According to the New York Times, President Obama recently proposed several changes to federal higher education funding. Among other things, the proposal ties a university’s eligibility for federal student aid to its ability to keep tuition affordable. (It does not specify how affordability is measured). Similarly, it would require all colleges to use a “financial aid shopping sheet” to facilitate students’ and families’ ability to compare financial aid packages.
The proposal also calls for a $1 billion grant competition similar to the K-12 “Race to the Top” competition. According to the administration, it would reward those states that take steps to increase college affordability and completion rates.
The administration also proposes (1) canceling a scheduled increase in subsidized Stafford loan interest rates, (2) doubling the number of available work-study jobs, and (3) requiring all colleges and universities to collect earnings and employment information for their graduates. Under current law, the Stafford loan interest rates are scheduled to double, from 3.4 % to 6.8%, on July 1, 2012.
