U.S. DEPARTMENT OF EDUCATION

OFFICE OF POSTSECONDARY EDUCATION

PUBLIC REGIONAL HEARING ON

NEGOTIATED RULEMAKING

Loyola University -- Water Tower Campus\
Rubloff Auditorium -- 1st Floor\
820 N. Michigan Avenue\
Chicago, Illinois 60611

**Thursday, October 5, 2006**

9:02 [a.m.]{.smallcaps} -- 3:30 [p.m.]{.smallcaps}

## 

## Department of Education Panel Members:

#### Daniel T. Madzelan

Director of Forecasting and Policy Analysis Staff

**Jeffrey Taylor**

Deputy General Counsel for Postsecondary and Regulatory Affairs

Office of General Counsel

#### Carney McCullough

Senior Program Analyst

Policy and Budget Development Staff

[P R O C E E D I N G S]{.underline}

Number range CHAPTER **PHIL HALE:** Good morning. Would everyone have a
seat, please?

My name is Phil Hale. I am Vice President of Public Affairs here at
Loyola University, Chicago. Thank you all for coming.

We are very honored to have the opportunity to host this public hearing
for the U.S. Department of Education, and I am very delighted to have
this opportunity to welcome all of you to our Water Tower Campus.

Let me start with some housekeeping, if I may. First of all, the
bathrooms are over here, outside of the room to my left. There is also
water outside that will be refreshed throughout the day. For those of
you who are planning to make a day of it, after lunch we will have some
caffeinated beverages and some cookies to keep you going.

I would also like to encourage those of you who are also planning to be
here for a while to sit in a little bit towards the center. This is a
nice auditorium, but we always have this tendency\--everyone sits along
the aisles and sits in the back and then latecomers come and they are
too embarrassed. So there are a lot of empty seats, but there is this
cluster of people in the back. We have no idea how many people to
expect, but I understand that we are already pretty full for this
morning's testimony. So just be aware of people that may be coming in
late, if you would, please.

Before I introduce our panelists from the Department and before we
launch into the public testimony, I would just like to ask if we could
just step back for a minute and remind ourselves very briefly of what we
are all about. We all come here today with some very particular issues
that we want to discuss and to share with the Department of Education,
but we are here because these issues all pertain to Federal funding for
postsecondary education and, like every other level of education,
funding for higher education is very much an investment on the part of
the Federal government, and an investment that has benefits that, I
think, accrue to our entire society.

I used to have a doctor who used to say that there is no panacea in
medicine except for proper weight control, achieved through good diet
and exercise. I think the same thing is true for social ills, as well.
There is no panacea for social ills except for education. We frequently
discuss the benefits of higher education and what it can do for the
individual student, and that is important, especially in terms of their
potential for future earnings. Investments in higher education also have
societal benefits that I think we just do not talk about nearly enough.

For example, in addition to preparing individuals for employment, higher
education prepares students to be good citizens, citizens who are better
informed about issues, citizens who are more active in their
communities. Higher education also fuels new technologies and
innovations that are at the very leading edge of this country's economic
development. Similarly, it is just impossible to imagine, for example,
our health care system in this country without college-educated nurses,
doctors, researchers, and other professionals upon whom all of us
depend, really, for our very lives.

So the programs we will be discussing today, like ACG and SMART, have a
societal impact that goes well beyond the individual students who will
directly benefit from them. And I just think it is important to remind
ourselves of that every once in a while. As you know, this public
hearing is one of four regional hearings that the U.S. Department of
Education has scheduled. We are very honored to host the Midwest
hearing, and I want to welcome all of our panelists from the Department
who are here today.

I would like to introduce, now, from the U.S. Department of Education,
Dan Madzelan, Director of Forecasting and Policy Analysis Staff, Office
of Postsecondary Education, U.S. Department of Education.

Did I get it right?

**DAN MADZELAN:** Yes.

**PHIL HALE:** All right. Thank you, Dan.

**DAN MADZELAN:** Thank you, Phil.

Phil did get my title correct. I do work in a hierarchy and, pretty
much, your position in that hierarchy is directly related to the length
of your title. You start with Secretary, Deputy Secretary, Assistant
Secretary, Director of Staff for Forecasting and Policy Analysis in the
Office of Postsecondary Education.

So, at any rate, thanks to everyone for coming here today. What I want
to first do is introduce my colleagues here up at the head table.

To your far right is Jeff Taylor. Jeff is our Deputy General Counsel for
Postsecondary and Regulatory Affairs.

Seated next to Jeff and between Jeff and myself is Carney McCullough.
Carney is with me in the Office of Postsecondary Education. She is the
Senior Policy Analyst for the Student Financial Aid Programs.

As some of you probably know, we are required by statute in the
Department of Education, and with respect to the student financial aid
programs authorized by the Title IV of the Higher Education Act, to
engage in a process known as negotiated rulemaking anytime we want to
issue new regulations or amend existing regulations that affect the
Title IV student financial aid programs.

We are required to do that except in a couple of limited circumstances.
We actually had one of those limited circumstances this past year when
the Congress passed the Higher Education Reconciliation Act, which made
significant changes to the student loan program, but also more
importantly authorized two new grant programs, the Academic
Competitiveness, and the National SMART Grant programs. We just did not
have time to go through a full notice and comment, negotiated rulemaking
process. So we did issue interim final regulations on those program with
comments invited, expecting to issue final regulations, essentially for
year two of the new grant programs November 1^st^. But again, we are on
a pretty tight timeframe and pretty strict requirements in general.

So that is really why we are here today, to start off this next
negotiated rulemaking process. This is the fifth time that we will have
undertaken this process since the 1992 Higher Education Amendment.
Carney and I have been involved in---I do not know if all of them, but
certainly most of them. I have been a Federal negotiator on three
occasions.

The regional hearing that we are having today, as well the one that we
had a couple of weeks ago in Berkeley and the two that we have upcoming,
is really the first step in this negotiating rulemaking process. We want
to hear from the affected entities, the higher education community,
about the things that we ought to be regulating.

Basically, our process for negotiated rulemaking is that we have these
regional hearings. We also invite comment. We essentially also solicit
non-federal negotiators. That was in our August 18^th^ notice. You have
until November 9^th^ to submit yourself or someone you know as a
non-Federal negotiator. Then, I think we have it scheduled for
December\--sit down and basically have our first negotiating session in
Washington, D.C. Typically, we have had four or five of these sessions
over a period of four to five months where we all sit around the table
and we craft the actual language for notice of proposed rulemaking.
Generally, we finish that up in May or June. We have established a
little bit more aggressive time period this time around. We are actually
starting this process a month or so earlier.

As far as what it is that we are negotiating, that is why we want to
hear from you. Basically, we do have one item that we will negotiate.
The Secretary announced this in this past May that---you probably know
for the Academic Competitive Grants program, that one of the eligibility
requirements is that a student can plead a rigorous program of secondary
education. What does that mean? Well, we made a stab at it, and we have
the Secretary's letter of last May, as well as some regulatory language,
but that is the one item that the Department has committed to
negotiating. Everything else is open.

We know, beyond that one issue, that there has been concern raised out
in the community about the Secretary's Commission on Higher Education
and their recommendations, what the Secretary may try to do in terms of
implementing some of those recommendations through regulations. Again, I
can say no decisions have been made on that. We had also left room in
this process for negotiating any items that may have come out of any
reauthorization in the Higher Education Act, but since the current
authority for the Higher Education Act has been extended yet again, this
time to June 30, 2007, we are not really looking at any reauthorization
items in this particular negotiating rulemaking session.

For today, many of you have signed up to speak. We are going to give you
five minutes to speak. These sessions will have a transcriber and
recorder, so please, when you step up to the microphone, state your
name, state your affiliation, and then you have five minutes to speak.
We are not going to cut off at five minutes. We do not have a series of
lights here, but we are not going let you ramble on, either, because we
do have a schedule and we are going to try and stick with it.

We have scheduled a break at 10:30, but that would obviously be more for
us than for you guys. If we, you know, feel that we have good momentum,
kind of a good discussion, or if we are hearing good things, then we
will just go through till lunchtime. We will break for lunch at---is
that noon, on there?

Okay, 12:00 to 1:00, we will have a break for lunch.

Again, please speak into the microphone and I will be---I guess I am the
timekeeper, and I will call people to the microphone essentially in the
order that you have signed up.

Again, just in closing, we are here today to listen. If you have a
question, we will be happy to answer it. We are not committing to
anything today. That is what the actual negotiating sessions are about.
But again, we are very interested in hearing what is on your mind, what
you have to say, what you think the Department should be doing with
respect to moving these Title IV student aid programs forward.

And with that, I will call our first speaker, Miriam Pride, to the
microphone.

**MIRIAM PRIDE:** Which microphone?

**DAN MADZELAN:** Any one you like. Thank you.

**MIRIAM PRIDE:** First of all, I want to say thank you to Phil Hale and
to Loyola for hosting us, and thank you to our partners and colleagues
from the Department of Education for having the courage to step outside
the Beltway and have a conversation with us at our home territories.

Good morning, everyone. My name is Miriam Pride, Mim Pride, from
Blackburn College. I come today primarily as a representative of the
Work Colleges. Blackburn College is a small, private, liberal arts
college that is affiliated with the Presbyterian Church located in
Carlinville, Illinois. We enroll slightly more than 600 students, all of
whom engage in some form of work on campus and perform community service
as part of their academic program and as part of the requirements for
graduation.

We are one of seven Work Colleges, including seven Work Colleges that
receive Federal funds under Section 448 of the Higher Education Act, as
revised 1965. Those colleges include Alice Lloyd, Berea College in
Kentucky, College of the Ozarks in Missouri, Sterling College in
Vermont, Blackburn in Illinois, Ecclesia in Arkansas, and Warren Wilson
in North Carolina.

While there are no specific issues in a negotiated rulemaking session
that will be convened later this year and early next year that directly
affect the Work Colleges, we do believe that our voice should be heard
in the negotiated rulemaking sessions. This is especially true as it
relates to the very real concerns of smaller, independent, liberal arts
institutions and the students that they serve, most especially as it
relates to the overarching concern of keeping the cost of college within
the reach of low- and middle-income families and students who attend the
Work Colleges.

Work College students largely come from families that can barely afford
a college education. Berea College and College of the Ozarks recruit
only students whose expected family contribution is so low that they
cannot be expected to contribute anything to tuition. Forty-one percent
of Blackburn students are the first in their family to go to college.

We are able to keep tuition low in our institutions because students
contribute by their work to the work of the institution and lower the
cost of college. We also, all of us, raise substantial private funds.

Most of our students complete a baccalaureate degree with a minimum of
loan indebtedness and within four years. The only major exception to
that is teacher preparation students who, typically, now are taking
four-and-a-half years.

We believe we have a unique perspective to contribute to the ongoing
debate about college student costs, student indebtedness, and
institutional accountability for Federal student aid funds. We believe
that the Work College experience and the point of view should be heard
at the negotiated rulemaking table.

In the past, the Work Colleges have been indirect participants in the
negotiated rulemaking sessions. However, during the Neg. Reg., following
the enactment of the 1998 Higher Education Amendments, the process of
selecting institutional representatives by the U.S. Department of
Education changed.

First, the major Washington-based associations were largely ignored in
the process of selecting persons to represent the various sectors in the
higher education community. While individuals were selected from those
sectors, they did not necessarily represent those sectors, nor did they
have effective lines of communication or ways of expressing the views of
those associations.

Second, not all sectors, and particularly the smaller liberal arts
colleges, were effectively represented. The Work Colleges urge the
Secretary to assure the presence and actual representation of all
sectors, and all points of view, and to ensure that a balanced viewpoint
is presented around the neg reg table when key issues related to all of
the Federal student loan programs, the new Federal grant programs, and
other important student finance issues and policies affecting students
and their parents are discussed.

Just a few weeks ago I attended a very wonderful conference in North
Carolina. The most elite institutions in this country were present. Some
of you here were present. The conference was well funded. The best
demographers, financial aid experts, people who care deeply about young
people were discussing how to provide access for able, low-need students
and they struggled with that issue for three or four days. At the end of
the conference I left sad because nowhere at the table were my
colleagues from the HBCUs, or from Berea, or from Bloomfield College,
the people who, for decades, have served those populations well. In the
cases of Berea and Blackburn, for almost 150 years.

It would be sad indeed if higher education has reached the point where
the private, liberal arts teaching institutions are not represented at
the table when public policy about higher education is being made.

We would also encourage the Secretary to use her considerable influence
to urge the Congress to complete the reauthorization of the Higher
Education Act, especially those parts providing Federal Pell Grant,
supplemental grant, FSEOG, and Federal Work-Study for needy students.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** David Preble.

**DAVID PREBLE:** Good morning. Thanks for having us here.

I am Dr. David Preble, Director of the Commission on Dental
Accreditation of the American Dental Association. The Commission on
Dental Accreditation accredits over 1,300 and is the accrediting body
recognized by the U.S. Department of Education for dental, advanced
dental, dental specialty, and allied dental education.

As their representative, I will be limiting my comments to accreditation
issues. First of all, we do applaud the Secretary for mentioning in her
radio address that she would be meeting with accreditors to talk about
some of the issues that came out of the Commission report.

It is important to recognize that specialized, professional
accreditation is different in many ways from institutional
accreditation. Specialized accreditation deals with development of
competent practitioners, and the Commission on Dental Accreditation in
particular requires that programs provide outcome measures that provide
the public with very useful information on program completion, success
on licensure exams, and employment rates.

Our program's on-time completion rates are exemplary, generally over 95
percent, and success rates on licensure exams are similarly high.
Specialized accreditation is a discipline-specific review process based
on professional expertise that takes years to develop. We do involve
public representatives in the process, but we believe this is most
appropriate at the decision-making level where the public can most
effectively oversee the process.

Accreditors provide accurate and appropriate public information. We feel
it is also important to recognize that accreditation is not simply an
evaluation process, but one that also fosters improvement. In order to
maintain the integrity of the process, not all aspects of the process
are appropriate to be made public because of the chilling effect that
would have on program candor, a necessary component to develop useful
recommendations for improvement.

Accreditors throughout---not just specialized accreditors, work to keep
the costs associated with accreditation reasonable. Some of the
recommendations in the Commission report would create an undue burden in
time and money without providing significant benefit. Since a major
thrust of the report is cost containment in education, we recommend
careful consideration of consequences before acting, such as potential
for increased litigation, maintenance of increasingly extensive
databases, inclusion of public members, onsite visit teams, et cetera.

From a process standpoint, we are in agreement with a letter from
members of the Committee on Health Education, Labor, and Pensions
regarding concern about negotiated rulemaking for Commission
recommendations before legislative action. In the absence of new
legislation specifically on accreditation, we see no justification for
negotiated rulemaking.

And lastly, again, we advise caution in lumping all accreditation and
education issues in one basket when considering recommendations. We
believe specialized, professional accreditors have shown strength and
success in areas that may be a concern for undergraduate institutions.

Thanks for the opportunity to share my thoughts.

**DAN MADZELAN:** Thank you very much.

Also, I will do my best, but if I mispronounce your name, please accept
my apology. That is part of the reason why we ask you to say it
yourself. With a name like Madzelan I am a little accustomed to that, as
well.

**DAN MADZELAN:** Umair Mamsa.

**UMAIR MAMSA:** Dear Department of Education, my name is Umair Mamsa,
and thank you for the opportunity to speak today at the hearing.

I am a junior at the University of Illinois in Chicago, majoring in
philosophy and political science. As a student, I believe that the
Department of Education should make higher education acceptable and
affordable, and that all those that hope for a quality education can
also have the opportunity, joy, and satisfaction to call themselves a
student one day.

Historically, the affordability of education went through three phases,
as I view it, luxury, privilege, and opportunity. Today it is a
necessity.

First, in the early days, with the birth of the best American
universities, a college degree was revered as a luxury for the rich and
affluent members of society. Later on, as colleges became a lot more
eminent and more began to emerge, it became a privilege for the middle
class and it became a little bit easier to go to college.

Then we moved on to the opportunity phase. In the late 1960s, there was
new optimism and hope with the passage of the Higher Education Act and
financial aid programs. Through hardworking parents' lifelong savings
and students' hard work, they could open a window for opportunity with
scholarships and loans. The dream of belonging to an intellectual
community, to study the arts and humanities, research and learn the
sciences, expand the mind, could be made possible.

But contrasting that to today, education in today's society is more than
a luxury and a privilege. It is a necessity for the individual, a
necessity that will ensure one's pursuit of happiness, the ability to
succeed in the workforce, and secure the financial well-being and to
provide for their loved ones. It is also a necessity for society, with
taxpayer dollars, and those dollars funnel right back into society. A
society cannot function without its doctors, lawyers, teachers,
scientists, and researchers as they provide services and a wealth of
knowledge for the community. Education, thus, is a self-sustaining
investment for society to ensure its well-being and the mechanism to
ensure an educated citizenry.

So, in order to meet this necessity, the burden falls on the student and
his or her parents. Today, the primary stress of the student is how they
are going to pay their college bill, afford the skyrocketing cost of
textbooks, and work increasingly long hours, often at minimum wage
salaries, and the last worry is struggling to find time to study. As a
result, the education that one gets is empty and hollow, one that sucks
up the intellectual curiosity and quest for knowledge. The initial
enthusiasm and joy of leaving off to college is dried up in the
remainder of time spent trying to leave as quickly as possible.

Now, if we really live in an enlightened society, if we really regard
ourselves as the best nation in the world, a society that cherishes the
rights and freedoms of individuals, then the education of our citizens
and our students should also be rooted by the same sacred values. A
college degree should not have to be dependent on finances and should
not be a burden. Education is a necessity, but it needs to be a
fundamental right. In order for one to obtain an education now the
burden is huge. It is this very burden that the Federal government
should be supporting.

Now, in the Spellings Commission Report, it states that the median debt
level among students who graduate from four-year colleges and
universities was \$15,000 for public universities and \$19,400 for
private institutions. Now, instead of valuing and regarding those that
go to college, they are penalized and punished by debt.

But today, I urge that the Department of Education consider ways in
which higher education can become more affordable and accessible for all
students. And it can easily be done in a variety of ways including
increasing grant aid and making loans more manageable by limiting a
student's repayment to a reasonable percentage of their income and
recognizing that borrowers with children have less income available for
student loans. Protecting borrowers from high interest charges when they
face economic hardships will, in essence, aid all student borrowers in
their efforts to successfully earn a college degree.

In conclusion, let's set the stage for higher education. We went from
luxury, privilege, opportunity, and today of necessity. Today, let's
finish what needs to be done and make higher education a basic right.
Let the next few days be a landmark as the 1960s Higher Education Act
gave hardworking students an opportunity, I ask that today or in the
near future the Department of Education make a progressive action and
transform the opportunity to a few to a fundamental and basic right for
all.

Thank you once again for allowing me to speak.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Bammeke Jenkins.

**BAMMEKE JENKINS:** My name is Bammeke Jenkins, and I am an alumni of
the Upward Bound Program. For those that do not know Upward Bound, it is
a program because of the War on Poverty under President Johnson in 1964.
It was started to serve first generation and low-income, college-bound
students. There were 130 students in the initial year.

I am a product of the Chicago public school system, and when I was in
grammar school, it was deemed the worst school system in the nation.
Because of Upward Bound, I have not only graduated from high school, I
have also graduated from undergrad, and I have a master's degree, and
right now I am working on a master's/Ph.D. here at Loyola. So Upward
Bound has truly been a benefit for me.

Right after I graduated from undergrad, I went back and started to work
for the program that I graduated from. So I felt that there was a need
for me to give back to those that were like me. If you cut Upward
Bound-type programs, then those students that were like me who were a
part of this public school system that really was not helping a lot of
people\--if you cut programs like that, students like me would not be
standing here today as teachers right now. Right now, I teach at City
Colleges of Chicago.

So I just want to say that Upward Bound has done so much for so many and
I am an advocate of it. I advocate all of the TRIO programs to my
students. The TRIO programs actually are Upward Bound, Educational
Talent Search, Educational Opportunity Centers, Upward Bound Math and
Science, Ronald E. McNair Post-Baccalaureate Program Student Support
Services, and they also have professional training grants that are also
under the TRIO umbrella.

The last thing that I really want to say about Upward Bound is that it
was started to

help\--the purpose of the program was to help students matriculate into
college and become successful and contributing people to our nation and
society. I have a lot of friends who have graduated from Upward Bound
and they are doing just that. So I want you to consider keeping the TRIO
programs when you go back to the Beltway.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Nayshon Mosley.

**NAYSHON MOSLEY:** Good morning. Again, my name is Nayshon Mosley and I
bring you greetings on behalf of Chicago State University's Upward Bound
program.

I, like Mr. Jenkins, am a product of the Chicago public schools, as well
as the Chicago State University's Upward Bound program. I was introduced
to the program as being a student in one of their target schools in
1992. I participated and graduated through that program in 1995. As a
result of that, I not only went on to get my bachelor's degree, but I
also got a master's degree, and I am currently working on my doctorate
degree.

Being from a low income, poverty-level situation, first generational
college student, I would have never before probably been given the
opportunity to advance\--and not only just the opportunity, but the
encouragement that the staff in Upward Bound have provided me with. Not
only do we just go to college and graduate college, but through our time
in Upward Bound we were given the opportunity to not only go through
historical colleges and universities, but we also took cultural trips.

We did a lot of journeying into Canada through the Underground Railroad
situations. We went to Historically Black Colleges and Universities. We
went to private and liberal colleges and universities. We had the
opportunity to kind of see what all opportunities were available to us,
not only just to motivate you to go to college but to give you different
options. We were mandated to apply to a minimum of eight colleges and
universities, to not put all of our eggs in one basket, to go ahead and,
if you did get rejected by one school or if you do not get accepted by
one or two schools, you still have five or six schools.

