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Election Promises and Funding Realities: What to Expect after the Dust Settles
Brett E. Lief Board MemberDirector of Strategic Alliances
Access MoneyPolitics
Is it about…
© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 3
© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 4
Timeline of Major Student Aid Legislation
5© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia.
1982•Defense Authorization Act
1986•Reauth of HEA
1993•Student Loan Reform Act
1997•Taxpayer Relief Act
1998•Higher Education Amendments
1958
•National Defense Education Act
1965
•Higher Education Act of 1965 (HEA)
1972
•Basic Educational Opportunity Grant Enacted
1978
•Middle Income Assistance Act
1980
•Reauth of HEA
1981
•Omnibus Budget Recon Act
2007
•College Cost Reduction and Access Act
2010
•Student Aid and Fiscal Responsibility Act
2011
•FY2011 Continuing Budget Resolution – eliminated year-round pell
2011
•Budget Control Act
2012
•Consolidated Appropriations Act
IS IT ABOUT ACCESS?
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• Society benefits from educated workforce
• Grants provide access, Loans provide choice
• Role of government to stand behind student
Original Guiding Principals
© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 7
• Belief that individuals, not society, benefit from postsecondary education and training
• Loans provide both access and choice• Government is positioning itself between
students and schools• Requiring additional school accountability
Original Guiding Principals:How They Have Changed
© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 8
• Three-year Cohort Default Rates• Gainful Employment
• Focuses on for-profit institutions and effects all other schools
• Current job market may make this a concern for more institutions
• How many of graduates are unable to find jobs?
• Administrative Capabilities of Schools• Compliance and Data Security
• Senate Hearings on For-Profit Institutions
Current Public Policy Discussions
© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 9
You are being watched…• Special Audit Services – Improper
Payments Elimination and Recovery Act of 2010
• “Under IPERA, any contractor performing the aforementioned requirement will be paid for its services based on a percentage of collections… The Department is seeking information from certified public accounting firms to assist in the development of a plan to conduct payment recapture audits…”
• ED OIG Report (May-2012) - of the 19 reports issued, the OIG identified $44 million in financial recommendations, closed 75 investigations of fraud and corruption involving ED programs and operations and secured nearly $16 million in settlements, fines and other recoveries.
• Consumer Financial Protection Bureau• Financial Aid “Shopping Sheet”© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 10
IS IT ABOUT MANAGING MONEY?
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© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 12
© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 13
IS IT ABOUT POLITICS?
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• The 112th Session: “The Gridlock Congress”• Very little major legislation, but some steps taken on
education issues --policy direction more in focus
• The budget mess: • The 6 Month Continuing Resolution – what it really
means• Sequestration• The Remainder of FY13
• The (really) lame duck session• Taxes (Payroll taxes, AMT, Cap Gains, Bush Tax
Cuts, Extenders), Doc Fix, Sequester, Debt ceiling
Congress
15© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia.
• Congressional Gridlock = Administration takes matters into their own hands, i.e. new regs., waivers
• Many new regulations have the potential to be game changers – could impact education policy for years; procedurally tough to overcome for a new Congress and/or President
• Because of past gridlock, Congress will face an unprecedented situation in which nearly every major education law will be scheduled for reauthorization: ESEA, HEA, WIA, CTE, CCDBG, IDEA, & Welfare
Congress
16© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia.
• The Administration: Turnover no matter who wins
• Big changes in Congress on key Ed Committees, especially if control changes
• Intra-party battles will be more important than inter-party battles with each party becoming more unified than ever
One Thing is Certain
17© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia.
• Elementary and Secondary Reauthorization due in 2007
• IDEA due for reauthorization 2008• WIA due for reauthorization• Higher Education Act Reauthorization
• Ten-years and eight extensions
The Agenda
18© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia.
• Longer it takes the more opportunities for changes through budget • Education could receive significant attention as the President looks
for possible victories outside of budget policy• Signature Administration initiatives continue
• Community College agenda• Regulatory expansion
• HEA Reauthorization possible, but big differences on issues like for-profits, Pell, and accreditation among others
• Muddled outlook for student loan providers; Administration still likely to push cuts to pay for Pell and Interest Rate fix
• Education Funding Outlook stable with moderate increases possible to larger programs -- Pell likely to receive increase, and interest rate fix on the table once again
• No Child Left Behind principals applied to higher education
The Agenda
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• Will be data driven• Will include state
cooperation• Include analysis of
programs serving today’s generation
• Programs will be looked at on meeting federal program basis
Change is Coming
20© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia.
Advocacy on All Levels
Individual Schools
Regional Association
Type of Schools
National Association
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© 2012 Inceptia Confidential. Do not copy or redistribute without expressed written permission from Inceptia. 22
QUESTIONS?
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CONTACT INFORMATIONBrett Lief