borrowing patterns for students who attend for-
profits are more similar to the not-for-profit 4-year colleges. 
It seems like, to me, to mismatch in the types of programs for-
profits offers in the cost. Have you looked at that 
differential in looking at the cost of college?
    Mr. KVAAL. Yes. You are right. Programs at for-profit 
colleges tend to have much higher tuitions, and they tend to 
have much, much higher percentages of students who borrow.
    Ms. SHALALA. And what about the retention and graduation 
rates?
    Mr. KVAAL. The retention and graduation rates are mixed. 
The for-profit colleges tend to offer shorter programs, but if 
you do it on an apples-to-apples basis, they are very similar 
or, if anything, community colleges have slightly better 
retention rates.
    Ms. SHALALA. Dr. Shetlar, can you talk a little about the 
wraparound services that you provide to students? I mean, you 
talked about very low tuition, and you, obviously, have a large 
number of students that work and go to school at your 
institution. What kinds of services do you provide to support 
students?
    Ms. MORRISON-SHETLAR. Educational supports, obviously, is 
things like advising, and to attain the skills that they need 
to be successful in their degree. Tuition is for--at Western is 
about $3,000 a year--
    Ms. SHALALA. Right--
    Ms. MORRISON-SHETLAR [continuing]. Total cost of 
attendance, with NC Promise is $14,000. So, it is room and 
board, and the other supports, health services that need to be 
in place, that are often the cost, additional costs.
    Ms. SHALALA. Mm-hmm. Thank you very much. Ms. Parker, I 
think you are going to do very well in the future. I would like 
to be helpful. I actually know a lot of H.R. people in Ohio, 
and so if you connect up with me after this hearing, I would be 
happy to provide some introductions to you because I am going 
to make sure you do not end up living in poverty for the rest 
of your life. Thank you. I yield back my time.
    Chairman SCOTT. The lady's time was expired. The gentleman 
from Virginia, Mr. Cline?
    Mr. CLINE. Thank you, Mr. Chairman. The cost of higher 
education has unjustifiably run rampant in recent years, and 
the overall cost of college is increasing as a result of many 
underwritten factors, including administrative costs. While 
some of my colleagues claim that college can and should be 
free, the fact is college can never truly be free. Costs are 
simply masked.
    That being said, students should have the option to attend 
an institution that prepares and enables them to be 
contributing members of society. The problem with accessibility 
is two-fold, which includes both the access for students to 
attend, and their success and completion while at college. You 
should not reach a point at which the cost of education is 
entirely prohibitive, but recognizing that as just as 
accessibility is important, so are graduation rates.
    So, Mr. Webber, I would ask you, in your testimony you 
State that only 60 percent of students at 4-year schools will 
earn a degree within 6 years of initial enrollment. With more 
and more resources at schools being devoted to administrative 
costs, why are we not seeing a higher percentage of graduation? 
And what benefits are they providing, if not contributing to 
student success by ensuring their graduation?
    Mr. WEBBER. Well, one of the issues is doing an apples-to-
apples comparison. So, over time, at the typical public 
institution, graduation rates have stayed roughly constant, but 
that is despite public institutions educating a much different 
type of student today than 30, 40, 50 years ago. And so, from 
an apples-to-apples comparison, in some sense our graduation 
rates have increased because we are--because they have stayed 
the same, if that makes sense.
    Mr. CLINE. Thank you. Dr. Morrison-Shetlar, I am reading 
your testimony; very interested in NC promise; sounds very 
exciting. How long have you been chancellor, interim 
chancellor?
    Ms. MORRISON-SHETLAR. Just slightly over 1 year.
    Mr. CLINE. And are you familiar with your budgets over the 
last, say, decade? I mean, can you speak to those budgets and 
the increases in your budgets?
    Ms. MORRISON-SHETLAR. To a certain extent, yes.
    Mr. CLINE. Okay. Can you approximate for me how much the 
budget has increased over the past 10 years per year, by 
average?
    Ms. MORRISON-SHETLAR. Let me ask that question. I just 
wanted to make sure it was somebody who actually has the 
numbers. So, actually, over the last decade, we have stayed 
relatively the same. What has happened is that we have had a 
decrease in sort of capital expenditures or the ability to 
invest in our current capital, and that is changing. With NC 
Promise, we are beginning to see folks look at the cost of 
attendance at the university, and to make sure that we have the 
budget that we need to be able educate a growing population.
    Mr. CLINE. That is not the answer I expected, so I want to 
commend you for keeping your budgets under control. And given 
that you have seen such a spike in enrollment, can you speak to 
other ways in which you, as a higher education institution, 
have managed to control costs on your own? Because from my 
perspective, and I have a lot of different colleges and 
universities in my district, they see continuing pressures on 
their costs, and because your university is getting so much 
support from the State to keep your tuition fixed and low, I 
was curious whether or not you all were making it a goal to 
actually control costs. And so can you speak to those?
    Ms. MORRISON-SHETLAR. Mm-hmm. Most definitely, I have 
mentioned this previously, but one of the things that the NC 
Promise is doing is helping us with retention, and so having 
our students be able to stay on at the university is reducing 
their cost, total cost of education.
