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Higher ed enters the age of accountability

College student success to become the focus of state and federal policy
University Business, January 2017
Public funding levels and the various approaches to affordability—from debt-free college to private-sector loans—will continue to dominate higher ed debates in and outside campus administrative offices.
Public funding levels and the various approaches to affordability—from debt-free college to private-sector loans—will continue to dominate higher ed debates in and outside campus administrative offices.

A greater level of accountability around access and outcomes looms on the horizon for higher ed administrators in 2017 and beyond.

Experts across the ideological spectrum predict the federal government and the general public to demand more transparency in the data released about how graduates of specific campus programs fare in the job market. 

This push could also see the enactment of performance-based funding rules—at least one such bipartisan bill has already been proposed in Congress. President-elect Donald Trump said little about higher education during his campaign, but observers expect the federal government to put more pressure on accreditation agencies to evaluate institutions more strictly.

“The movement from access to student success is making its way into state and federal policy, to various degrees,” says Josh Wyner, vice president and executive director of the Aspen Institute’s College Excellence Program. “I can see a world moving toward access, completion and completion-plus, post-graduation-success as holistic indicators of the performance of colleges of universities.” 

Of course, public funding levels and the various approaches to affordability—from debt-free college to private-sector loans—will continue to dominate higher ed debates in and outside campus administrative offices. 

Craig Lindwarm, director of congressional and governmental affairs for the Association of Public and Land-grant Universities (APLU), points out that over the last several years, public four-year schools have spent more per student than is covered by tuition increases.

If the federal government offered states matching funds to reinvest in higher ed, that could ease the burden on institutions and students. 

“Institutions are doing their best to absorb the costs and not completely pass them on to students,” Lindwarm says. “Still, most students are directly impacted by state disinvestment in higher ed. We think a federal policy to encourage and incentivize states would be very successful in impacting accessibility and affordability.” 

Performance pressures intensify

The federal government already collects reams of data on student outcomes, but much of it is not available to the public due to a Congressional ban imposed about 10 years ago after lobbying by private institutions and others, says Amy Laitinen, director of New America’s higher education program.

Bipartisan legislation that recently proposed to overturn the ban would give students access to institution-by-institution data on how much graduates of a specific campus program earn in professions. 

“The politics around those conversations get hard once you get to legislation,” says Laitinen, pointing out that the average member of Congress has 16 colleges in their district. “Once the rubber hits the road, you start to see everybody saying that’s good, but not for my colleges.”

The ban also leads to misleading federal graduation numbers because, to name one issue, transfers and part-time students are not accounted for, adds Lindwarm of the APLU. About 55 percent of students who earn a bachelor’s degree attend more than one institution and 60 percent have attended community college part-time, he says.

“We think it’s well past time that Congress lift the ban on student-level data,” Lindwarm says. “This ban essentially denies families and policymakers access to the information they need to better understand outcomes of higher education institutions.”

But privacy concerns could dissuade some lawmakers from putting a lot of energy into overturning the ban, predicts Neal McCluskey, director of the Center for Educational Freedom at the Cato Institute.

“People on all sides of the aisle say that if we had more information, that empowers consumers,” McCluskey says. “But once you attach questions of privacy and data security, that becomes a much hotter issue that goes outside higher ed and you get a lot of very concerned people who might come out against it.” 

Another piece of bipartisan legislation recently introduced in the Senate would reward additional financial aid dollars to schools that enroll and graduate high numbers of low-income students. Schools that rank near the bottom in these areas could face penalties. But higher education’s considerable political influence means change could come slowly, Laitinen adds. 

“We’ll see a push toward increased transparency around outcomes,” she says. “But the politics of higher ed reform are really hard, even if the policy reasons are compelling.”

New visions for accreditation

Part of this shift toward accountability could mean a change in the way colleges and universities are accredited. A trio of Democratic senators, including Elizabeth Warren, introduced a bill (http://UBmag.me/31) in September 2016 that would require accreditors to look at student outcomes. 

“We thought they were watchdogs, but they’re lapdogs,” says Anthony Carnevale, director of Georgetown University’s Center on Education and the Workforce, of accreditation agencies. As evidence, there are more than 400 accredited higher education institutions with graduation rates below 25 percent, he adds. 

David Bergeron, a senior higher education fellow at the Center for American Progress, says accreditation agencies have long focused on the mission set for them by higher education and the general public—which is to evaluate enrollment, finances and institutional operations.

“It’s painful to look at low graduation rates or the inability of graduates to get jobs,” says Bergeron, who spent more than 30 years in various leadership roles at the U.S. Department of Education. “Either accreditors are going to have to be refocused or replaced by some other accounting system. I don’t think accreditors can refocus themselves to really be engaged in the business of outcomes.”

One potential replacement would be the federal government, which could assemble the data to give the public a clearer picture on outcomes. The Department of Education, for instance, could take its enrollment data and track student’s earnings through the Internal Revenue Service and Social Security Administration.

This could show, for example, that 80 percent of a program’s graduates earn 150 percent of the poverty level or earn 25 percent more than students with only a high school diploma, Bergeron says. 

“To some extent, we have failed to exploit the kind of big data that’s being used in other parts of our economy,” he says. “We buy stuff from Amazon and it gains tremendous business intelligence about us, but we don't want to apply those kind of mechanisms to measuring outcomes of higher education.”