A lot of students that, where I came from, that would be a
discouragement to them, to get a rejection letter from one university
would be enough to say, "Oh, see. Now I can't go to college." Well,
those students that were in the program with me and those students that
continued to be serviced by the Upward Bound programs, as well as all
TRIO programs, they have more of an opportunity available to them today.

One of the main focuses of the Upward Bound program is, again, to target
low-income, first generational college students. As a result of that
program, I stand here before you today, as well as Mr. Jenkins, to
encourage you all to continue to push for funding for the Upward Bound
programs, to not cut funding, to not overwhelm them with the numbers to
where they cannot receive quality services.

I stand here today so that my daughter and other children will not have
to go through the cycle of not only not being a first generational
college student, but also siding for education so that she can live
above the poverty line. I believe that the Upward Bound program is a
successful program. I believe that the graduation rates, not only from
high school but also from college, are higher than they would be just
with the basic city of Chicago education. I think a lot of students
through the Upward Bound program do not just resort to city colleges
because it is convenient. I think that they branch out and go to other
colleges and universities across the state and across the country.
Without the Upward Bound program, that encouragement would not be there
coming from impoverished areas.

So I just want to thank you for the opportunity to share with you my
testimony, and again, encourage you, fight for funding for Upward Bound.
It is a great program.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Paul Murray.

**PAUL MURRAY:** Hello, my name is Paul Murray. I am a student of
University of Illinois at Chicago. I would like to start by saying thank
you for holding these hearings.

In February, billions of dollars were cut from higher education funding.
This may not have caused many problems right then and there, but in the
long run I think this will prove to have been a huge mistake that could
cripple the American way of life, as well as the economy.

There are five main points that are being pushed by students across the
Midwest. The five points will be discussed in total by at least one
student today. I would like to touch on one of these points. I will
discuss the idea of linking repayment of student loans to a percentage
of income after graduation.

Lower government aid means that more of the cost is placed on students.
The consequences for students, of course, are more debt, lower grades,
and different job selections. Since more debt is assumed, I am just
going to move right on to lower grades. When more of a burden is placed
on students, students need to find a way to support that burden. A
student may need to work a full-time job concurrent with their full-time
class schedule. In this case, the emphasis for the student is more on a
means of funding college rather than receiving high marks in classes.

Second, a student may choose a higher-paying job rather than a
lower-paying job. Such a student may want to be a teacher, a police
officer, or even a criminal defense attorney for the state, but this
student may not be able to take these careers into consideration.

Take me, for example, trying to get a degree in political science at
UIC. I will graduate at least \$30,000 in debt. After graduation, I hope
to move on to law school. I think we all know how expensive law school
is. When I graduate from law school, which is not even a sure thing, I
know that I will not be able to afford to work for the state. I am so
sure that I will not be able to afford it that the thought, "Maybe I
will work as a criminal defense lawyer for the state," will not even be
a thought by that time.

If I am thinking like this, there are certainly many others. Who will
the state turn to for attorneys with its rising number of jail inmates?
Everyone I know rants about how greedy lawyers are. What if that were
true? What if, 30 years down the road, it was still true? Would the
United States really depend on all of the lawyers in the country to
generously donate their time to work on pro bono cases? Then it would be
like a citizen obligation, kind of like jury duty, only this would be
secluded to greedy lawyers. We all know how every citizen jumps at the
chance to do jury duty.

What I say about college debt being hard to pay back, I think it goes
double for anyone out there trying to go to school to be a teacher,
police officer, or any other government position. Who knows, funding
education may save the government they would otherwise have to pay to
employees in order to balance their student loan debt. If I am not
mistaken, raising wages on such a wide scale as it is in government may
even raise inflation or cost of living at a higher rate than the
current, as it did when the cuts were made in February. However, I
digress.

I would like to conclude by saying that college would be a lot easier on
students, and positions in certain jobs would be a lot easier to fill if
repayment of financial aid was a percentage of the income of the student
after graduation. Society will benefit as a whole if higher education
receives more money because public demand on high-paying jobs would not
be as high. What if this were the way to trim a little fat off the
ever-widening gap between rich and poor?

Thank you for your time.

**DAN MADZELAN**: Thank you.

**DAN MADZELAN:** John Padgett.

**JOHN PADGETT:** Good morning and thank you.

Thank you for this opportunity to participate in today's hearings. My
name is Dr. John Padgett, and I am pleased to serve as President of the
International Academy of Design and Technology here in Chicago.

The Academy is an accredited institution offering associate and bachelor
degrees to over 2,000 talented students in the fields of design and
technology. Our primary programs of study include fashion design,
interior design, information technology, merchandising management, and
visual communications.

We commend the Commission and Secretary Spellings for the suggested
concrete and bold statements to the problems facing students and
postsecondary institutions today. It is time that we shine a light on
the system that has failed many students. The obstacles to student
success highlighted in reports are ones we deal with every day. Our
student population is unique, although not entirely unique. Fifty-eight
percent of our students are over the age of 21. Nearly 60 percent are
minorities. Many of the students are the first to attend college. Like
many other colleges and universities across the country, IADT must
address the deficiencies in an educational system that graduates
students from secondary schools without basic skills or the competence
required to be successful in postsecondary.

Of all incoming students on our campus, 65 percent have lower than
college skills and/or English. Thirty-five percent of our incoming
students do not have secondary school level reading or math. To bridge
this chasm between students' skill levels and college work, IADT offers
a two-tiered system of developmental courses in subjects of English and
math.

The first tier course focuses on helping students achieve secondary
school levels in math and English. The second tier courses are designed
to bring the students' skills to those of college levels.

With improvements in our developmental curriculum and instructional
design, as well as improvements in classroom delivery, we have seen an
increase in the pass rate of our developmental students. Currently, 65
percent pass versus 47 percent last year. Even more telling, we have
seen a marked improvement in attendance rates in our developmental
students, 85 percent attendance for all classes versus 55 percent last
year.

The retention of these high-risk students has significantly increased
since the policy has been in place, improving 25 percent for this
specific population. In an effort for the success of IADT students
enrolled in these types of programs, Career Education Corporation has
designed a developmental curriculum to be rolled out at more than 80
campuses across the country this fall.

The preparatory education program is designed to target all incoming
students, unless a student requests a test-out of the developmental
course work. Every student, then, will participate in a core content
course each term designed specifically to improve student skill levels
while also engaging in the program of study of their subject.

CEC has committed time and resources to programs such as these to help
students succeed throughout their educational experience, enhance their
confidence, and their mastery of basic skills in math, reading, and
writing. We support the recommendations of the Commission with regards
to better aligning secondary school preparation for the advanced college
level work.

First, encourage state efforts to align K-12 graduation standards with
college and employer expectations.

Second, provide incentives for higher education institutions to make
long-term commitments to work actively and collaboratively with K-12
schools and systems to under-served students improving college
preparation.

Additionally, we also recommend that the Department provide incentives
to high schools and school systems to develop post-graduation bridge
course work geared towards students who are not prepared to enter
college, and yet have completed their high school requirements.

And finally, standardize state high school graduation requirements to
level the playing field for students going on to higher education.

Thank you very much for this opportunity to speak.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Earl Dowling.

**EARL DOWLING:** Good morning and thank you for this opportunity.

Please know that we, members of the professional financial aid
community, appreciate your keen interest as evidenced by this regional
initiative and by heroically developing and implementing two new federal
grant programs.

My name is Earl Dowling, and I am the Director of Scholarships and
Financial Assistance at Harper College.

Harper College is a comprehensive public two-year college, with an
enrollment of over 24,000, located in Palatine, a northwest suburb of
Chicago. Harper College is dedicated to providing an excellent education
at an affordable cost, promoting personal growth, enriching the local
community, and meeting the challenges of a global society.

My professional financial aid experience spans 25 years, mostly in the
public sector. I appear before you this morning to make this one
suggestion for inclusion in negotiated rulemaking discussions. The
Academic Competitive Grant program is not available by interim Federal
regulations to students enrolled in certificate programs. The negotiated
rulemaking committee must reconsider this oversight, and therefore I am
recommending the definition of an eligible program of the higher
education amendments be modified to read as follows, "An eligible
program is a program, as defined in 34 CFR 668.8 that, for the ACG
program leads to a certificate---" that is the new language---"Or to an
Associate's or Bachelor's Degree in a two-year academic degree program."

For the current academic year, Harper College will enroll over 950
full-time students in our certificate programs. Harper students will
earn their certificates in such high-market areas as culinary arts,
early childhood administrator, early childhood teacher, financial
management, hotel management, and licensed practical nurse, to name just
six programs. These programs are in skilled and very marketable areas.
They attract the same quality student as enrolled in the associate's
degree program.

In fact, and this is critical to my argument, a student earning a
certificate, in, say, forensic science, will sit alongside an individual
working on their associate's degree in forensic science. Same faculty
member, same lesson plan, and some rigorous high school background, but
one is rewarded with an ACG. One chose the associates degree for their
postsecondary studies, whereas the other chose a certificate. We have
created an inequity issue, but easily corrected during negotiated
rulemaking.

This concludes my remarks. Thank you for the time.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Alisa Abadinsky.

**ALISA ABADINSKY:** Good morning. I want to thank you for this
opportunity to testify, and also for having it, really, in my backyard
this morning.

My name is Alisa Abadinsky. I am the President of the Coalition of
Higher Education Assistance Organization, also known as COHEAO. It is a
membership organization that is a partnership of over 300 educational
institutions and commercial organizations from throughout the country. I
work as the Director of University Student Financial Services at the
University of Illinois system. I am very proud to have heard student
testimony from there this morning, although, today, I am testifying on
behalf of the Board of Directors and members of COHEAO.

COHEAO members support student financial assistance and they are
dedicated, especially to the preservation and improvement of the Perkins
Loan Program. The Federal Perkins Loan program began in 1958 after the
Sputnik launch by the Soviet Union as the National Defense Loan Program.
It was renamed the Direct Student Loan Program, then renamed again as
the Perkins Loan Program after Representative Carl Perkins of Kentucky,
the former Chairman of the House Education and Labor Committee. It is
the oldest federally supported student loan program, a program that has
helped many of our nations leaders pay for college.

The Perkins Loan Program remains one of the most cost-effective ways of
providing student financial assistance. It is one of the best-targeted
programs for accomplishing the mission of improving access to higher
education. It represents a highly efficient use of Federal funds since
it targets the lowest-income students and includes an institutional
match of 25 percent of Federal Capital Contributions. That makes it
unique among federally supported loan programs.

Since the Perkins Loan Program began in 1958, more than \$21 billion in
loans have been made to students thanks to the revolving fund concept
and the institutional match, only one-third of these funds came from the
federal capital contributions.

COHEAO has several issues that it believes should be included in the
negotiated rulemaking schedule to commence this year. In general, we
believe the negotiated rulemaking offers an excellent opportunity to
expand and improve the administration of the Perkins Loan Program by
campuses and the Department.

First, we believe that the current practice by the Department to hold
all funds recovered from defaulted loans that have been assigned for
collection to the debt collection service should be modified. Under
current practice, an institution that believes that it will not be able
to collect a defaulted Perkins loan has the option of assigning the loan
to the Department, which can then attempt to collect the loan itself.
Sometimes the Department's efforts result in a successful collection.
However, the government does not return the collected funds to the
Perkins Loan revolving fund, nor to the original campus where the money
could be relented to help future students. This not only continues to
penalize future students for their predecessor's failure, it also
discourages schools from assigning loans to the Department in the first
place, since the assignment means a total loss of that loan for the
institution's Perkins Loan fund.

Current law gives the Department the option of whether or not to return
a share of collections to the institution. We propose the collections of
assigned loans be returned to the revolving fund of the campus that
assigned the loan after deducting the Department's collection costs.

Other issues that COHEAO believes should be part of the negotiated
rulemaking agenda include the following changes that would improve the
operation of the Perkins Loan Program, and I will offer a summary, and
we have additional items in our submitted testimony. Although the VISTA
cancellation benefit still exists, confusion has arisen due to the
managing of the program, with the AmeriCorps program under the
Corporation for National Service. The regulations need to reflect the
benefits clearly under the new program name.

Second, prior to consolidating a Federal Perkins Loan, consolidation
lenders should be required to provide easy to understand and conspicuous
disclosures to Perkins Loan borrowers about the loss of benefits that
would result if a Perkins Loan were consolidated, including the fact
that there is no interest rate benefit from consolidating Perkins.
Borrowers currently are consolidating their loans without being fully
informed about lost benefits.

Third, allow deserving borrowers who have served their country and the
military contingency operation to receive the new military deferment on
all of their outstanding Federal Perkins Loans if at least one loan
meets the criterion of having the first disbursement made on or after
July 1, 2001. In the Federal Perkins Loan Program, no federal interest
subsidy cost is involved. Therefore, there is no cost rationale for
restricting the loans eligible for this military deferment to only those
for which the first disbursement was on or after July 1, 2001. The
statute does not preclude this interpretation and it is much clearly
and, we believe, much fairer to borrowers and a more logical approach.

And finally, address conflicts in the August 2006 interim final
regulations on loan rehabilitation.

I want to thank you for this opportunity to testify about the upcoming
negotiated rulemaking. COHEAO looks forward to participating in this
round, and we will be submitting the name of a negotiator at the
appropriate time. Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Mauri Ditzler.

**MAURI DITZLER**: Good morning. I am Mauri Ditzler. I am President of
Monmouth College.

Monmouth is a private, residential, liberal arts college in Monmouth,
Illinois. We are a member of the Associated Colleges of the Midwest, the
Council of Independent Colleges, an independent colleges' organization,
the Association of Presbyterian Colleges, and a number of other
institutions.

I speak for myself today, but I expect that my enthusiasm for what the
Department of Education may do in response to the Spellings Report and
my concern for what they may do are shared by my liberal arts college.

Those of us who work daily in higher education know that there is a lot
of work that needs to be done. So we welcome the Federal government as
you join us in that task. As a matter of a fact, I am particularly
enthusiastic that the Federal government is interested because, in my
career, I noted that when you prompt us, those of us in education, even
those of us in private higher education, we usually respond, and we
respond quite enthusiastically.

That is also why I am a bit concerned, because sometimes you prompt us
and we respond, and then, in our enthusiasm of response, there are
sometimes some unintended consequences. When we look at what the
Spellings Commission asks you to do, we are enthusiastic about those
things. I think all of us should be. Access, affordability,
accountability\--who could be against those things? And we are for them,
as well. But we know that, in our enthusiasm to legislate for those
items, sometimes we can cause actions that have unintended consequences.
I think that is my concern.

At Monmouth, we regularly ask ourselves, "What were colleges meant to
be? What, really, should be about?" And we have concluded, looking back
at our heritage, and the heritage of so many colleges like ours, that we
are really about the public good. As I read the Spellings Report, I am
convinced that those people were thinking about the public good.

But then I worry that, in their attempt to be very concrete, they got
away from the idealism. They talked about concrete things like access
and affordability. Those items can support the public good, but one can
also imagine how enthusiasm towards those could actually turn us against
the public good.

What I am going to do is give you two quick examples, and then suggest
that you be very careful as you legislate in these areas. One has to do
with affordability. Affordability is a good thing. The Commission talks
about the importance of ease of transfer. That should make things more
affordable, and I can imagine what they had in mind. A young person
could look around and find the college that had the least expensive
English composition course and enroll in that college for a time. Then
they could find someplace that had inexpensive calculus courses and take
those courses for a time. And when it was time to put the major
together, they could find, maybe, a more expensive institution that
would give them the courses in their major. The net effect would be less
cost overall, so it would seem more affordable.

But some of us think that we miss a piece when we do that. We think that
when you transfer there is a problem. We think that a very important
part of education has to do with integration and building a community
and learning from each other. We think it is important for young people
to work with the same colleagues, the same students, over four years.
They see what happens if they are uncivil as a freshman to some
classmates. They see what happens if they get along with their
professors, if they build bridges. They see what it is like to be led as
a freshman by upper-class students and then gradually take that
responsibility as they move on.

So we think that it is very important that you live in a community,
learn how to function in a community, or learn the consequences of not
functioning well in that community. We think it is very important that,
when you are a senior, you can think back to your first year and
remember taking courses with those same students. So you all had read
some of the same texts, had some of the same professors, went through
the same crises on campus, figured out how those were worked out, so
that when you talk to each other and you learn from each other, you
learn as a community should.

We think that if you focus too much on transfer, as I think the
Commission's report does, you run the risk of losing part of what we
think is a very important aspect of the American higher education
system. We are building from a community and learning as part of that
community.

Another example of where I can imagine one might take a recommendation
of the Commission and then go in the wrong direction has to do with
accountability. Accountability is a good thing. We should all be for it,
but, again, it can have some unintended consequences. If we asked
colleges to be accountable, one of the things we would ask them to be
accountable for is their graduation rate. We should all do better for
the graduation rate. If a young person enters our college, we should
make sure that they graduate. If we are not doing a good job of that, we
have to let people know. So we ought to publish, in some fashion, our
graduation rates. I can imagine a response to the Spellings Commission
to say, "Let's make that readily available." But if we make that too
readily available, we will mislead young people. Well, actually, more
problematically, we will cause colleges to respond in inappropriate
ways. If it is important to me that my college has a high graduation
rate, if it is published and we are accountable for that, I can do one
of two things. I can work very hard to make sure my students are likely
to graduate, and I hope I would do that. But another thing that is
likely to happen is we are likely to look at the population of
applicants and say, "Which of those applicants are more likely to
graduate?"

So we might give a preferential financial aid package to students whose
gender, race, and economic background suggest they are much more likely
to graduate. I fear that would happen. While, in our enthusiasm to look
better in the accountability standards, we would take actions that were
inappropriate.

I do hope that you will hold us more accountable, but I ask when you do
this legislation you take a great deal of care, that you do not simply
publish statistics, but you think of ways to correct those and fine tune
so that, in fact, institutions are not punished for taking risks working
with students who have a long way to go, because we think that is in the
public interest.

I come today simply to say to you that we, in private higher education,
want to be a partner with the Department of Education. We want to
endorse the Spellings Commission's report, but we ask that you be
remarkably careful as you go down that path. We know that, when we work
together well and when we are on the same page, we can do a lot of good
things together. But we also know from past experience that sometimes
the responses of the diverse higher education community are not what the
Department of Education expects them to be and we suffer from unintended
consequences.

Thanks for the opportunity to talk.

**DAN MADZELAN:** Thank you very much.

**DAN MADZELAN:** Paula Peinovich.

**PAULA PEINOVICH:** As a 1966 graduate of St. Olaf College from the
Midwest Conference and a colleague from Monmouth, I think that these
comments will also indicate to the Department the tremendously
complicated task we are undertaking here.

My name is Paula Peinovich, and I am President of Walden University.
Walden is an entirely online university owned by Laureate Education. We
offer graduate degrees at the master's and doctoral levels in education,
psychology, management, public policy, and administration, and health
and human services, as well as master's programs in engineering and INT,
and undergraduate programs in business.

We serve the independent adult learner. The average age of our student
population is 35. Walden is accredited by the Higher Learning Commission
of the Central Association.

I appreciate the opportunity to share my thoughts with you today on a
number of issues that Walden believes the Department of Education should
consider during the negotiated rulemaking process. We support the work
of the Commission on the future of higher education.

As an overarching issue for consideration, my comments are focused on
the need to better incorporate the interests of the non-traditional
learner into Federal higher education policy. As Peter Soakes so deftly
demonstrated in his issued paper to the Commission, the traditional
full-time student 18-22 years of age residing on a campus represents
only 16 percent of the higher education population. Thus, as I speak
today on the specific concepts of outcomes measures and transparency,
innovation in teaching, and changes to Title IV funding, I do so with a
broader recommendation that changes in these policies must take into
consideration the needs of the non-traditional adult learner.

We applaud the Commission's consideration and dialogue regarding how the
higher education community might better measure student achievement and
how to use those measures in a manner that best informs students'
prospective policy makers about the quality of our institution. The
issues are difficult. I think you have just seen that from looking at
Walden and Monmouth College.

It is essential to ensure that we do not end up with a mechanism that
pigeonholes institutions as one-size-fits-all. Rather, we must embrace
and encourage the diversity in the institutions and in the educations
that they offer.

At Walden, we have a specific process for measuring student achievement
that incorporates continued improvement as a primary goal. Each academic
program at Walden has a set of student learning outcomes specific to
that program and we conduct audits to improve their clarity and scope
regularly. We work to ensure that the measures used are appropriate and
at the correct level of specificity for the learning outcome in
question.

Learning and outcome assessment at Walden draws upon multiple measures,
including things that are easily reported, student GPA, retention rate,
graduation rate, student course evaluations, ratings on research papers
and dissertation evaluation records, student assessment, final course
grades, annual surveys of students and alumni, and a wide range of these
kinds of measures. Some are not as easily reported publicly and in a
comparable rate.

We also use third-party studies of the impact of our graduates on their
own communities and their own client base. Within our institution, the
process of using outcome data for continuous improvement is embedded
into the University's functioning. The faculty of the Curriculum and
Academic Policy Committees, which is the core of our faculty-shared
governance system, review regularly the outcomes that are put together
by our Outcomes Assessment Division. The faculty committees record their
analyses, make action plans for improvement into a concrete system, and
review progress against plans continuously.

In terms of the accreditors in student assessment, I want to mention
that Walden has been accepted into the Higher Learning Commission's
Academy on the Assessment of Student Learning. In the Academy,
institutions voluntarily participate in a four-year series of workshops
and projects on assessment. The goal of the Academy is for institutions
to improve their assessment programs and share their experiences with
the peer group.