    Mr. CLINE. Not their costs, your costs.
    Ms. MORRISON-SHETLAR. Right, my cost. So, one of the things 
that the--again, the system is doing is capped fees, and so 
that we cannot go above 3 percent in terms of increasing our 
fees. So, what we have to do--
    Mr. CLINE. Right.
    Ms. MORRISON-SHETLAR [continuing]. if we are not getting 
that, those additional funds, then we are looking at 
reallocating to make sure that we are focusing. Western 
Carolina University does not do everything. It does specific 
things really well, and so, in past years, prior to my time 
coming to Western Carolina, we looked at program 
prioritization. What are the kinds of programs that we are 
doing? Is it the right programs for our region? And if it is 
not, then are we getting--eliminating those programs and 
focusing our resources in other areas? The other things that we 
do--a reallocation of resources is always the key to this. If 
you do not have the money, what are your priorities and the 
values of your institution? You know, follow the money.
    And so, we have a very strong strategic plan that has a 
focus on success, student success, time to graduation, 
retention, and we make sure our resources follow those values, 
those metrics, and the issues we are accountable for, so--
    Mr. CLINE. Thank you very much.
    Ms. MORRISON-SHETLAR [continuing]. reallocation.
    Mr. CLINE. Great. Thank you, Mr. Chairman. I yield back.
    Chairman SCOTT. Thank you. The gentleman from Michigan, Mr. 
Levin?
    Mr. LEVIN. Thank you. Mr. Chairman, I would like to submit 
into the record two letters highlighting the critical 
importance of the Public Service Loan Forgiveness Program; one, 
from the American Federation of Teachers, and the other from 
127 national and State animal health science professional 
membership organizations.
    Chairman SCOTT. Without objection.
    Mr. LEVIN. Thank you. Mr. Chairman, I believe strongly that 
restoring the middle-class means we must stop shortchanging our 
students. All students in our country deserve a high-quality 
education that helps them reach their full potentials, and we 
must invest in higher educations, so students, like Ms. Parker, 
are not buried in debt when they graduate.
    I also believe strongly in loan forgiveness for those who 
make the financial sacrifice to use their skills in public 
service, such as working as teachers, firefighters, public 
defenders, nurses, or members of the military. The PSLF, or the 
Public Service Loan Forgiveness Program, created with 
bipartisan support in 2007, offers loan forgiveness to 
individuals after they work in public service careers for 10 
years. The program was designed to ensure that talented 
individuals, including teachers, service members, and veterans, 
can pursue careers in public service, even if they take out 
loans to obtain a degree.
    Dr. Kvaal, I would like to ask you a question. I think we 
worked together in previous lives. It is good to see you again. 
What would eliminating the PSLF Program do to diversity of the 
public sector work force? Would it make it harder for 
underrepresented groups to pursue careers in teaching, in 
nursing, and the like?
    Mr. KVAAL. It would. We know low-income students and 
students of color are more likely to borrow, and they borrow 
more, and so it would make those career choices more 
challenging for them.
    Mr. LEVIN. And how would eliminating this program make it 
harder for low-income individuals, in particular, to pursue 
careers in public service?
    Mr. KVAAL. Well, we know student debt is an obstacle for 
our students making their career choices, and students with 
higher debts are less likely to choose low paid careers, 
including public service careers.
    Mr. LEVIN. Thank you. Today's college students often 
struggle to find adequate, affordable housing options near 
their campus. In fact, researchers believe that the population 
of homeless students in higher education is close to 1.5 
million. Furthermore, a recent GAO report examining college 
student hunger found that low-income students, first-generation 
students, and single parents are at greater risk of being food 
insecure.
    Ms. Parker, I was so moved by your story of struggling to 
find housing with--for you and Journey. Thank you for sharing 
this experience, and I am inspired by how you have overcome 
that difficult time in your life. Can you tell us a little more 
about what difference the stable housing that you found has 
made for you, and can you expand more on how you were able to 
find stable housing?
    Ms. PARKER. Thank you. I was able to find the housing 
through our advising. We have special circumstances advising at 
Columbus State, and they directed me in the direction of 
Scholar House, and--
    Mr. LEVIN. And what is Scholar House?
    Ms. PARKER. Okay.
    Mr. LEVIN. Who stays--who lives there?
    Ms. PARKER. Student parents. So, it is a community of 
student parents, and they provide programming for us. So, we 
have things for, like, mentoring, coaching, financial literacy, 
programming offered to us, that is like a requirement. And it 
is a partnership between CHMA Metro--I am sorry, Columbus 
Metropolitan Housing Authority and Community Properties of 
Ohio. It is a Section 8 voucher to allow us to have it at a 
loan.
    Mr. LEVIN. So, it is sort of a cooperative program of 
different--
    Ms. PARKER. Yes.
    Mr. LEVIN [continuing]. agencies working together to make 
sure--
    Ms. PARKER. Yes.
    Mr. LEVIN [continuing]. people can get housing?
    Ms. PARKER. Exactly.
