U.S. DEPARTMENT OF EDUCATION

OFFICE OF POSTSECONDARY EDUCATION

PUBLIC REGIONAL HEARING FOR

NEGOTIATED RULEMAKING

Federal Student Aid Conference

Royal Pacific Resort -- Conference Hotel\
6300 Hollywood Way\
Orlando, Florida 32819

**Thursday, November 2, 2006**

9:00 [a.m.]{.smallcaps} -- 3:50 [p.m.]{.smallcaps}

U.S. Department of Education

Public Hearing

Orlando, Florida -- November 2, 2006

Panelist

**Representing the Office of Postsecondary Education:**

James Manning

Acting Assistant Secretary

Office of Postsecondary Education

David Bergeron

Director, Policy and Budget Development Staff

Dan Madzelan

Director, Forecasting and Policy Analysis Staff

**Representing the Office of General Counsel:**

Elizabeth McFadden

Assistant General Counsel

Division of Regulatory Services

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

**DAVID BERGERON:** Good morning. According to my watch it is 9:00. We
have many folks signed up with us today for this regional hearing on
negotiated rulemaking. Thank you all for coming. Thank you, those of you
who are going to present. We really do value your testimony and your
input.

As you know, this is the third in a series of regional hearings. We have
one at UC Berkeley, one at Loyola Chicago, and one here. We did the one
here because we had knowledge that there were going to be some financial
aid officers and folks involved in the student loan programs here in
Orlando. Funny how that is, we knew that they would be here, and so we
decided that this would be a great opportunity for us to have a regional
hearing here in Florida, and then we will have one next week in
Washington, D.C.

If either you do not have the time or inclination to get up to the
microphone and say something, and I can fully understand that, why
people do not want to talk into microphones\--we are receiving public
comments by e-mail. We are doing that until November 9^th^. We are also
receiving nominations for negotiators until November 9^th^, so that is
what we will be doing.

Just to give you a context for all of this, when Congress enacted the
Academic Competitiveness and National SMART Grants, the Secretary
recognized that there would be need for further regulatory activity,
even though we are going to publish an interim final rule, and then a
final rule, before we begin, so that we could get the programs up and
running.

When we talked to her about that need for negotiated rulemaking for the
third year and beyond for Academic Competitiveness and National SMART
grants, she said, "Well, what do you normally do?" We said, "We normally
held regional hearings. We get public input as to what we should have on
the negotiating agenda, and then we develop an agenda based on that
public input." That is what the College Education Act requires us to do,
to get public input. And she said, "Come and do that." And so we were
very happy that she said not only just go and do it, she said, "Go and
let people come and talk with you\--express their desires in terms of
what we regulate this year."

We had hoped that the Higher Education Act would be reauthorized by now
and we would have that to factor into the process. It does not seem
likely that will happen, but we do have some things that came out of the
third extension of the Higher Education Act related to allocable
expenditure trustees, and a few other little things like that that we
may fold into this process. We will see how the public comment goes, and
we will see what we end up with in terms of ideas for what we really
need to negotiate.

I am fortunate to have here this morning with me Jim Manning, who is our
Acting Assistant Secretary for Postsecondary Education. He has been
doing a number of jobs around the Department over the years, and we have
known him for a good long while. So we are happy he is here. He may have
a few things to say.

But before I let him do that, I am going to introduce the other person
sitting at the table who probably will not say too much during the
course of the day, but she is here to keep us all honest. Elizabeth
McFadden is\--and I am sure I will slaughter her title, but she is
Deputy Assistant General Counsel for Regulatory Services at the
Department. That means she is involved in our regulatory process and
manages that process across the Department. If there is somebody who is
responsible for making sure that we get our regulations out on time, it
is Elizabeth. So we are fortunate to have her here with us, and not only
to just make sure we do it on time, she makes sure we do it well. So we
are fortunate to have her, as well.

With that, I will turn over to Jim Manning, and then we will call our
first witness to the microphone.

**JIM MANNING:** Well, thank you, David. Let me just offer my own
welcome and thanks to you for being here. We really are most interested
in hearing from you. We do, as David said, value your input and look
forward to hearing from you.

So, rather than take up any additional time, why don't we go ahead and
get started?

**DAVID BERGERON**: With that, I would ask Belle Wheelan to come to the
microphone. When you come to the microphone, please state your name and
your organization so that can be transcribed in the record of this
hearing. That transcribed testimony will be available on the
Department's Web site within a week or two of this hearing, we hope. The
ones from the two previous hearings are already available.

**BELLE WHEELAN:** Thank you.

**DAVID BERGERON:** Thank you.

**BELLE WHEELAN:** My name is Belle Wheelan, and I serve as President of
the Commission of Colleges of the Southern Association of Colleges and
Schools.

The Commission is a regional accrediting body, with a membership of
approximately 800 member and candidate institutions located in 11 states
in the southeastern region of the United States.

I will share with you that I have given my comments already so that you
may have them.

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

My comments are meant to complement those of my colleagues, Dr. Barbara
Beno, the current chair of CRAC, and Dr. Steven Crow, past chair of
CRAC, who spoke at the hearings in Berkeley and Chicago, respectively,
and addressed the Department's process of negotiated rulemaking and
accreditation's role in assessing student learning.

Thank you all for this opportunity to briefly address a number of issues
germane to higher education, accreditation, and the Department of
Education. My comments, as theirs, reflect the views of the Council of
Regional Accrediting Commissions.

I appear before you today having served as a leader in many of the
higher education sectors identified and challenged to action in the
report of the Secretary's Commission on the Future of Higher Education:
as the President of two community colleges, as the Secretary of
Education in the Commonwealth of Virginia, as a faculty member at
several institutions, and currently as president of a regional
accrediting association.

During my tenure as president of the community colleges in Virginia, I
was an active participant in the work of the Commission on Colleges, not
only leading my academic community during its reaffirmation of
accreditation process, but also as chair of visiting committees,
volunteers committed to the work of the Commission. It is from these
perspectives that I make my comments today.

Regional accrediting commissions are comprised of diverse members. Their
missions and governance vary. My commission's membership includes
private for-profit, private not-for-profit, and public colleges and
universities, single-sex institutions, Historically Black Colleges and
Universities, military academies, community and technical colleges,
liberal arts colleges, art institutes, chiropractic and medical schools,
comprehensive graduate institutions, doctoral degree-granting and
research institutions, seminaries, and many other institutions of higher
education that cannot be categorized.

This wealth of diversity has been our region's strength. It defines our
organization and demands that our self-regulatory process includes
capable administrators, faculty, staff, students, and public members in
conversations about the type of standards and processes that make our
accreditation valuable and credible. It is this input from those
representing our diverse population, their genuine respect for the
organizational complexity and the myriad institutional missions in the
region, and their understanding of the design service of our colleges
and universities to their respective constituents that provides a
reliable structure for addressing challenges confronting higher
education institutions throughout our region. It is a unique,
decentralized system of people driving others toward intellectual,
social, and cultural improvement.

Having described and stressed the importance of diversity in higher
education, and the need to understand colleges and universities in terms
of their missions and service, I would like to comment on a few of the
points in the Secretary's Futures Commission report, which is rich with
ideas. This is not a critique of those ideas, rather it is a perspective
that challenges others to consider accreditation's role in future
discussions involving the transformation of higher education.

First, faculty are key players in any change that takes place in higher
education, whether it pertains to defining and evaluating student
achievement, developing new pedagogues, curricula, and technologies to
improve learning, or creating new learning paradigms. Federal mandates
in the areas above do not ensure faculty buy-in to requirements for
change, but institutional success requires their commitment. The report
of the Futures Commission speaks to the support of various processes
needed to ensure change, but with the exception of one recommendation,
does not speak directly to faculty, the people who will eventually drive
that change if it is to be meaningful.

Secondly, in the application of the Secretary's criteria for recognition
of accrediting bodies, it appears that the Department views all
accrediting commissions as being the same, with little regard for their
diverse missions, the constituents they serve, or the initiation of any
innovative processes that accrediting commissions may want to use to
challenge institutional improvement. The federal record supports this
statement. If the Futures Commission truly supports innovation in
education, then, rather than expecting all accrediting bodies to look
and act alike, the Department of Education, in its application of the
criteria for recognition, should allow for more flexibility for those
accrediting commissions that present initiatives designed to encourage
institutions to focus on student learning. How can accrediting
commissions address fundamental issues related to the transformation of
higher education when current federal regulations accept only cookie
cutter responses?

Thirdly, there are two fundamental questions related to transparency:
How will information be used? And who will use it? It is reasonable to
expect a higher education institution to publish consumer-friendly data
about student learning in the areas of value-added learning and student
achievement. This is fundamental information for any student and parent
choosing a college or a university. However, it is unreasonable to
expect that this same information, produced in accord with a particular
institutional mission, can be fed into a common database and provide any
substantive and credible information after being stripped of its
mission-specific goals.

What is its value? You can have useful, reliable information if it is
provided and published by institutions and customized to the
effectiveness of their educational programs and student learning goals.
But once you force this information into common formats, the information
in the aggregate will have little value. It would be better to expect
the federal government to enhance and improve the collection of
information on IPEDS and other current tools and use this for the
publication of aggregate data, and then expect institutions to provide
and publish their own data on student learning specific to their goals
and missions.

Fourth, regional accreditation supports the statements of the Futures
Commission's report that challenges accrediting commissions to share
evaluative information with the public about an institution's
performance. However, the report does not address three consequences
when disclosure precedes final action by the accrediting commission.

First, an onsite evaluation report is a snapshot of an institution taken
at a particular point in time, and measured against standards of good
practice in higher education. The institution is expected to use the
report to make changes in areas of identified weaknesses. It is very
difficult to make those changes at the same time it is answering
questions from the public regarding the Committee's findings. The report
is only of value to the consumer when it is weighed against the changes
made by the institution to address findings.

Second, and this comes as no surprise to you, particular sectors of the
public will use preliminary findings and committee evaluation reports to
further that sector's own agenda, rather than provide a balanced view of
an institution's performance. This impedes the institution's progress in
addressing areas that need change, and it could influence external
support for the needed change.

Finally, full disclosure evaluation reports affect the candidness and
rigor of team members responsible for writing the report. Accrediting
commissions would better serve the public and the institution if it
released information after final action on accreditation, highlighting
the strengths and weaknesses of the institution, and providing areas of
needed improvement. There is no question that public disclosure prior to
final action by the Commission will affect the rigor of the review.

And finally, Dr. Crowe's comments regarding student learning bear
repeating. He said, "Most regionally accredited colleges and
universities will freely testify that, for the past 10 to 15 years,
assessment of student learning has, in many ways, shaped their
relationship with their regional accrediting commissions." Assessment of
student learning outcomes is core to the accreditation enterprise. The
evaluation of inputs and processes addresses an institution's ongoing
capability to sustain its assessment efforts. To be accountable to the
public, accreditation must continue to address student learning and
institutional capability.

It was my goal during this testimony to provide you with a perspective
from regional accreditation that would challenge you to consider
accreditation's role in future discussions involving the transformation
of higher education. My CRAC colleagues and I look forward to continuing
that dialogue, especially on the 29^th^.

Thank you.

**DAVID BERGERON:** Thank you, Dr. Wheelan.

Mark Rosenberg, please.

Again, could you state your name and your affiliation for the record?

**MARK ROSENBERG:** Good morning. I am Mark Rosenberg. I am the
Chancellor of the State University System of Florida. I have in my
responsibility 11 public universities in the state, nearly 300,000
students, and about \$3.5 billion worth of state expenditure. I also
happen to be a political scientist and a Latin Americanist, and was a
major beneficiary of federal initiatives through the National Defense
Education Act and Title VI for language and area studies when I was at
the University of Pittsburgh as a graduate student. And then,
subsequently, at Florida International University, we created a National
Resource Center on Latin America. That federal funding was crucial to
expanding our ability to prepare students for the challenges that we are
continuing to have in this hemisphere.

So, in many ways, I bring a perspective that not only folds into the
larger responsibilities, I have\--but where I came from, as well as a
professional, so I appreciate the opportunity to speak to you today.

Here in Florida, our geography is our destiny. Today's events in Latin
America and the Caribbean will have an immediate impact upon us in this
state as increasingly we are seeing throughout the southwestern United
States, as well, something as simple as an exchange rate fluctuation in
Western Europe or, indeed, the Far East, can have an immediate impact
upon our economy, in terms of tourism and property values. So we are
very much at the cutting edge of the global economy.

Despite this privileged, if you will, position, it is striking that our
state universities send out fewer than three percent of our students to
study abroad. So, therefore, what I would like to address to you today,
very briefly, is just share with you some observations about the
Secretary's Futures Commission, and elements that, in particular, are
important as we move forward.

