Executive order focuses on accountability

President Trump signed an executive order on Thursday aimed at making higher education more affordable, transparent and protective of students’ free speech rights.

The document directs the federal government to require institutions to be transparent and accountable about the average earnings and loan repayment rates of former students who received federal student aid. And it says the federal government should make this information readily accessible to prospective students, their families and the public.

The document calls for the alignment of  “the incentives of institutions with those of students and taxpayers to ensure that institutions share the financial risk associated with federal student loan programs.”

Preventing defaults

To help borrowers avoid defaulting on student loans, it says “borrowers should be educated about risks, repayment obligations and repayment options.” It also calls for disseminating information to help students complete degrees faster and at a lower cost.

To improve transparency and accountability on campus, the executive order directs the education secretary to make available, by Jan. 1, 2020, “a secure and confidential website and mobile application that informs federal student loan borrowers of how much they owe, how much their monthly payment will be when they enter repayment, available repayment options, how long each repayment option will take, and how to enroll in the repayment option that best serves their needs.”

The executive order directs the education secretary to expand and update the College Scorecard annually with program-level data for each certificate, degree, graduate, and professional program for former students who received federal student aid.

This data would include estimated median earnings, median Stafford loan debt, median Graduate PLUS loan debt (if applicable), median Parent PLUS loan debt, and student loan default rate and repayment rate.

The College Scorecard would also be updated annually with institution-level data, providing the aggregate for all certificate, degree, graduate and professional programs for former students who received federal aid, include the default rate and repayment rates.

To implement this, the executive order calls for the treasury secretary to provide appropriate statistical studies and compilations regarding program-level earnings by former students who received federal aid.

Risk sharing

The education secretary – in consultation with other federal officials – is directed by Jan. 1, 2020, to submit to the president an analysis of policy options for sharing the risk associated with federal student loan debt among the federal government, institutions, and other entities.

Also by that date, the education secretary is charged with submitting policy recommendations for reforming the collections process for federal student loans in default.

The executive order also directs the education secretary to compile information by March 21, 2020, about “successful state and institutional efforts to promote students’ timely and affordable completion of a postsecondary program of study.”

That would include information about successful transfer of credits and degree completion by transfer students, how states and institutions can increase access to dual enrollment programs, and other strategies for increasing student success.

“Increased information disclosure will help ensure that individuals make educational choices suited to their needs, interests, and circumstances,” the executive order states. “Access to this information will also increase institutional accountability and encourage institutions to take into account likely future earnings when establishing the cost of their educational programs.”

The executive order says that with better data and career counseling, students and their families will understand that “not all institutions, degrees or fields of study provide similar returns on their investment.”

Free speech

The order is also aimed at promoting “free and open debate on college and university campuses.” That provision is seen as a response to complaints that conservative activists are being stifled on some university campuses.

“Free inquiry is an essential feature of our nation’s democracy and it promotes learning, scientific discover, and economic prosperity,” the document states.

To advance that policy, the president calls for federal agencies “to ensure institutions that receive federal research or education grants promote free inquiry, including through compliance with all applicable federal laws, regulations, and policies.”

About the Author

Ellie Ashford
is associate editor of Community College Daily.