    Mr. LEVIN. Thank you very much. I think we need more of 
that, not less. A part of the President's budget was released 
this week, where the administration recommends eliminating 
subsidized undergraduate student loans. Republicans have also 
proposed eliminating subsidized loans. Currently, undergraduate 
students can receive subsidized loans allocated based on 
financial need, which do not accrue interest while they are in 
school.
    Dr. Kvaal, how would eliminating subsidized loans for 
undergraduates affect students, and does this help make college 
more accessible and affordable?
    Mr. KVAAL. The President's proposal would use those funds 
to reduce the deficit. It would raise costs by thousands of 
dollars for many of students over the life of their loans, and 
it would not make college more affordable.
    Mr. LEVIN. Finally, let me ask you a clarifying question, 
to you, Dr. Webber. There were some proposals offered by the 
minority about limiting borrowing among certain students to 
reduce debt loads. Do you believe debt loads, particularly 
among low-income students, are the result of frivolous or 
unnecessary spending or are they a reflection of rising prices 
and insufficient grant aid?
    Mr. WEBBER. I absolutely believe they are the latter, the 
rising prices and insufficient debt aid. I think there are very 
limited circumstances where, you know, some students, you know, 
maybe because of lack of financial counseling, do borrow too 
much, and so I think that schools should, you know, have more 
flexibility to, you know, to be able to counsel those students.
    Mr. LEVIN. More advising and counseling, rather than 
limiting the amount they can borrow if they need it?
    Mr. KVAAL. Exactly.
    Mr. LEVIN. Okay. All right, my time has expired. Thank you 
all so much. It is really an important subject.
    Chairman SCOTT. Thank you. The gentleman from Maryland, Mr. 
Trone?
    Mr. TRONE. I thank you all for being here this long day. It 
is nearing the end.
    Ms. Parker, I commend you for your phenomenal hard work and 
perseverance and you are, absolutely, going to be successful, 
and you will knock it out of the park. Just keep at it. My 
question is, we have been looking at a higher education and a 
education system that really has not changed much in the last 
100 and almost 50 years. We have been a K through 12 system, 
and then we have a 2-year or a 4-year college. You know, 
everything else has changed in 150 years. I mean, our students 
have changed. Their interests have changed. Where they would go 
to graduate school, that has all changed.
    What has changed? The type of jobs they are going to get 
has changed. The way we communicate, knowledge has changed. I 
would like to get some people's thoughts about is this system 
just yesterday's system and something that we just keep going 
with because it is there, or should we be trying to move to 
something more like a Pre-K through 14, that is 100 percent 
free, covers all those wraparounds, we cost--that we talked 
about a while ago. And who in the--what State has done the best 
practice in this area that could be something that we could 
learn from and emulate? Let us start with Dr. Morrison-Shetlar.
    Ms. MORRISON-SHETLAR. I think the comment about free is 
always difficult to determine. One of the things that NC 
Promise does is a little different from others, is that it is 
the first dollar, and so the students come and they know what 
their tuition is going to be. They know what their other costs 
are going to be, and then they can apply other loans and grants 
to that. So, I think making this a process that is more 
transparent, making a process that is more accessible, 
particularly for low-income or first-generation students, would 
be really, really important, and making sure that their 
education is helping our students get the right kind of jobs. 
At Western Carolina University, we do needs assessment in our 
community. What is the kind of--what are the skills that are 
needed?
    What are the kinds of things that would help our economy, 
and are a nimble enough university to be able to say, okay, we 
need to be focusing and growing those particular things. So, I 
think really knowing where--what your circumstances are. We are 
in rural North--Western North Carolina. We know what the needs 
of our community are, and as an institution, we meet those 
needs and we exceed those needs, if we possibly can, but we 
have to be nimble to be able to do that.
    Mr. TRONE. Other thoughts on that?
    Mr. KVAAL. Mr. Trone, if I might? There is an interesting 
experiment happening in Detroit with the Kresge Foundation 
about combining K through 12 schools with 4-year residential 
college. It would be interesting to explore with you.
    Mr. TRONE. How many States actually have a ``free'' first-
dollar or last-dollar community college, 2-year college? 
Anybody have a number on that?
    Mr. KVAAL. I do not think there is any State that is 
entirely free.
    Mr. TRONE. Tennessee? Nope?
    Mr. KVAAL. Tennessee is covered, in large part, using Pell 
grants. They have a last-dollar scholarship.
    Mr. TRONE. Mm-hmm. Okay. Let us talk about work force a 
minute. We support, you know, there is a lot of ideas in 
innovation, promoting multiple pathways to students to learn, 
and success in the workplace. At the end of the day, that is 
what they are looking for, success in the workplace, in the 
job. And sometimes these programs do not actually prepare 
people adequately, but what kind of safeguards do we need if we 
are spending Federal financial aid dollars to folks to help 
pursue work force focus programs? Are students able to use 
their Federal financial aid to help in these work force 
programs?
    Mr. KVAAL. In many cases, students are able to choose 
degrees or certificates offered by community colleges or trade 
schools that have direct occupational value. In order to get a 
Pell Grant, you must be attending a program at least the length 
of a traditional academic semester, which is 15 weeks. There 
are some proposals to allow shorter term programs to receive 
Pell Grants. Those programs may not necessarily be offered for 
academic credit. They may not necessarily be accredited. And so 
my view is those--there are a lot of those programs that are 
high in quality and that are worthy of support, but we do need 
to be careful, not just the types of programs that meet those 
criteria today, but the types of criteria that--programs that 
might be created to meet those criteria?