First of all, we do welcome the concerns about global and language
training. I want to note that, while we, in this era, have to be
legitimately concerned about the hardware of national defense, it is
equally obvious today, perhaps more than when Sputnik went up in the
50\'s, which engendered the National Defense Education Act, that we need
to be incredibly mindful and vigilant about the software of national
defense.

You know it better than I, but let me just repeat that we, this year,
will spend a little over \$100 million through Title VI on foreign
language training and, if you will, cultural immersion. That \$100
million is what we are investing in one new F-35. And so the concern
that we have is to find a way to balance out, if you will, national
defense hardware with national defense software. And I think that the
recommendation, in particular, that focuses on language training and
study abroad is very important to us.

Second of all, we would like to see the Lincoln Commission initiatives
that have been so much discussed funded through Title IV. We believe
that Title IV will offer the best opportunity to have the widest impact
on our students nationally at all levels, who will be eligible for
financial aid. Clearly, the absence of financial aid opportunities is a
major impediment, at least in Florida, for our students studying abroad.

Finally, I am going to be spending a lot of time with our very large
congressional delegation on these matters, and will look forward to
working with you to ensure that we can find a way to improve our
national defense software.

Thank you very much.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Frank Harrison.

**FRANK HARRISON:** Good morning.

**DAVID BERGERON:** Good morning.

**FRANK HARRISON:** My name is Frank Harrison, and I represent the
University of South Florida as their Student Body President. I am also
the Chair of the Florida Student Association, which places me on the
Board of Governors, which I believe, technically, makes me Dr.
Rosenberg's boss.

\[Laughter.\]

**FRANK HARRISON:** So the 11 public universities, the 300,000 students,
and the \$3.5 billion, and the Chancellor are my responsibility.

\[Laughter.\]

**FRANK HARRISON:** Today\--but I do want to exacerbate his points
regarding study abroad; I think that is imperative. The student leaders
of the state of Florida recognize their role as stakeholders in
continuing to improve their higher education system. Responsibility
should be shared among federal, state, and institutional levels to this
effect. In the next few minutes, I will briefly expand our driving
philosophy within the Florida Student Association, also known as FSA,
our focus on the current times, and then touch on a few concrete
recommendations.

As students, we are strongly committed to attaining a globally
competitive, world-class education. While quality, achievement, and
accountability are large component pieces of such an education, I am
here today to specifically address access and affordability. These
pieces are less glamorous parts of the model, but they represent the
foundation that will ensure a strong, educated economic workforce in our
state and nation. The university's role in what Richard Florida has
termed "the creative economy" is critical to both the education of our
citizenry, and the implementation of new technologies and talents
therein.

I would also like to bring knowledge to the fact that I make these
comments regarding affordability in the state that has the second lowest
sticker price tuition in the country, but I think it is important to
bring to this hearing's attention that, even with that low price, we
have still received for the past two report cards, an "F" from measuring
up because there is not significant need-based aid in the state of
Florida; we are working to address that, which I will get into, but the
federal part is a large help to that effect.

Our current focus, these components are particularly relevant to the
state of Florida as they pertain to under-represented populations. Our
Governor's recent Commission on Access and Diversity underscored the
contributions of diversity to a globally competitive education. Ensuring
the inclusion of under-represented groups ensures a better, more
holistic education that prepares all groups for the increasingly global,
diverse society.

Moreover, society's most rapidly growing groups are those that are most
disadvantaged economically and educationally. In Florida, for instance,
46 percent of our Pre-K through 12^th^ students in public schools are
eligible for the Free and Reduced Lunch Program, with the majority of
the students coming from traditionally under-represented minority
groups. We must ensure that these groups become educated if we are to
maintain our place in the global marketplace.

Governor Bush, in conjunction with our legislature, has supported a
series of initiatives, including a substantial increase in need-based
financial aid, such as our Florida Student Assistance Grant, the
establishment of our first generation matching grant program to provide
assistance to those families who have not attained a baccalaureate
degree. Students in the state of Florida are committed to a higher
quality education, but financial aid policy development, and the role of
federal assistance therein, are critical to the economic development of
both our state and nation.

Recommendations consistent with the Spellings' Commission, we support
the substantial increase in the amount of federal support for the
need-based Pell Grant, and the assistance to those students who do not
qualify for the Pell, but who cannot afford the full cost of attendance.
As you all are well aware, there are more and more students coming to
college these days that are considered non-traditional or part-time
adult learners.

We would also like to see the introduction of more match-based programs
that promote shared responsibility between federal, state, and even
institutional levels, as well as the simplification of the
FAFSA\--talking about affordability and access, accountability of that
affordability is also important. The FAFSA, as you all know, is a very
complicated form, and those people who need to be filling it out the
most, the people who are coming from these under-represented groups,
have the least experience in filling out those kinds of forms.

In today's society, one of the unfortunate disadvantages of the public
sector that all private sector businesses, with their focus on customer
service, everything from eBay, to AOL Instant Messenger, to fast cash at
ATMs\--we're held to the same standard of service in education and
filling out forms to go to education. The people who are least\--whose
families who have never been to college have the hardest time doing
this, and we really need to modernize that form to speak Greek.

Moving on, finally, I would like to thank you for your time and
consideration. The Florida Student Association is devoted to ensuring a
world-class education for its students, and looks forward to its
continued partnership with state and federal stakeholders to improve
access and affordability to our higher education system.

**DAVID BERGERON:** Thank you.

One of the things that we found throughout this series of hearings is
that we have a tremendously articulate group of students who have been
coming to these hearings. We have appreciated very much their comments
throughout the process.

\[Discussion off the record.\]

**DAVID BERGERON:** And we are going to continue with students for a
second, if you will indulge us.

**DAVID BERGERON:** Tej Okun. Did I get that anywhere near right?

**TEJ OKUN:** You got it, thank you.

**DAVID BERGERON:** Thank you.

**TEJ OKUN:** Good morning.

**DAVID BERGERON:** Good morning.

**TEJ OKUN:** As you said, my name is Tej Okun. I am a senior at the
University of Central Florida. As the Undergraduate Student
Representative of the Florida chapter of the National Association of
Social Workers, I have seen my peers struggle with the decision of
whether or not to further their education by attending graduate school.
Although the average Bachelor of Social Works earns less than \$30,000,
many graduating seniors are opting against graduate school on the sole
basis of the fact that they simply cannot afford it.

In order for our school to be accredited by the Council on Social Work
Education, we must complete a 420-hour field placement in our last
semester of undergraduate course work. This averages to 28 hours a week
of unpaid work on top of the other classes we may be taking to finish
our degrees. This renders most students unable to maintain employment,
and many are forced to take out student loans to not only pay tuition,
but to cover the living expenses previously covered by part-time
employment.

Although the average student debt at UCF is almost \$13,000, I would
venture to guess that social work students are taking out loans in
greater quantities. Many graduating seniors decide that the cost of
graduate school, which is about three times per credit hour the amount
of undergraduate course work\--the costs just highly outweigh the
benefits.

Due to the substantially high loan debt and low incomes, many social
workers are forced to leave the profession when the financial burden
becomes unbearable. This is not only a loss to the social worker and his
or her family, but to the needy populations which he or she serves.

Loan forgiveness programs, such as the five-point plan for manageable
debt proposed by PIRG, would address the economic hardships of
professionals, such as social workers, educators, and clergy, and could
potentially remedy this unfortunate situation.

Thank you for your time.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Nicole Stevenson.

**DAVID BERGERON:** Erin McNeery.

**DAVID BERGERON:** Elise Sconlon.

**ELISE SCANLON:** Scanlon.

**DAVID BERGERON:** Sorry.

**ELISE SCANLON:** That is all right.

Good morning.

**DAVID BERGERON:** Good morning. Thank you.

**ELISE SCANLON:** My name is Elise Scanlon, and I am the Executive
Director of ACCSCT, which is the Accrediting Commission of Career
Schools and Colleges of Technology.

Thank you for the opportunity to speak before you today on the issue of
accreditation.

As a national accrediting agency that has been recognized by the
Secretary since 1967, ACCSCT accredits more than 800 primarily
for-profit, career-focused institutions. ACCSCT is also a member of the
Council of Recognized National Accrediting Agencies, or the CRNAA, which
includes six accrediting bodies accrediting 3,100 institutions
throughout the United States.

While today I am speaking on behalf of ACCSCT, my comments here will
echo many of the sentiments included in a letter from the CRNAA sent to
Secretary Spellings in September. In that letter, the CRNAA supported
the Futures Commission's recommendations.

ACCSCT believes that the Department of Education currently has the
authority to take some action to improve access, accountability, and
transparency in higher education, and that this can be accomplished
while preserving the unique relationship accrediting agencies have with
the institutions they accredit, and the peer review process, which is a
critical feature of accreditation.

Today I will provide some thoughts on the recommendations of the
Commission, and how accreditation can play a significant leadership role
in improving higher education, with a focus on measuring student
achievement, making the accreditation process more transparent, and
encouraging and supporting the mobility of our students. I hope the
Department of Education will consider these ideas as it contemplates
regulations to implement the Commission's regulations.

First, measuring outcomes and accountability. ACCSCT strongly supports
the notion that the quality and success of all institutions of higher
education should be determined in significant part on outcomes'
measurements. When Congress last reauthorized the Higher Education Act
in 1998, it signaled a clear intention for the Department of Education
to require accrediting agencies to develop standards in this area. At
that time, Congress revised the recognition criteria for accrediting
agencies to include assessment of student achievement outcomes more
specifically.

When the Department of Education amended its regulations in 1999, it
noted the increased importance of reviewing outcomes in the preamble to
those regulations. The preamble stated that accreditors should monitor
in a systematic way the institution's or program's performance, with
respect to student achievement, including, as appropriate, completion
rates, job placement rates, or other measures of occupational
competency. For any accreditor reviewing institutions offering
vocational education, the Department of Education stated quite
specifically its intention that accreditation standards should be
quantitative for completion, job placement, and pass rates on licensor
examinations.

As noted in the CRNAA letter, the national accrediting agencies have
focused on student achievement outcomes for nearly a decade now. ACCSCT
has had standards in place since 1998 to review comparative data on
graduation and job placement. Our schools are required to demonstrate
acceptable rates on an annual basis for all programs. In addition, each
of the national agencies has in place standards requiring institutions
to focus on continual improvement in these areas. In doing so, we
require our institutions to involve the employment community in
discussions on how to develop and maintain programs that are relevant
and current to meet workforce skill requirements.

While we recognize the significant diversity in the types of higher
education in the U.S. today, as was pointed out, I think, quite
eloquently by my colleague from SACS, we believe that measuring outcomes
is an area in which all accrediting agencies, regardless of the types of
schools they accredit, can do a better job. Certainly, at a minimum, all
accrediting agencies that accredit vocational education programs can and
should measure student achievement outcomes. We believe the Department
of Education has the authority to create greater consistency among
accrediting agencies in the development and implementation of
quantitative standards for measuring student achievement outcomes for
vocational programs especially. Creating some baseline of consistency is
essential if one of the Department's goals is to encourage greater
disclosure of outcomes data on which the public might increasingly rely.

Another area which we believe distinguishes national accrediting
agencies in the context of accountability is in the level of contact
with our schools. The average grant of accreditation for a national
school is five years; for ACCSCT, five years is the maximum grant. We
regularly reaccredit schools with conditions requiring further visits
and review. ACCSCT also requires institutions to provide annual data on
outcomes, substantive changes, and changes in financial position.

ACCSCT and other national agencies review every new program created by
each of our institutions, and require preapproval for every new location
opened. We believe that this level of contact is essential to ensuring
quality in the area of substantive change and additional locations.
Ensuring consistency in accreditation processes is extremely important.

With regard to transparency, ACCSCT supports the interests of the
Commission and the Department of Education in improving the public's
understanding of the accreditation process. In addition, we support the
provisions in the pending house reauthorization bill, which would
require disclosure of increased information about accreditation,
including, for example, public disclosure of agency actions.

Further exploration of ways in which both accrediting agencies and
institutions can disclose information about student achievement and the
accreditation process itself is needed. We can achieve a better balance
between broader disclosure, and successful peer review, and the
self-evaluation process.

Finally, I would like to address transfer of credit. The Commission
report recognized the increasing enrollments of the non-traditional
student, older, often employed, part-time, and mobile. While transfer
students are not tracked in current data, we know students are
increasingly attending more than one institution in order to complete
their education. We also know that there is a lack of flexibility
demonstrated by institutions in accepting students' credits when they
transfer. We are pleased that the Commission recognized the negative
effects of these current barriers. Denial of credits results in the
denial of access, as well as increased education costs when students are
forced to take and pay for the same course more than once.

