CONTENTS
- Final Borrower Defense Regulations Released
- College Board Issues Annual Reports on College Pricing, Student Aid
- AAU Elects New Board Leaders
FINAL BORROWER DEFENSE REGULATIONS RELEASED
The Education Department today released final regulations to make it easier for defrauded federal student loan borrowers to cancel their debt and bars institutions from using mandatory arbitration agreements. The regulations, most of which will take effect in July, require troubled institutions to make new disclosures to their students and set aside money to cover taxpayer costs should the school collapse. This set of rules represents the Obama Administration’s final significant action to alter the federal student loan system.
A group of several higher education associations, including AAU, submitted comments to the Department on August 1 expressing support for clear, consistent processes for defrauded borrowers to seek debt relief. They requested additional clarity on several pieces of the final rule to ensure that borrower relief was provided only for clear examples of serious institutional wrongdoing and that institutions received a fair process.
It is unclear if the final rule addresses any of the associations’ concerns. The higher education community will review the final rule over the next several days and provide additional information and analysis.
COLLEGE BOARD ISSUES ANNUAL REPORTS ON COLLEGE PRICING, STUDENT AID
The College Board’s latest reports on college pricing and student aid show that published tuition and fees in school year 2016-17 overall rose at a slightly slower rate than the year before, and that borrowing for higher education declined for the fifth consecutive year. The reports, released October 26, found that students and parents borrowed $106.8 billion for school year 2016-17, down from a high of $124.2 billion (in 2015 dollars) five years earlier.
Trends in College Pricing 2016 shows the average published tuition at both public and private nonprofit institutions increased slightly. (The figures below are not adjusted for inflation.)
For public, four-year institutions, average published tuition and fees for in-state students rose by $230, or 2.4 percent, to $9,650 in 2016-17. After subtracting student grant aid and tax benefits, the average net price for in-state students was $3,770, an increase of $340, or about nine percent.
For private, four-year, nonprofit institutions, average published tuition and fees rose by $1,150, or 3.6 percent, to $33,480 in 2016-17. After subtracting student grant aid and tax benefits, the average net tuition and fees paid by full-time students at these institutions was an estimated $14,190, an increase of $1,140, or about eight percent.
Trends in Student Aid 2016 reports that undergraduate students in school year 2015-16 received an average of $14,460 per full-time equivalent (FTE) student in financial aid, including $8,390 in grants from all sources and $4,720 in federal loans. In 2015-16, institutions provided an estimated $43 billion in grant aid to undergraduate students – 23 percent of total undergraduate aid and 40 percent of total undergraduate grant aid. In that same year, 32 percent of all undergraduates took out federal subsidized or unsubsidized student loans.
Of all borrowers with outstanding student loan debt—undergraduate and graduate—38 percent owed less than $10,000, and 16 percent, including 10 percent of undergraduate borrowers and 43 percent of graduate borrowers, owed $40,000 or more.
Early next year, the College Board will release a third report, Education Pays, which will use employment, earnings, health-related behaviors, and other factors to document how individuals and society benefit from increased levels of education.
AAU ELECTS NEW BOARD LEADERS
The AAU membership has elected Rice University President David Leebron as chair of the association’s board of directors and Ohio State University President Michael Drake as its vice chair. Their one-year terms began October 25, following the association’s semiannual membership meeting.
Elected to the AAU board were University of Southern California President C.L. “Max” Nikias and Vanderbilt University Chancellor Nicholas Zeppos.