    Mr. TRONE. Okay. Thank you.
    Chairman SCOTT. Thank you. The gentleman's time has almost 
expired. Thank you. The gentlelady from North Carolina is 
Ranking Member Dr. Foxx.
    Mrs. FOXX. Thank you, Mr. Chairman. First, Ms. Parker, I 
want to congratulate you on getting your associate's degree, 
and on continuing your education. I will tell you that I was 
very, very poor growing up, but I worked my way through 
college. It took me 7 years, and I had a family, and so I want 
to encourage you, as other people have, to continue to do what 
you do because getting your degree, I hope, will be worthwhile 
for you. It has certainly been for me, and so I commend you for 
continuing to do what you are doing.
    Dr. Akers, I want to go back to the issue of the Public 
Service Loan Forgiveness Programs, and in your testimony, you 
mentioned that it is estimated it cost $24 billion over the 
next 10 years. Could you give a few examples of how the PSLF is 
inequitable and poorly designed?
    Ms. AKERS. Sure. So, I have no objection to subsidizing 
employment in careers that serve the public good and that are 
undersubscribed with the market wages that exist in them, but I 
firmly believe that the Student Lending Program is the wrong 
place to provide those subsidies. It is sort of an obvious 
example of where there is inequity, is you could imagine two 
nurses working in a nonprofit hospital system. One of them went 
to college and had the experience that Ms. Parker talked about 
with pizza and partying in dorms, and then the other, you know, 
scrimped and saved to have the low-cost experience. The 
individual who has high amount of debt will have their loans 
forgiven, essentially receiving a very large subsidy of 
taxpayer dollars, while the person who was more careful with 
their spending does not receive the subsidy. I would much 
prefer if we just choose to support particular professions that 
those subsides be delivered through something, like a tax 
credit, that motivates all individuals to enter that 
profession, rather than just those who have spent large sums on 
their education.
    Mrs. FOXX. Well, thank you for that example. I think, of 
course, what Ms. Parker said, her idea, before she went to 
college, was that is was a vacation, and I think many people 
see that the taxpayers are subsidizing those kinds of students 
who going to college to be on vacation and not having the kind 
of seriousness that other students have, and I think your 
example is an excellent one.
    Dr. Morrison-Shetlar, thank you for coming to Washington to 
testify about the wonderful things that are going on at Western 
Carolina and other places in North Carolina. I think talking 
about the Carolina Promise, talking about the programs that you 
all have, where students can transfer from community college 
and make sure that their credits transfer into their degree 
programs, I happen to think North Carolina is doing a lot of 
good things in that regard. Dual enrollment in high school that 
costs absolutely nothing, and that is, by the way, all 
throughout the State. I know you were a little unsure about how 
to answer that question before, but it has been going on a long 
time before I was involved, and before Ms. Adams and I were 
both in the General Assembly, that program started. So, it has 
been going on a long time, and it has been very successful, but 
I know improving the economic mobility of your students is an 
important value to you, and you eluded to that. Could you share 
with us what you are doing on campus to work with businesses 
and industry to make the transition from college graduate to 
employee seamless for your students?
    Ms. MORRISON-SHETLAR. We have a very robust career and 
professional development service for our students that allows 
us to find businesses and industries in our area that are 
interested in taking our students before they graduate, so that 
they are eligible for getting the experiences that Ms. Parker 
talked about, as she did in her work experience. These are 
really important connections to be made, and we live in an area 
where the businesses and the industries are very supportive of 
our student success. And a high percentage of our students, 
when they do these internships or practicums, end up being 
employed by those businesses and industries and, therefore, as 
I mentioned earlier, stay in the area and contribute back to 
the economy.
    Mrs. FOXX. Thank you very much. And, Dr. Webber, I want to 
say, again, a special thank you for being here today, and for 
the written testimony that you provided, which is very, very 
helpful to us. And, Dr. Kvaal, thank you, and, again, Ms. 
Parker, thank you so much for coming and sharing your 
experiences.
    Thank you, Mr. Chairman, I yield back.
    Chairman SCOTT. Thank you. The gentlelady from Nevada, Ms. 
Lee.
    Ms. LEE. Thank you, Mr. Chairman, and I want to thank all 
of you for being here today. As one of eight children, I was 
able to put myself through college with a smorgasbord of help, 
whether it was the Perkins Loans, the Pell Grants, student work 
study, and that was significantly important to me. But we are 
finding more and more that students are not having that same 
opportunity, and, in fact, research from the Brookings 
Institute predicts that by 2023, nearly 40 percent of borrowers 
may default on their loans. So, to me, this indicates that we 
do have a student loan default crisis, which is a much bigger 
crisis for minority and low-income students, particularly those 
who attend for-profit colleges. The study finds that default 
for student at for-profit schools is almost four times that of 
those that attend community colleges. We also know that black 
students are three times more likely to enroll in for-profit 
colleges than their peers, and students at the bottom quartile 
are twice as likely to enroll at for-profit colleges than 
students in the top.