Included in the Commission's recommendations is a suggestion that the
Secretary should develop a national strategy that would result in better
and more flexible learning opportunities, including an emphasis on the
ability to transfer credits among institutions more easily. We support
such an effort.

Accrediting agencies can play an important role in facilitating credit
transfer. All accrediting agencies, whether regional, national, or
specialized, are recognized by the Secretary under identical criteria
and processes. The Council on Higher Education and Accreditation, CHEA,
and other organizations have jointly and formally adopted a policy
confirming that institutions should evaluate credits for transfer
without relying solely on the sending institution's accreditation. And
yet, ACCSCT regularly learns\--almost daily, learns\--of examples of
regionally accredited institutions denying credits from students solely
based on the national accreditation of the sending institutions. We
believe the focus in these decisions should be instead on course
equivalency and student competency.

In 2005, a report prepared by the Government Accountability Office on
the transfer of credit issue confirmed ACCSCT's own experience, noting
that 84 percent of postsecondary institutions have policies to consider
the accreditation of the sending institution when assessing transfer
credits. We believe that this is a national problem requiring a national
solution. We supported HEA legislation which would have prohibited the
denial of transfer credits based solely on accreditation. In the absence
of a reauthorized statute, we believe that this is an issue that
requires the Department of Education's leadership and, at a minimum, a
facilitated discussion on how accrediting agencies might better ensure
that their institution's admissions policies do not result in the
arbitrary denial of credit transfers.

In conclusion, I would like to emphasize that accreditation plays an
important role in ensuring institutional quality, and I hope that the
Department will continue to rely on accreditation to create more
consistency in measuring outcomes, increased transparency, and student
access.

We look forward to the opportunity to work with the Department of
Education as it moves forward with the discussions on accreditation. I
have a written statement that I will leave behind for your convenience.

Thank you very much.

**DAVID BERGERON:** Thank you very much.

**DAVID BERGERON:** Nicole Stevenson.

**NICOLE STEVENSON:** Good morning.

**DAVID BERGERON:** Good morning. How are you, Nicole?

**NICOLE STEVENSON:** First of all, I would like to thank you for
providing the opportunity for us to come and speak to you today about
the critical issue of loan forgiveness.

I stand before you as a representative of graduate students across the
nation who have varying amounts of student loans. I personally have
accumulated approximately \$65,000 in debt in order to complete my
master's degree. I was unable to find information on what the average
amount of student loan debt is for a social worker with a master's
degree in the state of Florida, so I interviewed 95 master's students at
Barry University School of Social Work in Miami Florida, where I attend.
Out of these 95 students, 57 percent of us will owe more than \$40,000
at graduation. The combined debt of these 95 students is \$4.8 million.

I represent students who have made a lifelong commitment to serving
at-risk and forgotten people by choosing to become social workers.
Social workers are known for working with vulnerable people, such as the
poor; everyone knows that. We also advocate for policies to address
pressing social problems, conduct research on how to most effectively
deal with issues such as substance abuse and domestic violence, and
organize communities to advocate on their own behalf. The core of social
work is our commitment to building a more just and humane society. These
are not glamorous jobs, but they are essential, and we are committed to
providing a wide array of services to those in need.

With the cost of living continuing to increase, paying back student
loans is going to create a substantial problem for all of us. The
average starting salary for a professional social worker with a graduate
degree and six years of postsecondary education in the state of Florida
is approximately \$30-35,000. This is less than half of the accumulated
debt that we owe the federal government.

I strongly believe that failing to offer lower interest rates and loan
forgiveness programs means fewer and fewer students will be willing to
pursue professional education in areas such as social work. A
significant decrease in a qualified, professional workforce is to the
detriment of all of our communities and the most vulnerable groups of
our society. The extent to which societies have qualified and educated
professionals addressing the most serious and increasing issues in this
post-9/11 era is directly related to ability for younger adults to
access institutions of higher education.

Every social worker I have ever met has a passion for their work that is
oftentimes not mirrored in other professional settings. Each social
worker wants to effectively help as many people as they can better
themselves. Why must we be forced to serve those deserving people at a
wage that we cannot live on? No social worker expects to become wealthy
by filling social work positions, but must they be forced to choose
between helping those in need and sufficiently providing for their
families?

Loan forgiveness is an integral part in helping those of us who have
made it our lifelong mission to help others survive and thrive. It is a
well-known fact that happy workers are more productive. Part of the
happiness that we, as social workers, deserve is the assurance that we
can afford to provide for our families and work jobs we love without
worrying about the enormous debt hanging over our head because of our
student loans.

Thank you, again, for giving me an opportunity to speak on this matter.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Erin McNamee.

**ERIN McNAMEE:** Good morning.

**DAVID BERGERON:** Good morning.

**ERIN McNAMEE:** That was close enough.

My name is Erin McNamee, and I am a first-year graduate student studying
social work at Barry University in Miami, Florida. I have served my
country as a Peace Corps volunteer and, upon completion of my master's
degree I plan to serve my community as an advocate for child welfare.

For many, earning a master's degree in social work is the first step to
attaining a therapeutic license. Clinical social workers have the unique
opportunity to provide counseling as well as advocacy and support to the
most at-risk members of our population. These well-trained professionals
are charged with enormous tasks, often earning notoriously low pay.

If not for the social worker, who would remove the barriers to education
that plague so many of our youth? Who would help the prisoner
reintegrate into society? Who would assist a son in placing his mother
into a nursing home, save a child from an abusive home, navigate
hospital protocol for the family of a cancer patient, advocate for a
rape victim, hold the hand of the dying?

Policies can be written, laws enacted, and budgets passed, but these
mean nothing without someone who will carry out the tasks necessary for
their social establishment. After all, what good is a law that protects
elders from abuse if there is no one to visit their home and evaluate
their care? What good is money for a drug treatment program without
someone to offer advice, support, and counseling?

I am intelligent, well educated, resourceful, and extremely passionate
about serving those in need. In short, I am exactly who you would want
to serve as a social worker in the above capacities, but you will lose
me. You will lose me, and others like me to the private sector simply
because we cannot afford to do the work that we long to do.

Upon graduation, I will have accumulated close to \$60,000 in student
loan debt. If I am lucky, I will get a job that pays me \$35,000 a year.
That means that close to 30 percent of my income will go toward
repayment of my student loans.

Ladies and gentlemen, I implore you to make the necessary changes to the
federal student loan program so that professional social workers can
serve their communities without falling into the poverty threshold
themselves. Please untie our hands and allow us to do the work that we
have been called to do.

Thank you.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Glen McGhee. Could you state your name and
organization into the microphone?

**GLEN McGHEE:** My congratulations to Jim in his ascension. I hope it
works out for you.

For the record, my name is Glen McGhee, and I am the Director of the
Florida Higher Education Accountability Project, otherwise known as
FHEAP. FHEAP is a loosely connected national watchdog group where we
believe that accreditation reform is the key to bridging the
accountability gap in higher education.

I am here to bring you some bad news about minimum standards in higher
education for the Southern states, those standards mandated by Congress
in 1992 as part of the program integrity requirements of the Higher
Education Act. The sad truth is there are no minimum accreditation
standards, because the quality control function of the regional
accrediting association in the South has broken down.

What is sad about this is that the students\--you know, the last person
was talking about the students suffering\--the students suffer, too. I
want to focus on the faculty\--I am talking about 34 CFR 602.26, which
was moved over to 602.16(a), and those standards cited there relating to
student achievement measure of program length and faculty
qualifications.

Although 12 higher education standards were first put in place through
the HEA amendments of 1992, these were quickly put on the backburner by
then-Secretary Richard Riley. If you look at the final for April
29,1994, apparently he was badly burned during the onslaught to overturn
the SPREs.

Anybody here remember that, in 1990, everything went upside down?
Subpart 1 got pushed off the table, but Subpart 2 has apparently gotten
forgotten. It is still there; those are the program integrity
requirements. Secretary Riley adopted what he called, "A minimalist
approach to implementing Part H, Section 496." That is a hands-off
approach, and this is why we now have what could be called "standardless
standards."

The result, at least in the South, has been devastating. Instructors
without four-year degrees, without any kind of graduate work\--I am
talking about zero graduate credits\--are teaching in areas they have
been assigned to, and allowed to step into community college classrooms
to teach four-year transferable courses.

We believe that rulemaking modeled on the highly qualified teaching
provisions of No Child Left Behind is needed. These provisions quite
rightly, in our view, were put in place to combat a very grave threat to
student learning. Consequently, we would argue the threat, as well, is a
harm to taxpayers and the federal interest, namely out-of-field teacher
assignments. As you probably know, this is a big problem in secondary
education, so much so that it has required a federal initiative to deal
with it and, even now, no one is sure if it is going to work to fix the
problem.

So I am here today to tell you that out-of-field teaching in higher
education is higher education's best-kept dirty little secret, and that
it will not go away until accreditors begin to address it. The reason
for this is simple. The same micro-political factors that operate at the
secondary level, that cause out-of-field teacher assignments, are also
operating at the community college level. They are also operating in
postsecondary education, and it is creating the same problems.

These systemic problems reaching almost as high\--we did a study of Bay
County's dual enrollment program, and almost 50 percent of the
instructors did not have 18 graduate hours, the Good Practice
requirement, in what they were teaching for college credits. This is
supposed to be addressed by accreditors as part of their quality
assurance provisions responsibilities, but it turns that is what
happened is SACS is working instead to perpetuate the status quo through
their peer review process and in-house institutional studies.

None of this, of course, is objective, including the way the
institutions vote on the standards that they themselves will use for
their own accreditation. Others have long observed that this is very
incestuous and self-serving, just as it was when it was first put in
place 800 years ago when the European university guilds first emerged.

So, clearly, steps must be taken by the Secretary for the gradual
elimination of the standardless standard policy now in place.

Thank you.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Melissa Coral.

**MELISSA CORAL:** Good morning.

**DAVID BERGERON:** Good morning.

**MELISSA CORAL:** As you stated, my name is Melissa Coral. I am a
graduate student at the University of Central Florida. I am also the
graduate representative of the Florida chapter of the National
Association of Social Workers. I am here to support this hearing by
encouraging changes in the loan repayment process.

This past spring I faced a treacherous professional crossroad. I was
graduating with my undergraduate degree in social work. I was eager to
earn my master's degree, yet I did not know if I could afford it. I am a
first generation college student of immigrant parents. They cannot
support me financially, and entering the one year of master's program
required for me to quit my part-time job and focus on my studies.

I began to worry about how I would pay for my living expenses, my books,
and my classes. I also wondered if this decision would impact my life.
Would I be able to enjoy my first professional salary, or would it go
toward repaying my loans?

When faced with the crucial decision of continuing on to grad school, I
faced times of self-doubt and uncertainty. I knew that various
non-profit and social service agencies would not be able to reward me
for these educational attainments. Also, I know that paying for college
would be primarily financed by college loans. In the end, I followed my
professional aspirations, knowing that repaying my loans would be
difficult on a \$30,000 to 40,000-a-year salary.

Today I am asking you to help students and reward them, instead, for
choosing to attain postsecondary education. I believe that if one's
income is taken into account, it will greatly benefit college students
in the social work and other helping fields. In addition, taking into
account one's family size will assist you to provide for their children
or older family members.

I believe that these proposed changes will help students better manage
their loan repayment and lighten their financial strain. These changes
will support those of us who choose helping professions, such as
teaching, social work, or counseling. We are not highly rewarded
monetarily, yet we are greatly needed by society.

Therefore, I believe making these changes in the loan repayment program
would support individuals like me, and assist us while we help others.
In the future, I would like for these changes to encourage more youth to
choose these helping professions, without worrying about how they will
pay for their education. Money is a deterrent for many college students.
I believe you have the power to make it a less threatening and
discouraging process by improving the loan repayment terms.

I look forward to helping minorities and immigrants attain mental health
and social services. I also look forward to serving clients in various
settings, ranging from schools, hospitals, community centers, to private
counseling offices. I am eager and willing to practice professional and
ethical social work. I hope you take these career goals, and those of
many like me, into consideration. I look forward to serving my
community, and hope this commitment will be valued. In that spirit, I
believe you will support students and ease the loan repayment process
for us.

Thank you for your time.

**DAVID BERGERON:** Thank you. This is the last time. I know I am going
to slaughter\--Brad Giedd.

**BRAD GIEDD**: Yes. Very good.

**DAVID BERGERON:** Good morning, Brad.

**BRAD GIEDD:** Good morning. Thank you for the opportunity to be here.

My name is Dr. Brad Giedd. I practice locally; I am an optometrist. I am
a 1997 graduate of NOVA Southeastern University, College of Optometry in
Fort Lauderdale. So I bring a ten-year history of student loan debt
perspective to this discussion.