The availability of program-level data could radically change students’ views of institutions, Carnevale adds. “Institutions will matter less and programs will matter more.  It doesn’t matter as much which institutions you go to; it’s the relationship between the program and the economy. If you go to Harvard and become a school teacher, you still get paid like a teacher.”

Look ahead on loans

Another change that may gain support in the effort to ensure greater accountability would be allowing banks and other private lenders to offer student loans. Compared to federal loans, this would better align lenders’ interests with students' academic goals, says Preston Cooper, a policy analyst with the Manhattan Institute.

“If you’re a private lender, you’re going to have a strong incentive to make sure the money is actually spent right,” Cooper says. “I have a hard time believing a private lender would have lent to Corinthian or ITT.”

Private lenders could also be a force for demanding more data on outcomes, and shifting accreditors’ focus away from overemphasizing an institution’s financial resources, he says.

“More established schools have a much stronger financial position than new ones that are providing competition,” he says. “This should make accreditation a fairer process. It’s a way to make the market operate less like a cartel and more like a competitive market.”

Another policy change that enjoys bipartisan political support is the refinancing of student loans. “It’s very popular, but it’s bad policy,” says Laitinen of New America. “It’s super-expensive and regressive because it benefits those who already have degrees. It’s going to take a huge chunk of dollars that could be better used off the table.” 

She points out that 40 percent of student debt is owed to graduate schools—meaning people who will likely be able to repay their loans when they enter the workforce. The millions of dollars that would be devoted to loan refinancing could be better spent beefing up Pell Grants and other programs that help lower-income students, she says. 

“Folks who are really struggling with debt often are people who don’t have degrees,” Laitinen says. “They’re folks who went to college, didn’t get the right support and now they have debt and no degree. Contrast that with someone who has a master’s.”

And simmering on the backburner of higher ed policy? There may be a renewed push to eliminate 529 plans, which some believe favor more affluent families and sap resources for poorer students, says
McCluskey of the Cato Institute. President Barack Obama abandoned an effort to end 529s in early 2015. 

“It would be a move away from subsidizing middle- and upper-income people and simplifying student aid,” McCluskey says. “I’m not sure anything will happen but something should happen.” 

Debt and completion standards

The push to eliminate tuition for many students at public universities will likely result in a less far-reaching compromise, many experts believe. 

“Realistically, I don’t think we’ll get to free anytime soon,” says Laitinen, of New America. “If we’re going to spend these additional resources, we need to know what we—and I mean students, families, taxpayers—are getting for those dollars.” 

Such a move could flood public universities with more affluent applicants who would crowd out the lowest-income students who need the benefits the most, says Cooper, of the Manhattan Institute.

Congress would most likely set a lower-income threshold, adds McCluskey. Lawmakers could mandate, for example, that students at 200 percent of poverty level don’t take on any college debt—which would still require increased funding from states and the federal government to cover the difference. 

“When push comes to shove, no one wants to be seen as standing in the way of making college more affordable,” he says. “But there are huge unintended consequences that go with this—you still have the big problem of non-completion. Even if a student hasn’t taken on debt, they’ve still lost money.” 

Setting completion standards has always been a dicey prospect, meaning it may fail to gain much traction in 2017.

“You get pushback from lots of colleges who will often say there’s so much that goes into higher education that we can’t control—and they are right,” McCluskey says. “Higher ed is usually pretty adept at coming together and opposing something that would impose a one-size-fits-all rule on outcomes.”

Elsewhere on the affordability spectrum, more colleges and universities—particularly smaller, liberal arts institutions—may “reset” tuition so sticker prices more accurately reflect the cost of providing a higher education and what a student will pay, says Michelle Asha Cooper, president of the Institute for Higher Education Policy.

Utica College in New York and La Salle University in Philadelphia, for example, have announced respective resets that cut tuition by 42 percent and 29 percent. 

“Colleges are recalibrating and thinking about what tuition really needs to be,” she says. “The affordability concern is not going to go away. Institutions are going to be forced, one way or another other, to do something about it.” 

Climate change on campus

In 2016, higher ed saw fewer of the racially charged protests that roiled campuses in the the fall of 2015 and brought new urgency to issues of inclusion and equity. Still, administrators will have plenty of work to do to improve climates as minorities and other underrepresented groups gain political influence, Cooper says. 

“What we’re facing today has not been faced in previous iterations when these topics emerged,” she says. “Now racial minorities are becoming majorities—a third of the student population comes from communities of color.” 

Forward-looking institutions will continue work to increase the number of minorities in leadership positions, and as part of the faculty and student body. There will also be increased pressure to prevent colleges from becoming stratified by social class.

“We will need make sure people from low-income backgrounds are represented across all sectors,” Cooper says. “We can’t just put certain groups of people into one particular sector—like, for example, saying all low-income kids have to go to community college.”

2017 Lookout

  • Accountability: Institutional performance on access and outcomes may be tied to federal funding.
  • Accreditation: These agencies may face pressure to conduct more rigorous evaluations.
  • College climate: An increasingly diverse student body will continue to push for more inclusive campuses and for the hiring of more minority administrators, professors and instructors.
  • Data transparency: Look for a renewed push to overturn the law that prevents the release of student-level earnings outcomes—and opposition by privacy advocates to any such effort.
  • Affordability: More institutions will reset tuition while free college may have little to no support with Republicans in control of the White House and Congress.
  • Career planning: Academic programs will become as important as institutions are to incoming students trying to forecast future job satisfaction and earnings

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