    Mr. Kvaal, I wanted to ask you, given these statistics, can 
you explain why students who attend for-profit institutions are 
at greater risk of default?
    Mr. KVAAL. For-profit colleges tend to be significantly 
more expensive. They tend to be priced at the level that would 
require you to borrow Federal student loan at the maximum 
level, and they often offer mediocre education or worse. And, 
as a result, we do see a lot of students defaulting or failing 
to make payments on their student loans.
    Ms. LEE. Thank you. You know, you had said earlier that--
like you said that students that qualify from these for-profit 
colleges, actually may do worse in the labor market than they 
otherwise would do, even if they did not go to school. This 
happens even though the credentials they offer tend to be 30 to 
40 percent more expensive.
    ABC interviewed a young veteran, Brian Babcock, a couple 
years ago, who served our country in Iraq, and his plan was 
policework when he graduated. He used his GI Bill money to 
pursue criminal justice degree at ITT Tech, which we all know 
what happened with that. He heard about the school on a 
commercial. ITT promised him that all police agencies would 
take his credential, and they even helped him fill out the 
student loan application, which lead him to borrow up to 
$70,000. He went on to apply to 20 to 23 police departments, to 
only find out that none of them recognized this degree. We just 
discovered today, and this is a particularly important point in 
Nevada, we have a lot of for-profit universities that have shut 
their doors, 30 in the last 10 years, and we just discovered 
today, that 1,733 GI Bill recipients were affected by the most 
recent closures of the Dream Education Schools, of which one is 
in my district alone. Can you explain, more specifically, speak 
to why minority students and veterans tend to be the target of 
these predatory recruitment practices by for-profits?
    Mr. KVAAL. I think in many cases, students do not have 
experience with college. They have family members who do not 
have experience with college. We know that for-profit colleges 
engage in very high pressure or sometimes deceptive recruiting 
tactics. In 2010, the GAO sent undercover investigators to for-
profit colleges. All 15 found misleading statements. Four of 
them found fraudulent statements. The veterans are particularly 
attractive to for-profit colleges because they generate revenue 
outside of what is called the 90-10 Rule, which limits revenue 
to 90 percent of student aid. And so, for all of those reasons, 
you see the practices of for-profit colleges falling 
disproportionately heavily on the communities you mentioned.
    Ms. LEE. Thank you. Real quickly, we are running out of 
time. Any quick suggestions for what the Federal Government can 
do to protect these students?
    Mr. KVAAL. I think it is really important to have 
standards, to make sure that students graduate, can find jobs, 
and can repay their loans. I think it is important to crack 
down on the use of commissioned salespeople, which leads a lot 
of this deceptive information. I would certainly include GI 
benefits and DOD spending in the limitation on the amount of 
Federal funds that these for-profit colleges conclude. And I 
think that students who are defrauded should have a right to 
get their loans forgiven, which is true in theory, but not in 
practice today.
    Ms. LEE. Right. Thank you very much. Thank you all.
    Chairman SCOTT. Thank you. The gentlelady from 
Massachusetts, Ms. Trahan?
    Ms. TRAHAN. Thank you, Mr. Chairman, and thank you for 
having this hearing. It is so important to all of us. You know, 
I was born and raised in a working-class family, in Lowell. I 
was one of four girls and attended public schools my entire 
life. You know, if not for a volleyball scholarship, I would 
not have gone to the college that I had gone to, and so I am so 
uniquely aware of the anxiety that goes around education and 
funding your own education. You know the school--school tuition 
had a high sticker price then, but I think what is more 
alarming to me is that in the last 25 years, I have seen that 
sticker price increase 3X, 3X in 25 years.
    So, Mr. Kvaal, you know, I looked at your--the student debt 
report that TCEA put out last September, and more than 200,000 
colleges granting bachelor's degrees carried an average debt of 
more than $35,000. I mean, today, we heard Ms. Parker's 
testimony and your $66,000 debt. I just want to ask a couple of 
basic, you know, questions on this because it would be--and I 
think it is helpful for us to know what the major drivers are 
for these tuition increases.
    Mr. KVAAL. Well, for most students, three-quarters of 
students go to public institutions, and for those students the 
single biggest driver has been declining State support over the 
last few decades.
    Ms. TRAHAN. Yep, but--so that is fair. I have got three 
stepsons. I have toured lots of college campuses in the last 10 
years, and I have also seen a bit of an amenities arms race, 
whether it is the dorms, the cafeterias, the gyms. And I am 
wondering if you could speak to the--has the quality of 
education or the job readiness, not just the student 
experience, has it risen as a result of these tuition hikes?
    Mr. KVAAL. Well, I think, in part, colleges do have a 
challenge because they employ highly educated work force. It is 
highly paid. It is difficult to become more productive, like 
other parts of the economy because you cannot have more than 20 
students in a seminar without the seminar getting worse. I also 
think many of our colleges are chasing prestige in a way that 
is measured by the U.S. News and World Report, for example, 
which measures academic quality by the amounts institutions 
spend, not the amount students learn, and we do not value 
community colleges and regional universities that are inclusive 
and affordable and higher in quality.