Although I did borrow as an undergraduate, my testimony concentrates on
the professional students, that perspective, and the evolving crisis
that student debt and changing borrowing rules are creating in my
profession.

As you may or may not know, optometrists are the primary eye-care
providers in this country, seeing a vast majority of primary eye-care
patients. Like primary healthcare providers or general physicians, we
are a non-surgical profession, unlike our ophthalmology counterparts,
and thus we have significantly less revenue generating potential. The
average annual income for optometrists is in the range of \$82,000 to
\$100,000, and that may seem like a very respectable income.
Unfortunately, however, the average student loan debt for optometrists
graduating at most institutions has soared to more than \$120,000 debt.
The problem that this creates is that, even when these loans are
consolidated over a 30-year period, at usually an eight to nine percent
interest rate, or that is what it was when I got out of school,
repayment can require as much as 20 to 30 percent of one's annual
income. Certainly, this is well beyond what some economists have defined
as a manageable amount of student loan debt.

Graduates with this type of debt are handicapped in several ways as they
enter their practice lives. First, those wishing to pursue private
practice situations typically must endure smaller salaries initially
when starting, either on their own or with an existing practice. For
many, this is not a reasonable option anymore, as loan repayment tends
to begin right after licensor can be obtained. Thus, many of our
graduates opt for some of our alternative practice types, including
commercial practices, where better initial incomes can often be found.

The tradeoffs in this scenario can range from a loss of medical
decision-making independence to diminished professional satisfaction,
and, ultimately, to the loss of the long-term financial benefit that has
historically been the reward in owning one's own practice.

You may ask why this should matter to you. Well, the big picture dilemma
that has been developing during the last decade or so involves the
recruitment of candidates to the primary healthcare professions. We have
seen a significant decline in the quantity and quality of our applicant
pools, as potential candidates are seeing the writing on the wall in
regard to the financial implications of choosing these professions where
the expected debt burden is so high.

Personally, while I love the patient contact and professional
interactions of optometry, I would not choose this profession if I had
to do it again. I know mortgage brokers, for example, without any
advanced education who have better financial situations than many
doctors I know, and they have incurred little or no student loan debt.
This will become problematic to the healthcare system of the United
States as our population ages and these professions become more vital to
the overall public health.

When the brightest students of today and tomorrow choose careers in real
estate, for example, instead of healthcare because it is the smarter
financial decision, we will all be paying a price for a system that
defies its very name "financial aid."

What can be done to help solve this problem? Certainly, some of the
responsibility lies within the colleges and universities in helping to
create affordable education. Many of these programs have become
education for profit machines that continue to raise tuition higher and
higher, often without any explanation or justification.

In the case of student aid, my personal story bears witness to the large
effect interest rates, for example, can have on the burden of student
debt. Upon commencement, I did as most professional graduate students
do, and I consolidated my loans. The interest rates at the time were in
the eight to nine percent range, and 30 years was the typical period. I
pursued a clinical residency and deferred my loans for another three
years while the interest accrued on all the unsubsidized portions of my
loans. When I began repayment immediately after my residency, my initial
payments were more than \$1,200 per month, and that was the
income-sensitive reduced rate. These payments were to increase to more
than \$1,500 a month after a couple years and stay at this level for the
remainder of 30 years. Initially, my student loan payments were
absorbing more than 30 percent of my income.

I was one of the lucky ones, however. Through an unusual loophole in the
law, I was able to reconsolidate my initial variable rate consolidation
into a fixed rate loan around the time all the interest rates were
dropping in 2001. My final consolidation dropped my interest rate to
around four percent, and my payments to around \$900 per month. So now I
am at least a little under 20 percent of my income. Without this lucky
break, though, I can tell you there is absolutely no way I would ever be
in the position to become a partner in the practice where I have been
for the last six years.

My wife, who is also an optometrist, has a loan about half of the amount
of mine, but because she consolidated in a program that stuck her around
eight percent, her payments are only slightly less than mine. So you can
see what a big difference just a change in interest rate in helping with
the problem. She opened her own practice with another doctor
three-and-a-half years ago, and they did not even see the paycheck for
the first two-and-a-half years. The student loan bills, however, kept
coming regardless of her salary.

We have both worked multiple jobs and averaged a six-day work week since
graduation in order to stay afloat, as we pay nearly \$2,000 per month
to our student loan repayment, and that has certainly caused us to push
away some bills that could be paid off, and it has prevented us from
making significant contributions to our kids' college savings and to our
own retirement savings.

While my situation is what it is, there are many that I know who have it
much worse. I am certainly not complaining. I am, however, campaigning
for future professional students who often do not even understand the
implications of this massive student loan debt they are about to assume.
I strongly urge you to carefully consider the proposed reforms offered
by the student advocacy group. Time is of the essence in helping the
next generation of college and professional school graduates to not be
overwhelmed by the burden of student loan debt.

I appreciate your time.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Shelley Saunders.

As she is coming to the microphone, I will remind her to state her name
and organization, and I want to say that sometimes in the other hearings
we have had time for questions. We have a lot of folks signed up for
testimony today, so we may not have much time for interaction, but I
want to thank everybody who is testifying. Go ahead.

**SHELLEY SAUNDERS**: Good morning and thank you.

My name is Shelley Saunders, and I am the Vice President of Strategic
Services with American Student Assistance.

American Student Assistance is a private, non-profit, federal guarantor,
and it is the designated guarantor for Massachusetts and Washington,
D.C. It is also one of the original guarantors to obtain a voluntary
flexible agreement.

The foundation of our agreement with the Department of Education is to
ensure that students and families receive the information and services
they need to manage their education debt. ASA feels that there are
several overarching principles on which the Department should
concentrate during the negotiated rulemaking process. Specifically, ASA
suggests that the Department focus on changes to the regulations that
enhance borrower benefits, simplify student loan borrowing, and promote
successful loan repayment.

In keeping with these principles, ASA proposes the following list of
issues for negotiation for both the Pell and Direct Loan programs. With
respect to access to economic hardship deferment, the overly complicated
process of applying for an economic hardship deferment results in the
under-utilization of the deferment entitlement, and makes it simpler for
a lender to offer the borrower a less beneficial, especially in the long
run, discretionary forbearance.

Current regulations also base eligibility exclusively on the level of
student loan debt versus income, regardless of other circumstances and
financial responsibilities the borrower may have.

We recommend that Congress reevaluate the HEA provisions for the purpose
of simplifying the eligibility criteria. In the meantime, we suggest the
Secretary exercise her authority to simplify existing regulations. In
particular, we would like the Secretary to examine the eligibility
criterion that allows the borrower to qualify for deferment if the
borrower is receiving or has received payments under a federal or state
public assistance program.

The Department should consider developing a comprehensive list of
federal and state qualifying public assistance programs and placing that
list on a Web site. This would enable loan holders to consider the
eligibility of all applicants for the deferment in a consistent manner.

Next, I would like to endorse the plan for fair loan payments outlined
in the Project on Student Debt, which was presented at the September
19^th^ hearing in Berkeley, California. The plan focuses specifically to
simplify the economic hardship deferment application process, and make
required payments more manageable by basing them on 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 proposals contained in the plan are consistent with ASA's commitment
to helping borrowers avoid defaulting on their student loans. If
adopted, they 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.

Also, a borrower's need for the Income-Contingent Repayment Program
should not require them to put their credit in jeopardy in order to
receive the help they need. We urge the Department to reevaluate the
requirements for Pell borrowers to be a minimum of 60 days delinquent
during the entire application process for Direct Loan's
Income-Contingent Program.

With respect to financial literacy, the Treasury Department and Congress
have indicated that a lack of financial literacy is a significant issue
in the U.S., and have gone so far as to establish financial literacy
month annually in April. ASA strongly advocates developing a financial
literacy program that is available as an elective course to all students
attending secondary or postsecondary institutions. Such programs would
assist students in achieving a level of financial literacy necessary to
succeed.

Additionally, guarantors are starting to see borrowers defaulting who
are located in areas affected by Hurricanes Katrina and Rita simply
because they do not have a resource for contacting these borrowers at
their new location to offer counseling on repayment options. As a
component to business continuity planning, we recommend that the
Department pursue a data match with FEMA to secure addresses and
telephone numbers of affected borrowers in the event of a national or
regional disaster.

Finally, ASA is a charter member of the National Association of Student
Loan Administrators, or NASLA, and would like to express our support of
the testimony given by Mr. Torres from the Texas Guaranteed Student Loan
Corporation, and Ms. Fairbairn, from Great Lakes Higher Education
Corporation, in the prior hearings. In particular, we support their call
for NASLA to be represented in the negotiated rulemaking activity. We,
too, feel that NASLA has been an effective voice for student loan
guarantors whose mission is to ensure consistent and reliable student
loan services to America's students, parents, and postsecondary
institutions.

It is important to note that NASLA is not a Washington, D.C.-based trade
association; rather, it operates through a consensus of its members
without paid staff or outside consultants. Accordingly, it brings to the
table the direct and unfiltered views of actual operational agency
participants. Since it is impossible for all to participate, the
Secretary should recognize those associations and consortiums that most
directly represent operational participants.

In the case of guarantors, direct representative entities such as NASLA
and the Guarantor CEO Caucus would appear to be the preferred choices.
This would appear particularly appropriate in the case of the Title IV
issues negotiating track. Therefore, we encourage the Department to
consider once again extending an invitation to the nation's guarantors.

Thank you for your time and consideration.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Edmund Gross.

**EDMUND GROSS:** Thank you for the opportunity to participate in
today's hearing.

My name is Ed Gross, and I am the President of the International Academy
of Design and Technology in Tampa, Florida. Prior to that, I have been
president of several other colleges, and retired from the public sector
as Vice President of Academic Affairs and Provost of Valencia Community
College. I mention that only to reinforce the fact that I have
participated in both regional accreditation, as well as national
accreditation activities.

Our college is one of the 80 represented by Career Education
Corporation, and we have been in Tampa for about 22 years. It is a
nationally accredited institution-offering associates of science,
bachelor of arts, bachelor of fine arts, master of applied arts.

Our purpose is to help prepare people for the profession they have
chosen. To do so, we work very closely with leading employers to create
bridges from the classroom setting to the workplace environment. Each
program at the college has an advisory committee made up of industry
professionals and employers who ensure that the curriculum meets or
exceeds industry standards. In fact, I, as president, send every
employer who hires one of our graduates a letter stating that if they
find a training deficiency within the first 90 days, that we will
retrain that graduate free of charge.

Our curriculum is developed with a focus on employment needs within the
global marketplace in an effort to provide immediate placement
opportunities for our students. There is no better example of how this
type of educational foundation can translate into real world success
than our graduates.

One of our recent graduates of the fashion design program, for example,
currently is employed with Michael Kors in New York City as a design
assistant. IDT students benefit from having faculty members who are
accomplished in their own right. I like to say that they have not just
studied fashion design; they are, in fact, fashion designers themselves.
For instance, one of our fashion design instructors is currently
designing costumes that are moving now into production.

IDT students are consistently engaged in the community around them. For
example, each quarter our interior design students volunteer their time
to redesign a house or facility for a non-profit organization in order
to raise money for worthy causes.

Students select IDT with the confidence that they will receive an
educational experience that will fully prepare them to launch their
career in their chosen field. We commend the Commission and Secretary
Spellings for suggesting concrete and bold solutions to the problems
facing students of postsecondary institutions today.

Many of IDT students are the first in their family to attend college.
Our school is often the first step to new lives for countless students.
Like other colleges and universities across the country, IDT must
address deficiencies of an educational system that graduates students
from high school without the basic competencies required for
postsecondary education. To meet this need, we at IDT offer tuition-free
math and English refresher workshops, as well as free tutoring for any
student who wants it.

Another obstacle for our students is one that the Commission identified
is a problem for students nationwide, barriers to the transfer of credit
between institutions. The burden on students and institutions alike as a
result of these barriers is unacceptable at a time when many students
are highly mobile and may be completing their degrees in multiple
states. Our students still confront two main obstacles for transferring
their hard earned and, as you heard this morning, highly paid credits.

First, they experience a bias toward our operation as a proprietary
institution, which, having retired from the public sector, I find
ironic. And second, they encounter administrators and faculty members
who object to our national accreditation, and reject transfer credits
without an objective evaluation.

To highlight the reason for our concern about transferring credit
policies, I would like to share with you some stories about some
problems students have encountered in the past 18 months, without
identifying the student.

