A Senate committee last week passed a major update to the law governing the nation’s higher-education institutions, providing funding for–and putting the onus on–colleges and universities to better prepare students for success in the global economy.

Among its many provisions, the bill would allow online institutions to qualify for federal aid; provides grants to help schools design curricula to address high-need, high-skill vocations, such as information technology (IT); offers scholarships to students who pursue careers in math or science; and calls for technology to be a greater component of teacher-education programs.

Introduced by Sens. Mike Enzi, R-Wyo., and Edward Kennedy, D-Mass., the Higher Education Act (HEA) reauthorization bill is a bipartisan effort to increase accountability in the nation’s higher-ed institutions, strengthen teacher training and recruitment efforts under the federal No Child Left Behind Act (NCLB), and embrace virtual learning as a legitimate means of pursuing a continuing education, among other goals. The Senate Health, Education, Labor, and Pensions (HELP) Committee unanimously approved the bill on Sept. 8.

As America watches its competitive edge whittled away by such rapidly advancing nations as China and India, lawmakers have expressed their displeasure with the state of U.S. education, blaming falling graduation rates on a lack of reform and calling on stakeholders at all levels to breathe life back into what many contend is a system in need of repair. Without change, they warn, the nation’s economy will fail.

“Higher education is not only important to an individual’s economic livelihood. It is also important to America as a whole,” said Kennedy, the ranking member on the HELP Committee. “To remain a leader in technology in this new global economy of the 21st century, we depend heavily on an educated and highly skilled workforce. Yet evidence suggests we are lagging behind other countries of the world.”

According to the international Organization for Economic Cooperation and Development (OECD), the U.S. now ranks 14th in college graduation rates among developed nations. The trend continues with respect to adult and master’s education courses. Twenty years ago, more than 87 percent of 25- to 34-year-olds who pursued a postgraduate education went on to earn a degree. Two decades later, that rate in the U.S. remains unchanged, while eight other countries have surpassed it, according to a Sept. 13 OECD report.

By 2015, analysts predict, three-quarters of all workers will possess some postsecondary education or training. By 2020, experts say, companies will be short some 14 million highly skilled workers.

Twenty years ago, such a demand would have translated into a wealth of employment opportunities for U.S. students. Today, a deeper pool of talent overseas, coupled with the promise of lower wages, has many corporations plucking future executives from the halls of foreign institutions. U.S. schools, meanwhile, are losing ground, officials say.

The bill, S. 1614, seeks to bolster the efforts of postsecondary institutions by strengthening the accreditation process, improving access to education by way of technology, supporting more aggressive student financial aid programs, reducing the need for remedial education, and boosting high-school graduation rates, among other goals.

On the technology front, the legislation–as it emerged from committee–relaxes the controversial “50-percent rule” to permit schools to expand distance-education offerings and establishes a new requirement that the Secretary of Education make available to the public information about the costs of attending postsecondary programs, so that parents and prospective students can more easily compare tuition fees and other expenses when deciding on a school.

The change in the 50-percent provision is particularly relevant to for-profit online institutions because it would, for the first time, allow schools that collect more than 50 percent of their revenues by way of distance education courses, or those that count more than 50 percent of their total enrollment through participation in virtual classes, to collect federal financial aid.

Originally, the 50-percent rule was put in place to keep disingenuous online diploma mills and other scam operations posing as legitimate degree-granting institutions from tapping into millions of dollars in available federal funds.

While online institutions still would have to apply for an exception to the rule, the Senate’s version of the bill would do away with the 50-percent requirement, making it possible for legitimate online schools to obtain federal assistance.

The bill also authorizes a series of grant programs to help all varieties of higher-education institutions develop new curricula and services designed to connect students with high-skill, high-growth occupations, such as the IT or biotechnology fields.

Under the bill, schools can use federal money to expand or create programs emphasizing job skills relevant to growing employment sectors; purchase equipment to facilitate academic training; support academic programs focused on high-growth occupations or industries; expand or create distance learning and other alternative opportunities to obtain training in these fields; build partnerships with local businesses; and support curriculum development related to entrepreneurial training, among other uses.

With an eye toward narrowing the “knowledge gap” that exists between rich and poor students, the Senate committee also revised or added a number of grant programs designed to help make the college experience more affordable.

The pending reauthorization would extend the law that governs the Pell Grants initiative and just about every other financial-aid program for aspiring college graduates by six years.

Pell Grants, which offer financial assistance to low-income families, would see their maximum value raised to $5,001 in 2006-07 and incrementally to $6,300 over five years. Eligibility requirements also would soften a bit, opening the program up to households that report $20,000 or less in income a year, up from $15,000 in the previous version of the bill.

Lawmakers also updated the State and Partnership Grants program under Title II of the HEA to help new and aspiring teachers meet the highly-qualified teacher provisions set forth under NCLB.

Specifically, the bill asks institutions of higher education to take responsibility for adequately training and preparing tomorrow’s classroom teachers by “ensuring that all teacher-preparation programs prepare current or prospective teachers to become highly qualified, to understand scientifically-based research and its applicability, and to use technology effectively, including use of instructional techniques to improve student academic achievement.”

To that end, colleges can use the money to retrain faculty; align existing teacher-preparation courses in conjunction with state content standards; integrate effective teaching skills and increased rigor in the classroom; and promote the effective use of instructional strategies for students with special needs.

Financial assistance also would be available for teachers colleges to provide internships and other clinical opportunities meant to help aspiring teachers gain relevant classroom experience.

For research purposes, grant money could be used to collect and disseminate data on teacher retention rates between institutions of higher education, local education agencies, and K-12 schools to evaluate the strength of a state’s teacher support system.

Students, too, would get additional assistance under the revised bill.

Through the Provisional Grant Assistance Program, or ProGAP, the government will offer $5.5 billion in grant aid over the next five years to the most economically disadvantaged of students.

To help meet the demands of an increasingly tech-driven workforce, lawmakers created the Mathematics and Science Scholars Program, a new initiative through which high school students can receive scholarships of up to $1,000 for taking courses anchored in math and science disciplines and for pursuing a postsecondary degree in one of those two fields. Though each state would set its own eligibility rules, the bill specifies that participating states provide a 50-percent match for all funds and recommends that preference be given to students attending high-need schools.

Other changes include:

  • Reauthorizing programs to support historically black colleges and universities, Native Hawaiian and Alaskan institutions, tribal colleges and universities, and professional or graduate institutions for minority-serving institutions.
  • Reauthorizing the Federal Perkins Loan program, which allows institutions to operate revolving loan funds. It also lets families with adjusted gross income levels below $20,000 automatically claim “zero” expected family contributions in financial aid analysis.
  • Creating a new grant program to support graduate programs at Hispanic-serving institutions, similar to programs already established for historically black colleges and universities.
  • Authoring $1 billion in “smart” grants targeted toward students in their third or fourth years majoring in math, science, or foreign-language fields. The legislation provides additional loan deferment for members of the armed services who serve in a combat zone.

The House version of the HEA reauthorization bill, called the College Access and Opportunity Act of 2005, was passed by the House Committee on Education and the Workforce by a voice vote of 27-20 on July 22. Both bills still must be voted on by their respective chambers of Congress. If passed, they will go to a conference committee, where lawmakers will attempt to reconcile the differences.

In the wake of Hurricane Katrina, a HELP Committee staffer said it isn’t likely the Senate will consider the HEA bill until all necessary Gulf Coast relief measures are passed. He could not provide a timeframe for when that might occur.


U.S. Senate

Senate Heath, Education, Labor and Pensions Committee

Sen. Mike Enzi

Sen. Edward Kennedy