    Ms. TRAHAN. Great. That is helpful. And you mentioned, I 
think you are the only one in your testimony who sort of used 
the word ``accountability.'' What accountability measures 
should we employ to make sure that our young people, frankly, 
get the return on their huge investment?
    Mr. KVAAL. Well, the most basic question, I think, for 
Federal policymakers is, can students repay their loans? We 
have had the cohort default rate and statue for 30 years. It 
has long been bipartisan, widely accepted. It is no longer very 
effective at driving down student loan defaults. So, there is 
series of reforms you could make to revitalize the student loan 
default rate. I think there are other things that are worthy in 
other areas. For example, the Gainful Employment Rules apply to 
occupational programs, often at for-profit colleges, and look 
at typical debts relative to expected earnings.
    Ms. TRAHAN. Great. Thank you. I am going to switch gears 
because I still have a little bit of time left. So, we heard 
from Ms. Parker's testimony that far too many students and 
their children, like Journey, are going hungry while you are 
nobly trying to learn and get ahead. The help they need is not 
reaching them. The GAO recently found that of the 3.3 million 
students, and I think this was referenced earlier, who are 
potently eligible for SNAP Benefits in 2016, less than half 
said they participated.
    So, Chancellor Morrison-Shetlar, I am wondering if you 
could help with your experience? Is student hunger an issue you 
see at Western Carolina, and if so, what are your 
recommendations for helping students?
    Ms. MORRISON-SHETLAR. Student hunger is definitely 
something that we are seeing in, I think, all of our 
institutions. It is a big issue, and it is something that we at 
Western, and across the system, are really, really conscious 
of, making sure that students get to the resources that they 
need to be able to be successful. Western Carolina University, 
we have collaborated with the Baptist Children's Home to create 
a food bank and resources for our students who are homeless, 
who have issues, and they are referred through sometimes by 
faculty, by staff. That we have really got to get the 
information out to people about the resources that they have 
available to them, as Ms. Parker has mentioned, and I think 
communication is the big issue. We have got to get that 
information out, and it has to be done in a way that is 
compassionate and respectful for the person who is being 
affected because that is one area where if people don't feel 
like they are being valued or respected, they will just leave, 
and so retention will become an issue.
    Ms. TRAHAN. Right. Thank you. I have run out of time, so I 
yield back, but thank you all so much for being here today.
    Chairman SCOTT. The lady's time has expired. The gentlelady 
from Washington, Ms. Jayapal?
    Ms. JAYAPAL. Thank you, Mr. Chairman, and thank you for 
holding these important hearings. Thank you to the panel for 
being here. This has been an issue that has been important to 
me for some years. And I think that, if I am not mistaken, Dr. 
Kvaal, when you were with the Obama Administration and I was 
writing my bill in the State Senate for the Washington Promise 
Act, I believe we worked with you, so thank you for your help 
back then. And we did just in--we have one of the best 
community college systems in the country. We did just in 
Seattle add a 13th year to sort of the K-12 continuum, and so 
we are excited to see how that goes. In Washington State, just 
to echo some of the comments of my colleague that has just 
spoke, we went from the State covering 66 percent of the cost 
of college, public universities in 2008, to now covering only 
35 percent, and we are in a very high, very unaffordable, let's 
put it that way, area in terms of our living costs. So, the 
challenges for students are tremendous. And I want congratulate 
you, Ms. Parker, and all of the students across our country, 
who go to through such challenges.
    Let me start with you, Chancellor, and thank you so much 
for your work on the North Carolina Promise Program. I wanted 
to ask if you could zero in a little bit on what you have found 
around college accessibility and income diversity of your 
students, in particular? Any specific reflections on that 
connection?
    Ms. MORRISON-SHETLAR. The metrics of the UNC System have 
put forward to us as a result of--just affordability and access 
across the system, but then also including NC Promise, is 
really to focus on making sure that low-income students, first-
generation students have access to a high-quality. affordable 
degree. And, as a result, the NC Promise System chose three 
institutions that allow students less than 150 miles' travel to 
get to college, where they can get a 4-year degree, which means 
that you are basically supporting your community, and that is 
really, really important. And so people coming to Western and 
to Pembroke and to Elizabeth City are people who want to have a 
high-quality education, would not normally have been able to 
afford it, but with NC Promise, that has allowed them to do 
that. So, we are seeing increases in retention and time to 
graduation, even in the fact that we have just been at this for 
a short period of time, but we are seeing, particularly, 
student retention because they are having--they are not having 
the financial impact that they would have had otherwise.
    Ms. JAYAPAL. That is perfect cause my next question was 
going to be around sometimes we separate cost and affordability 
from completion, and in my experience and the students I have 
spoken to, and it has--talked to tens of thousands now across 
Washington State. There is a very direct connection because if 
you do not have the aid, if you have to go out and have a 
second job or a third job, if you cannot afford your textbooks 
or your--a computer now, because everything is--it really 
affects your ability to complete. And so can you speak to that? 