Jennifer graduated with her bachelor of fine arts degree from the
International Academy of Design and Technology in Detroit. She wanted to
continue her studies in the graduate program. Only one of the state
universities would recognize her degree.

Megan successfully completed course work toward her associate of applied
science degree in fashion design and merchandising at IDT. She moved out
of the state to be closer to family, and, when she applied to a local
public university, the school advised her that she would have to start
all over.

Students should not be required to navigate each institution's
particular transfer-of-credits policies. It should not be required
without cause to repeat course work in which they have demonstrated
proficiency. We are encouraged by the Commission's serious look at the
shortcomings of the existing accreditation process. We support the
development of a regulatory framework neutral to whether an institution
is accredited by a national or regional body. Increasing access for all
students is crucial, and this type of innovation in the system can only
provide more opportunities for students.

The reality today is that many students tend to attend multiple schools
and complete their studies in a non-linear way. There is a critical need
to capture performance outcomes so that parents, shareholders, including
the federal government, and students have reliable and accurate data to
consider when making college decisions. We support the Commission's
efforts to address this problem, including its recommendation to develop
from the study a privacy-protected higher education information system
that collects, analyzes, and uses student-level data. We also urge the
Commission not to implement this higher education system as an unfunded
mandate on institutions.

We look forward to working with Secretary Spellings and others at the
Department, not only on designing this proposed system, but also in
implementing other solutions to the problems facing students in
postsecondary education in general.

Thank you very much for allowing me this opportunity.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Phil Van Horn, please.

**PHIL VAN HORN:** Good morning and thank you.

**DAVID BERGERON:** Good morning.

**PHIL VAN HORN:** My name is Phil Van Horn. I am President and Chief
Executive Officer of the Wyoming Student Loan Corporation. I am also the
Chairman of the Board of Directors of the National Council of Higher
Education Loan Programs, known affectionately as NCHELP.

NCHELP is a non-profit association of education providers, such as
guarantee agencies, secondary markets, lenders, loan servicers,
collection agencies, schools, and other organizations involved in the
administration of the Federal Family Loan Education Program. I represent
NCHELP in my remarks today.

In its August 18^th^ Federal Register notice, the Department of
Education requested suggestions for issues that should be considered for
action by negotiated rulemaking committees. I am pleased to offer some
of these recommendations this morning.

First, unresolved items raised in comments on the interim final
regulations. NCHELP suggests that the negotiating committees take up any
items that were addressed in our comments on the August 9, 2006, interim
final regulations for the student loan programs and have not been
resolved as those comments recommended. Our comments on the interim
final regulations were provided on September 8, 2006, jointly with the
Consumer Banker's Association, the Education Finance Council, Student
Loan Servicing Alliance, the Guarantee Agencies CEO Caucus, and the
National Association of Student Loan Administrators. As this testimony
is being prepared, the Department has not yet published revised
regulations, although this did come out yesterday, to take into account
the comments received.

Three issues in particular in the interim final regulations warrant
inclusion in a negotiated rulemaking process. First of all, identity
theft. In our comments, we took strong exception to the approach taken
in the interim final regulations and the definition of identity theft,
and the requirements for obtaining discharge of liability on the basis
of identity theft. In its place, we urge the Department to adopt the
definition of "identity theft" used by financial institution regulators
under the Fair Accurate Transaction Act of 2003.

And secondly, to provide for the discharge of the borrowers loan
liability, and the reimbursement of the loan holder on the basis of an
identity theft report, as defined in that act. The adjudicated crime
approach adopted in the interim final regulations is unduly restrictive,
unwise, and unnecessary. It does not give effect to the remedial purpose
of the identity theft provisions of the Higher Education Reconciliation
Act of 2005, and that is to help borrowers and provide reimbursement to
the innocent holders. The rationale for our recommended approach is set
out more fully in our comments on the interim final regulations.

Rehabilitation of defaulted loans is more effective than consolidation
in preventing redefault. A borrower's ability to rehabilitate a
defaulted loan should be facilitated. The interim final regulations fail
to ensure that all qualifying borrowers are able to rehabilitate their
loans by making nine payments within 20 days of the due date during
consecutive months, as provided by the Higher Education Reconciliation
Act of 2005. We believe this important means of addressing defaults must
be fully implemented.

The issue of retroactivity\--in at least two areas, the interim final
regulations raise concerns that settled standards are being
retroactively revised. First, regulations relating to the exception of a
former insurance rate, on their face, provide for reimbursement to a
lender or a lender-servicer designated for exceptional performance of 99
percent of the unpaid principle and interest through default claims. The
Higher Education Act of 1965 guarantees lenders 100 percent of
reimbursement for all default claims, whenever made, on loans for which
the first disbursement is made prior to October 1, 1993. A literal
application of the regulations would violate the act. We believe that
the regulations must preserve the 100 percent lender insurance rate for
exceptional performer lenders, as well as others, for claims on
pre-October 1993 loans.

Second, as indicated in comments submitted by NCHELP and the Education
Finance Council, regulations related to special allowance payments on
loans raise interpretive issues and questions that could be read as
retroactively changing settled interpretations of the Higher Education
Act and existing regulations. As stated in our comments, we believe the
regulations must clearly provide that new standards do not apply to
outstanding bonds or loans, and urge the Department to consider the
language submitted in those comments.

In addition, we believe the negotiated rulemaking committee should
ensure that any regulations that impose new restrictions and/or burdens
on schools and other participants in the student loan programs have only
a prospective effect.

In addition to unresolved items raised in our comments on the interim
final regulations, we recommend that the negotiated rulemaking
committees address the implementation of one new source of authority and
two broad themes, those being, first, Grad PLUS Loans. The Higher
Education Reconciliation Act of 2005 authorizes PLUS Loans to graduate
professional students, but the interim final regulations fail to
harmonize this new authority with other authority for loans to the same
students. For example, disclosure requirements designed for PLUS Loans
to parents should not be applied to PLUS Loans for students; these
repayment periods do not begin immediately. And, to the extent permitted
by the statute, the repayment period for a Grad PLUS Loan should begin
when the repayment period for the student's other loans begins.

We believe the negotiated rulemaking committees can serve as effective
forums for exploring the operational implications of the regulations,
and for finding ways to prevent confusion on the part of Grad PLUS Loan
borrowers in these other areas.

Secondly, safe harbors. Implementation of the Higher Education
Reconciliation Act of 2005 is being accomplished in a highly compressed
timeframe without the benefit of the usual rulemaking procedures. In
many cases, our members have been obliged to make decisions on the basis
of a good faith reading of the statute and less than complete guidance
from the Department. We believe the negotiated rulemaking committee
should address the need to immunize regulated parties against
enforcement of standards that were not in effect when decisions
consistent with statutory language were made.

Finally, amelioration of debt burden. The need to address mounting
student loan debt is manifest. We have heard testimony here today. There
is more that could be done to help borrowers who are having difficulty
in managing their student loan payments. We urge that the negotiated
rulemaking committees address indebtedness in the context of current law
among the actions that the committees could consider are: first, making
the economic hardship deferment more accessible; secondly, maximizing
the flexibility of the income-sensitive repayment plan in the Pell
Program. Few borrowers benefit from either of these provisions.

The collaborative nature of the negotiated rulemaking process offers the
promise of finding other means of addressing this issue.

Thank you for the opportunity for these comments, and I have copies here
that I will leave on the table.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Keon Williams.

**KEON WILLIAMS:** Good morning and thank you.

**DAVID BERGERON:** Good morning.

**KEON WILLIAMS:** My name is Keon Williams. I am a 21-year-old from
Bethune-Cookman College. I am a junior majoring in political science. I
am a "B" average student, 3.26 GPA. I am in several student government
associations: Model United Nations, the representative for the ICUF,
which is the Independent Colleges and Universities of the State of
Florida; and the campaign based on the FRAG Grant.

Our college tuition is \$18,818, a very large amount of money to ask a
college student to attempt, but it is worth it when you look at the cost
of education. I currently receive the Pell Grant, the FRAG Grant, and
the FSEOG, and those are pretty much grants that help pay for my
schooling. And even though with that, it is still not enough. I have to
take on an extra job, and I am a residential assistant with the college
to help make up those funds.

Before coming back to school, I had decided to transfer because the
amount had become so great and that I did not have enough funds to pay
for it, and I knew transferring to another institution with the lower
costs would be wise, but at the same time, I would lose credits that
would not transfer, which means I would have to pay for an extra year in
school.

The struggles I have been through\--I am the first person in my family
to attend college, and it has been quite an experience so far. And just
going through everything that I have been through, I know that education
is at least that one hope that you can grab hold of to come out of the
struggles that you have been through, and hopefully you can, therefore,
with your kids, teach them the importance of education to therefore put
themselves up through society.

I was talking to Krista today and we were talking about\--when we look
at statistics, we typically look at them as hardcore facts, but at the
same time it removes us from that sensitivity to actually look at it for
what it is, face value. One of the examples I was thinking about as we
were talking was about the movie I, Robot. In the beginning of the
movie, Will Smith jumps into the water to save the little girl that had
apparently jumped off in a car and went into the water. As he went to
save her, a robot jumped in the water to rescue her, and the robot read
the vital signs; Will Smith's was 58 percent, the little girl was only
36 percent. Which one did the robot save? Well, of course, Will Smith,
but a human being would have saved the little girl.

And so, when I look at the government, I know the government is a
machine, but at the same time it has individuals within that machine
that have hearts that are compassionate. I realize that, sometimes, even
though statistics may say this, we have to look at it for what it is on
the ground level, face value. And even then, with tuition being so high,
I still want to go to grad school. I study in political science, and
hopefully I can go to school and get my master's degree in public
administration, because one day I would make a change in society to
implement policy; that is what I want to do.

And, knowing this, I know that going to grad school is going to cost
even more money. And so I may have to take out another loan because my
family does not have those funds. And so, with that being said, many
college students go to college, and they say, "How am I going to pay for
this? To go to school and get in debt when I could just enter the
workforce, but I know entering the workforce is not going to provide me
with the standard income of living."

We have been viewing statistics lately, and it is telling you if a
person goes to college, they are likely to make 46 percent more than the
person with just a high school degree. Those are current statistics.

And so, when you look at that, you are weighing the issue. Should I go
to school and get in debt, or should I just continue to struggle and
don't have to default on loans, or anything? And that is another thing,
default on loans. Right now, my mom pays, I think, \$182 a month off of
loans that I have already taken out from the Department of Education.
And so, on top of that, bills and everything\--it can be quite
overbearing sometimes. And so I have taken the time out of class this
morning, comparative politics, to come here and give my testimony on why
you guys should make these changes, because you are in a position to do
that.

You know, when I first got the phone call that said, "Hey, you can meet
someone that can actually make those changes," I was like, "Well, I have
to meet them." And I am here today because I think that you guys really
need to hear my testimony, and I really need to be here because you guys
are the people that actually have the power to do so, and I hear that
these changes are small changes. I know you guys get questions on a lot
of things. Because you don't know the actual numbers, and stuff like
that, you don't know what the future is going to take. But I can bet you
this much, with education, that is the biggest investment. And if I have
been doing my research right on other countries, other countries are
starting to invest more in education now because they see that is the
way it is going. If you educate your society, then, therefore, they will
aspire to create ideas and to therefore continue to produce. But if
education is being cut, more students are taking out more loans; now you
have citizens depending on the government even more.

I mean, I am studying this, so that is why I am\--so, with this being
said, will you guys consider these recommendations? And not just to
limit the student loan payments to a reasonable amount, something
income-based. You know, when you get out of college and get a job, your
loans may be \$200 a month, maybe \$400, but you are only getting paid
minimum wage, in a sense, because a lot of us get the first jobs that we
have in order to work our way up through society.

Recognize that the borrowers sometimes have children with less income.
Also, do you think there should be that added interest that is on top of
it? You should prevent them, also, because that is on top of the loan.
And, in a sense, if that could be eliminated, then we could become
people that pay back our loans on time. And those of you don't pay your
loan one time, if you default one time, that immediately goes to your
credit report, and that will stop you from getting something else, now,
a house, a car. The cancellation of debts from borrowers on income based
on 20 years from now. And also, we just want you guys to simplify the
loan process; just simplify it, sometimes, because it is pretty much a
tedious process, right now.

And so, as a college student, I am in my junior year\--one more year
hopefully, April 2008, I walk across that stage with my degree and to
pursue my master's in public administration because I really do think
that it is individuals that make the change to society. And I am glad to
meet three of those individuals today.

Thank you very much.