Walden's participation will serve as a springboard to developing the
next iteration of Walden's Outcomes Assessment Framework. Challenges for
the future at Walden in our assessment program include integrating
periodic academic program review and continuous outcome assessment,
assessment of student services, providing capacity for longitudinal
analysis providing information to the public on learning outcomes, and
using third party research impact assessment more broadly within the
institution.

This new Academy, sponsored by the Higher Learning Commission, will be a
valuable service to assist us in moving forward with those with not only
the support of our own institution, but with peer collaboration.

Walden supports the general concept presented by the Commission that
institutions have a responsibility to disclose more information to
students, prospective students, and the public in order to improve
institutional accountability regarding student achievement, and to help
students to make more informed decisions about their education. However,
each school or type of institution may define student achievement
differently based upon their mission and the population they serve.

Any Federal policy regarding the disclosure of data for comparative
purposes should respect institutional discretion and diversity in that
regard. This is why Walden does not support a mandatory testing
requirement as a measure of student assessment and institutional quality
at the undergraduate level.

While national testing may be applicable in the K-12 study, we believe
the diversity of higher education institutions and degrees offered
prevent any application of effective testing at the undergraduate level.
A testing requirement for all eligible institutions would ultimately
result in the homogenization of our higher education institutions.

Alternatively, we believe it is possible to require institutions to
publicly disclose certain specific information. We support the idea, for
example, the graduation rates, completion retention rates, the
disclosing of that are useful to the public. When considering methods
for doing so, however, it is critical that the Department of Education
consider the need for consistency in defining these terms.

In addition, the Commission report suggests the possibility of requiring
disclosure of all outcomes by both the Department of Education and by
accreditors. While both entities might require institutions to report
such data, each of them for different purposes, disclosure to the public
should coordinate between the relevant entities.

Walden prides itself on its reputation and accomplishments in providing
a quality education exclusively through distance learning. Distance
education is now a proven way in which to provide access to a quality
education for many learners who otherwise might not be able to enroll.
Walden was at the forefront of distance education when we were founded
35 years ago, and we have some ideas on how to encourage innovation
while ensuring continued quality.

Walden supported the recent repeal of the 50 percent Rule as part of the
effort to expand access to distance education. However, with its repeal
comes additional responsibility on the part of the Department, the
creditors, states, and accredited distance education institutions
themselves.

We support the Department's new regulations that implement the repeal of
the 50 percent Rule. In particular, we think it is consistent with the
Act's intent to clarify the distinctions between telecommunications,
distance education courses, and correspondence courses. We understand
that some may have concerns about this language, and specifically the
need to clarify the term, "regular and substantive interaction." We look
forward to continued discussion of those terms.

Walden has continually worked to ensure the appropriate level of
interaction between our faculty and students, and we welcome the
opportunity to share our experience in defining those terms with the
Department of Education if this language is under consideration during
negotiated rulemaking.

We also believe that accreditation should play an important role in
ensuring quality in distance education as it does with all institutions
and programs. While we supported the repeal of the 50 percent Rule, we
also had an expectation that Congress would include certain safeguard
measures. It is important ensure that all recognized accredited agencies
are doing a consistent jobs reviewing institutions that offer distance
education.

Adjusting Title IV programs to better meet the needs of the independent
working adult learner is of great importance to Walden. While we
recognize that our recommendations will be outside the scope of
negotiated rulemaking, we believe they are important to mention. In my
written submission, I highlight a number of recommendations for focus on
discussion on the PLUS Loan Program.

While we applaud the extension of the PLUS Loan Program from just
parents of dependent undergraduates to working graduate students,
independent adult undergraduate students remain excluded. These students
who represent the most important demographic to enroll often have less
access to funding than others. Again, I refer you to Peter Soakes report
to the Commission about the demographics of the higher education student
population. We strongly encourage the Department of Education to
consider the expansion of the PLUS Loan Program to include independent
undergraduate learners.

We, of course, also applaud Secretary Spelling's initiative to
streamline the FAFSA application and approval process for students who
may more quickly understand the funding for which they are eligible.
Such understanding often has a direct bearing on their educational
choices. This is an area in which the Department of Education can
improve systems without the need for Federal legislation.

In conclusion, I ask that the Department of Education consider when
making any changes to its regulations how the Federal government and the
higher education community might do a better job serving the needs of
the growing cohort of independent adult learners. We believe that all
students and the public would benefit from the increased disclosure of
student assessment data by institutions from continued growth and access
to innovative methods of teaching and from reform to our financial aid
systems.

I look forward to any opportunity to work with the Department of
Education on these issues as it proceeds with negotiated rulemaking.

> Thank you very much.

**DAN MADZELAN:** Thank you.

I see my boss is coming down the aisle.

\[Pause in proceedings.\]

**DAN MADZELAN:** Some on-the-fly adjustments.

**DAN MADZELAN:** Steven Crow.

**STEVEN CROW:** My name is Steven Crow, and I am the Executive Director
of the Higher Learning Commission of the North Central Association of
Colleges and Schools.

The Commission is a regional accrediting agency that accredits over
1,000 colleges and universities in 19 states.

I also appear today on behalf of the Council of Regional Accrediting
Commissions, which I recently chaired. The Council, known as CRAC, is
comprised of seven regional higher education accrediting commissions in
the United States.

Thank you for the opportunity to comment on a variety of issues germane
to higher education and the Department of Education. Dr. Barbara Beno,
the chair of CRAC, spoke at the hearing in Berkeley on September 19^th^.
I will not repeat most of the points she made there about CRAC's
activities related to the authorization of the Higher Education Act, and
to the recently completed National Commission on the Future of Higher
Education. My comments today, as hers on September 19^th^, reflect the
views of the Council or Regional Accrediting Commissions.

We admit to some confusion about the various proposals the Secretary of
Education has made about accreditation. In the Federal Register for
these hearings, we learned of the plan to begin a round of negotiated
rulemaking commencing by the end of this year and saw that accreditation
was specifically included in the scope of that negotiated rulemaking. In
her speech on September 27^th^, Secretary Spellings announced plans for
a summit in November on accreditation.

Through Barbara Beno, CRAC stated the case that it would be wiser to
postpone any negotiated rulemaking related to accreditation until after
Congress reauthorizes the Higher Education Act, probably next year. In
light of some of the changes contained in the House and Senate drafts in
Section H of HEA this year, we expect a negotiated rulemaking on
accreditation may potentially need to occur within a few months of the
round contemplated to start this winter.

Our suggestion to postpone negotiated rulemaking applies only to
accreditation. We are fully aware that new regulations need to be
crafted for changes in higher education funding that have been approved.
And we understand that the DOE and the higher education community would
be well served by a negotiated rulemaking on these matters. With respect
to accreditation, it seems more likely that, in the short run, more
useful collaboration might be made through the proposed summit than
through negotiated rulemaking.

Secretary Spellings has made it clear that she wants accreditation to
play a more vital role in assessing student learning, while eager to
participate in a discussion about what that role might be and how it
might be achieved. However, the Secretary has misunderstood assessment
and accreditation by commenting that the accreditation process only
inquires whether an institution does assessment, and then is satisfied
with a yes-or-no response.

Strong assessment of student learning requires that faculty determine
and state clear learning goals and then create methods by which they
determine whether a student achieves those goals. From these
assessments, faculty and administration plan and fund ways to enhance
student learning. This is hard and complex work that never really ends.

Therefore, it should be no surprise that within my Commission, at least
50 percent of our accreditation decisions in the past few years have
involved requiring follow-up on the effectiveness of a given
institution's practices on assessment. Every other region could report
the same. Most regionally accredited colleges and universities, I think,
will freely testify that for the past 10-15 years, assessment of student
learning has, in many ways, shaped their relationship with their
regional accrediting agency.

All recent revisions to regional accreditation standards have made
assessment of student learning core to the accreditation enterprise. In
addition, thousands of administrators and faculties have attended scores
of meetings and workshops provided by regional associations that want to
educate these institutional representatives on ways of making their
assessment practices more effective. To be sure, we also give assistance
in providing better information to their accreditor about assessment of
student learning on their campuses.

Regional accreditors see assessment as a major measure by which to shift
the culture of our colleges and universities to place a high value on
learning more about what students learn on their way to a degree. We
believe that effective change in the learning environments created by
institutions should be driven by evidence rather than instinct, by
knowing rather than assertion, by dependable data rather than surmise.

Institutional self-studies and peer review team reports are filled with
evaluations of assessment programs and advice on how to make assessment
an effective management tool for educational quality. It has been a
challenging lesson to teach and a hard one for institutions to learn.
The amount of follow-up testifies to that and to the commitment of
regional accreditation to continue and enhance the assessment
imperative.

But we have come to understand that this institutionally specific,
mission-based assessment, no matter how useful it might be for our
colleges and universities, does not necessarily provide the kind of
comparable data about learning that the National Commission proposes and
the Secretary seeks.

It is worth noting that the wording considered by the Senate and the
House this year, in revising the Higher Education Act, suggested that
Federally recognized accrediting agency standards related to student
learning should value, among other things, such as the degree completion
and job placement, the kinds of data used by institutions to improve
their programs. This highly specific to each institution, so we do need
to have an important discussion with the Secretary about the idea that
accreditation can support a national institutional reporting scheme
guaranteed to provide useful points of comparable data.

The report of the National Commission, by the way, was not the first to
note that accountability and assessment are not synonymous, and that
they do not necessarily serve the same ends. At this point, we are
concerned that the shift to nationally comparable data is likely to have
the unintended consequence of undercutting the efforts of regional
accreditation and our member institutions to make assessment a powerful
tool for educational improvement.

The debate over the right mix of national tests or some other means of
developing uniform comparable performance data promises to be heated.
The energy burned there, particularly that of faculty who are
fundamental to the success of assessment, probably will come at the
expense of making progress in assessment.

Make no mistake, in higher education no assessment scheme will work
unless the faculty believes it is worthwhile for the success of their
students and for the ability of the faculty to improve teaching and
learning. While a few national tests may well provide comparable data
for consumers and policy makers, we are confident that, in and of
themselves, they do not provide the rich mix of evaluation strategies
found in assessments that lead to necessary educational improvement.

This is not an either/or situation before us. Instead, it is a both/and.
We understand, and we look forward to the conversations that contribute
to understand and reasonable shared responsibilities among institutions,
states, accreditors, and the Department of Education.

Thank you for your time.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** George Torres.

**GEORGE TORRES:** Thank you.

As a result in the sudden change in the weather from Austin, Texas to
Chicago, and the fact that the cab driver asked me if I had a map, I
will be brief.

\[Laughter.\]

**GEORGE TORRES:** My name is George Torres. I am the Assistant Vice
President for Congressional Legislative Relations with Texas Guaranteed
Student Loan Corporation. I cannot hear what I am saying, I am sorry,
because of the change in weather. So let me know if what I am saying is
clear.

I do have a detailed copy of my testimony outside, so I will be very
brief. This is just a summary. Texas Guaranteed Student Loan Corporation
was established in 1979 by the Texas Legislature as a public non-profit
corporation to administer the Federal education loan program for the
State of Texas, and to provide other related programs to support the
state's postsecondary education efforts, student financial aid,
recruitment, retention programs, those kinds of things\--outreach
awareness.

At the outset, we would like to make a couple of points. One is that we,
along with the CBA, the Education Finance Council, the National
Association of Student Loan Administrators, and the Student Loan
Servicing Alliance, submitted comments to the interim final regulations
published the Department of Education in August, and we appreciate the
Department's consideration of those comments. We also want to support
previous input to the Department that strongly encourages the Department
next year during the reauthorization of the Higher Education Act to do
all that you can to urge the Congress to increase spending for
need-based grants, especially for the Pell Grant Program. And to
hopefully increase the income protection amounts for student financial
aid applicants.

These statutory changes have been recommended by both the advisory
committee in student financial assistance, as well as the Secretary's
Commission. And doing just those two things will go a long way in
increasing access to higher education for low-income students and
families.

In Texas, 70 percent of all financial aid awarded every year is through
the Federal program, which is unfortunate. We do not like it, but that
is the way it is. Ninety percent is through the Federal programs. So the
Federal programs are very, very important in the State of Texas. Making
these changes, opening up these programs as much as possible will help
everybody.

For negotiated rulemaking, I am just going to touch on three issues. One
is that, because of the size of the student loan program, about half of
all the financial aid in the country is generated through student loans
through the FFELP. And because a core focus of guarantors is to try to
work with the student financial aid community to maximize the success of
borrowers in repaying their loans, working with the Department, with
families, with schools, with lenders, with student loan services
throughout the life of the loan, we feel it is of utmost importance that
a guarantor be a part of the negotiated rulemaking team.

Therefore, Texas Guaranteed has nominated, and strongly encourages the
Department of Education to approve, as in past years, a guarantor of the
National Association of Student Loan Administrators to represent the
interest of the FFEO as the primary source of financial aid to the
negotiated rulemaking team.

The issues of negotiated rulemaking, again, because our focus is on
trying to simplify the process of applying for student loans in both the
FFEL as well as the Direct Loan Program, we urge the Department to look
at simplifying the method of obtaining and granting student loan
deferments. Currently, a borrower must document eligibility for this
benefit with his or her lender, and a holder can grant only an in-school
deferment if the holder receives information that supports the
borrowers' eligibility for the deferment.

To simplify the process, Texas Guaranteed suggests that the Department
require a holder to grant any type of deferment to the borrower, notify
the borrower if that borrower has currently been granted such a
deferment based upon documentation obtained by another holder. We also
think that the National Student Loan Data System could probably be used
to accomplish this and to simplify that process.

Utilization of discretionary

forbearance\--while forbearance can be a useful tool in preventing
defaults, guarantors have found that there is little that can be done
for borrowers to resolve mid- and late stage and prevent defaults
because of heavy use of discretionary forbearance early in their
repayment. We suggest the Department examine whether the current use of
forbearance is appropriate and, if not, implement changes to strengthen
its use by encouraging lenders to increase counseling to borrowers
regarding the impact of forbearance on loan repayment illustrating to
the borrower the impact of interest over time, requiring some type of
payment when the borrower has used one or more years of forbearance
before granting a subsequent forbearance, reinforcing with lenders and
guarantors the importance of borrowers establishing responsible
repayment habits early, and the importance of borrowers promptly
resuming repayments after a period of non-payment due to a deferment of
forbearance. And, probably most important, requiring lenders and
guarantors to promote the use of deferment to obtain an economic
hardship deferment alternative repayment options, such as graduated
repayments plans, interest only payments, or reduced payment forbearance
prior to granting a discretionary forbearance.

Exit counseling\--we would like the Department to recommend or
reevaluate exit counseling requirements to include the new graduated
professional GradPLUS borrowers, as well as Stafford borrowers who have
obtained in-school consolidation loans. And that exit counseling include
a discussion of a grace period and its applicability only to Stafford
Loans that have not been consolidated, discussion of the availability of
deferment and forbearance for GradPLUS and consolidation loan borrowers,
encouraging the borrower to establish early repayment habits, and a
warning about the impact of taking advantage of a longer repayment
period, as permitted under the extended repayment schedule, as well as
under the consolidation loan program.

On a final note, Texas Guaranteed supports the views expressed in the
two September letters from 12 U.S. Senators\--I think there were 14 U.S.
Senators on the other letter\--concerning the regulations that will be
promulgated to implement changes that were made in the Deficit Reduction
Act concerning the payment of special allowance for certain lenders.
That was the letter that was sent on September 1^st^ signed by 14
Senators, I believe, including Mr. Ensign and Mr. Kennedy. And the
September 6^th^ letter from\--well, I do not think Mr. Kennedy signed
that one, but the September 6^th^ letter signed by Mr. Ensign and Mr.
Kennedy and 10 other Senators regarding the treatment of the
Commission's report in negotiated rulemaking.

Having said all of that, it is certainly our intent that Texas
Guaranteed work in conjunction with our student financial aid community
to work with our congressional delegation next year and with the
Department of Education during the reauthorization and to do everything
we can to educate our delegation on the findings of the advisory
committee on student financial aid, which, again, for the third time, I
think, this decade, has found that the two biggest barriers to obtaining
higher education is inadequate index funding and the cost of education,
as well as working with them on reviewing the findings of the
Secretary's Commission.

That is it for me. Thank you.

**DAN MADZELAN:** Thank you very much.

**DAN MADZELAN:** Alan Stager.

**ALAN STAGER:** Hello, my name is Alan Stager, and I am a junior at the
University of Wisconsin Waukesha. I am also the student government
president at UW Waukesha. I would first like to thank you guys for
hearing students today.

Going back to my public education in high school, I know I had to work
hard to get a great education and get into a great college. What I did
not realize was that no matter how hard I worked, my choice of college
would ultimately depend on cost. Working hard is what I did. I worked to
receive two scholarships and also began working full-time at the age of
15. My initial choices in college were the University of Wisconsin
Milwaukee and the University of Wisconsin Madison, two of the larger
research universities in the area, knowing that these would be better
for my education and better for my resume, and being able to get a
better job out of college.

My choice to go to UW Waukesha was pretty much, basically, solely on
cost. It would be about half as much as it would be compared to going to
UW Milwaukee or Madison\--not necessarily the quality but like I said,
the cost.

Coming from a middle class family, I am not eligible for any financial
aid. My brother and I have not received any financial aid from my
family, except for the house we live in, basically because my parents
are going to be retiring soon, and also they have their interests to
worry about as far as being able to live for the rest of their lives.

Like I said, I have been working full-time over the summers and
part-time during the school year, working 24-25 hours a week, somewhere
around there, throughout college. There have been many times that my
studies have suffered. There have been many times when I had to choose
what classes to skip to study for the other classes, because I spent the
whole night before working.

Every day is a struggle between school and work, making sure that I pass
all my classes, not to mention getting good grades, and following
through on promises at work to my boss, making sure I can continue to go
to school, which also leaves no time for study groups, sports, clubs,
and organizations on campus. It makes it really hard to juggle all three
and still make sure I get a good education and be able to get a good job
out of college.

After I graduate college, I will have racked up over \$15,000 in debt. I
mean, that is my plan so far. If I can get out with \$15,000 in debt
that would be good\--well, as good as I can get for now, I guess. I
decided to go to a two-year college, like I said, to save on cost. If I
did not, I would be looking at upwards of \$20-30,000 in debt.

Working and getting scholarships has obviously helped bring that down,
but \$15,000 in debt coming out of college to start my life off I do not
think is fair. I mean I was planning on starting my life after I got out
of college, not after I had to pay off my student debt.

Being at Waukesha, I started getting involved in student organizations.
Like I said, it was a hard juggle between classes and work, but every
time I could, I have been working to\--I have been enjoying student
organizations.

I am actually at Waukesha right now because I really believe in their
way of learning, and their accessibility just means that I do not
necessarily have enough money to go to a four-year college right away.
That is why I am President right now at UW Waukesha. I really believe
that education should be open to more students, not only myself, being a
middle class student that is struggling to get through college, but for
everyone that is not as privileged as I am to be a middle class student.

Some of the things that I would really like to see be done to help
students get more accessible education is more programs for high school
students to get encouraged to go to college, more financial aid for
students who might be first generation students to go into college, as
far as their families, lowering tuition, not only for those students who
do not have enough money to go, but also middle class students like
myself that will end up with \$15-, \$20-, \$30,000 in debt. I guess the
real question is, I guess, getting through college, like I said, is hard
for me, what about all those less fortunate students that will not have
this opportunity that I have.

Thank you.

**DAN MADZELAN:** Thank you very much.

**DAN MADZELAN:** Kiley Williams.

**KILEY WILLIAMS:** Good morning. My name is Kiley Williams. I am a
student at the University of Wisconsin Oshkosh, and I am the vice
president of United Council of University Wisconsin Students, which
represents 125,000 students on 21 campuses in the UW system.

I began my college education at one of those campuses, the University of
Wisconsin Fox Valley. Fox Valley is a two-year campus, minutes away from
my home in Appleton. With good grades and strong extracurriculars
throughout high school, I was accepted to every University I applied to.

For me, attending a two-year was far away from the prestigious education
I dreamt of growing up. But, being from a middle class family, I
qualified for nothing but loans. To save money I attended Fox and lived
at home for my first two years in school.

I got involved with the student association on campus and was elected as
Communications Director. I thought the skills that I would learn as
Communications Director would directly apply to my marketing major. I
did not think the position would lead me to you today.

Once I got involved with student government on campus, I got involved
with the United Council and the United States Student Association where
I found a passion that I never knew I had. Growing up in a household
where a college education transformed my parents' lives, I always
believed that education is the key to creating a better life for
oneself. And yet, education is not an option for so many people because
of various barriers.

The United States has come so far as a country, and we pride ourselves
on having a progressive society, but the United States is failing in our
global economies right now. I cannot help but imagine our position in
the global climate years from now when our friends and I are the leaders
of this country. How can we be a civilized nation, a progressive
society, and a global leader if we are not an educated generation?

As a nation, we have amazing rights that many countries admire us for.
How can we exercise rights, though, if we are not educated? I truly
believe in the power of education, and I also believe in the right of
every person to have access to have higher education if they so desire.
The only barrier to higher education in the United States should be lack
of will to attend college. How do we break down the other barriers?

The first step is to increase grant aid.

Second, to make loans more manageable by limiting loan repayments to a
percentage of students' income, and also to realize that students'
parents have less income to devote to repayment, and then also to lower
interest.

And finally, just to give more grant money than loans so that students
like me and Alan do not graduate with thousands upon thousands of
dollars in student debt.

