Rep. Peter Welch, D-Vt., said Monday he will introduce financial aid legislation designed to broaden the scope of aid for students and reduce the cost to hand it out.
During a news conference at Community College of Vermont in Montpelier on Monday, higher education officials came to support the draft of a bill that intends to address the long-term rising costs of higher education by removing restrictions and reporting requirements on student aid.
Currently, federal financial aid is not available for students enrolled in non-traditional degree programs and the cost to administer aid is raising tuition rates for colleges across the country, Welch said. His student aid package would be more flexible, allowing students to receive aid for accelerated and non-traditional degree programs, he said.
The Flexibility to Innovate for College Affordability Act would expand the eligibility for financial aid for students in accelerated degree programs and reform current reporting regulations that cost institutions money to administer, Welch said. The draft bill has not been introduced.
Welch drafted the bill because growing student debt and higher education expenses are not sustainable, he said.
“The costs are going up and the revenue isn’t. And the federal government is not doing its share. You know, it’s cutting back in supporting investments in the future, education, foremost among them,” Welch said.
Welch joined Vermont’s congressional delegation in voting against the Student Loan Certainty Act this summer, which was later signed into law, because it is only a temporary fix to rising student loan interest rates.
Welch’s bill would increase the number of credit hours that students can earn and still receive federal financial aid, he said. If the new bill were enacted, federal Pell grants and loans could be awarded to students to take courses beyond the current maximum of 12 credit hours per semester, Welch said.
The bill would also set up a Regulatory Reform Task Force to identify the federal regulatory requirements that are placed on financial aid distribution. The task force would make recommendations to Congress on how to reduce the amount of burdensome regulations, Welch said.
Higher education officials said these reporting regulations cut into their own financial aid resources because managing the paperwork is a lot of work for the institutions.
Timothy J. Donovan, chancellor of the Vermont State Colleges, said the reporting requirements create an administrative overhead that does not serve the student’s financial need.
“There are things that add to administrative costs that in the end don’t add any value,” Donovan said.
Welch said that he will be working to get both parties in Congress to support the bill when he gets back to Washington.
College costs have risen 1,120 percent over the past 30 years, with outstanding student debt now at $1.2 trillion, a news release stated.