This Week in Legislation

Week of November 28 This week, both the U.S. House and U.S. Senate are in session for legislative business. While neither chamber is expected to consider student financial aid-related legislation, the House and Senate will continue to work on transition activities for the upcoming 115th Congress. For example, House Democrats are expected to vote on their party leadership and House Republicans are expected to select the chairs of the House Appropriations, House Education and the Workforce, House Energy and Commerce, and House Financial Services Committees. On Tuesday at 12:40 p.m., Federal Reserve Board of Governors Member Jerome Powell gives a speech titled, “The Economic Outlook,” at the Economic Club of Indiana Luncheon in Indianapolis, IN. Tuesday through Friday, all day, Federal Student Aid holds its 2016 Training Conference for Financial Aid Professionals in Atlanta, GA. Select conference topics include: Federal Perkins Loans Program Update; Administering Title IV Aid for Transfer Students; National Student Loan Data System (NSLDS) Update; NSLDS Enrollment Reporting; Hands-On NSLDS; Common Origination and Disbursement (COD) System Update; Default Prevention; Public Service Loan Forgiveness Policy and Operations; Borrower Defense to Repayment Final Regulations; Income-Driven Repayment (IDR) Plans/Pay As You Earn (PAYE); and How to Detect and Deter Federal Financial Aid Fraud. For conference details and the agenda, visit the FSA website. Wednesday through Friday, all day, the American Association of State Colleges and Universities, in consultation with the American Association of Community Colleges, Association of Public and Land-Grant Universities, and Council for Advancement and Support of Education, holds its 23rd annual Higher Education Government Relations Conference in St. Petersburg, FL. The conference will demonstrate how campus government relations professionals can create messages, engage and energize stakeholders, and assemble coalitions that recognize and reflect new realities confronting public higher education and state government. Conference participants will attend sessions on bridging the campus and capitol divide through institutional leadership, the voluntary system of accountability and student achievement measure, and federal legislation and policy issues. Wednesday through Friday, all day, the Foundation for Excellence in Education hosts its 2016 National Summit on Education Reform. The Summit provides state and local policymakers, education leaders, and advocates with comprehensive information on evolving laws, new trends, successful policies, and the latest innovations that are transforming education for the 21st Century. Former Florida Gov. Jeb Bush will give the keynote address. Select proceedings will be livestreamed on the Summit website. On Wednesday at 9:15 a.m., the Brookings Institution holds an event titled, “Understanding Fedspeak,” to examine the purpose and quality of Federal Reserve communications from the perspectives of academics, former Fed officials, Wall Street watchers, and those in the press who cover the Federal Reserve. Participants include: Jon Faust, Director, Center for Financial Economics, and Louis J. Maccini Professor of Economics, Johns Hopkins University; Alan Blinder, Visiting Fellow, Economic Studies, Brookings Institution; Louise Sheiner, Senior Fellow, Economic Studies, and Policy Director, The Hutchins Center on Fiscal and Monetary Policy, Brookings Institution; Ben Bernanke, Distinguished Fellow in Residence, Economic Studies, Brookings Institution; Tim Duy, Blogger, Senior Director, Oregon Economic Forum, and Professor of Practice, Department of Economics, University of Oregon; Ylan Q. Mui, Reporter, The Washington Post; David Wessel, Director, The Hutchins Center on Fiscal and Monetary Policy, Brookings Institution; Roberto Perli, Partner, Cornerstone Macro; Peter Hooper, Managing Director, Chief Economist, Deutsche Bank Securities; Julia Coronado, Chief Economist, Graham Capital Management; Vincent Reinhart, Chief Economist, Standish Mellon Asset Management; Donald Kohn, Senior Fellow, Economic Studies, Brookings Institution; and Jerome Powell, Member, Federal Reserve Board of Governors. On Wednesday at 11:00 a.m., the Federal Reserve Bank of New York releases its Q3 2016 Household Debt and Credit Report. The Household Debt and Credit Report offers an updated snapshot of household trends in borrowing and indebtedness, including data about mortgages, student loans, credit cards, auto loans, and delinquencies. On Wednesday at 12:00 p.m., the Cato Institute holds a briefing on Capitol Hill titled, “Cutting Wasteful Spending in the Trump Administration.” The event, which discusses a new report by Sen. James Lankford (R-OK) on wasteful spending that the incoming Trump administration can cut, features Sen. Lankford; Thomas Schatz, President, Citizens against Government Waste; Chris Edwards, Editor, DownsizingGovernment.org, Cato Institute; Justin Bogie, Senior Policy Analyst in Fiscal Affairs, The Heritage Foundation; and moderator Peter Russo, Director of Congressional Affairs, Cato Institute. On Wednesday at 2:00 p.m., the Federal Reserve releases its Beige Book. Eight times a year, the Fed releases its Beige Book, a summary of current economic conditions for the 12 Federal Reserve Districts based on anecdotal information gathered through reports from Bank and Branch Directors and interviews with key business contacts, economists, market experts, and other