I know it is early, but can you speak to that and perhaps any 
of the other panelists that might want to comment on that 
relationship because they are so often separated? What comments 
do you have around that completion and--?
    Ms. MORRISON-SHETLAR. Well, NC Promise is a first-dollar 
program, and so students know exactly how much it is going to 
cost, with their tuition and their fees, room and board, et 
cetera, and so that knowledge allows planning. That knowledge 
allows seeking other resources to complete that cost of 
attendance, and that is something that I would love to see as 
having a simpler process, a more transparent process, something 
that first-generation students or low-income students can have 
access to and be successful at. That would be a huge game 
changer for the people and the students that you are talking 
about.
    Ms. JAYAPAL. Well, and actually I just want to say before 
asking, if any of you have comments on that, that I actually 
have championed a proposal to invest in a Federal-State 
partnership to make public college, both 4-year and 2-year 
tuition fee free for everybody. And under the plan, the 
government, the Federal Government, would cover two-thirds of 
the cost of eliminating tuitions and fees, and the States would 
cover a third, and I believe that--actually, that is a really 
important cornerstone of higher education authorization, 
reauthorization. But you look like you were going to say 
something, Dr. Webber?
    Mr. WEBBER. Yes. I was just going to say that I think you 
hit the nail right on the head with respect to affordability 
and completion. That, on average, a college degree pays off in 
spades, and this is true for the vast majority of people, but 
risk is really the important thing here, that downside risk. 
You know, the people who are in the single worst position are 
those who are--do not complete, and for them--
    Ms. JAYAPAL. Right.
    Mr. WEBBER [continuing]. college is not affordable.
    Ms. JAYAPAL. Exactly. Dr. Kvaal? I just have a couple 
seconds here.
    Mr. KVAAL. Just to add, we have this idea of college 
students as being upper middle class, temporarily eating Taco 
Bell, and the reality of their lives today are really very 
different, and we need to think about cost of supporting 
children, other family members, emergency expenses. There is a 
whole range of costs that get in the way of completion that we 
do not deal with.
    Ms. JAYAPAL. Thank you so much. I yield back.
    Chairman SCOTT. Thank you. I would recognize myself for a 
couple of questions. I see the votes have been called.
    Mr. Kvaal, you mentioned the problems with the Public 
Service Loan Forgiveness, that it is good in theory, but is 
problematic in reality. Is the problem legislative or 
administrative?
    Mr. KVAAL. Both. I think it would help to simplify the 
types of repayment plans that are eligible for Public Service 
Loan Forgiveness. The types of employment is unclear. It could 
be clarified by the department. It could also be clarified by 
Congress.
    Chairman SCOTT. Are you saying that somebody can be 
working, year after year, thinking they are on a plan, and not 
knowing and you get--after the 10 years, all of a sudden you do 
not get any credit?
    Mr. KVAAL. That is not only hypothetical, that has 
happened.
    Chairman SCOTT. And is that legislative or administrative?
    Mr. KVAAL. There is a mess. In many cases, the department 
has given inaccurate, or its contractors have inaccurate 
information to students, but I think there is an opportunity 
for Congress to fix it.
    Chairman SCOTT. Are you talking about a problem with 
servicers?
    Mr. KVAAL. Yes.
    Chairman SCOTT. Okay, and you mentioned the cost of the 
for-profit colleges is higher than community college for the 
same program. How much higher, is it close?
    Mr. KVAAL. It is many times higher.
    Chairman SCOTT. Many times, like three, four, five times?
    Mr. KVAAL. Three, four, or five times is a fair estimate.
    Chairman SCOTT. Ms. Morrison, you talked about the North 
Carolina Promise, and you also mentioned a significant 
improvement in graduation rates in several colleges. How much 
did the financial assistance contribute to the increased 
graduation rate?
    Ms. MORRISON-SHETLAR. We are early on in the NC Promise, 
and so our 6-year graduation rate at Western, over the last 6 
years, have gone 50 percent to 60 percent. I anticipate that 
with NC Promise we will see an increase in graduation rate. It 
is too early, at this point in time, to say.
    Chairman SCOTT. Is there a limit on how many students can 
participate?
    Ms. MORRISON-SHETLAR. No. Any of the students who are 
enrolled at the three institutions have NC Promise.
    Chairman SCOTT. So, if you can get into the institution, 
you get the rate?
    Ms. MORRISON-SHETLAR. Correct.
    Chairman SCOTT. You do not have to have a minimum grade 
point average to get in?
    Ms. MORRISON-SHETLAR. We have the standards, set by the 
institutions, for entry, and if the student obtains those or 
exceeds those, then they have the possibility of coming to 
those three institutions.
    Chairman SCOTT. Now, has this benefit at these three 
colleges had an adverse effect on enrollment at other colleges?
    Ms. MORRISON-SHETLAR. Not that we have data to show. In 
fact, those institutions who have said that they have had a--
seen a decrease as a result of NC Promise, the numbers just 
don't jive. We are seeing a 6.6 percent increase. Other 
institutions, 14 and 19 percent increase. So, it is--what we 
are seeing, particularly, was transfer students, as the 
transfer students are coming from the same places that were 
transferring from before. There is just more of them because it 
is a more affordable option.