As a student and the Vice President of a united council representing
125,000 students in Wisconsin, I beg you to make higher education a top
priority in our country to ensure a strong future for generations to
come.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Michelle Villarreal.

**MICHELLE VILLARREAL:** Hello. I just want to thank you for convening
these hearings about how to make college more affordable.

**DAN MADZELAN:** Could you state your name and affiliation?

**MICHELLE VILLARREAL:** Yes. My name is Michelle Villarreal. I am with
the University of Wisconsin Stevens Point, representing about 9,000
students.

My story begins like many other college students. I had the anticipation
after graduating high school about college\--or before graduating high
school. I had that feeling of urgency that I needed to leave high school
and finally be on my own. Of course it was not that easy.

After months of deciding and delegating what college to attend in the
Fall of 2006, I found the college I presently attend, University of
Wisconsin Stevens Point. I also found myself funding this at my parents'
mercy so that they could provide me once more, because I realized
quickly that I would not be able to pay for college on my own.

In order to take out a loan I would need a cosigner, my mother. I
searched for a loan and found one that was seemingly reasonable, later
to find out that it was anything but that. A loan for \$20,000 would
accumulate interest, and I would end up paying way over \$60,000 upon
graduating. I found that the loan companies milk the fact that students
have no other option than taking out a loan.

It is a win-win situation for the loan companies because of the fact
that students have no other option than taking out a loan other than
scholarships. The business of loans make almost a 200 percent profit off
of the money that they are loaning because of the money I will end up
paying in interest. Between the gap of school and graduation, I would
need to juggle work, school, extracurricular activities, and my social
life, as well as my family life. That is a vague picture of most college
students.

Extracurricular activities are essential because, other than GPA, it
sets you apart from other contestants in this cutthroat job market. I
found it disheartening that new actions are being committed against the
fact that college tuition has gone up substantially and interest rates
continue to skyrocket. Coming from a middle class family, I can only
imagine how much more painful it is for families who cannot even think
of the possibility of college.

Many hold this misconception that their problems are really in their
action, but it is not the case in this situation, between students and
college. The bigger picture here is that this problem has not been
accepted as an issue. It has been thrown to students in this country as
their own problem. This problem should be addressed as an issue and a
solution should be sought diligently and justly by the institutions that
I rely on: the education institutions and, most important, the
government institutions.

How can young adults concern themselves with the social issues of today
when their main concern after graduating college will be, "How am I
going to be able to rid myself of the shackles of debt?"

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Colleen Kiefer.

**COLLEEN KIEFER:** Hello, my name is Colleen Kiefer, and I am with the
Student Government Association at the University of Wisconsin, Stevens
Point.

First of all, I want to thank you for arranging this entire event. I
know all of us really appreciate being able to actually talk about
issues that are affecting us.

Like I said, my name is Colleen Kiefer. I am an out-of-state student
from Philadelphia studying water waste management and sewage sites at
the University of Wisconsin Stevens Point. I am also a Senator
representing the students of the College of Natural Resources in our
student government association. Because I am an out-of-state student and
my tuition is extremely higher than the average student at our school,
and because of this high cost, I have already taken out approximately
\$20,000 in private loans and will graduate with an estimated debt of
\$50,000, which is a lot of money.

With my major in waste-water management, I will be qualified to provide
crucial services to the community. However, these services, while
personally satisfying, are not exceptionally rewarding in compensation,
making it difficult for me to pay off my accumulated student debt. While
my situation is more extraneous for my university, the reality is that
my constituents at the University of Wisconsin, Stevens Point are
graduating with an average of almost \$15,000 in debt.

At UW Stevens Point, over 90 percent of our students are full-time, and
it is difficult for us to remain in good academic standing while
struggling to balance work, class work, extracurricular activities that
are directly related to field work that they will do later in life, like
research on the field, as well as internships that are vital for field
experience and future employment. Because of the financial demands
placed on us, many of my constituents are forced to choose a minimum
wage job at a local grocery store or coffee shop, instead of internships
and going to these extracurricular activities.

This is detrimental to their educational progression, as well as for the
marketability of them once they have left and graduated. As a specific
representative of my university's College of Natural Resources, I
represent students who are generally entering fields that do not receive
high incomes. For example, the average environmental protection major
will make approximately \$27,000 after graduating. A resource management
major will make approximately \$25,000 after graduating.

All of these jobs pose as vital services for the sustainability of our
environment and our economy. However, the majority of my constituents
will be unable to purchase cars, houses, or even securely start families
due to the financial constraints of having to pay off their student
loans. It is because of this that I ask you to consider the five-point
plan that has been presented earlier today and to help us relieve
honorable graduates of impossible debt that can just load them down for
decades.

Thank you.

**MARY MILLER:** Break.

\[Laughter.\]

**DAN MADZELAN:** My boss is suggesting that we take a break.

\[Laughter.\]

**DAN MADZELAN:** So, how about 15 minutes, and we will reconvene at
11:00?

**DAN MADZELAN:** Well, I think we will reconvene.

Before we start, I just want to mention that out on the table in the
lobby there are some papers that provide some local luncheon
opportunities\--or identify, I guess, some local luncheon opportunities
for you.

With that, we will continue with Jeff Runion.

**JEFF RUNION:** My name is Jeff Runion. I am a sophomore currently
attending St. Louis Community College at Miramack. I am also the State
Board Chair for Missouri Public Interest Research Group.

St. Louis Community College is a two-year public institution and a
gateway to higher education for many non-traditional students. Like
other non-traditional students at my institution, I have to deal not
only with a hectic class schedule, but also working to find enough
living expenses.

Right now, I am only able to do this by combining income from the three
jobs I work on campus and supplementing that with student loans and Pell
Grants. At the start of each semester, I get a knot in my stomach as I
walk into the financial aid office to take out yet another essential
student loan. I know, as I use this money to pay for food, rent,
clothing, and books, that one-day, after I am handed my diploma, I will
also be handed a bill, with interest.

This debt incurred by students has not only financial repercussions but
social implications, as well. Student loan debt after college keeps some
students from pursuing vital public service careers, as public service
careers do not pay enough for students to pay off their loans and manage
their living expenses. In addition, this delays milestone events like
buying a home, starting a small business, the definition of the American
Dream.

Both PIRG and the St. Louis Community College Student Government have
worked together to highlight student concerns about college
affordability. We have conducted research at local, state, and national
levels that points to student loan burden as the primary culprit in
creating immediate and continuing hardship for students at both two-year
and four-year colleges. We have identified several problems, such as
student loans being too hard to meet by people who work in the public
sector, and policies for defaulters do not include leniency for
unexpected hardships.

In addition, when students default, they are ineligible for hardship
claims, loan forgiveness, and Federal Pell Grants. This seriously
compromises their ability to complete a degree at a four-year school and
obtain gainful employment. Fixed non-variable interest rate loans are
too inflexible to create, and create excess money for loan payments that
commonly get diverted away from education budgets.

This was the case last winter when the U.S. House and Senate deflected
billions of dollars in interest rates to reconcile the budget. Students
are not properly educated and counseled on how loan programs work. This
lack of knowledge leads to fear of entering college or negligent
budgeting. Some students who are undecided in their majors or
overwhelmed by mounting debt drop out of two-year schools, defaulting on
their loans prior to receiving associate's degrees, leaving them in debt
and lessening their prospects for employment.

I have some recommendations I would like this Board to consider:

One, to increase loan forgiveness. The Board needs to create loan
forgiveness programs for people pursuing public service careers such as
education, nursing, or social work. These valuable and needed public
sector careers will appear more attractive and realistic options to
students.

Reform default regulations. Students who have previously defaulted
should have straightforward opportunities to claim hardship and return
to deferment. In addition, loan programs need to offer community service
or some other redemptive recourse to enable defaulting students to repay
loans.

Reinvest grant aid. Excess money from student loan payments and private
loan subsidies need to be invested in non-binding grant aid. The
interest rate needs to be variable and kept at 6.8 percent so students
will be able to take advantage of lower interest rates, yet be able to
budget for a capped constant rate over the course of their schooling.

Provide more financial education to students. Colleges need to offer
regular mandatory informational workshops and advising sessions on loan
programs and scope of tuition payment options. Loan counseling should be
coupled with the yearly visits that a student makes to his or her
academic advisor. To this end, community colleges need more federal
funding for financial aid and advising staff to facilitate lower advisor
to student ratio.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Elizabeth Tieri. Elizabeth?

\[Pause.\]

**DAN MADZELAN:** Brett Thurman?

**ELIZABETH TIERI:** I apologize.

I am Elizabeth Tieri from the University of Illinois at Chicago.

Today, I present to you not one but seven stories, a generation of
college attempts, disasters, and successes.

As the youngest child of a large family, I have never been able to make
a single step in my life without first studying six others before me. My
steps towards college, towards my career, towards this testimonial
before each of you today can only be made in reflection of my siblings.
So I offer you their stories as the prelude to mine. Pardon me if I get
a little personal.

Donald Jr. was an enthusiastic man who quickly found himself footsteps
to follow outside of our struggling middle class family. He learned a
trade and started a business with little concern for those of us still
waiting for life to breathe through our lungs.

Colleen left as quickly and as distantly to work full-time in the city
while studying one course at a time. She graduated as a nurse 15 years
later while I was taking the ACTs, but without a cent of debt.

Andrea tried a few trade schools, but decided raising her toddler was
simpler.

Rocco panicked without a determined career and dedicated his life to the
Reserves in order to afford a future.

After Cheri's divorce, she maxed out Federal loans in order to support
her children.

My sister Kathleen was found by a scholarship for families like ours,
but that did not involve out-of-state living expenses, which she had to
cover with student loans and weekend jobs.

And now there is me. At the beginning at my college career, I feared
working too much and moving too slowly, taking too many loans and not
enough courses. I dabbled in secondary education because I was told
there were jobs and have recently been advised to try information
science for similar reasons.

Apparently there is no money in my chosen profession, and many mentors
find that a larger factor than my interests and my talents. But in this,
my last year of undergraduate studies, I can clearly state what I want,
regardless of the unclear path towards that goal.

I do know, however, that it involves graduate school, as so many careers
have slowly begun to include. Unfortunately, this decision is an
unprecedented one in my family, and I found myself without my standard
counsel. Unfortunately, as well, I find myself considering not
departments, programs, or professors, but distances, tuition, and
teaching assistantships.

These are not quite factors that I understand directly, but more
comprehensible are their effects on me. Speaking in numbers, as is too
often done in these circumstances I have over \$30,000 in loans already
and am looking at similar costs each year until I earn my doctorate.

Between my siblings and I, we have more than \$100,000 in student debt,
a number that could nearly buy my mother and father a home of their own,
but that is a luxury that my parents continue to consider much less
profitable than higher education. I am lucky and grateful to have
parents with such strong priorities. They have instilled in me the
strength to juggle a full course load, two part-time jobs, and some
selective extracurricular activities.

I feel I have succeeded, but I am quite aware that many other students
are not so strong. Many students fall behind in their studies, skip
dinners on a regular basis, and literally collapse beneath the weight of
higher education. I, myself, have begun to notice my weaknesses. Just
yesterday, I felt forced to step down from an executive position in our
undergraduate student government because I am not able to sacrifice the
little time I have between classes, my library job, and my waitressing
job for the student body. I must focus that time on homework, reading,
and my thesis as a double major in history and French language studies.

This has been a realization for me. I can tell myself that it is my best
option for the present. I cannot forget, however, that this selection
would not have been necessary if just one part-time job would suffice.
And I cannot help but be jealous of those whose higher education is not
tainted by these selections, as few as such students may be.

In preparation for standing before you today, I found that in my French
Literature class of 15 students, 10 of us felt forced\--not just
compelled but forced\--to work more than part-time to support our
educations. To reiterate the numbers, that is two-thirds of my
colleagues.

I stand here today to compel you to consider my stories and those I have
brought to you while you legislate changes that should make higher
education more universally available and more positively experienced by
future students.

Thank you very much.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Brett Thurman.

**MATTHEW GUIDRY:** Hello. Brett Thurman will not be able to make it in
today. He is not yet here. My name is Matthew Guidry. I am taking his
spot.

I am with the University of Wisconsin Stevens Point, and I am
representing both a student organization, WisPIRG, Wisconsin Public
Interest Research Group. I am the Vice President of the State Board and
also the local campus organizer there. I was also a student there. Along
with that, I am also representing the College of Letters and Science as
a Student Government Senator. So there are a lot of people in there, but
to add one more stack to it, me and the fellow WisPIRG compatriots and
students went out and collected postcards of other students that were
also into this and really wanted to be represented but could not make it
because of classes or other reasons. Also, getting 260 other students
here would be a little bit harder. But they came in spirit, and I will
have postcards for you later from all of them.

On to what I was actually looking to say to you guys\--beyond that I
really wanted to hit on three main points, the system. And from the
system was basically from starting from high school, my own personal
fears and fears of many, many compatriots that I have had going into
this. They were scared to go into college and, once they made it into
college, when it really hit them was that first freshman semester where
they would get scared. They would see that giant bill come in and have
no idea how to pay for it, and that would scare some of them away. Some
of them would work like crazy, work 40-60 hours, which is ridiculous,
which every high school counselor and every college advisor that I have
talked to has said, "Do not work more than 20 hours, or you are hurting
yourself by hurting your homework time, and hurting your college time,
and hurting your extracurricular time\--to basically lose out on that
college experience of diversity and education."

But with that, it is beyond fear of just getting that loan. It is beyond
fear of not knowing how to do it. So that is one of those questions that
I would probably pose to you and you are probably looking at right now,
is how to make that application process easier and smoother from not
just college freshmen but high school seniors. I am hoping to see you
hit it earlier and harder. And, as Jeff had mentioned earlier from
Missouri, have that as an advisory point where every year, every
semester, when you go to get advised for what classes you are taking, be
advised on your loans so you can stay up to date on that, because these
college kids, of course, with their busy schedules and their hectic
lives, have many things on their plate that\--they feel overburdened.
That is probably from inexperience from it or literally being
overburdened from being overworked, along with many other things
contributing to that.

So taking it off their plate for some reason and getting it back on the
plate seems to be very, very important. It is getting those kids to look
at it consistently over time. I think that would at least get rid of
that initial fear.

Beyond that, add to the existing counseling over and over and over again
because of that long-term debt that is coming in there. One of my
friends had mentioned earlier that she had took out \$15,000 in loans so
far, and that is going to boost her up to about \$60,000 to pay for that
in the end. Luckily, she got rid of that specific loan because it just
did not seem economical and viable to what she wanted to do as an
out-of-state student.

So, getting stuff like that, even

though\--the ridiculousness out of it, which is, basically, maybe the
loan companies taking advantage of certain students, non-traditional
students, out-of-state students, finding a better way to make it a
smoother transition for students that really want to go to that number
one college that they like. For instance, Stevens Point is huge in
natural resources. We just had Governor Doyle up there, and he just
pledged to get us in five years\--well, in 2012, in his mind\--to get us
to 100 percent renewable energy and off the grid.

Now, to do that, we have to keep our natural resource people, our
physics people, and all our people within that college motivated and
moving. And to continue doing that, it seems to be a lot more effective
to get the money worries out of the way and get that economical
stability to give them the ability to get in there and do their student
organizational stuff that will come from the ideas to help us with that
future.

Along with getting everyone going like that, I work in the IT department
a lot. So I have a lot of experience right in there, and what I gained
from that experience, beyond just the little computer knowledge, is
working with a lot of the people. Those people I work a lot with, School
of Education people, they come in constantly and they are always working
on these new Web sites. But what I hear from them over and over again is
not the fact that they have to work on these Web sites that they have
very little training, is that the fact that they have enormous student
debt coming in and, as teachers, they cannot really afford to have a
family, or they cannot really afford to look to buy a car soon. They are
investing in that bike, and they really like that bike, but it is kind
of hard to commute with a bike if you are, say, coming from Chicago to
Kinoshia or Racine to Milwaukee. It is a little bit to pedal.

It is economic hardships like that that just make me cringe a little bit
and say, "We need to get out there and help our public service figures,
help our educational people"\--which you guys, I know you are right
there with us and you are probably, like, saying, "Yes. That is what we
are here for and that is what we want to do." Keep going with it,
because it has got to have an answer out there.

I think we have thrown some answers out there, hopefully, today with the
five-point plan and putting some caps on the interests' rates to prevent
some of that ridiculous overspending and maybe over-profitizing from it.
More importantly, looking beyond that, is those with exceptional
problems.

I had a friend it was two years ago, now. He had a slight accident and
is now paralyzed from the chest down. He is still going to school. He is
still kicking really hard, but he is thinking a lot more about student
debt because the direction he was originally going was in natural
resources and, kind of, a game warden kind of thing, which he is now
unable to do. So now he is changing directions, "elapsing" some more
student debt with some more loans. He is still worried about how he is
still going to pay for it, if he is going to be able to pay for it, if
he is going to be able to work for that.

Really, that was kind of an eye opener to me on how hard this process
really was, because he is unable to see what direction he is going, or
how much loan debt he is going to be in at that point four years from
now, now that he has to restructure his major to compensate for that
accident.

So I think that falls into some economic hardship and economic
forbearance issues that should really get touched on and for the
hardship especially with specific injuries of that nature would be
something that would be really touching\--I think you guys would know
how to handle that, but something I really wanted to point out.

And getting beyond that, I would also like to thank you for having this
and making this here today. I would like to say that we have several
students from UWC at this point, as you have probably heard from, now.
They have come about five hours, and we left about 9:00 last night. So
we may be a little wired and a little tired, but we are really happy to
be here, and we are really happy that you guys are talking about this
and getting this issue on the table to get it fixed out there.

So thank you, and hopefully there will be some more comments and
solutions for you guys.

**DAN MADZELAN:** Thank you, and it has been a nice day. It will
continue to be so, I am sure.

**DAN MADZELAN:** Edgar Staren.

\[Pause.\]

**DAN MADZELAN:** Edgar Staren?

**DAN MADZELAN:** Dan Mann.

**DAN MANN:** Good morning. Dan, Carney and Jeff, we are really happy to
have you in Chicago, here in our home state.

My name is Dan Mann. I am the Director of Financial Aid at the
University of Illinois at Urbana Champaign.

My colleague, Susan Fisher from the University of Wisconsin at Madison
is here. We are here presenting comments on behalf of the Financial Aid
Directors of the Big Ten Universities.

Our Big Ten Universities enroll more than 589,000 students. This past
year, we administered more than \$2.3 billion in Federal financial aid
funds. We have been very pleased to have the new ACG and SMART grants.
We are very happy that, after many years, we have had new grant money
available to our students. I do not think any of us would have designed
these programs this way if we were told that we had new money, but we
are nonetheless trying to make them happen and work. So one of our
concerns is trying to make sure that we are able to administer these
programs in an efficient way for our students.

In terms of our comments today, we are actually coming to you with 15
very specific recommendations. In the spirit of trying to keep within
our five-minute time range, I am not going to read all four pages of
this, but I am going to try to summarize the 15 recommendations.

Our first six comments are specific to the ACG and SMART grants.
Recommendation number one is that ACG and SMART grants should not only
be available to U.S. students, but they should also be available to
eligible non-citizens, just as other Title IV aid programs are available
to these students.

Our second recommendation is that continued eligibility for ACG and
SMART should be based on the institution's established satisfactory
academic progress policies, just as it is determined for other Title IV
programs, and not on a prior semester grade point average.

Recommendation number three, initial eligibility for ACG and SMART
should be determined any time during the academic year for students who
may have not qualified for it at the beginning of the fall semester.
However, a student should retain eligibility for the entire year, unless
satisfactory progress requirements are not met.

Recommendation number four, if AP/IP credits exceeds the grade level one
status as defined by the institutions when the student begins initial
enrollment at the institution, the student should be eligible for
year-two ACG without establishing a grade point average of 3.0 or higher
at the institution.

Recommendation number five, grade level progression for determining
eligibility for ACG and SMART, should follow the rules currently in
place for the Stafford Direct Loan annual loan limits.

Recommendation number six, the cumulative grade point average of the
prior institutions should be used to determine eligibility for transfer
students in regards to the required 3.0 grade point average.

We also have two recommendations on other provisions. The first is the
provision that calls for the elimination of business assets for all
small business defined as those with fewer than 100 employees is
patently unfair. In our experience, the asset protection allowance
currently in the Federal methodology protects a reasonable amount of
such assets and evaluates all family-owned businesses equitably.

Our other recommendation is we support the recommendations put forth by
the project on student debt. The five practical reforms proposed by this
group weighs the burden of student debt for our students.

We have three other comments in general. One is we support the
continuation of the current experimental sites initiatives, and we will
work towards changing the statutes that these experiments have proven to
be unnecessary.

A second general recommendation, we support continued efforts to
increase the annual loan limits for undergraduates at the freshman and
sophomore levels.

And the third general comment, we support increasing the aggregate loan
limits for all grade levels.

We also have four very specific recommendations and comments regarding
the Spellings Commission's recommendations. First, we agree that the
amount of funding currently found in all student aid programs is
insufficient to meet the needs of our students.

Second, we are proponents of any means to identify low-income students
with academic promise who would benefit from early intervention
programs.

Number three, we support increasing the funding in Federal grant
programs to restore the purchasing power of the Pell and FSEOG programs.

And finally, we have participated in many experimental site initiatives
that have demonstrated that eliminating some regulations have no
detrimental effect on the integrity of our student aid programs. As we
are talking about simplification, we think we ought to be looking at
simplifying the current rules that are there, because we have proven
that some of those rules are not necessary.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN**: Eric Weems.