sources. On Wednesday at 3:00 p.m., the Brookings Institution and the Committee for a Responsible Federal Budget host an event titled, “A Reform Agenda for the Federal Budget Process,” featuring remarks from House Budget Committee Chairman Tom Price (R-GA) on his proposed reforms of the budget rules that could shape next year’s federal budget and its progress through Congress. After the discussion, Rep. Price and panelists will take questions from the audience. Participants include: Maya MacGuineas, President, Committee for a Responsible Federal Budget; Harry Stein, Director, Fiscal Policy, Center for American Progress; James Wallner, Group Vice President for Research, The Heritage Foundation; David Wessel, Director, The Hutchins Center on Fiscal and Monetary Policy, Brookings Institution; and Philip Joyce, Professor of Public Policy, University of Maryland School of Public Policy. On Thursday at 8:30 a.m., The Heritage Foundation hosts an event titled, “Tax Reform in the Next Congress,” featuring remarks by House Ways and Means Chairman Kevin Brady (R-TX) as he makes the case for tax reform and shares his perspective on likely Congressional action. Following Chairman Brady’s remarks, a panel will examine the similarities and differences between the Ways and Means Committee and Trump tax plans and discuss their likely economic impact. Participants include: Stephen Entin, Senior Fellow, Tax Foundation; Jason Fichtner, Senior Research Fellow, Mercatus Center, George Mason University; Daniel Mitchell, Senior Fellow, Cato Institute; and moderator David Burton, Senior Fellow, The Heritage Foundation. On Thursday and Friday, all day, Academic Impressions hosts a conference titled, “Optimizing Your Tuition Discounting Strategy,” in Silver Spring, MD. Attendees will learn how to develop tuition discounting strategies that achieve both enrollment and net tuition revenue goals. This event will help balance institutional goals of access with necessary tuition revenue benchmarks by analyzing the: relationship between sticker price and discount rate; balance between institutional goals and external benchmarks; and optimal means of utilizing financial aid in the discounting process. For details and to register, visit the Academic Impressions website. On Friday at 1:00 p.m., Federal Reserve Board of Governors Member Daniel Tarullo gives a speech titled, “Financial Regulation Since the Crisis,” hosted by the Federal Reserve Bank of Cleveland and the Office of Financial Research 2016 Financial Stability Conference.   Betsy DeVos Nominated for Education Secretary President-elect Donald Trump on Wednesday nominated education reformer Betsy DeVos as the next U.S. Secretary of Education. Calling Ms. DeVos “a brilliant and passionate education advocate”, Mr. Trump said she will help him “reform the U.S. education system and break the bureaucracy that is holding our children back so that we can deliver world-class education and school choice to all families.” In a statement following the announcement, Ms. DeVos said she was honored to help Mr. Trump “make American education great again.” She went on to say that “the status quo in education is not acceptable. Together, we can work to make transformational change that ensures every student in America has the opportunity to fulfill his or her highest potential.” Ms. DeVos is Chair of the education group American Federation for Children, which has made private school choice its main concern. She is also a former Michigan Republican Party chairwoman and the DeVos family is the most prolific donor to the Michigan Republican Party, GOP officeholders and candidates. In 2000, Ms. DeVos and her husband, Dick, funded an unsuccessful statewide ballot initiative to amend the state constitution to allow tax dollars to be used for private school tuition through education vouchers. They have since advocated for school vouchers in other states. In 2012, Mr. DeVos led the charge in getting the Legislature to make Michigan a right-to-work state, eliminating work rules that made financial support of unions a condition of employment for teachers in public schools. The DeVoses founded their own charter high school, the West Michigan Aviation Academy. In response to her appointment, Senate HELP Committee Chairman Lamar Alexander (R-TN) said Ms. DeVos would make an “excellent choice” as Education Secretary and that he would “move swiftly in January to consider her nomination.” Sen. Alexander said he looked forward to working with Ms. DeVos “on the upcoming reauthorization of the Higher Education Act, giving us an opportunity to clear out the jungle of red tape that makes it more difficult for students to obtain financial aid and for administrators to manage America’s 6,000 colleges and universities.” Because Ms. DeVos has focused her work on K-12, it is difficult to know much about what the Trump Administration has planned for higher education. Therefore, who Mr. Trump selects for other senior posts at the Department and in the White House Domestic Policy Council will be key. A related article by The Chronicle of Higher Education is included in the expanded version of today’s Daily Briefing.   