**DAVID BERGERON:** Thank you.

As I have said throughout the process of the hearings we have, I
continue to be impressed by our students and the way that they are able
to present the facts to us in a wonderful way. We appreciate hearing
them.

One more and then we are going to take a really brief break. I know we
have all been sitting a while, and we will be sitting some more, so we
are going to take a quick break after Tim.

Thank you, Tim.

**TIMOTHY ANDERSON:** How are you doing?

My name is Timothy Anderson. I attend the great Bethune-Cookman College
in Daytona Beach, Florida, and I am actually with the student government
organization, also. I am a senior majoring in international studies.

I am glad for this opportunity to actually present myself and represent
our college, and basically, I have a Sallie Mae loan, a Parent PLUS
Loan, and other private loans that I have incurred while attending
Bethune-Cookman College, and I believe it is imperative for you
individuals to make an increase in state grants for that.

I am the first person in my family to attend college. I am from Orlando,
Florida, this area, actually, and I have a proud family. I want to
attend law school or grad school after I am finished with
Bethune-Cookman College, but I feel that the loans have presented a
problem with that. I might have to enter the workforce because of that,
because I don't have enough money to attend these places where I would
like to go. I actually have two jobs, which I work right now. One is the
mailroom, which is at my local college, and I also am a residential
assistant. And, in saying that, I also worked at Circuit City and other
jobs to actually stay at Bethune-Cookman College.

There are actually times that I just wanted to quit to actually go
straight to work to help my family out, but my family has pushed me to
stay in college. This is why I am actually here, to actually see my
little brothers and sisters go on to college and not have to worry about
that.

Saying that, I currently have a student loan of \$10,000 plus, and I
really would like to stress to you how much grants would help me to
continue my education and other fellow students that attend our college.
I support the Commission and hope that you will be able to increase the
grants system that we have here.

I thank you for this time for allowing me to speak here, and I find this
is a great opportunity for me to speak in front of you and I appreciate
all that you are doing. Thank you.

**DAVID BERGERON:** Thank you. With that, we will take a 10-minute
break.

**\[Brief recess.\]**

**DAVID BERGERON:** We are going to reconvene the hearing.

**DAVID BERGERON:** I will call Mark\--I am sorry, I am having trouble
reading today. Maria, how are you?

**MARIA CALAMIA:** Hello. I am Maria Calamia. I am from Community
College of Vermont. I also have some comments from the Vermont
Association of Student Financial Aid Administrators. We are in the
process of preparing some written comments, so I have some comments from
them. And I think I have some comments as a parent, as well.

**DAVID BERGERON:** Jim likes those comments, because he is a parent of
a college-age student. I have a ninth grader, so don't even talk to me
about college yet.

**MARIA CALAMIA:** I want to thank you for this opportunity, and I just
tried to get together something really quickly, here, because I did not
realize that the hearing was going to take place here until I actually
arrived here and had time to look at my materials.

Two main issues that come up in my daily work as financial aid
administrator is looking at the college loan debt of my students. Our
school is the Community College in Vermont. We have about 9,000 students
per year. About 5,000 are financial aid applicants. Somewhere between
2,000 and 3,000 students receive Pell Grants out of that allocation.

I should also say that I believe that we are the most expensive public
community college in the nation, and it might be the next most
expensive, but I was looking through the materials that we received in
NSLDS, and our students have accumulated quite a lot of loan debt. Most
of our students\--the average age of our students is somewhere in the
lower 30s, 32 years old, approximately. Most of them spend at least six
years getting their associate degree from us, and that is if there are
no blips in their educational program. If they are taking six credits
per time, it is going to take them six years, as long as they don't have
to withdraw from the class and take other classes that are required for
their program.

So you can see where they are taking out the annual limit, being
independent students, how that loan debt could accumulate quite quickly.
So oftentimes we are dealing with students with more than \$20,000 in
loan debt who are not graduates. Being a community college, we also have
students coming in and out of programs. Some of them, you will see their
name and go, "Hey, that student is coming back from a 10-year break in
their educational program."

So it does take them a long time, and we, as an institution, have seen
this, and the financial aid staff has been working on increased
counseling, dealing with debt management and financial literacy issues,
and pushing them on\--our college recognizes this, but we are also
trying to push that as a required course in our programs. The other
initiatives that our school is taking on is trying to provide remedial
education in a non-course setting so that students can receive loans
while they are taking remedial course work, because oftentimes we do see
students who might have 10 college-level credits and \$10,000 worth of
debt because of the remedial course work that they had to take prior to
those college-level courses.

So what I am asking on the loan debt issue is trying to be flexible with
the schools and provide something like allowing schools to prorate loans
per enrollment status of their students before the schools actually get
into position where they might need a default or reduction. Also, a big
issue that I see daily is dealing with how the FAFSA collects incoming
resource information and relying so heavily on taxes. The tax laws are
not really made for financial aid, so we try to collect more
information. And a good start on getting to that was that exemption for
the 1040 requirement by allowing parents and students who receive a
means-tested financial assistance through other programs to say that
they could have completed something other than the 1040 in their tax
form, but all too often I do see from tax returns that it clearly looks
like we are giving Pell Grants to people who have very high incomes and
just are able to hide those incomes through their tax forms. So, if
there is any way to get away from that\--I know that would not simplify
FAFSA at all, but I believe that it is really needed to get those funds
to the really needy students.

Also, in two-parent households, oftentimes that income is not collected
correctly just because there is no marriage involved, so it gets very
confusing for the parents and students to fill out those forms just
because they are not married, although they are living in a household
where there are two parents and children.

Now, as for the Vermont Association Student Financial Aid Administrators
comments, final written comments will be coming shortly from Yvonne
Whittaker on this, but currently they sent to me this morning a few
issues, and they are limiting their comments on this to the ACG and
SMART Grants; I am sure you would like to hear that. They want to make
sure that they maintain need-based component of the ACG and SMART
Grants. They feel it is imperative that the eligibility of these two
programs remain linked with the Pell Grant eligibility to assist the
neediest students. They want to expand the eligibility to Pell-eligible
non-citizens. It was not really made clear to them why that population
was excluded from the original legislation.

The definition of "the academic year," they feel that should come in
line with the definition of "academic" for other Title IV programs, just
to remove the confusion and limitation for their eligible students. And
then, also, the other item is on the evaluation of GPA for SMART Grants.
We want to make the requirement for the GPA evaluation for SMART
consistent with ACG, in other words, just taking the ACG once a year.
And, as I said, Yvonne Whittaker will provide the final comments and
write in within the next few days.

As a parent, I do have two daughters, one of which just turned 24. She
is an independent student, if she decides to become a student, but
seeing her parents go to graduate school and not really get that much in
loan debt because we had scholarships\--and we went to school 25 years
ago, 30 years ago, but seeing that our incomes are not that great, that
we both make \$35,000 a year because we are in helping professions\--she
does not think it is worth it to get into debt to go to school. So she
feels like she will go to school eventually, and she might move out of
the country to do that.

I have another daughter who is 19 years old who just started school at a
public four-year institution, out-of-state, so she is paying
out-of-state tuition. It is approximately \$14,000 a year. I can only
afford to send her for one year. At that point, once she is there, she
is going to have to decide, is she going to go to another school\--she
would prefer to stay at this school\--or she is going to take off a year
and become a resident in the state that she is in right now. So, either
she is going to go to a school and go into a program that she would
rather not, or she is going to have to have a disconnect in her
education. As we know, if she takes off a year, who knows if she will go
back? So, as a parent, I just have those two comments related to loan
debt.

So, again, thank you for this opportunity.

Number range CHAPTER **DAVID BERGERON:** Thank you, Maria.

**DAVID BERGERON:** Lucy Scalici.

**LUCY SCALICI:** Good morning.

**DAVID BERGERON:** Good morning.

**LUCY SCALICI:** My name is Lucy Scalici, and I am the Assistant
Director of Fiscal Management of Title IV funds for the City University
of New York.

We are the largest urban university in the U.S. We have close to 500,000
students across 21 campuses in New York City, where 110,000 are Pell
recipients. We are happy about the enactment of the ACG and SMART Grant
programs.

But I am also a double-dipper, because I am also a graduate student at
John Jay College of criminal justice and Public Administration, entering
my final semester next spring. So I am in the classroom as a student
everyday, listening to student gripes about financial aid, and thinking
I can do something about it, but it tears me up as an administrator, as
well, when I can't do anything about it. I see both sides of the coin.

I testify to you today as a student. I would like to thank the federal
government for recognizing that higher education needs additional
need-based financial aid, but my concern is, "When did Title IV become
segregated?"

FFEL loans, FSEOG, Perkins, and even TAP in New York State are not
segregated. We have been treating U.S. citizens and eligible residents
the same, 99 percent of the time in everyday life, except for voting and
U.S. military service. I truly believe it is unfair to segregate
eligible residents for receiving the ACG and SMART Grant in the ACG and
SMART Grant Program.

The ACG and SMART Grant Program was created for the exceptionally bright
and for students that are majoring in lacking areas. Please revisit this
regulation and recognize that this country was built on U.S. citizens as
well as eligible residents. Please include the residents to receive ACG
and SMART Grants in fiscal year 2008. My public administration feelings
are surfacing because I believe the government is being unjust to
college students. Let's be fair.

Thank you for the opportunity for letting me testify today.

**DAVID BERGERON:** Thank you. I would say that the U.S. citizen
requirement is a statutory requirement. One of the things I should have
said at the beginning of the hearing is one thing that we cannot do
through our regulatory process is change the underlying statute as it
exists, and that is one of those statutory requirements that we cannot
change through regulation.

**DAVID BERGERON:** John Boyles.

**JOHN BOYLES:** Good morning. My name is John Boyles, and I am
privileged to represent around 50,000 students of the University of
Florida in Gainesville, and also to serve as the Vice Chair at the
Florida's Students' Association, as you heard from our chairman earlier
this morning.

We, as student leaders in the state of Florida, and our students that we
represent, recognize our role as stakeholders in continuing to improve
the higher education system. Having said that, I will choose to spend
most of my time discussing the affordability aspect of education and the
higher education system, because all the other aspects of the report are
wonderful, and we appreciate the work that has been done by the
Commission and the recommendations that are made. But without the
affordability, those aspects of the report do not matter, because our
students will not be able to afford to receive the education that we are
talking about improving.

The responsibility for affordability should be shared among our federal,
state, and institutions to the effect of establishing an education that
our students can enjoy. In the next few minutes, I would like to briefly
explain our focus as student leaders and students on increasing the
purchasing power of the Pell Grants. I will also draw some attention to
some potential oversight for Florida students in the SMART Grant
program, and I would also like to make some brief general comments on
the financial aspects of public higher education in the state of
Florida.

The Commission on the Future of Higher Education recommended increasing
the purchasing power of the Pell Grant to a level of 70 percent, a
substantial increase from the previous 48 percent of the average
in-state tuition at public four-year institutions in 2004 and 2005. We,
as students, support this recommendation, and we encourage the Federal
government to provide assistance to those who do not qualify for the
Pell Grant. The Pell Grant Program has been a wonderful program that has
provided education for many students over the years who cannot afford
their own education. At the same time, however, tuition increases have
gone up, tuition costs have gone up, and cost of living has gone up to
great extent, especially in the state of Florida.

The way that we can see the ability of our students to receive
increasing aid can be done through increasing the size and number of the
Pell Grants, increasing the support for the Supplemental Educational
Opportunity Grant, the Federal Work Study Program, the Family Federal
Education Loan Program, the Direct Loan Student Loan Program, and the
Perkins Loan Program.

As student leaders, we do make this request in full acknowledgment of
Florida's, within the national arena, low tuition and fees. As Frank
stated earlier, we are second in the lowest and cheapest amount of
tuition and fees. However, with that affordable tuition and fee process
and price, we in the state of Florida face a great challenge with a huge
lack in need-based financial aid. In addition, our cost to attend an
institution is not the lowest in the nation, or even close to the second
lowest in the nation. According, as Frank said earlier, to the measuring
of report cards of 2004 and 2006, the state of Florida received a grade
of "F" in affordability both times.

With current financial aid options, those who have the least ability to
afford to attend college encounter significant financial barriers. For
the lowest two quintiles, the poorest 40 percent, the cost to attend
college, even with the lowest price in tuition, second lowest in the
nation, it still equals about 40 percent of their family income, and
this is after the adjustment for financial aid receipts based on the
average amount distributed statewide.

My running mate in the spring elections for our student government had
to work three jobs before we even ran for office, which was, again, an
additional cost, simply to make ends meet, and she was on scholarships
for the University of Florida. She still had to work three jobs just to
make ends meet to be able to afford to buy her textbooks.