**ERIC WEEMS:** Good morning. I am Eric Weems. I am the Director of
Financial Aid here at Loyola University of Chicago.

I would like to thank you, as well as all of the participants for taking
the time to visit our lovely campus here at the Water Tower campus.
Fortunately, we have gotten many of the construction cranes moved out of
the way for a new residence hall and some of the other construction
going on in this campus.

I would like to applaud the Department of Education for giving us the
opportunity to offer our observations as a higher education community,
and specifically as a student aid community to be able to work toward
collaborative efforts to improve all of the Federal student aid
programs. So thank you very much, again, for being here.

I would also like to thank Dan Mann, who summarized many of the points
that I had in mind to say today. So I will, at the risk of time\--I will
not go back and try to expand on how he eloquently touched on these
points.

I would like to make just a few general observations about the Academic
Competitiveness Grant and the National SMART Grant. Clearly, as Dan
noted, we are thrilled to have opportunities to extend need-based grant
assistance to students. I think all of us in financial aid offices
recognize the need for greater amounts of need-based assistance at the
federal level and at all levels for students, and the opportunity to use
grants to be able to extend that is something that we were very pleased
for.

With that said, and recognizing, as your opening remarks noted, that the
interim regulations and the opportunity to start this program were done
quickly, I would like to make the general comment to many of the points
that Dan made that, through the negotiated rulemaking, you consider
making the SMART and the Academic Competitiveness Grant follow along the
existing provisions for many of the already existing Federal student aid
programs, not the least of which the fact that the recipients of these
two grant programs are recipients of the Federal Pell Grant. We want to
be able to be consistent with respect to things like making ineligible
non-citizens being able to participate in this grant, and, as well,
following the academic year definition.

I think one of the things that we are always in tune to at the campus is
trying to make things as simple as possible for students, trying to
eliminate confusion. Having two academic year definitions, one for the
student loan programs, which\--student loan programs, by the way,
following the definition we would be using at the university for
academic level progression. Being able to be consistent for students is
something I think we should all strive for.

With respect to the student loan programs, I obviously would like to
chime in, even though it may not be something as part of the negotiated
rulemaking, to continue to think about opportunities to increase those
annual loan amounts. While I would not want that to stand in the way of
existing grant program expansion, the fact of the matter is more and
more students, particularly first and second year students, are in need
of additional loan assistance. Unfortunately, when the Federal student
aid programs, Federal Stafford Loan, as an example, is not enough to
cover funds needed, the students are going to be using higher priced
loans through private or one of those alternative student loans.

So I think the opportunity to expand the Federal Stafford Loan program
is not so much an opportunity to put on more debt but rather to provide
opportunities for smarter borrowing. And to that end, I would also like
to offer this, again, the suggestion that we consider expanding for the
Graduate PLUS loan, the opportunity for loan counseling to be included
as a part of that. Though the greatest majority of our students are
going to be students who are going to be going through loan counseling
as part of their Federal Stafford Loan borrowing, it is not a
requirement. There will be students who will not have borrowed through
the Federal Stafford Loan program. We will give them opportunities to
begin borrowing large amounts of funds without going through that loan
counseling.

At the school, I am hesitant, in a way, to offer new requirements, but
at the same time I think this is good practice for students to go and be
educated borrowers as they progress forward through the remaining of
their graduate and professional career.

So thank you very much for the opportunity to offer our thoughts here
today and for being here. Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Jacki Fairbairn.

**JACKI FAIRBAIRN:** Hello, my name is Jacki Fairbairn. I am the
Director of Policy and Regulatory Compliance of Great Lakes Higher
Education Guarantee Corporation.

Great Lakes is a public, non-profit corporation. It administers the
Federal Family Educational Programs. We are the designated guarantor in
the State of Wisconsin, Minnesota, Michigan, and in Ohio.

To begin with, Great Lakes would like to express our support for the
testimony given by Mr. Torres from the Texas Guarantee Student Loan
Corporation, which I will refer to as TG. In particular, we support TG's
call for the National Association of Student Loan Administrators to be
represented in the negotiated rulemaking activity.

We too feel that NASLA has been an effective voice for student
guarantors whose mission it is to ensure consistent and reliable
services to America's students, parents, and post-secondary
institutions. Importantly, NASLA is not a Washington, D.C., based trade
association. It operates through the consensus of its members without
paid staff or outside consultants. Accordingly, it brings to the table
the direct and unfiltered views of actual operational guarantee agency
participants.

We believe that, together with the program beneficiaries, our students,
and our parents, it is the operational program participants who should
be at the negotiated rulemaking table. We understand that it is
impossible for all to participate. In that regard, the Secretary should
recognize those associations and consortiums that most directly
represent the operational participants.

Appointment of umbrella organizations, of trade associations as direct
negotiators would appear appropriate only where the umbrella
organization represents constituencies too numerous to be separately
seated, or who have no separate voice. In the case of guarantee
agencies, direct representative entities such as NASLA and the Guarantor
CEO Caucus would appear to be the preferred choice.

This would appear appropriate in the case of the Title IV loan issues
negotiating track. Therefore, we encourage the Department of Education
to consider, once again, extending an invitation to the nation's
guarantors.

Now, the Department has heard a variety of very important issues
throughout today's testimony, which certainly underscores the necessity
of engaging in a negotiated rulemaking process. We would like, as Great
Lakes, to echo the concerns brought forth by our colleagues at the Texas
Guarantee Agency, and we would like to add a few more issues to the list
for your consideration.

We will be submitting several recommendations but, for purposes of
brevity, and in the interest of avoiding redundancies, I will highlight
only three, the first being capitalization policies, disability
discharge, and, again, as was mentioned other times, but also fair
repayment.

Regarding the capitalization policies, I would like address the issue
with the frequency with which it occurs with the PLUS and consolidation
loan programs. Congress, industry trade associations, borrowers, and
others have expressed concern about the increased overall amount that
borrowers must repay over the life of their loans. The current
capitalization policy for PLUS and consolidation loans allows loan
holders to capitalize interest on a quarterly basis.

Interest occurring on Stafford Loans may, however, only be capitalized
when the loan goes from a non-repayment status, such as grace or
deferment, to a repayment status. We suggest the Department consider
aligning the capitalization policies for PLUS and consolidation with
what is allowable under the Stafford Loan program. This could save PLUS
and consolidation borrowers a considerable amount of money, especially
when viewed in the context of much higher outstanding balances carried
by students and parents on PLUS and consolidation loans, coupled with
the longer repayment periods of consolidation loans.

The other issue we would like to bring forward is that of the total and
permanent disability discharge process and requirements. The conditions
of a discharge provision have been in place since 2002. We feel that
sufficient time has taken place for the Department to take a step back
and correctively look at the conditional discharge process and evaluate
whether or not it is effectively accomplishing its purpose of providing
a balance between program integrity and the additional burden placed on
borrowers who have been determined eligible for total and permanent
disability discharge but who are forced to wait for this benefit.

While we understand the Department's obligation is to protect the
integrity of the discharge program and not allow for abuse or fraud, we
are not convinced that the current process is as streamlined or as
efficient as it could be. Experience in working within the parameters of
the conditional discharge process over the past four years has shown
that too many borrowers are being caught in a web of bureaucratic red
tape and forced to jump through the proverbial hoops. In too many cases,
a disqualification determination has been found to be based upon the
Department's procedural inability to verify continued eligibility.

In addition, Great Lakes would like the Department to reexamine its
policy that allows it to garnish the disability wages of defaulted
borrowers. We believe that this is a policy that ought be rescinded.
Borrowers whose disability payments are garnished are frequently in the
most extreme financial circumstances, and resolution of garnishment
complaints are difficult if not impossible to resolve with alternative
repayment options or to even justify as moral social policy.

Finally, we would like to endorse the plan for fair loan payments as
outlined by Robert Shireman, Executive Director on the Project on
Student Loan Debt, during his testimony on September 19, 2006, in
Berkeley. Great Lakes joins student groups, parent associations, and
college access providers in formal petition urging the Department to
make student payments more manageable for low-income borrowers.

The plan focuses specifically to simplify working on the hardship
application process and make required payments more manageable by basing
them on both Federal poverty guidelines and family size. It also seeks
to make the income contingent repayment program more effective and
accessible to more student loan borrowers, not just those in the Federal
Direct Loan Program.

The proposal contained in that plan are consistent with Great Lakes
commitment to helping borrowers avoid defaulting on their student loans
and, if adopted, would further advance our efforts to provide viable
repayment options to borrowers who are willing to pay their student
loans, but are unable to manage their monthly payments.

In closing, I would like to also mention that Great Lakes supports the
comments endorsed by NASLA, the Guarantee Agency CEO Caucus, and others
in response to the interim final regulations that the Department
published in the August 9^th^ Federal Register.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** We will try for Edgar Staren again before lunch.
Edgar?

\[Pause in proceedings.\]

**DAN MADZELAN:** Okay. Thank you.

Does anyone want to be Edgar?

\[Laughter.\]

**DAN MADZELAN:** You have the opportunity for 15 minutes or so.

Okay. We will, then, break for lunch.

\[Discussion off the record.\]

**DAN MADZELAN:** This is the, I guess, the open mike part of this.

\[Laughter.\]

**PAUL LINGERFELTER:** I am on your schedule right after lunch. My name
is Paul Lingerfelter, and I will just go ahead now, if that is okay.

I am the President of the State Higher Education Executive Officers
Association. I have not\--I am going to speak extemporaneously this
morning. We have a statement on our Web site. I also would call your
attention, and the attention of the audience, to another commission
report that she has sponsored, the Commission on Accountability in
Higher Education, chaired by one of Secretary Spellings' predecessors,
Dick Riley, and also Governor Frank Keating.

Now, these two commission reports have very many similar
recommendations, all addressing the problems we are all here to talk
about today. I want to thank you for your attention, and also the
audience, for their participation and patience through all of this
testimony.

I want to begin by thanking the Secretary for establishing the
Commission on the Future of Higher Education, and make just a couple of
comments of why I think this is a significant report. The positive
changes in the world economy have changed the job description higher
education. When I grew up, the job of higher education was to educate 20
or 30 percent of students to what we then considered a high standard of
learning. Now, we have to educate 50-80 percent of students to that
standard. It is a totally different job.

I think the important contribution of the Commission is to call for an
end to complacency about higher education in the United States. We have
become very accustomed to thinking we have the best higher education
system in the world, and we did for the world that we had 25 years ago.
For the world that we have today, it is no longer the best.

The bottom line is that more Americans need to participate in higher
education and need to succeed, and we also have to have a better system
of lifelong education. It is pretty obvious what we have to change. We
have to provide opportunities for people that are not participating and
succeeding now to participate and succeed. They tend to be lower income.
They tend to be minority. They tend to be disadvantaged in a variety of
ways.

The most important issues that we need to deal with are, first,
preparation for college. The Academic Competitiveness Grants are an
important means of addressing that issue. Other things need to happen in
the states to address the same issue.

The second important issue is aspiration for college. Nobody has said
anything about Gear Up today. I would like to. I think that the Gear Up
program, because it is systemic, it is frequently used at the state
level to encourage participation in college, is an enormously important
resource as we address this national challenge.

The third critical issue is affordability. We need to have access and we
need to make sure that students that have done what they need to do to
be prepared can succeed.

I would like to emphasize just a few short-term priorities. Our first is
to simplify the process of applying for aid. The Secretary and the
Commission are absolutely right. We need to recognize that a lot of the
regulations that we use that make this complicated and cumbersome create
a sense of false precision that is bogus, to use a short, common word.

Second, I think we need to find ways of getting students much earlier
knowledge that they are eligible for student aid. There is a great
student aid program in the state of Oklahoma that tells students as
early as 7^th^, 8^th^, and 9^th^ grade whether they will be eligible for
aid in college. That is a standard which we should all aspire to.

Third, we need to find ways of connecting the regulations for the
Academic Competitiveness Grant to existing state programs. There needs
to be some real conversation and effort to make sure that the efforts of
the states and the Federal government are aligned.

We need to increase the Pell maximum as quickly as possible, and we need
to provide incentives for growth in state student aid programs. The
Federal government cannot do everything. It needs to be done\--a few
states have strong student aid programs, but many more need to.

I want to mention just a couple other issues that are on the table, and
then I will stop, and we can all go to lunch. One issue that is really
important is data systems. The Commission saw this as an issue. The fact
is that we will not be able to mobilize this country to do what we need
to do in higher education unless we can give the people good information
about graduation rates, about student success in our systems of higher
education and focus public attention on the goals we need to achieve.
Secondly, without data systems, we do not know where we need to improve.
So we need to have better data systems to deal with those issues.

I want to make just a quick comment on student learning. I think some of
the comments made today about the importance of avoiding, short of, a
rigid national system for assessing student learning are right on. It
would be a mistake to use student learning as a fine-grained tool of
assessing institutional progress or institutional capacity. At the same
time we need to have general measures of whether students are learning
what they need to learn in a higher education system.

The Commission's recommendations for a 12^th^ grade NAEP for increasing
the frequency of a national assessment of adult literacy, and also for
states to develop general assessments of student learning, so states can
know what their issues are.

And finally, the Commission report called for real increases in
productivity of higher education. I think we all recognize that is
essential. I think it is important, though, to stress that we are going
to need to spend more money in higher education in order to meet these
national goals. We have got to find a way to get a lot more productivity
out of the money we do spend. And that is the way we need to think about
this.

Thank you very much.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** With that, we will break for lunch and reconvene here
at 1:00.

\[Whereupon, at 11:51, the hearing adjourned for lunch.\]

### A F T E R N O O N S E S S I O N

\[1:11 p.m.\]

**DAN MADZELAN:** Welcome back. Noticing the presence of a quorum, we
will continue with Meegan Bassett.

**MEEGAN BASSETT:** Good afternoon. Thank you so much for the
opportunity to address you today.

My name is Meegan Dugan Bassett. I am a Senior Policy Associate with a
group called Women Employed.

As I was preparing my testimony today, I was really astonished that the
width and depth of the Commission was able to reach a report, and I hope
that my comments will help you a little bit in trimming some priorities
for the Department of Education.

Women Employed is a 34-year-old organization located here in Chicago. We
are dedicated to the economic advancement of women and removal of
barriers to economic equity. We pursue this mission by promoting fair
workplaces, increasing access to education and training for low-income
adults and developing model tools and programs.

As our economy has changed, postsecondary education has become the best
way for low-income adult workers to increase their wages. In 2003,
workers with associate degrees earned 34 percent than those with only a
high school diploma, and numbers were double for bachelor degree
holders.

In Illinois and elsewhere, jobs requiring no formal training are really
on the decline. So it is more important than ever to increase
accessibility and affordability in our nation's education system for
low-income working adults that wish to return to school, as well. The
Commission has recognized the need to address challenges specific to the
growing number of adults who are enrolling as independent students.
However, programs often ignore this population.

I will just really quickly go through a few priorities we believe the
Department really should take on if accessibility and affordability are
to improve for low-income adults in particular. First of all, we cannot
make progress towards increased access without increasing available
need-based aid and ensuring that it gets to the neediest students. This
may not be something that you have much control over, but I would like
to put it on your radar screen. Although independent students tend be
from lower-income families than other students, Federal Expected Family
Contribution calculations penalize them for working. Calculations of
independent student aid are often deeply unrealistic.

Number range CHAPTER A single mom earning \$15,000 a year simply cannot
afford to spend 50 percent of her income on college costs as the formula
often assumes. Too often, low-wage workers with children must choose
between getting the skills they need to increase their income and
keeping their families fed, clothed, and sheltered, not to mention
daycare, if they are juggling school and

work.

Increasing the basic Pell Grant substantially, as the Commission has
recommended,

would greatly increase the number of low-income workers who can afford
to complete postsecondary education. The current cutoff is considered
volatile by some, meaning the very small differences in income lead to
ineligibility very quickly. A study by the Illinois Student Assistance
Commission shows that independent students receiving earnings as low as
\$18,000 a year and possibly lower are not eligible for Pell Grants in
Illinois.

One thing that I would also like to mention is that the Commission has
mentioned

the need for connections between adult education remedial courses and
the college level, and that

is really important, because continuation rates are really abysmal if
you look at students who are

in remedial course or adult education who wish to get into certificate
or degree programs.

However, some of the grant programs that are being considered by the
Department right now summarily exclude non-traditional students. There
are a number of certificate programs out there that are demanded by
businesses and that work very well for low-income working students
because they are quicker and they are very connected to the types of
jobs that they would like to go into. Those are often not covered by
financial aid.

One issue that also remains unaddressed by the Commission is the need
for support

services. I believe that relates to some of the programs that you all
are looking at right now. For low-income students, support services such
as subsidized childcare, tutoring, intensive counseling, and early
comprehensive career counseling can make a tremendous difference in
whether or not they complete school.

One of the things\--last year we put out a report called, \"Investing in
Success: Educational Supports for Low Income Students in Illinois,\" and
one of the things that I found as I was preparing for that report was
that I talked to a number of students all over Illinois who were adult
students\--I should say independent students\--who were in the TRIO
program. Everyone that I talked to said that they absolutely depended on
the extra support that they had received from TRIO because they
often\--because they were juggling family responsibilities and work
responsibilities, they often ran into emergencies and needed a lot of
help, because they were also first generation students. They did not
have that background family knowledge about what they needed to do in
school and the types of careers to get into, et cetera.

So I would really like to encourage the Department to do as much as you
can to continue to fund programs that are working well and improving
those programs as opposed to cutting back on them as much as it is in
your power.

We commend Secretary Spellings\' Department of Education Commission on
the Future of Higher Education for taking a fresh look at higher
education and really attempting to address the three \"A's\":
accessibility, affordability, and accountability. The Commission has
made

some excellent recommendations that we believe could make a significant
difference for non-

traditional students. If we are to develop the workforce that our new
economy needs, we must

effectively address accessibility and affordability for our current
workforce, as well as for younger students.

Low-income workers possess a wealth of work experience, but must be able
to access postsecondary education to qualify for jobs in a
knowledge-based economy. Your work can make the difference between a
lagging workforce and a world-class workforce.

Perhaps Commissioner \[sic\] Spellings phrased it best in a Houston
Chronicle editorial on September 28^th^, \"Our goal is nothing less than
full access to the American Dream by every American who chooses to
pursue it.\" Let\'s make that dream a reality.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Thank you, Meegan, for reminding to remind everyone
that, when you step up to the microphone this afternoon, if you state
your name and your affiliation so we make sure we know who said what
when we are looking at our transcripts of this session today.

**DAN MADZELAN:** Next, Edgar Staren and Brett Thurman.

**EDGAR STAREN:** Hello. My name is Edgar Staren, and I am the student
government president at the University of Illinois at Chicago.

I remember when I was back in high school. I thought it a necessity to
attend the

prestigious private universities like my friends, who did actually come
from a lot of money. My

father does make a sturdy income, but my parents also loved the idea of
family. As such, they

decided to have six children.

I remember being so frustrated that I would not be able to attend a
school like my

friends because, at the time, this was the privileged thing to do, but
it was too expensive. I did not qualify for financial aid, and my
parents could not afford the risk of not being able to afford to send my
brothers and sister to school in the future.

I would not have even known how to take out a loan, only being 17 years
old and, to think, loans for graduate school on top of that. I remember
thinking, \"Poor me. I am that kid in the middle class loophole.\" But
in reality, I was too young to understand the significance of all those
zeroes when I looked up tuitions of schools. Then I grew up.

I attend a four-year public university, which I am very proud to attend.
I was around people who were barely even able to afford attending there,
however. I remember my

freshman year of studying at 2:00 a.m. in the lobby while my good friend
worked at the desk, who, incidentally, was taking the same test as me
the next day. He was one of the brightest kids I

knew, as well. He did not even end up graduating from that university
because he could not afford the costs. So he ended up going into another
field which he did not dream of which required less education.

I remember feeling so fortunate at that time that my parents saved and
worked hard to allow me this opportunity, because I know how much they
struggled to do so. Eventually, I realized I was one of the privileged
now, in terms of today\'s society. I realized that there are millions of
students that would have loved to have had the opportunities that I have
had in this regard. This just cannot be.

My senior year, I was elected to Student Body President. This is the
largest student

population at any public university in Chicago, which, as you know, is
the third largest city in the United States. In this capacity, I have
the honor of representing over 16,000 students. Today, I am here to do
that to the best of my ability.

However, I am not just going to sit up here and act like I understand
the American

higher education system to a \"T\" and act like I have all the
solutions. Just thinking about writing this speech in the last couple of
days, I saw the realization of truly how many factors there are to
consider. However, despite all these direct requests and expectations of
all the students speaking today, I believe there is one universal
message, and that is what I would like to close with.

There are problems. And, while state support is a necessity, it is
bigger than that.

Forty-three states are receiving an \"F\" for college affordability,
with the other 7 receiving \"D's\" and \"C's.\" This is on the national
report card in higher education. How can we expect our students to work
hard for the bettering of this nation by receiving top grades when our
system of higher education is failing?

We have top ranks in the world for having older adults with degrees, but
are failing

in the educational attainment of our youth. This discrepancy will only
get larger unless these

issues are focused upon.

Ninety percent of the fastest growing jobs require a post-graduate
education, yet 90

percent cannot afford that education. In the last ten years, tuition and
fees of public schools rose

51 percent after inflation, 15 percent more than private schools. The
debt levels, when comparing

public schools to private schools, are having less and less
differentiation.

Perhaps the solution is money management or different policies to be set
forth. Yet, either way, we need to improve our youth\'s preparation
prior to entering college. Perhaps this can be done by furthering
nationwide merit-based support. Either way, we need to increase the
amount of grants and their worth. We need to strengthen the importance
of receiving a college education, and we need to make this education a
possibility as well as a reality for all. Then we will continue to
uphold the standard of excellence that the United States prides itself
upon.