    Chairman SCOTT. Okay, thank you. And, Ms. Parker, you 
mentioned assistance you got from counselors. How important was 
their advice in making it possible for you to stay and complete 
your degree, and stay in school where you are now?
    Ms. PARKER. Extremely important, sir. Their advice that 
they gave me are coping skills on how to deal with anxiety when 
dealing with things, like finances or worrying about child 
care, or just coping mechanisms, so that I can still stay 
focused, and it was extremely helpful.
    Chairman SCOTT. Do you know how these counselors were paid 
for? Were any of them in a TRIO program, like Student Support 
Services?
    Ms. PARKER. I also have an advisor for the TRIO, in Student 
Services.
    Chairman SCOTT. Has that been helpful?
    Ms. PARKER. Yes, very helpful, connecting me to 
scholarships and resources, guiding me.
    Chairman SCOTT. Thank you. In light of the time, Ranking 
Member, I will complete my questions now and submit others for 
the record. Does the ranking member have closing comments?
    Mrs. FOXX. I do, Mr. Chairman, and, again, in light of the 
time, I will abbreviate my comments. I do want to say that I 
will submit to Dr. Webber a question about a comment he made 
about Temple that I would like to have some clarification on, 
but I will do that.
    Mr. Chairman, I want to, again, commend you for having this 
hearing, and appreciate the opportunity to collaborate with you 
on it, but there is a void in our focus, I think, today, and 
that is the issue of the responsibility of the institutions and 
the States because we see over and over that the issues is 
completion. I am looking forward to some of the other hearings 
in this series that will help us focus more on why so few 
students are completing, and why so many students are not 
seeking the educational program that best suits their 
interests, and what is the responsibility of the institution, 
the student, and the State?
    I am, frankly, flabbergasted by what we heard from Ms. 
Parker about the lack of concern by the University of Toledo 
for her. I think that points out, again, lots of problems at 
the State level, and I want to believe that no student going to 
an institution in North Carolina would have faced that total 
lack of concern. We have had a lot of hearings on postsecondary 
education over the years and, as time goes on, statistics add 
up. It is becoming clear that none of the issues stand alone.
    Mr. Chairman, you and I share a love for methodical 
processes, and a topical approach makes sense to many, but as 
our witnesses have shown us today, each topic leads directly to 
another. That is why this committee must focus on the following 
touchstones for reform: strengthening innovation and 
completion, modernizing Federal student aid, and promoting 
student opportunities.
    We have not even touched on some of the newer elements that 
are finally being considered within the contents of 
postsecondary education. Just the other day, I read about how 
population challenges are beginning to impact small liberal 
arts colleges. According to a new study by economist Nathan 
Grawe, there will be 450,000 fewer students entering the 
postsecondary system in the 2020's because there are fewer 
people being born in this country. Without the tuition revenue 
supported by the students, colleges are going to need to figure 
out a way to adapt, and it is imperative for our country's work 
force that the system supports students in completing an 
affordable postsecondary education of some kind.
    Mr. Chairman, you and I share a passion for seeing skills 
education play a bigger role, but we cannot forget about small 
institutions and the role of the liberal arts. Students must 
have options. I look forward to continuing these conversations 
with you in our next hearing, and I yield back.
    Chairman SCOTT. Thank you, Dr. Foxx. And one of the things 
that we want to make sure we do not leave out is access to 
liberal arts education. Many people want to have a formula, 
where you can monetize your education the day after you get 
your degree. That is not often possible with the liberal arts 
degree, but the long-term benefits in terms of transformation 
of the student, I think, is extremely important. And for--
    Mrs. FOXX. And as an English major, you know I agree.
    Chairman SCOTT. And for those who are academically 
qualified to make that choice, we do not want to limit that 
choice just to those who can write the big tuition checks, but 
we have heard today that a quality education is out of reach 
for too many of our students. We have heard how Federal and 
State disinvestment from public higher education has hindered 
and under-resourced the school's ability to reach all of our 
students. You have heard how the weakening Federal grant 
programs and supportive services have made it difficult for 
students to access higher education, and I think we have an 
obligation, particularly with the State disinvestment. We heard 
that going from the Pell Grant covering 75--to about 75 percent 
going to 25 percent. Well, that triples the cost to the student 
right there. Just in the Pell Grants, inflation has made the 
portion they pay even more expensive. So, it is obvious that we 
have do something, and today's hearing was extremely important 
and informative for us to get our job done, and I want to thank 
our witnesses for being with us today.
    Thank you, and without objection, the committee hearing is 
adjourned.
    [Additional submissions by Mrs. Foxx follow:]
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    [Additional submissions by Ms. Fudge follow:]
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    [Additional submissions by Mr. Levin follow:]
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    [Additional submissions by Ms. Shalala follow:]
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    [Additional submissions by Ms. Schrier follow:]
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    [Additional submissions by Mr. Takano follow:]
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    [Additional submissions by Mr. Taylor follow:]
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    [Questions submitted for the record and their responses 
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    [Dr. Morrison-Shetlar response to questions submitted for 
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    [Whereupon, at 1:47 p.m., the committee was adjourned.]

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