Moreover, the fastest-growing populations in Florida and nationally are
those with the lowest SES background. Developing and maintaining a
globally competitive workforce that will attract industries within the
innovation economy requires a well-educated population.

I would like to stop for a minute and come back to my initial point
about our shared responsibility. In no way am I suggesting that this
burden to ensure affordability fall entirely on the federal government.
Our state is in need of greater need-based financial aid options, and we
are working to improve the existing ones. Governor Bush has championed
the First Generation Matching Grant Program, and fought to increase the
Florida Student Assistance Grant. In addition, we at the University of
Florida have a groundbreaking program called the Florida Opportunity
Scholars Program for first generation families who fall below the
\$40,000-per-year income line. It has been a very successful program,
and we are grateful for the state government's assistance in making that
happen.

Additionally, students must learn to be frugal and wise with their
expenditures once they are awarded aid. We have been investigating this
problem, as members of the Florida Student Association and student
leaders in the state, and we are making recommendations to our fellows
around the state, and to each other, and to our Florida Board of
Governors to attempt to rectify some of those situations.

These shares of responsibility notwithstanding, the primary means of
financial aid does often come from the federal government, however. In
the State University System of Florida, approximately 75,000 students
receive some form of federal grant, and over 160,000 receive some form
of federal loan. Even with our state and students assuming greater
responsibility for this, the need for a stronger Pell Grant must be met
if we are to maintain our share in the global marketplace.

I would like to take a few minutes to talk about the SMART Grant
Program, in which I want to congratulate the government on this program,
because I think that it is a wonderful, innovative program that will
help to increase our math and science students, and the ability that we
will have in the future of the global marketplace. The National Science
and Mathematics Access to Retain Talent Grants, or SMART Grant Program,
authorized under Section 401(a) of the Higher Education Act of 1965, as
amended, is provided to students who pursue a major in physical, life,
or computer sciences, mathematics technology or engineering, or a
critical foreign language. However, Section 691.17(a) of the Academic
Competitiveness Grant and National SMART Grant interim final regulations
published on July 3, 2006, specify that the Secretary of Education will
identify the eligible majors for each award year. Eligible majors for
the 2006-2007 award year were identified by Classification of
Instructional Program, or CIP Code, but excluded students enrolled at
the New College at Florida, and our honors college at Florida Atlantic
University, who had concentrations in these specified areas, but were
classified under a different CIP Code. The implications from this
include that the current amendments would negatively affect these
institutions in our state university system, and some of our most
promising students there within.

To make some general comments, I would like to inform each of you that I
have traveled along with other leaders in the University of Florida
student government for the last two summers to the city of Washington,
D.C. to meet our state's delegation, as well as other senators and
congressmen and women throughout the federal government to talk about
these issues. I am heartened to see that a report that has come forward
and addresses some these issues of affordability, as we have traveled
every summer to make those issues known to the legislators up in
Washington, D.C.

I would like it also to be known that in the Commission Report it does
state that tuition levels from 1995 to 2005 have risen at an average of
36 percent over inflation; that is 51 percent without inflation.

In addition, in our state we have become less of a priority, and I know
this is a national trend. About 20 years ago, the average rate of shared
responsibility between student tuition and state funding was 25 percent
tuition and 75 state, now it is 31 percent tuition and 69 percent state.
In addition, as I stated before, we currently are the second lowest in
state tuition. There is not a day that goes by in my life as the student
body president at the University of Florida that I do not work with our
President, Provost, and our senior administration, and hear from them
that the only way for us to stay competitive as a university is for our
tuition to at least double. That is what I hear on a daily basis.

Currently, our administration is pursuing a policy to increase our
tuition by great amounts for our students who will be starting in the
Fall of 2007. Their proposal will probably be something to the extent of
adding on \$1,000 per student per year as an additional charge.

My question to this Commission, to our state, and to our administration
as I continue to work with all of you is, "What is the role of public
education in Florida?" What is the role of having a public school? Is it
that the state will then provide additional access and additional
affordability, additional resources to us as students? Is that the role
of our public education? Is it to ensure that our public has the
education that we need to continue to be a global leader? Is it our role
to ensure that we will be able to care for our citizens and for our
students as we come up through an education system in this nation?

Thank you for your time and your consideration. We at the Florida
Students' Association, and as students in the state of Florida public
education system, are devoted to ensuring a world-class education for
our students, and we look forward to our continued partnership with the
state, and the local governments, and other stakeholders in ensuring
access and affordability to our higher education as a nation.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Brent Tener.

**BRENT TENER:** Good morning.

**DAVID BERGERON:** Good morning.

**BRENT TENER:** My name is Brent Tener, and I am the Associate Director
of Financial Aid at Vanderbilt University. I am here today, though,
representing the Southern Association of Student Financial Aid
Administrators, for whom I serve as President.

SASFAA is made up of financial aid professionals in nine states. Our
mission is to educate students about financial aid availability for
college and postsecondary education, and to deliver those funds in a
fiduciary and efficient manner to those students. In addition, our
association champions the viability of federal and state financial aid
programs to provide access to needy college students.

As demonstrated through past regulatory changes, students are best
served when the regulations have broad support from a variety of
constituents. Our commitment to you and Secretary Spellings is to
provide, when possible, a digest of issues on which the SASFAA
membership has general consensus. There are seven specific areas I would
like to address today as it relates to those items.

The first relates to certificate programs. We would ask that further
consideration be given to the issue of certificate programs and students
enrolled in these programs at eligible two-year public schools who
currently remain ineligible for the Academic Competitiveness Grant.
There remains wide consensus that these students should be eligible
based upon the law. It is helpful to note that many of these students
are enrolled in programs designed to train first responders in the event
of an emergency. We encourage the Department of Education to make this
discussion part of the negotiated rulemaking process and/or to seek
legislative relief to make ACG funds available to these students.

Next, from a macro perspective, the ACG and SMART Grant programs do not
achieve the purpose for which they were designed if schools cannot award
these funds in a timely manner. As you are aware, many schools have
chosen to delay the awarding of these funds while they try to make and
to satisfy programmatic requirements that the Department of Education
has outlined. Based upon recently published regulations, there has been
no relief given to schools as it relates to determining eligibility, and
this is particularly true in the ACG Program. This process needs to be
simplified to deliver the funds to the many first generation college
students that they serve.

I would encourage the Department to continue exploring ways to simplify
the process for schools so that we can deliver these funds in a prudent,
responsible, and timely manner. If relief and simplification is not
forthcoming, I believe that many schools will continue to delay the
awarding of these funds until well after school has started. This delay
is caused through, largely, in fact, having to review high school work
based upon the eight-semester transcript. With that administrative
burden, it is very difficult for those schools to get all the necessary
materials together to make those awards in a timely manner and to
deliver those awards in a timely manner.

Next, loan limits. We would ask that the Department explore ways,
through legislation if necessary, to raise the aggregate borrowing
limits for undergraduate students. We are fearful that students may
reach their limits of borrowing before completing a baccalaureate
degree, and other speakers have spoken to those constraints, that
students will run out of borrowing eligibility before they get to the
end of their chosen program of study.

The next issue relates to the reporting to the COD system, or, as we
like to refer to it, as COD. We believe that the Secretary has placed
undue burdens on the schools as it relates to reporting ACG reporting
through COD. Specific areas that are problematic include the payment
eligibility reason, and the high school reason code. These reporting
elements are not prescribed in the law, and I would ask that this issue
be addressed in negotiated rulemaking. It is an undue burden to the
schools to have to go back in and report all of those additional
requirements through COD.

Next, transfer and dual-enrolled students. Please continue to review all
of the issues in the ACG and SMART Grant programs as it relates to dual
enrollment and transfer students. The issues are too numerous to
mention, but the major areas center around the number of hours
completed, and how transfer credits are counted, and the timeliness of
evaluating eligibility. I talked to a colleague this morning, and one of
the real issues they have is that a student could be a 30-year student
at a school, transfer to their school, and be considered a second-year
student, and would then not be eligible for the ACG Grant, assuming that
the student had not already borrowed the second year. So students are
not being served well by the way the programs are being put together. We
would like more flexibility in assisting students as they transfer from
school to school.

Graduate PLUS Loan issues. We have concerns regarding the implementation
of the PLUS Loans for graduate students. My colleague from Wyoming did
an excellent job of summarizing some of those issues. There are many
challenges with this retooling of the PLUS program, but, specifically,
what we would like is to see that flexibility for lenders and servicers
to automatically grant forbearances for students when they graduate.
Currently, with no change to the regulations, students will need to
request a forbearance to postpone their loan payments. There is really
no aligning with the Stafford Loan at this point in time. Students will
have to be proactive to go out and request a forbearance.

In my school, using law school students as an example, they would have
to immediately go into repayment or forcibly go out there and request
that forbearance. If it were automatic and those payments were aligned
with the Stafford Loans, it would really aid our students tremendously.

Cleanup of any existing issues as it relates to repayment schedules in
the PLUS Loan Program would be very helpful. If the student is going to
be continuously enrolled, please allow the lenders and servicers the
flexibility to send repayment schedules when the student has graduated,
and not be required to send those repayment schedules while the student
is yet enrolled.

And finally, as it relates to the PLUS Loan issue, schools should be
required to offer the subsidized and unsubsidized Stafford Loan before
awarding the PLUS Loan. This remains an area of confusion. There is
potential that schools, unscrupulous schools, may go and award the PLUS
Loan only as a way to help their default rate. We want to make sure that
students are awarded the best loans for them. We understand that
students, if they choose, can take out the PLUS Loan Program, including
the amount of the Stafford Loan, but we want that to be a student
decision. We do not want schools to be forcing a PLUS Loan-only option
upon students.

And finally, one area of concern with the Spellings Commission
recommendation that we have is the statement of dismantling the current
array of federal student financial aid programs and replacing it with
something that has yet to be defined. While we certainly concur with the
Commission that the Pell Grant Program needs to be substantially
increased, these funds should not come from a dismantling of the current
programs. Each program serves a vital and proven purpose, and
eliminating these will only serve to diminish support for low-income
students. Indeed, the Commission's recommendations would have a net
negative impact on student aid for the neediest students.

In summary, my points that I have outlined: Number one, address the
issue of certificate programs; number two, simplify the eligibility
requirements for the ACG and SMART Grants as it relates to schools
certifying that eligibility; three, review the undergraduate loan
limits; four, simplify reporting requirements to COD; five, simplify the
process for transfer and dual-enrolled students; six, make the new Grad
PLUS Loan work better for students; and finally, do not dismantle the
current Title IV programs, as each serve a vital purpose.

Thank you for the opportunity to come and speak with you today.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Tom Auxter.

**TOM AUXTER:** I am Tom Auxter, and I am the statewide President of the
United Faculty of Florida, and I am also, since 1973, a philosophy
professor at the University of Florida.

I am speaking today representing 18,000 faculty members in Florida who
have concerns that the Spellings Commission shares with us, and we have
some ideas about how it is we would like to see those conclusions
interpreted.

First, the issue of student loans. This is a major concern for faculty,
and we see the students suffering; we see the disruptions that occur in
their education. What we would like to do is see something like the
proposal from the Project on Student Debt, which consists of many
organizations that represent higher education, that represent faculty,
that represent students, that represent the student loan industry, and
they have a five-point plan for dealing with fair loan payments.

I want to say that I agree with several speakers here that said that we
need to make this a more rational and sensible approach on repayments.
It makes a lot of sense to us to talk about need-based student aid. What
we are hearing now is the need for need-based repayment of loans,
recognizing that people have different incomes, different ability to
afford repayments, different numbers of children that they are
responsible for, different amounts of disposable income, and I think we
need to be more sensible to how we craft our policies.

I also want to mention that I think it is justifiable and important\--we
are affiliated with the American Federation of Teachers and the National
Teachers Association. We share the concerns that they have been
constantly raising with us about support for major expansion of Pell
Grants. Pell Grants, as you know, have been flat for two decades, and
the maximum amount that has been given\--inflation has been incredible
during this time period. Since 1992, we have had something like 46
percent increase in public university tuition fees and costs. I would
very much like to urge that we see a major expansion in Pell Grants to
deal with the affordability issue.

Now, the arguments that I would make as a philosophy professor, I would
make an argument about future generations. It always was a lesson from
the past that people seemed to endure as an important value that we give
our children a head start in life, and that we give them at least the
kind of head start that we got in life. We have generations who have
gone through public universities without much debt coming out of that
experience. Many of them are now proposing that we put a much greater
burden on our very own children. I would like to say that I think there
is something wrong with that approach and that attitude, and that the
gift of good soil and agriculture, that you enrich the soil and you hand
the next generation soil that is even better than the soil that you are
given, I think that principle needs to apply to education, too. We give
our children something to work with, not a mountain of debt that they
have to dig themselves out of. So I think there are important moral
arguments here for these issues of student loans.