All of these students are asking for is one thing, and one thing only.
Please make

the future of tomorrow the priority of today.

Thank you.

**BRETT THURMAN:** Thank you for allowing us to come here and speak.

My name is Brett Thurman. I am also from the University of Illinois
Chicago. I am the Committee Chair of the Academic Affairs Committee on
the Undergraduate Student Government.

I served four years in the United States Army before entering college
and, as such, was placed in a unique position to see my friends leaving
college at the time I was entering. So I

got to see a lot of their issues with student aid and debt burden. And
what I have seen from a lot of my friends is this: the burden and cost
of

attaining college education has become too heavy a load to carry
regardless of the paths students

take.

Although our nation\'s lower-income students previously relied upon a
rather large network of community colleges to obtain their degree, this
alternative has also increased in cost beyond most students\' ability to
pay, even with financial aid.

In Dearborn, Michigan, Timothy Pollit is currently in his sixth year of
pursuing his

journalism degree, previously a student at Eastern Michigan University,
he now attends a community college. After attempting to balance school
with working full-time to cover necessary living expenses such as rent,
car insurance, and food, not to mention tuition fees and books, Tim has
finally submitted to moving back into his parents\' home. For his six
years struggle to pay down college debt and attend classes at the same
time, Tim has the following to show for his efforts: He has moved back
into his parents\' home; he has 72 credits towards a 128 credit degree,
and he has accumulated approximately \$20,000 in student debt.

In Augusta, South Carolina, Lauren Duncan is currently working as a
nurse\'s aide at People\'s Hospital. She wants to attend college and
then nursing school, but cannot afford to quit working. When she decided
that she could not afford to attend a large four-year university, she
looked into nearby community colleges. What she found was that the
insufficient amount of financial aid available to her when she was
considering the four-year university was not even offered if she
attended a community college part-time.

Between the meager financial aid available and the cost of attending
school, paying

for a vehicle to commute to school, and additional living expenses,
Lauren has found no option

but to continue working as a nurse\'s aide and forego seeking a higher
education. My friend

Lauren is 23 years old.

Ladies and gentlemen, these are my friends, and I have many more like
them across the country in similar predicaments. I stand here today in
their place because I am fortunate enough to have the time and education
that they are still struggling for. The names, universities, locations,
and majors are all different, but the financial hardship remains
dismally universal. Our current financial aid system is failing to
assist in new areas that have developed since its inception. New
considerations must be taken into account and an overwhelming amount of
financial aid is available only to full-time students. At a time when
students choose to work and attend college part-time simply to attempt
to reduce the amount of debt they incur.

Most community colleges are, by their very nature, commuter campuses,
and we have no measurements in place to ascertain the financial burden
owning, operating, and maintaining a vehicle necessary to get to and
from classes, or, more appropriately, to get between class and work.

Although the advertised price of a commuter college may be less than
that of a larger university, the student still faces the same large
expenses for text books and supplies. If a student does manage to run
the gauntlet and finish with a degree, he or she is guaranteed to have

a hefty loan repayment bearing down on them six months following
graduation, or they may still

be searching for a job that pays enough to make the necessary loan
payments.

The solutions to these problems begins with a more comprehensive FAFSA
application and determination process. If the additional expenses
incurred by students are not included in the universities\' expected
cost analysis\--if these additional expenses are accounted for, a more
accurate description of need will follow.

Secondly, the growing number of students that choose to work full-time
to help cover the costs of their part-time education need to be
addressed and given assistance. Whereas

the thinking in the past may have been that working students need less
financial aid due to their income, the opposite is more commonly true
today.

More financial aid for part-time students will help us to stop punishing
those who choose to work the hardest to achieve a post-secondary
education.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Trevor Montgomery.

**TREVOR MONTGOMERY:** Hello. My name is Trevor Montgomery. I am also a
student at the University of Illinois Chicago. I am a senior. I am a
past Student Body President at the University, and I am also the founder
and President of the Student Lobbying Association. I would like to thank
all of you for this opportunity to speak here today.

The Commission on the Future of Higher Education report states that
tuition at public four-year colleges and universities has increased by
51 percent over the last ten years after adjusting for inflation. Many
people blame these increases on the lack of state funding for public

colleges and universities. I am one of these people.

There once was a time when an individual could go to a local
state-funded university, earn a degree, and go on to work a noble career
as a teacher, social worker, or anything that they dreamed of, without
being held back by the burden of student debt. This time is no more.

Currently, students that graduate from local state-funded colleges face
the same

debt burden as students graduating from private schools. When comparing
Northwestern University, a private institution in Evanston, Illinois,
and the University of Illinois, Chicago, a state funded university, I
found that almost the same percentage\--actually 45 percent from UIC and
46 percent from Northwestern\--graduate with student debt. Of those
students, the average student with debt from Northwestern graduates with
about \$18,000, while the average UIC graduate with debt walks away with
about \$17,000 in debt.

I think it is hard to believe that students from a state-funded school,
with the mission of accessibility and affordability can walk away with
the same average debt as students from a prestigious private university.
This clearly demonstrates how the lack of state funding is robbing
students of the right to an affordable public education.

I think it is obvious that, as tuition rates increase significantly,
students from both public and private colleges and universities are
forced to rely more on Federal grants and loan programs. Students need
affordable loans now more than ever, but sadly, another fact that we are
all familiar is that recently, February, the Federal government cut more
than \$12 billion to Federal student loan programs. This was the largest
single cut to student financial aid in history, and it came at one of
the worst times for students. The increasing cost of college, coupled
with the increasing lack of affordable student loans, are being felt by
many people, like my friend, Sara.

My friend Sara attended a state-funded university in Southern Illinois.
She received a bachelor's degree. She enrolled in another state-funded
school where she received her master's degree in social work. After
completing six years of education, Sara was ready to fulfill her dream
of becoming a social worker in Chicago. But even with the help of the
Illinois Veterans Grant, Sara's loan debt was over \$35,000. She knew
that she would not make a lot of money as a social worker, but she did
not want to let her loan debt stand in the way of her dream.

After only a few months of working, Sara was already starting to make a
difference, but after she began to pay on her student loans, Sara was
forced to quit her job because of her unmanageable debt. She now works
at a higher paying job, which allows her to manage her student loans,
but she is not doing what she dreamed of. And the saddest part is that
the extremely needy people that she loved and worked with will suffer
for this more than anyone, because they have lost someone that truly
cared.

After hearing a story like Sara's, I feel that there are many things
that should be done to lighten the burden of student debt, such as
preserving fixed-rate loan consolidation, lowering the interest rate
cap, eliminating origination fees, and expanding loan forgiveness on
loans, all of which could be changed and maintained within the Higher
Education Act.

Federal grants can also be paramount in relieving the burden of student
debt. The Academic Competitiveness Grant and the SMART Grant are great
new programs, but there is also a need for increased grant aid that is
accessible by all students. The Pell Grant has been the cornerstone of
low- and middle-income student financial aid packets, and has helped
many to attain what really should be the right of postsecondary
education.

However, the current maximum Pell Grant of \$4,050 only covers about 44
percent of the average in-state tuition at public four-year colleges.
And, as a recipient of the grant, I know all too well that this fails to
cover the rising cost of tuition.

The Commission on the Future of Higher Education made a recommendation
to increase Federal spending on need-based aid and increase the average
Pell Grant, so that it covers 70 percent of the average in-state tuition
at a public four-year college. This would be a major step in reducing
the burden of student debt and making college more accessible to
everyone. Myself, and students from all over the Midwest encourage the
Commission to wholeheartedly pursue making this recommendation a
reality.

I also would like to ask each of you to consider that, out of five
recommendations that myself and many other students may have referred to
today, the students in the Midwest and around the country feel that the
implementation of these recommendations would help significantly reduce
the burden of student debt in the lives of many Americans. We would ask
that you would consider each of them.

I ask that you consider one, limiting student loan repayment to
income-related proportions on all loans.

Two, I ask that you consider taking family size into account with
student loan repayment plans, recognizing that borrowers with children
have less income to budget for monthly loan payments.

Three, I ask that you cancel student loans after 20 years of good faith
payment, bringing relief to borrowers that have done everything they
could, including paying on time and paying in full, but are still living
under the burden of student debt.

Four, I ask that you consider suspending interest on the loans of
individuals who are enrolled in the economic hardship program.

And five, I ask that you consider simplifying the process of applying
for the economic hardship program.

As a student with over \$15,000 in loan debt myself, I ask that each of
you take these considerations and opinions, along with the
recommendations of my fellow students, into account.

I would sincerely like to thank all of you for this opportunity, and it
has been my honor. Thank you.

**DAN MADZELAN:** Robert Skorczewski.

**ROBERT SKORCZEWSKI:** My name is Robert Skorczewski, and I am from the
University of Illinois at Springfield. I am the Sergeant-at-Arms at the
Student Government Association there.

First of all, thank you for having these hearings and giving me the
opportunity to speak.

With that, let me say that, at this time in history, we seem to be at a
point that will define us for years to come. It could be said that our
great nation stands at a crossroad. As with all crossroads, we must
choose a path. The path that I have chosen for myself is one of public
service.

I have spent my college career serving my fellow students as a mentor, a
tutor, and as a member of the Student Government Association. After I
graduate, I plan on serving my country in the United States Navy. One
day, I hope to serve my fellow citizens as an elected official.

Public service is one of the greatest investments a person can make in
himself and his community. It pains me, therefore, to know that students
are being forced to forego service opportunities after they graduate in
favor of higher paying jobs elsewhere. Many must do this because of the
need to repay their student loans.

Often, graduates simply cannot afford to take lesser paying jobs, but
jobs that are very much needed and serve the public. Each year we see
state funding for our schools decrease. This translates to tuition
increases. Students must take out more loans to cover these increases.

I am not here to ask you to make tuition increases go away. Some
increases are necessary to maintain the quality of our schools. I am,
however, asking that you do what is in your power to ensure that
students are not forced to suffer overwhelming burdens their entire
lives in order to get that quality education.

Many have mentioned the five-point plan that will help alleviate the
burden that student loans can be for students. Please take our
testimonies to heart, and help students with loans, where help is so
desperately needed.

Today, I am here with you. My brother, a member of the Army National
Guard Reserves, will be at Southern Illinois University in Edwardsville,
where he is attending school. Obviously, public service is highly valued
in my family.

My father will be at Carlisle High School. He worked 18 years in a coal
mine. When the mine shut down, he returned to school, at the University
of Illinois in Carbondale, to get a teaching degree. Now, he is taking
classes online towards a master's in library sciences, so he can keep
working at the school.

My sister will be Minneapolis, following her dream of being a writer.
She hopes to attend a creative arts school there next year, but must
move there, first, because following her dream would be too expensive
without residency. The loans would simply be too much.

My mother will be working at Washington County Hospital today and, most
likely, this weekend. She will be working extra shifts at a hospital in
a nearby city.

Student loans affect my family very much, which is why I feel so
passionately about this cause. You could say that my brother and I are
lucky that our paths have led us to serve in the military, which will
help us pay for our education. I will be graduating this spring with
almost \$20,000 in debt, but I have the security of a generous loan
repayment option with the Navy. The rest of my family is just as
hardworking, though, and will have to continue to be hardworking to deal
with the debt for student loans.

I am not telling you this to look for pity. I am not asking you for a
handout. I am not here to ask for more scholarships or grant money for
my own education. I am asking that you make loans less of a lifelong
burden for students all over the country. The rewards would be truly
worthwhile.

Imagine more teachers and social workers. Imagine more graduates taking
a year or two to work for a non-profit organization. Imagine a much
stronger community.

So we stand here at a crossroad. Down one path, I see a path of debt, a
path of working a job that is not rewarding, but must be taken to repay
student loans. It is a path of graduates who may need to take a second
job to make ends meet. It is not a path that is desirable for students.

Down the other path, I see a world of fulfillment. This path allows us
to explore our desires to serve our fellow men and women, and not have
to worry about an unbearable loan repayment schedule. I ask that you
please make this second, more fulfilling path available to students all
across America.

On Monday, I sat at a table asking students to support our request for a
change in student loan repayments. In the short time I was there I
received almost 100 signatures. I was one student who asked for support
for a few hours one day, and the response was overwhelming. This is
truly an issue that is of great importance to students, faculty, staff,
administrators, parents, and alumni alike.

Thank you for this opportunity to speak about an issue that is very
important to so many of us.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Bill Church.

**BILL CHURCH:** Good afternoon. My name is Bill Church, and I will also
be speaking extemporaneously to you this afternoon.

Based on what I have heard this morning, I have jotted down a few notes,
so please bear with me.

I am a Commissioner with the National Accrediting Commission of
Cosmetology Arts and Sciences, and also a school owner, and, as such,
represent the proprietary sector of postsecondary education\--the people
who are tax paying. Of course, paying taxes theoretically depends on
whether or not you make a profit, and we certainly hope we can do that.

We read with great interest the Commission's report about access and
affordability and quality, and innovation, and accountability. For the
most part, we are in agreement with that report. So much of what is
contained in the report are things that we have been doing for a long
time in the proprietary sector, especially in the area of
accountability\--completion rates, licensing rates, and placement
rates\--we have severe thresholds that we need to adhere to.

We also need to even share with our potential students as we enroll the
information regarding safety issues and salary issues. All of that is
disclosed up front. I must tell you that, based on the schools that come
across my desk as a commissioner, I can assure you that school owners
and/or their admissions representatives are not, in fact, enrolling
students to make their completion rates look good, not based on some of
the completion rates that I see. I just do not think that is happening.

Of course, in our schools, we must improve our outcomes, and we do that
through a number of different means, not the least of which are student
surveys and employer surveys and advisory committees, all assessing
constantly our outcome. So it is something that we have been doing for a
long, long time. Some of that which is contained in the commission
report was very, very refreshing to us.

Very quickly, some of the issues that we would like to see, and I
realize that this is primarily about financial aid, and I must tell you
that the financial aid program, specifically with regard to loans, does
need to be revamped, if not the least of which is this streamlining of
the FAFSA. We are subjected in our proprietary sector to some rather
strict composite scores that we must meet at the end of every year based
on annual audits that we get, or that we receive.

I must tell you this, most healthy corporations in this country will
have a very, very difficult time meeting those composite scores, but
somehow, year after year, we are able to do that. Those schools that do
not must get a Letter of Credit. We would love to see that eliminated,
if possible.

The issue of default rates, which plagued proprietary schools for years
seems to be under control, but, once again, the segment of the
population that we tend to serve are the ones that are least likely to
pay those loans back. We do seem to have a better handle on that, but we
would love to see that eliminated as well.

The big thing with the public, private, and proprietary sectors, as we
see it, is equity. We would love to see whatever rules and regulations,
whatever outcomes, whatever thresholds that are thrown upon the industry
be divided in equitable amounts to all three of those portions of
education. In other words, measure us all the same way. That is all we
are asking.

Quite frankly, I would encourage you strongly to invite to the table of
negotiated rulemaking as many proprietary schools as possible. I really
think we have something to offer.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Cynthia Davenport.

**CYNTHIA DAVENPORT:** Good afternoon. My name is Cynthia Davenport, and
I am the Executive Director of ASPA, the Association of Specialized and
Professional Accreditors.

ASPA is a membership organization representing 51 different accrediting
groups and nearly that many professional fields and disciplines.
Together, the members of ASPA accredit roughly 15,000 programs, schools,
or units, and take pride in the role they play in helping to ensure the
quality of education provided to the many thousands of students in those
programs.

While many of the programs accredited by members of ASPA are housed in
institutions that are accredited by our national or regional colleagues,
some members of ASPA are recognized by the Secretary of Education as
Title IV gatekeepers, especially for single-purpose, freestanding
institutions. Many others are recognized as program accreditors for
other federal purposes.

I appreciate the opportunity to appear at this hearing today. The report
of the Commission on the Future of Higher Education was discussed at
length during a recent ASPA membership meeting, which helps me to speak
on behalf of the members of ASPA. First, ASPA is in agreement sent in
early September by those members of the Committee on Health, Education,
Labor, and Pensions who expressed concern regarding inclusion of
recommendations from the report of the Commission in negotiated
rulemaking, before any legislative action has been taken. We have a
strong preference rather than two rounds of negotiation, which would be
best held, we believe, after reauthorization of the Higher Education Act
is concluded.

Next, we think that it is possible to agree with the concerns stated in
the early pages of the report without agreeing with many of the
proposals in the later sections. Accreditation has a long history of
serving the public interest. In fact, specialized accreditation was
developed starting in the early 1900s because of a need to be sure that
the public was well-served by competent practitioners in fields that
ranged from medicine to business to law, library science, music, and
subsequently to the many professional fields and disciplines that
continue to serve the public today.

The focus on ensuring the development of competent practitioners means
that specialized accrediting organizations have long been interested in
results and student learning outcomes. However, they also recognize that
composite outcomes are a trailing indicator, and not an indicator of
individual student achievement. Accreditors focus on institutions and
programs providing conditions that will enable students to succeed, but
they also recognize that students must accept some responsibility for
their own learning as part of the partnership that creates that success.

In part because of their strong roots in public service, members of ASPA
believe that it is very important to acknowledge that there is no single
public interest. Because of this, accreditation must address numerous,
often competing elements of the public interest. Mandating any single
public interest through either legislation or regulation would
disenfranchise and ultimately be a disservice to other important
publics.

I have modified my remarks slightly, because my colleague, David Preble,
covered some of the points very eloquently that I was prepared to make,
but they will be included in my written testimony that I will submit,
but I am kind of skipping ahead, here.

ASPA member accreditors believe that accreditation is meant to foster
improvement and not just provide evaluation. They are committed to
providing good, accurate, appropriate public information that does not
compromise the integrity of the process. The business world understands
the need for private discussions prior to making announcements to
stockholders or the public. Accrediting organizations and institutions
also need the time and space to make decisions. It is important to make
public all final accreditation actions, but maintaining a level of
confidentiality enables the system to work to the benefit of all.
Because only a small number of programs is under review at any given
time, and because institutions are dynamic with ongoing changes,
inappropriate comparisons are likely to create a non-level playing
field, putting institutions at a competitive disadvantage, and perhaps
even mislead the public, something which goes against the very nature of
specialized accreditation.

We believe that preserving autonomy and freedom of action is important.
It allows the diverse mission of institutions to flourish. Innovation
and creativity will die without some degree of freedom. Retaining
principles that respect freedom and time for institutions and programs,
and also for accrediting organizations produces effective, productive,
and cost-efficient ways of operating.

Members of ASPA are concerned that much of the higher education policy
discussion seems to have lost sight of the fact that the future of
American success depends on the extent to which students master
disciplinary and professional content, not on how much data is
collected, or the specific kinds of accountability systems used.
Accreditors are receptive to, and appreciate, thoughtful recommendations
from many sources, but want recommendations, especially those that call
for change, to be based on accurate information, empirical data, and
balanced analysis.

Many of the proposals under discussion, unfortunately, do not meet these
criteria. Having said this, it may be important to add that opposing
some of the proposed changes is not the same as being opposed to all
change, or even to change in general. Members of ASPA simply hope to
assure that change is not change just for the sake of change, but has a
real potential to make positive improvements that would pass the cost
benefit analysis.

In conclusion, on behalf of ASPA and its members, I want to thank
Secretary Spellings for indicating that she understands the need to meet
with the accreditation community to discuss some of the proposals
contained in the Commission's report. We are hopeful that, as we meet,
ways to implement sound ideas will emerge, and the potential harm of
unintended consequences can be avoided. We urge you to keep the points
from these remarks in mind as you develop the topics to be addressed in
negotiated rulemaking. ASPA stands ready to assist in this important
endeavor whenever it occurs, although we hope that the accreditation
aspects will be addressed when reauthorization is completed, and not
this fall.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Chris Rasmussen.

**CHRIS RASMUSSEN:** Thank you for the opportunity to be here today. My
name is Chris Rasmussen. I currently serve as the Director of Policy
Research at the Midwestern Higher Education Compact, an interstate
compact of 11 Midwestern states. Based in Minneapolis, it serves higher
education institutions, systems, and government stakeholders. I am here
today speaking not so much on behalf of the Midwestern Higher Education
Compact, but rather as an individual with nearly 20 years of experience
working with college students, and serving in studying higher education
in five U.S. states and the Commonwealth of Australia.

I would like to add that I am the first in my family to earn a college
degree. I am a former Pell Grant recipient, and I relied heavily on
Federal Stafford and Perkins Loans, self loans, institutional loans, and
private loans in the pursuit of both my undergraduate and graduate
degrees.

Since the last major reform of the federal financial aid system in the
early 1980s, attempts to reduce barriers to access have amounted to
little more than tinkering with what many would argue is a dysfunctional
model of college pricing and discounting. Perhaps, instead of continuing
our efforts to repair a broken model of college financing, we should
abandon the model altogether, and consider a radical restructuring of
our thinking about how to pay for college.

Anytime we look outside of our own country for examples of how we might
do a better job of getting more of our talented youth to attend college,
while radically reducing the complexity and the bureaucracy of our
current Federal financial aid system. One worthy example of
consideration is in Australia, where I have spent considerable time
studying what is known as the Higher Education Contribution Scheme. This
is a Federal government program that allows students to defer all
tuition costs until after graduation, at which point they repay the debt
through salary reduction. The program is essentially a form of income
contingent lending, with borrower repayment set as a percentage of an
individual's gross earnings, currently between four and eight percent of
pay.