Final Debt Relief Rulemaking Expected Next Month Kelly Leon, a spokesperson for the U.S. Department of Education, told Politico’s Morning Education that the Department expects “to publish a final procedural rule before the conclusion of this (Obama) Administration.” While the bulk of the regulations regarding how defrauded student loan borrowers are able to have their debt forgiven was finalized on November 1, a recent notice from the White House’s Office of Management and Budget states that a final “procedural rule” will be provided that outlines the details of how the debt-relief process will work for borrowers and schools. The final rule will also explain how the Department will accept and consider evidence of fraud as well as how schools will be permitted to defend themselves against such allegations. Secretaries from Five Agencies Ask for Cooperation in College Access and Completion In a letter written earlier this month to state workforce agencies, welfare administrators, student financial aid professionals and other key contacts at the state and local levels responsible for administering federal benefits programs, Secretaries from the Departments of Agriculture, Education, Housing and Urban Development, Labor, and Treasury outlined guidance on how federal agencies should cooperate in order to assist low-income students access and complete college. “For too many students and families, a high-quality college education still feels out of reach, signaling that there is still more work to do to eliminate barriers to college access and college completion,” they wrote. While they noted the successes of the Obama Administration in this area—doubling investments in federal financial aid through Pell Grants and tax credits; student loans made more affordable by keeping interest rates low; allowing borrowers to cap student loan payments at ten percent of their discretionary income; making accessing financial aid simpler and faster; providing students with information about college costs and outcomes to help them make better college choices; and promoting innovation, competition, and accountability to help bring down costs and improve college quality—the Secretaries went on to say that low-income students are likely to have some unmet financial need even when they do receive aid. “Part of the solution,” they wrote, “is ensuring that millions of people enrolled in the federal means-tested programs can easily access the available support and information about education and training opportunities and resources to gain the skills they need for the 21st century economy.” They asked that letter recipients work together to connect eligible students with available federal support and to partner with states to ensure resources effectively support their communities. Federal Reserve Meeting Indicates a Raise in Interest Rates is “Coming Soon” Minutes released from the November meeting of the Federal Reserve’s Federal Open Market Committee (FOMC) reveal that officials agreed it might be appropriate to raise interest rates “relatively soon” against a backdrop of an improving labor market and somewhat higher inflation. The minutes showed that “some participants noted that recent committee communications were consistent with an increase in the target range for the federal funds rate in the near term or argued that to preserve credibility, such an increase should occur at the next meeting.” During the November 1-2 meeting, policy makers took note of a steady increase in new jobs and a tighter labor market that was driving “wage inflation” higher. Overtime hours were also on the rise and some industries were facing a shortage of qualified workers. The minutes showed that Fed officials also pointed to “somewhat higher” inflation in recent months. In addition, the minutes also showed officials emphasized that near-term changes in the benchmark borrowing cost would be dependent on economic data, with the expectation that “only gradual increases” would be warranted. FOMC members noted that labor market conditions had improved “appreciably.” According to the minutes, it was noted that “allowing the unemployment rate to modestly undershoot its longer-run normal level could foster the return of inflation to the FOMC’s 2 percent objective over the medium term.” Most analysts are of the view that the FOMC will raise the federal funds rate at the Committee’s next meeting, which is scheduled for December 13-14. Also, with President-elect Trump’s plans for big infrastructure spending and tax cuts, there could be pressure to raise rates further next year. Long-term rates have already risen. A related article by The Wall Street Journal is included in the expanded version of today’s Daily Briefing. Education Department Update The following announcement has been posted to the IFAP website: ·         2016-11-22 - (General) Subject: 2017-2018 Application and Verification Guide   General News ·         The Chronicle of Higher Education hypothesizes that the Republican-led 115th Congress is likely to alter several higher education policies. ·         The Washington Post covers Maryland SmartBuy, a $10 million program that lets people with education loans purchase a home and wipe out college debt at the same time. ·         Business Insider speaks with a financial planner who says the most common money problem she sees with 20-somethings is that they don’t fully understand the debt they took on during college until later. ·         U.S. News and World Report breaks down the final regulations on borrower defense to repayment. ·         The Associated Press reports that at least 50 public colleges and universities nationwide have lowered nonresident tuition by more than 10 percent in recent years without making similar reductions for in-state students. This information is shared by SASFAA's Legislative Affairs' Committee and NCHER.