A minimum income threshold must be reached before any repayment begins,
currently set at the equivalent of about US\$27,000. This helps to
ensure that individuals are not overly burdened by loan obligations as
they struggle to find work or choose to enter fields that are
traditionally lower paid, including the service industries and
professions such as teaching, childcare, and social work.

While repayment is based on income, no student or family means testing
is applied at the point of college entry, meaning no Federal FAFSA is
completed, although a separate Federal government program does provide
cash assistance and housing allowance to students who meet certain
income standards. While scholarships exist for the most highly talented
of college applicants, all students entering the same academic program
are assessed at the same level of deferred tuition.

The Australian system applies to both full-time and part-time students,
thus covering high school graduates who go right to college, and working
adults returning to complete a degree or obtain the education needed for
a career change or professional development. From an economic
perspective, the Australian model offers distinct benefits to the
prospective consumer. The entry price of college is, essentially, zero,
at least in terms of tuition. The income-contingent aspect of repayment
and the minimum income threshold serve as forms of insurance that reduce
the risk associated with the choice to go to college.

While the government loan is indexed annually for inflation, it does not
carry any nominal interest rate, neither while the person is in school
or during repayment. Therefore, a delay in repayment is not penalized
through interest compounding. This makes the net value of college
investment more favorable than borrowing at market rates.

In my work with Australian students and families from low-income
backgrounds, the vast majority indicated they would not have been able
to pursue education without the availability of the deferred payment
option. Features of the system relieved their anxieties about paying for
college, including a minimum repayment threshold, and a relatively small
amount of their wages that would be directed toward fulfilling their
loan obligations. As a result, they expressed relatively little concern
about their ability to repay their loans or the burden represented by
their debt.

Individuals who chose not to attend college decided to pass on the
opportunity not because of tuition costs or potential indebtedness, per
se, but mostly because they were interested in careers that did not
require a college degree. In fact, many indicated to me that they would
likely have attended college if it had been required to enter their
desired occupational field. The financial indebtedness was something
they were willing to assume if necessary.

The cost-related concerns for these students, or non-students, as it
were, expressed had more to do with relocation for college, the need to
support themselves while in school, and various out-of-pocket expenses.
Many researchers and higher education advocates in both Australia and
the United States have argued that individuals from low-income
backgrounds are more debt averse than their middle- and higher-income
peers. This plays a role in their decision whether to attend college.

I believe that what some might consider debt aversion in the college
choice context is often more accurately described in economic terms as a
"low taste for risk" and heightened discomfort with the uncertainty of
outcomes from the college investment. Educational debt aversion seems to
exist more as conventional wisdom than it does as an empirically-proven
phenomenon. What appears to be at work in many cases is a relative lack
of knowledge or understanding of principles of finance and investment,
and of the long-term benefits of short-term borrowing. An effort to
achieve a higher level of economic literacy in adolescents might help to
reduce the anxieties about the cost of college felt by many.

At the moment, many college students face a double whammy upon
graduation, high student loan debt and the dramatically increased cost
of housing, which has gone up more than 100 percent over the last six
years in some parts of the country. The average home cost in many cities
in the Midwest, which has historically enjoyed a relatively low cost of
living, is now over \$250,000. The volume of student loan debt carried
by many students, together with the fact that a home purchase is
substantially out of reach for many, could have serious implications for
our society, including delayed marriage, delayed or reduced
childbearing, extended residence with parents, and the inability to
invest or save for emergencies and retirement.

Finally, I believe the importation and application of pieces of the
Australian model would make for an interesting experiment in expanding
educational opportunity in this country while reducing the relative
burden imposed by student loans. It certainly is better than continuing
to tinker with the model we presently use.

Thank you very much for your time.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Matt Glaman.

**MATT GLAMAN:** During high school, I wanted to go to college. Well,
now I am there--

**DAN MADZELAN:** Name and affiliation, please. Thank you.

**MATT GLAMAN:** I am Matt Glaman. I am from Stevens Point. I am a
freshman this year.

Throughout high school, I planned to go to college, and I knew that it
would be tough to pay for it, but I kind of put that aside, because I
needed to graduate. I wanted to make sure that I would actually be able
to go to college.

This summer I applied for financial aid, which was a lot of paperwork
and a lot of time, and it was quite confusing for me. I applied for it,
and I waited and waited. I found out that I was only going to receive
\$1,300. Tuition this semester cost me around \$4,500. That leaves me
roughly \$3,000 for this semester. If this were to continue for all
eight semesters, I would be in debt \$24,000. I searched around for
loans to figure out how to pay off this \$3,000, and all of the loans
were at an interest rate of about five percent. So \$24,000 at five
percent over four years\--that is a lot of debt that I am going to have
to pay off.

Also, I have friends that do not even go to college now because of this
cost. They saw that ahead of time. They did not ignore it like I did. My
friend Tighe, he had received a 26 on the ACT, could have gone to a
great college, but he was unable to pay for it. He is now working at a
gas station. He was going to apply to Milwaukee, get a business major
and open a community center where kids could go and bands could
play\--try to give something back to the community, but now he is not
doing that because he couldn't afford college.

My friend Liberty, she was going to go to school to be a
photojournalist. Throughout high school she had a job at Walgreens. She
came very secure. She had a good income. She was able to support
herself. She chose not to go to college so that she would not lose this
job. She would not go to college. She would not get into debt, and she
would not have to find a new job and have to start all over.

Then, going back to my situation, with this \$24,000 in debt with five
percent interest over the four years, and then getting out of college
having to find housing, pay for food, other things I will need, and
commuting to a job\--I do not know how I am going to start off. I do not
know how to start life because I am so far behind. So I am hoping that,
with all these ideas that have come up, you guys help find a way to help
make college more affordable so that people who do decide to go to
college and make this country greater by using their intellect\--and
then get more people to go to college. That is pretty much the sum of it
all.

Thank you for your time.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Katie Kloth.

**KATIE KLOTH:** Hello. My name is Katie Kloth, and I attend the
University of Stevens Point, Wisconsin. You have seen many of us here
today.

I did not break it, I promise.

**DAN MADZELAN:** It belongs to Loyola, not us, so---

\[Laughter.\]

**KATIE KLOTH:** Loyola, I did not break your microphone.

In all seriousness, though, I am double majoring at Stevens Point in
communications and political science and, after my college endeavors
have ceased, I plan to attain a job doing environmental activism and/or
journalism. However, due to enormous of student loan debt that I will
have to pay off post-graduation, I will most likely first have to get
some kind of higher paying job in a field that is not my first interest
or first choice, and rather than doing what I want to do, which is
non-profit activist work that would benefit numerous other people,
rather than just myself.

In having aspirations to be a non-profit worker, such as a program
organizer, in a place much like I come from, Stevens Point\--we do many
grassroots things and social interest things and it is amazing. Any way
you choose to describe it, it is amazing. Sadly, the salary you get is
only about \$23,000 a year, and that is not a lot of money considering
how much debt I am going to be having.

With this job, getting new experience in other countries helps broaden
your spectrum of understanding and attain a plethora of new knowledge
through experiential learning. However, in addition to debt from
tuition, if one wants to study abroad it only creates a higher bill that
cannot merely be supplemented by governmental financial aid, and causing
me and other people to take out other alternative loans, which I had to
take out this year\--like, a \$13,000 loan. They do not even have
ceilings, so they can just skyrocket. You can owe all this money, it is
redunculous \[sic\]. Anyway\--I am serious, though.

Anyway, so, the unfortunate reality of this is\--in fact, everyone
should have this great opportunity to study abroad and go where they
please, as it is a life-changing opportunity that can be missed. I, for
one, am studying abroad in Australia next semester and, like I said, I
have taken a \$13,000 alternative loan and, since I already have a
Stafford Loan, a Perkins Loan, and work study, this is just going to be
a ridiculous amount of extra loan money and debt I will have to pay off
that I will not be able to.

In conclusion, I think that student debt needs to have better
regulations to help control these interest rates that are spiraling out
of control. There needs to be more financial aid available to all
qualified students, in general, so others like me do not have to work
two jobs during the school year, and end up juggling extensive job
demands with school, where the majority of my time will be spent making
money versus studying, which I am actually going to school for.

Thank you for your time.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Scott Formo.

**SCOTT FORMO:** Good afternoon. My name is Scott Formo, and I am the
President of the Minnesota State College Student Association, and also a
student at Alexandria Technical College in Alexandria, Minnesota.

I am very appreciative that these hearings have been called to discuss
some of the positive changes that can be made to the Federal financial
aid process. Currently, the Minnesota State Colleges and University
System, or MNSCU, is the largest single provider of higher education in
the state of Minnesota, which encompasses 46 two-year community and
technical college campuses, as well as seven four-year state
universities. MNSCU serves approximately 240,000 students annually in
credit-based courses, and an additional 130,000 students a year in
non-credit courses.

As President of the Minnesota State College Student Association, or
MSCSA, I am here today to represent the more than 100,000 students from
Minnesota's two-year public colleges. MSCSA empowers student governments
and students by organizing and promoting activities and encourage unity
within the student community, while also providing opportunities for
students to develop leadership skills.

Over the past couple of months, we have geared up for what makes to be
an interesting year, both academically and legislatively. Rosalind
Carter once said, "A leader takes people where they want to go. A great
leader doesn't necessarily take people where they want to go, but ought
to be."

We have worked hard along the way with other student associations to
train many great leaders to advocate for what "ought to be" by
mobilizing our leadership teams to raise awareness of the issues at
hand, including the rising interest rates and student debt through
regular press events, training, workshops, and regular association
updates to all of our 46 campuses. More recently, we have shifted into
high gear in our "Get Out the Vote" efforts by swarming campuses with
students, working to register new voters. So far, this year, we have
registered over 1,200 new voters at our campuses.

In addition, through comprehensive student-based, grassroots efforts,
MSCSA advocates local, state, and federal level for accessible,
affordable, and quality education. In fact, this past week, MSCSA
students were in Washington, D.C., to advocate at the Federal level with
Senate, Congressional, and the National Governor's Association delegates
and staff, various educational lobbyists, and other local, state, and
Federal student associations that were present for the American Student
Association of Community Colleges at the ASACC fall citizenship
conference.

While in Washington, D.C., I heard many stories similar to the ones you
have heard today, and will hear at future hearings, of how student debt
is a growing concern that affects today's students and tomorrow's
economy. More importantly, though, here today, I also represent the
growing number of adults and students like me with families and children
who are returning to school to achieve vocational goals and acquire the
skills necessary to compete in the global economy.

Many of us have returned to school to create a better life, not only for
ourselves and our families, but also for the community as a whole. Like
many other non-traditional students, I returned to school because I felt
that I needed to update my skills in education in order to make myself
more marketable in today's workforce. As a returning parent/student, not
only am I facing the challenges of returning to school and balancing
family time with school and work, but also reacquainting myself with the
necessary study skills to succeed, while battling the rising cost of
tuition in Minnesota, as well as across the nation.

I also returned to school to help create a better community. Higher
interest rates and increasing student debt can seriously deter students
from going to school and filling essential roles in society. College
campuses that have many benefits to offer the community, along with the
wide variety of choices in degree options\--however, like any other
college campus in the nation, these options do not come without a high
price tag, as students today are faced with cuts to financial aid and
higher interest rates on student loans.

With our future earning capacity devoted to paying off the extra debt
created by the rising interest rates, students today are faced with some
tough decisions. With such a high debt load, how can I provide for my
family, and actually move ahead in my career, which is my sole reason to
return to school in the first place. More importantly, how is it
possible to save for my retirement, and, even more importantly than
that, my ten-year-old son's college education, when I can hardly pay for
my own, as it is?

Parent-students from Minnesota and across the nation are often forced to
decide between financing their own education and that of their children.
Even if they ambitiously attempt both, after graduation they will have
even less income than traditional students to contribute towards
repayment. MSCSA urges the Department of Education to formally recognize
the unique financial needs of parent graduates in the repayment process.

Balancing the financial needs of both education and family is made more
difficult by the amount of borrowing that has become necessary to finish
a degree, even at the public two-year college system. At Alexandria
Technical College, my home campus, 78 percent of students are not
eligible for the Pell Grant, and 10 percent have a family income of less
than \$30,000.

As a thirty-something non-traditional student, I am only slightly above
the average age of Minnesota's public two-year students, which is 26.3
years of age. When you consider that 95 percent of the students over age
25 receive no parental support for their education, access to supposedly
open-access institutions seems increasingly out of reach.

According to the United States Student Association, nationwide there is
\$31 billion in financial need that is not being met by financial aid.
MSCSA applaud Secretary Spellings and the Department of Education's
recognition that students face heavy debt loads upon graduation, and we
encourage the Department to take great strides in controlling the
affordability of loan repayment in the financial aid process, generally.

Student borrowing rates are a huge concern across the country. In
Minnesota, 74 percent of undergraduates graduating from public
institutions in 2004 had borrowed money to complete their degrees,
borrowing an average of \$17,200 each. Since that time, tuition has
continued to rise at rates that dwarf both inflation and the cost of
living. Tuition at Minnesota's public two-year colleges has risen 67
percent since the year 2000.

A great deal of the Higher Education Act was really to accessibility and
affordability to a quality education by all. Minnesota's population is
expected to increase by 14 percent over the next 14 years. Currently,
eight percent of the adult population of Minnesota has less than a high
school diploma, making accessibility even more important than in years
past.

Affordability means having the ability to go to college full-time
without having to take on one, two, or even three jobs, having to take
out student loans with interest rates higher than they were only a few
months ago, or even having to choose between what you want to do versus
what you can afford to do. While this is what past generations were able
to call affordable, currently it is the exact opposite. Average student
debt for students has increased by 107 percent in the past decade.
Minnesota colleges are more dependent on tuition than our neighbors.

Recently, the *Chronicle for Higher Education* released its data, and
Minnesota's two-year public colleges now ranks number two in the nation,
number two as in the second highest cost of college education in the
United States, not exactly what we want to brag about. MSCSA urges the
Department of Education to consider the point at which lack of
affordability becomes a roadblock for accessible education.

The National Center for Public Policy in Higher Education's Measuring Up
2006, the state report card on higher education states that, compared
with the best performing states, families in Minnesota devote a fairly
large share of family income, even after financial aid, to attend public
two-year colleges. Measuring Up 2006 goes on to state that Minnesota
does not offer low-price college opportunities. Even after financial aid
is disbursed to institutions and students, the percent of Minnesota's
income, the average of all the income groups, needed to pay for college
expenses, minus financial aid, has risen from 19 percent to 22 percent
for the public two-year colleges, 7 percent higher than other top states
in the nation. It has risen from 19 percent to 26 percent at the
four-year public colleges and universities, 10 percent higher than other
top states in the nation.

In populations with the lowest income, 52 percent of the average family
income is spent on college education at the two-year public college
system, whereas 24 percent of the lower middle-income, and 16 percent of
the middle-income, and so forth. The report also states that
undergraduate students are borrowing an average of 22 percent than in
1992. MSCSA is conscious of the fact that the Department of Education
cannot directly control tuition, nor the amount of financial aid our
students are awarded. However, by negotiating rules of repayment that
alleviate the financial burden of graduates, today's students may be in
a better financial position to contribute to the economy in the
essential ways we all value, through careers in public service,
increased tax revenue, and an educated workforce.

There are many small ways that we could provide great benefit to today's
learner. I am sure you will here many creative proposals throughout the
course of these hearings. However, I am concerned with the ability of
working adults, particularly parents, to return to school in today's
high-tuition, high-debt climate. Allowing loan forgiveness after many
years of diligent parents would definitely aid parents boggled by how to
help their children access higher education while repaying their own
student loans.

Additionally, families run into financial hardship for a multitude of
reasons, many unforeseen and not preventable. Providing graduates with a
simplified process for applying for hardship deferrals and halting the
accrual of interest during times of hardship would ensure that every
family can reach their educational goals. This is not to say that there
should not be accountability that acquire loans to fund their course
work of education is an investment, and sometimes borrowing is a
necessary expense to achieve a degree. As a student, a future
professional, and a parent I take this responsibility very seriously, as
do other students across the country. If given the tools to alleviate a
portion of the repayment burden, we can achieve more than we ever
thought possible.

Our association represents students that will train and transition into
tomorrow's workforce\--the hardworking people who will enter service
occupations, such as nursing, law enforcement, education, and public
interest work. To allow entry into these fields, particularly among
non-traditional students, something must be done to alleviate
unreasonable repayment on student debt. Allowing for income-contingent
repayment plans for all borrowers, and forgiving remaining debt after 20
years of dutiful repayment would significantly assist in this area.

MSCSA urges the Department of Education to make repayment more
manageable for graduates in all fields of study through these measures.
We encourage you to look creatively at other means of growing America's
potential workforce through affordable education. With the passing of
the Higher Education of 1965, the Federal student loan programs were
created. President Johnson declared that the result of this legislation
was that "A high school senior anywhere in this great land of ours can
apply to any colleges and university in any of the 50 states and would
not be turned away because his family is poor."

Just over 40 years later, this vision could not be further from reality.
The good news is that the vision has not been lost, and there are things
that the Department of Education can do to set higher education on an
even playing field for all. Become a model for state governments, and
lead the Federal financial aid system to where it ought to be.

Thank you, again, for your time and consideration today.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** You will have to tell us who is next.

**KATIE CAMPION:** My name is Katie\--is this loud enough?

**DAN MADZELAN:** No.

**KATIE CAMPION:** Okay. My name is Kate Campion. I am the Treasurer for
the Minnesota State College Student Association, and I am the Student
Senate President for Inver Hills Community College in Minnesota. I am
what you might call just a little bit biased.

Thank you very much for the opportunity to share my thoughts with you.

Like the Department of Education, I am concerned with making changes to
the financial aid process and established rules that would provide
increased affordability to today's college student. I bring a somewhat
different perspective to this discussion, as I have only recently
graduated high school and begun my college experience with plans to earn
a degree in urban education.

With tuition at colleges and universities at a rapid rate, many students
are ruling out higher education before they even step foot into the
door. I attend a two-year community college, the open access point in
Minnesota for affordable higher education for high school graduates.
Two-year colleges have always prided themselves as serving as an open
access point to higher education, however, nationwide, this is becoming
less and less the case. Tuition has more than doubled in the last ten
years, suppressing increases in available aid, resulting in students
being priced out of a college degree.

Fifty-four percent of traditional-age students under age 25 in Minnesota
do not receive parental contributions toward their educational expenses,
yet parental income is considered in the financial aid process for most
of these students, excluding many of them from receiving need-based
grants and subsidized loans. Private loans or public unsubsidized loans
quickly become the only method of financing higher education for these
students.

Although I took advantage of earning college credits while still in high
school, my parents have been able to assist me thus far. Soon enough, I
too will be forced to borrow to continue my educational pursuits, a
burden that neither myself, nor my family is prepared for. This year, my
family is faced with a difficult decision. My parents' income,
collectively, disqualify me for student aid, but are not enough to be
able to actually afford my education without putting a huge strain on
their finances.

Without many options, and with skyrocketing interest rates on student
loans, my dad decided to just bite the bullet and pay for my education.
I do not know how long he is going to be able to keep that up, though. I
will soon join the majority of students financing their education on
student loans and accumulating debt. High student loan interest rates
compound the sticker shock that high school graduates and their parents
face when looking at investing in higher education. Many are wary of
accepting the high debt burden necessary to attend college.

For those that do go to college, what happens if they fall on hard times
after completing their degree? College graduation is meant to be a time
of celebration and dreams of what the future holds, but the growing
concern of college graduates is their substantial debt loads, and it is
terrifying. Graduates facing economic roadblocks are required to make
tough decisions simply to make loan payments. Would you choose between
health insurance, food for your family, or making a loan payment?

For students entering the service sector, the question is not a matter
of when economic hardship will come, it is if a base salary can even
cover the cost of repaying debt. The national average starting salary
for a teacher in school year 2003-2004 was \$31,704. According to
reports, a new teacher with that income would have just under \$13,000
in discretionary income. In the case of the average teacher, that
results in a maximum payment of \$4,586.50 a year, or \$216 a month.
That is about the cost of my car payment. This leaves just over \$10,000
in discretionary income, which, to me, is not that much to base a future
on.

I fear that, as an urban educator, I will have to take time away from
preparing my classes to work a second job just to repay my loans. If the
Department of Education were to allow more accessible hardship deferrals
on loans to graduate repayment, it would provide peace of mind to
countless students and ensure that fewer graduates default on their
loans, allowing them to maintain the credit they so desperately need to
begin their adult lives.

The default rate on student loans in Minnesota average 3.3 percent in
2003, below the national average of 4.5 percent. However, in the public
two-year system, 18 of 29 colleges had a student loan default rate above
the national average. On the high end, Fond du Lac Community College, a
college with a substantial American Indian population, had a default
rate of 21.8 percent. America cannot afford a future of indebted
graduates, or worse, a financially inaccessible educational system,
especially for students of color.

The public two-year college system that I represent educates more than
50 percent of Minnesota's future, which I hope will soon include me\--78
percent of the state's nurses, and 92 percent of the law enforcement
officers. These occupations are critical to preserving the high quality
of life in our country, our states, and our communities. Cracks in the
current system are already beginning to show. Over the next decade,
America will have to recruit 2 million new teachers to fill our nation's
classrooms. Two-thirds of graduates today have student loans.

With significant debt, students will see little incentive to move into
these low-paying but essential jobs. By providing for loan repayment
plans that are income dependent, and cancelling loans after 20 years of
on-time payments, the Department of Education would stop students from
having to choose what they want to do with their lives and what they
need to do to repay their debt.

As I mentioned earlier, my field of study is urban education, and I am
personally facing this decision. In order to gain licensure, I must have
a bachelor's degree from a four-year institution. By the time I am done
with that, despite my parents' assistance this year, I will have between
\$20- and \$30,000 worth of debt. With a potential starting income as
low as \$23,000 a year in Minnesota, nearly \$8,000 below the national
average, how can I afford hundreds of dollars a month in loan repayment?

If I remain on my current path and nothing is done to prevent rising
tuition and interest rates, it will be nearly impossible for me to pay
off my school loans. College and university students are drowning in a
sea of pop quizzes and debt. Although the quizzes are arguably in our
favor, there is much to be done about unmanageable debt.

The ability of the financial aid system to lessen the debt obstacles
that students face in planning their futures would allow more inclusive
access to higher education and increase likelihood of student success.
Congress seems to understand the potential effect of loan debt on
educators because, in the fall of 2004, Congress passed the Taxpayer
Teacher Act of 2004, which allows for loan forgiveness for math,
science, and language teachers with five years of tenure at low-income
schools. While this legislation is a positive step, it fails to address
the growing problem of how to recruit 2 million college graduates into a
low paying career when many must begin making student loan payments
within a few months into their first semester of teaching.

Students such as me, who are facing significant challenges and choices
between what we want to do and what we can afford to do, will ultimately
feel more strongly the pull of loan debt over career choice. Teachers,
social workers, non-profit community workers, and the performing arts,
which represent a whole sector of low paying but socially valuable
careers are critical for a strong and flourishing nation.

MSCSA strongly encourages the Department of Education to consider
alternative loan repayment, hardship, and forgiveness actions that
lessen the debt loads and benefit the national and local economies, as
well as society at large.

Thank you, again, for your consideration.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Nichelle Bottko.

**NICHELLE BOTTKO:** Hello, I am Nichelle Bottko. I am the Director of
Development for the Minnesota State College Student Association, and I
am also a proud student of St. Paul Technical College.

I would like to thank you for allowing me to speak to you today to share
with you a little about my worries, my personal story, and how it
relates to students attempting to attend college and further themselves
in life.

As a young person whose life is consistently filled with student
worries, I sometimes forget that the plight of the average student today
is not readily apparent to those who are not currently enrolled. It was
not that long ago that a person could pay for college off of the money
that they earned while working a summer job. They could leave with their
education and very little, if any, college loans to weigh them down.

It seems that the entire world has changed in just a few short years. I
am a typical, traditional-aged college student. I take classes, and I
work a lot to try and pay for them. Although I own a house with my
brother, and my parents are unable to contribute to my education, their
income still counts against me when my financial aid is calculated.
Because of this, I am not eligible for any kind of aid other than loans,
and the loans that I do receive do not cover the cost of a full-time
college class load, let alone books or other living expenses.

One of the greatest challenges that I face as a student is debt. I worry
about a future that includes high monthly payments combined with
ever-increasing interest rates. The high cost of student debt has
already forced me to make tough decisions that will have a lifelong
impact. I have already changed my career path. Like our MSCSA treasurer,
Katie, I initially wanted to become a teacher. Although teaching is a
very rewarding career, it was way too much to think about the kinds of
loans that I would have collected by the time I had graduated.

Figuring out how to pay them with a teacher's salary was even more
daunting. Because of this, I decided to become an American Sign Language
interpreter. I chose this program because I could earn a two-year degree
and then enter the workforce. This career, however, will not satisfy all
my future needs and, after I complete my two-year degree, I will be
working on degrees in business marketing and also community development.

Students today, like myself, are already doing everything they can to
reduce their levels of debt. Gone are the days when a student could earn
a year, or even a semester's worth, of tuition at a summer job. Today,
students are forced to make difficult and sometimes detrimental
financial decisions in order to stay afloat. Students are taking few
classes, which is prolonging their education, in order to pay for their
living expenses and hold down their long-term debt.

In the MNSCU system, 25 percent of students report using credit cards to
pay for their tuition and fees, and 37 percent use credit cards to pay
for textbooks and supplies. Some students are concluding that the high
debt load is too much to take on and are leaving school, or not
considering higher education at all. America cannot afford to lose this
crucial resource, and educated workforce, which provides innumerable
socio-economic benefits.

In their 2005 report, "How Much Debt is Too Much?" Sandy Baum and Saul
Schwartz attempted to explain the history of previous efforts to analyze
unmanageable debt as 8 percent pre-tax income. They suggested that the 8
percent rule is a lender benchmark that arose from mortgage underwriting
standards and is not appropriate for measuring the burdensome
undergraduate debt. They go on to suggest that, in order to protect
low-income graduates, anyone earning less than half of the median
individual income in the U.S. should not be expected to make any loan
payments. They suggest that those in the upper end of the wage earning
spectrum should pay more than 17-20 percent of their pre-tax income on
their debt, while those somewhere in between should not pay more than 20
percent of their discretionary income, which is defined as income
exceeding half of the median earnings.

Now, those numbers may be a little hard to follow, but the result is
that using this benchmark to analyze starting salaries and measuring
unmanageable debt, we can see that today's educators will be facing
unmanageable debt loans, along with many low-paying public service
careers, which are vital contributors to American society and the
overall economy.

Even after changing my degree aspirations due to high tuition and low
interest rates, I have had to make more concessions as a student. I
tried to lessen my dependence on loans by working four jobs, but working
40-50 hours a week also has its costs. Work greatly limits a lot of time
that I can spend studying, and has even resulted in taking smaller
course loads, delaying my graduation with a two-year degree.

I am not alone. Forty-nine percent of working students in Minnesota say
that their job will lengthen the amount of time that it takes for them
to complete their education. Coordinating a work schedule and a school
schedule is also a problem. Because of class time constraints that
certain classes put on my schedule, I have had to work several
part-time, lesser-paying jobs, just so I can afford tuition and books
for the classes that I need.

I did not start out in debt. Part of the problem is that, over the past
several years, the middle class has been priced out of a higher
education. A study released this year from the Minnesota Office of
Higher Education shows that the number of students with a household
income between \$60,000 and \$90,000 who were to take out educational
loans rose 12 percent between 2000 and 2004. I know, however, that I am
one of the lucky ones, even though I have had to make some tough
decisions.

My brother, who is only a year younger than me, is in the same
predicament I am in. The difference is that he was unable to stay
productive in school and to make ends meet with the job that he had.
Instead, he now works full-time and, for the time being, has put off
college education altogether.

I know another two-year college student who has, out of desperation, and
lack of another viable option, decided to pay for her classes using
credit cards.

Many of the non-traditional students who are established economically
are finding themselves making tough decisions, also, of whether to
finance their own education, or to save for their child's. I can tell
you for a fact that higher education and the prospect of never-ending
student debt have stopped students to choose to enroll in classes.

Not only has my brother given up a higher education, but my mother, who
would love to complete a two-year degree, has also given up. After
seeing my struggle, and my brother giving up on his college education
altogether, she and my dad are trying their hardest just to be in a
place where they can help my two teenage sisters after they graduate
from high school.

Student debt is a very real problem and, for students like me, it is
unavoidable. It affects the choices that I make everyday. MSCSA strongly
encourages the Department of Education to take notice of the disastrous
consequences that unmanageable loan repayment and increasing interest
rates have damaged. If graduates were provided with income demand
repayment options and cancelable debt after 20 years of regular
payments, and preventative measures to stop interest rates from
deepening the problems with borrowers facing hardship situations, future
graduates of my generation would not be shackled to debt, and they would
see the light at the end of the tunnel.

Thank you very much for this opportunity to share my story with you
today.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Okay. We are going to take about a ten-minute break.
We will back at about 2:40.

\[Brief recess.\]

**DAN MADZELAN:** Well, let us reconvene this afternoon.

**DAN MADZELAN:** Rebecca Myers.

**REBECCA MYERS:** Hello, my name is Rebecca Myers, and I am actually a
graduate student here at Loyola University Chicago. I am in the master's
social work program, and I will graduate in May, hopefully.

I am not from any student government or any organization here on campus.
I just found out about it and did not want to miss the opportunity to
share my story with you guys. I apologize if it is a little bit
scatterbrained. I did not have a lot of time to put things together.

I went to Ohio State for my undergraduate. I got a bachelor of arts in
Spanish and a bachelor of science in social work in four years. Before I
even started classes, you know, I filled out the infamous FAFSA, and did
all that by myself. My parents were not involved in any of it. I had to
pay for school all by myself. I ended up going into the financial aid
office and signing all the papers, not really knowing what I was getting
into.

I had difficulties, also, because I had to record all of my parents'
salaries and everything on the FAFSA, but it was not taken into
consideration that they did not help me with anything during my
schooling, so it was difficult to get grants. I was not eligible for a
lot of things.

So I graduated with, actually, not as much debt as most of my peers. I
was very lucky. I worked two jobs for the majority of my college career,
my undergraduate career. After that, I was a counselor in Mexico. I
lived there for a year. I took a year off and went back home to
California, to my home state, and had difficulties finding a job that
would pay enough for me to make a living wage, as well as pay off my
student debt.

For instance, I was offered a job that I was interested in taking. I was
qualified to do it. I had been trained to do the specific work, working
with severely emotionally disturbed adolescent males in a group home for
the night shift, and they paid \$10 an hour. I just knew that I have to
go back to school. I have to get my master's degree. This is not going
to cut it.

So I moved out here to Chicago just a few months ago to get my master's
degree and get my MSW. So, hopefully, I will be able to get a job that
pays a little bit better once I finish and really enter the field. The
problem now, however, is that I'm accruing triple the amount of loans
that I had as an undergraduate. Like I said, it is very difficult for a
social worker to find work once we graduate that is going to pay enough
for us to make a wage, as well as pay off all our student loans.

I know that a lot of us in my program are having difficulty applying for
jobs that we do not necessarily want, but we have to take because that
is what is going to pay us the money that we need to pay off these
loans. So a lot of these jobs where we really need people who care and
have a heart to do these things, working with these types of kids,
mentally ill, or whatever the specific field of social work that it may
be. A lot of us are having to pass what we really want to do and are
trained to because it just does not pay enough, and we are having to go
into other fields, sometimes, to pay off these loans.

So I know that there is no easy answer for what we need to do to fix the
problems that I know all of us are facing as students, but I thank you
for recognizing that it is an issue, and recognizing that this country
is really putting out a huge number of young adults who are in serious
debt, and I just thank you for making it a concern of yours and for
listening to our concerns. So I am just very grateful, and I thank you
for listening to my story and taking the time.

Thank you.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Steve Schulz.

**STEVE SCHULZ:** Good afternoon. My name is Steve Schulz. I am a staff
member with Marquette University in Milwaukee, like our host institution
today, a Catholic Jesuit institution and a member of the Association of
Jesuit Colleges and Universities.

We are a doctoral research university with more than 11,500 students,
and we are the largest private institution in the state of Wisconsin. We
are also one of only two with a law school in the state, as well.

I will make a few brief remarks. I will preface them by saying that we
appreciate the opportunity that the Department of Education has made to
make some comments. However, we do note, as others have, that this takes
place during the negotiated rulemaking process, taking place
concurrently with the reauthorization of the Higher Education Act. And,
to that end, as others have, we would urge the Department of Education
to limit its negotiations going forward to issues that are not governed
by relevant statutory authority.

That said let me take a micro-view, first, in terms of ACG and SMART,
and then a bit of a macro one in student financial aid. We concur
substantially with what Dan Mann and Eric Weems advocated this morning
with this panel, in that we are always grateful for Federal student
financial aid. That said we certainly have some suggestion of how to
improve administration for ACG and SMART, in particular.

Our experiences have come typically in administrative guidance from the
Department of Education, as well as some problematic issues. I will just
highlight a couple, that are at the top of the mind for us. There has
been substantial confusion to the interpretation of grants rated to a
student's academic year in education, as opposed to their class standing
in their field of study. The initial guidance that we received indicated
that, in order for a student to qualify for a first-year ACG, that
individual had to graduate from high school on or after January 1. To
qualify for a second year, the student had to have graduated on or after
January 1 of 2005.

We asked the Department of Education, if a student set out a year, would
they qualify for a first-year grant if they were a freshman in the
current academic year, and the answer came back that they would qualify,
which was contradictory to the original guidance that was proffered by
the Department.

We also asked on September 12, actually, about a student that graduated
from high school this past June met all other ACG criteria, and had
enough advanced placement courses to be classified as a sophomore. We
had asked the Department, does a student qualify for a first-year or a
second-year grant, and came back with a response in the Department that
they were still determining how to handle AP credit. As of my last
discussion with our financial aid office, that student still had not
been awarded under ACG because that determination had not been made.

I would also remark that the Department e-mail to students advertising
SMART and ACG itself cause some confusion. Because these grants are
bases parallel eligibility, Marquette has fielded a lot of questions for
students that are absolutely certain they have met the criteria
outlined, only to find out that they do not qualify. For example, they
transferred in middle of last year. They are classified as continuing
freshmen, so they are neither a new freshman nor a sophomore, and
therefore ineligible under the grant. We would also note that the
Department has not advertised Pell Grants in the same way that there was
proactive effort made with ACG and SMART.

In terms of administration, we would echo what Dan and Eric both said
this morning, in terms of\--we ask why only U.S. citizens are eligible
for this program, unlike every other Title IV program that we are
currently involved with.

**JEFF TAYLOR:** There is a very simple answer for that, and that is
because the statute itself requires that students who qualify for ACG or
SMART Grants be citizens of the United States. That was Congress's
restriction that they placed in that. That is a very clear restriction
that we cannot legally get around. So, for that to be changed, Congress
will have to do it.

Thank you.

**STEVE SCHULZ:** I understand. Thank you for clarifying.

Also, with regard to program administration, in terms of the rigorous
nature of curriculum, as worded we are taking the word of parents or
guardians of home-schooled students as to the nature of a rigorous
curriculum, and permitting that interpretation for home-schooled
students, and yet demanding others prove the rigor of their program at a
traditional high school. It is an inconsistent application. We would
ask, and are glad to hear the announcement, that there will be
negotiated rulemaking on that point, about what qualifies as rigor.

In short, our experience has been that students in particular are
looking at staff at several at our offices that, historically, have not
been involved in the administration of financial aid because of how ACG
and the SMART Grant was set up. This was typically a student financial
aid effort for us. We have our registrar's office involved,
admissions\--there are many folks who are not experienced in this vein
that have had to come in, because of the way the system is currently
worded, currently being run.

The administrative burden that they are being asked in that form is
unprecedented, to the extent that they have not had to have that
jurisdiction before. More broadly, students who qualify for the Pell
Grant are the most neediest students, and among those who can least
afford post-secondary education, and yet SMART and ACG benefit only some
of those students by assisting, again, U.S. citizens who have had the
opportunity to receive a rigorous education, subject to definition, and
decide early on a major and a particular discipline. Many students
remain at a disadvantage. The lack of additional funding for them risks
sending the wrong message both to current and prospective students.

The simple fact, as we have heard today, is that there is not enough
sufficient aid overall for students in need, and our feeling is that
programs such as ACG and SMART, as currently configured, do not support
already scarce resources at the institutional level in aiding the most
needy individuals. We are spending, in our view, an extraordinary amount
of time having to set these up, plan, interpret, and implement for a
relatively small number of students, whereas more broad-based programs,
such as Pell, remain stagnant in their funding and their application.

It is not, in our view, the most equitable distribution of much needed
aid. We applaud the Department of Education, though, in seeking input on
ACG and SMART, and we will be offering written comments, as well. We
encourage the Department to continue work with higher education
community legislators and others to enhance financial aid in appropriate
ways.

Thank you for your time.

**DAN MADZELAN:** Thank you.

**DAN MADZELAN:** Just, also, a quick note on the academic year
question. That has been a tough nut for us, because the statute for ACG
and SMART does specifically say "academic year." There is a specific
academic year in the statute.

Now, there may be a disconnect there, in that the definition of academic
year in the statute is more of a programmatic, not an individual
student, kind of thing. We have been struggling to figure out how to
reconcile those.

Steve, I think you are waiting on your answer. I cannot share it with
you right now, because it is in its final stages of clearance within the
Department, but I believe that answer is imminent, if not by the end of
close of business tomorrow, then the first part of next week, which is
not Monday, since that is a holiday for us.

**DAN MADZELAN:** Rebecca Thompson.

**REBECCA THOMPSON:** Good afternoon. My name is Rebecca Thompson. I am
the Legislative Director for the United States Student Association.

USSA is the nation's oldest and largest national student organization,
and we are the officially recognized voice of students in the Department
of Education, on Capitol Hill, and in the White House.

Today, I urge the Department of Education to prioritize higher education
access and affordability as it begins its negotiated rulemaking process.
The Spellings Commission reported that net college costs at four-year
public universities were 73 percent of a low-income family's income in
2005, as compared to 57 percent in 1992.

Access to higher education is a right, not a privilege, and should be
accessible to all students, regardless of their income. Also, the
increase in the price of college has exceeded price increases in all
other sectors of the economy.

In addition to being the legislative director for USSA, I am also a
recent college graduate, with almost \$35,000 in student loans. Like
many of the students who have spoken today, I am also struggling with
unmanageable debt. Better yet, I am drowning in debt.

While more can be done on both the campus and the state levels to reduce
the cost of skyrocketing tuition, we urge the Department to revise its
regulations to benefit millions of students who are struggling just like
me. As the Department begins to implement the Spellings Commission
recommendations, I ask you to increase grant aid and make student loans
more manageable.

USSA strongly supports the Commission's recommendation to increase the
Pell Grant to cover 70 percent of in-state tuition cost. Doing so will
allow countless more low- to middle-income students an opportunity to
take advantage of an opportunity that has been traditionally available
to the wealthy, as 90 percent of the fastest growing jobs in the new
information and service economy will require some post-secondary
education.

Today, more than ever, it is important for the U.S. to have an educated
workforce who can truly compete in the global economy. When negotiating
its current student loan regulations, there are a variety of ways in
which the Department of Education can make loans more manageable.

The first is by limiting loan repayments to a percentage of a student's
income. With more and more students taking on the burden of unmanageable
debt, having a college degree will essentially be worthless if students
are spending the majority of their earnings on loan repayments.

Next, take into consideration that students' parents have significantly
less income to contribute to loan repayments. Students should not be
penalized for attempting to provide a better life for their families,
and should not have to choose between food and outrageous loan payments.

Lastly, I urge the Department to lower the interest rate cap. By
lowering this cap, students could potentially save thousands of dollars
each year.

In conclusion, on behalf of millions of students across the country, I
ask the Department of Education to prioritize higher education, and ask
that you help open the doors of higher education to all students.

Thank you.

**DAN MADZELAN:** Thank you.

**[\[insert Grace Serino testimony\]]{.underline}**

**BILL PARSONS:** I am Bill Parsons with the American Council on
Education, and it is nice to be with you all today. Two things I just
wanted to ask, by way of clarification. Did I understand, this morning
that you are saying that the one area the Department of Education was
committed to addressing in this upcoming negotiated rulemaking was
rigorous high school curriculum?

**DAN MADZELAN:** That is correct.

**BILL PARSONS:** And that is narrower than ACG and SMART Grants,
generally?

**DAN MADZELAN:** Yes. The basic high school eligibility component, if
you will, for AC Grants---

**BILL PARSONS:** Is the one area you are committed to addressing.

**DAN MADZELAN:** Yes.

**BILL PARSONS:** And then, second, did I understand that the Department
hopes to have an announcement regarding a potential fix to this academic
year conundrum, shortly?

**DAN MADZELAN:** Yes.

**BILL PARSONS:** Great. Thank you.

**DAN MADZELAN:** As I mentioned, this has been a real internal struggle
for us, across our offices, and owing, in a large part, frankly, to the
statute, but some of our other interpretations\--so we believe that we
have worked those disagreements out at the staff level\--the even higher
staff levels. But again, the Department of Education's ordinary
clearance process for these kinds of interpretative documents\--it is
not done until Secretary Spellings says it is done.

**BILL PARSONS:** I understand. That is a hopeful prediction, though.

Thank you.

**DAN MADZELAN:** Yes.

\[Discussion off the record.\]

\[Ms. Ateni Asihel was the last presenter. However due to a recording
error, Ms. Asihel's testimony was not recorded.\]

**DAN MADZELAN:** I think we will take this opportunity to thank
everyone for coming today.

Jeff, would you care to---

**JEFF TAYLOR:** Yes. I would just like to say, a lot of the presenters
have already left, but this was my first, I guess, public open meeting
for the Department, and I had been very impressed over the course of the
day of the thoughtfulness and thoroughness of the comments, both from
students, and lenders, and school administrators, and other folks that
are very interested in higher education.

As my colleagues will confirm, we will, of course, have a transcript of
the proceedings today, and we will take that back and review what has
been recommended, along with the other three public meetings that we
will have as we consider what the negotiated rulemaking sessions will
look like.

**CARNEY MCCULLOUGH:** I just want to echo what Dan and Jeff have said.

This has been my fourth or fifth experience with negotiated rulemaking,
and it was really exciting to see such a large turnout of so many people
from all areas of higher education, as we mentioned. This is sort of
unprecedented in the hearings that we have had in the past. So that is
really nice to see everybody very excited about the issues and, as Jeff
said, we are going to take that back and look at the transcript and the
written materials that people have submitted. There were written
materials that were coming in. We will carefully consider them as we
move forward with our negotiated rulemaking activities.

Thanks again.

**DAN MADZELAN:** And I have nothing more to add to that other than to
thank you again. If you can make it down to Orlando, which is where we
will be next on our road show\--what is that? About a month. We will see
you then, if not, some of those will see you in Washington, D.C., at the
negotiated rulemaking, I am sure.

Thanks again for your participation.

\[Whereupon, the hearing concluded at 3:30 p.m.\]