The other issue that concerns faculty quite a bit are all the
discussions concerning standardized testing as an accountability
measure. I do not especially like the word, "accountability." I think it
masks a more important word, which is "responsibility." You cannot
always be an accountant the way that you figure out responsibilities,
sometimes you need to budget afterwards, after you accept
responsibility. But, with that said, I want to say that
one-size-fits-all kind of testing has been a huge failure in Florida,
and I don't see anywhere in the country where it has actually succeeded.
Parents are as angry as they can be, and students are as angry as they
can be, about the FCAT experience, the Florida Comprehensive Assessment
Testing, and how it has corrupted the very education the students are
getting, and how there is a kind of dumbing down\--the smarter students
have to be drilled in preparation for these tests\--how a variety of
courses that students should be taking that stimulate them are ruled out
now because we have to teach to the test.

Any idea that we should introduce this into colleges and universities is
certainly going to be a disaster. And let me say that we have
politicians in Florida that have tried to do that. It disturbs me that
there is now a discussion of doing this at the federal level, as well.
The problem is that colleges and universities don't all have the same
mission, and if what you try to do is to compare "College A" with
"College B" by how many people do well on a standardized test, what you
do is ignore the different missions that colleges and universities have
and make them more standardized in their missions. You also ignore the
differences of students, the huge diversity of students. And I can say
something interesting: In Florida, the idea was to have a
pre-test/post-test of the SAT, and have something like the SAT given in
the junior year, and see how much better they did as a value-added
measure. Right away, all kinds of absurd consequences come from measures
like this. For example, we have a lot of students who don't ever take a
math course in the university because they have done very well in math
and passed all the courses they needed to take in advanced, accelerated
high school classes, and then, all of a sudden, they are supposed to be
taking this measure, as well. There are multiple absurd consequences
from a one-size-fits-all testing procedure.

So I would urge you not to go down that path, and to recognize that we
have diverse missions, we have diverse students, we have very different
kinds of students in urban environments that have different kinds of
challenges, and their institutions should not be punished for the
challenges that do not come from those institutions. The institutions
are trying to deal with those challenges. And so I would ask us to take
a look at our responsibility there.

I also want to add that this kind of value-added method, and insisting
that we do these accountability measures, also limits academic freedom
in higher education, because, if you have to teach to the test, what
that means is that there is a lot of teaching that you do not do. What
that means is, when students are interested in something, and they want
to follow the argument where it leads, you don't go there, because it is
not teaching to the test. And what it means also is that you do not
introduce topics that are not going to be tested. So it is very
important to understand that there are consequences for these kinds of
ideas. While these simple solutions that come from people who are not
living in the environment and know what the consequences are may seem to
fix some problem that they can identify and feel frustrated about,
multiple additional problems are created by these, and we need to be
very careful before we tread into these areas. For example, trying to
put pressure on accreditation agencies, just have some kind of
standardized testing as a way to compare colleges and universities and
make that public to parents as a way to pressure institutions to all
teach to the test. These are very, very ill-advised kinds of ideas.

The one thing that is frustrating to faculty in Florida, and I am sure
to other states as well, is what the Spellings Commission did not
address, and that is the academic staffing crisis. It is true in
Florida, and it is true in other states, as well. The national trend is
that, now, less than 30 percent, only 29.2 percent, of the faculty are
full-time, tenure-track or tenure-accruing faculty. In other words, the
stable core of the colleges and universities, those that create
programs, those that students touch base with again and again over the
years and come back for recommendations, come back for advising and
suggestion, and so forth, are gone from our base. No other profession
would tolerate this. You would not take a group of surgeons and say, "It
is okay if 71 percent of the surgeons do something else as a different
job half the time." You would not take an attorney and have your rights
defended by somebody who is working at some other job and, part-time,
works as an attorney. It is also very exploitative to part-time faculty,
because what this does is\--the institutions are paying very low
salaries to these faculty members, and they are doing it so people, even
putting those together, have a hard time having a full salary, teaching
sometimes five, six, seven different courses. They are going around to
different places. Students can't meet with faculty who have these kinds
of migrating patterns. Often, they don't have offices; often, they meet
in their cars with students, in order to just to be able to talk to
students.

So the crisis is with us, and the American Federation of Teachers has
model legislation that I think is worth considering, and that is to pay
all part-time faculty on a pro-rated basis, the same kind of rate of pay
that you would pay a full-time faculty member that you have at an
institution, and not do a cut-rate kind of job of paying them, so the
people have an honest career that they can pursue, and they can engage
in higher education, and be engaged with students in higher education,
and not be hustling for work everywhere in the world in order to try to
hold things together\--as well, to have a ration of 75-25 of how many
full-time faculty you have to part-time faculty so that the part-timers
are paid fairly and adequately, and have a real income without being
over-stressed and dysfunctional in what they do, and the full-time
faculty are there for students to consult with and meet and have ongoing
advice from them, recommendations later on in life, and so forth. So I
think the academic staffing crisis is something that needs to be
addressed that was not addressed.

Finally, one accountability measure that bothers me, and this has
surfaced in the Federal Higher Education Reauthorization Act, is that
the so-called "Academic Bill of Rights" was inserted in there. This was
a political insertion. It had nothing to do with, "This needs to be how
we reauthorize higher education." It has been a political attack on
academic freedom to have restrictions on how professors teach in the
classroom, what topics they are allowed to discuss, the manner in which
they discuss them, and the requirement that they have to give equal time
for a variety of any conceivable point of view. Even the wackiest points
of view have to be discussed as if they are real. This is corrupting of
the entire process. It limits what faculty can do, and when we had
testimony\--I testified before the Florida legislature on this. I
thought the most impressive testimony there came, actually, from the
students. The students said, "We don't want to go to a university, and
we are not going to FSU just because we want to feel comfortable and get
through without being challenged. We came here to be challenged. We want
to be challenged in the classroom. We love controversy. We want to think
about ideas, and we don't want to have some arbitrary requirements that
shape and restrict what professors can do in the classroom because
somebody has a political agenda of how they would like education to be
conducted."

So I would ask, also, for a recognition that, as we go through this
process, and the Department of Education is part of it, of seeking
reauthorization, that we make clear the consequences, and the bad
consequences, of introducing these kinds of requirements as they have
been introduced in that act.

Thank you very much for your time.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Reginald Floyd and Denise Bennett.

**REGINALD FLOYD:** Good morning.

**DAVID BERGERON:** Good morning.

**REGINALD FLOYD:** Thank you for allowing us to bring this testimony.
My name is Reginald Floyd, and I would like to introduce my colleague,
Mrs. Denise Bennett. We are here representing the Indian River Community
College District Board of Trustees, and Dr. Edwin Massey, president of
our college.

Ms. Bennett and I are Directors of the St. Lucie Academy, located in
Fort Pierce, and Vero Beach Kellogg Academic Program for Success, Upward
Bound Program at Indian River Community College.

We offer testimony regarding the Department of Education's attempt to
circumvent congressional authority with regard to the federal TRIO
Upward Bound Programs.

Upward Bound is one of five federally funded Title IV TRIO programs, and
serves more than 65,000 low-income and first generation students in more
than 900 programs nationwide. Upward Bound helps high school students
prepare for getting admission to, and finding financial aid for,
college. More than 91 percent of Upward Bound students who graduate from
high school immediately enter postsecondary education versus 41 percent
of students from similar economic circumstances who did not participate
in Upward Bound.

Currently, Congress requires institutions to limit Upward Bound services
to students who are low-income and the first generation in their family
to attend college. It also requires that the college or university that
sponsors the program to ensure that the students have a need for
academic support for successful completion\--to ensure that the students
have a need for academic support to successfully complete a program of
postsecondary education. It gives the institution the discretion to
define that need.

By law, Upward Bound programs can admit students that have completed the
eighth grade, but have not yet graduated from high school. Under the new
guidelines, the Department of Education is proposing to require all
entering Upward Bound students to be in the ninth grade, but not yet
completed the tenth grade. According to the most recent profile from the
Department, 34 percent of participants enter the program during the
ninth grade, 33 percent enter in the tenth grade, and almost 10 percent
enter in the eleventh grade. By only allowing ninth and tenth graders to
enter the Upward Bound program, you are penalizing 28,600 participants
simply because of their grade level.

This is particularly harmful to low-income students who have a much
higher chance of moving during the school year than middle- or
high-income students. The plan also requires that 30 percent of newly
admitted students be at high academic risk for failure, which is defined
by a student who has not achieved at the proficient level on state
assessment tests in math and reading, or has a grade point average of
2.5 or less on a 4.0 scale.

Some students would be faulted for doing well in school. Just because a
student is not in the 30 percent high risk program, it does not mean
that they do not need Upward Bound services. This is especially true in
rural areas. These proposals would remove the individual programs
flexibility, creating a one-size-fits-all approach that would damage
Upward Bound's mission of helping needy students get into college.

Also, according to the Department of Education, the single highest
reason reported for needing Upward Bound services is that the students
have a lack of opportunity, support, and/or guidance to take challenging
college prep courses, which represents 20 percent of those students,
followed by coming from a predominantly low-income community. The
Council for Opportunity and Education, or COE, believes that students
should not be penalized for succeeding in school. By placing a priority
on high risk students, those low-income students who are succeeding in
school are jeopardized. The Council, along with other higher education
associations, is concerned these proposed regulations establish a
precedent for imposing additional requirements for any Title IV program,
circumventing Congressional authority.

The priority asserted is such a marked departure from the existing
program design that it effectively substitutes a new program for the one
that Congress authorized and provided the funds to operate. The proposed
priority discards the current flexibility to vary the program in
accordance with local needs, substituting in its place a monolithic
federal vision about whom to serve.

By establishing a priority for a cohort of ninth grade students, the
proposal would disenfranchise all of the eleventh graders that Congress
intended to be served by the Upward Bound services. The requirement that
30 percent of newly-admitted students be at high academic risk for
failure would deprive certain ninth grade students, those who would do
well in school, from receiving the Upward Bound services they may
require.

And finally, the proposal creates a troubling gray area between
Congressional intent, as expressed in statutory language, sometimes
amplified by report language, and the Department's constitutional
obligation to carry out that intent in a straightforward manner. Mrs.
Bennett.

**DENISE BENNETT:** Good morning. Again, just a few more pointers. It is
vital to retain local control of educational decisions. The educators
who run the programs know which students are the best candidates for
Upward Bound services, the students who both need the academic help and
support, and are motivated to learn.

For people in Washington, D.C., to substitute their judgment at a
distance is a disservice to students. There is no cookie-cutter approach
to identifying students who would most benefit from TRIO services. This
decision is based on local needs and determined by skilled TRIO
professionals.

Point number two, even students who are considered high-performing are
not necessarily prepared for college, or even high school.

Point three, Upward Bound has been operating effectively for many years
under existing rules, and is a highly successful program that should not
be altered in this way. On an average, approximately 90 percent of high
school seniors that graduate from Upward Bound programs enrolled in an
institution of postsecondary education.

Point four, a final comment about the proposed national evaluation of
Upward Bound that would force staff to recruit double the number of
students they can serve, then disappointing half of them in the name of
evaluation\--these are vulnerable teens who should not be manipulated in
this way, because their lives and careers will be affected by these
choices.

In conclusion, we are opposed to the proposed priority for the Upward
Bound programs published in the July 3, 2006, Federal Register.

We would like to say thank you for this opportunity for allowing us to
share our points and concerns. Thank you.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Kathleen McGivern.

**KATHLEEN McGIVERN:** Good morning.

**DAVID BERGERON:** Good morning.

\\ **KATHLEEN McGIVERN:** My name is Kathleen McGivern, and I am the
Executive Director of the Commission of Accreditation of Allied Health
Education Programs. CAAHEP accredits 2,000 programs in 18 different
allied health disciplines. We are recognized by the Council for Higher
Education Accreditation, CHEA, and we are members of the Association of
Specialized and Professional Accreditors, ASPA.

Because the vast majority of our programs are in institutions with
regional or national accreditation, CAAHEP decided in 1998 that we would
not seek renewal of our recognition by the Department of Education. But
even though we are not a gatekeeper for Title IV purposes, we understand
the decisions made by the Department will have a broad impact on
accreditation as a whole, and ultimately will affect even those
accrediting bodies that are not covered by federal regulations. So I
appreciate the opportunity to comment today, even though I am an
interloper, in terms of the Secretary's program.

We share many of the concerns that have been expressed by other
accrediting bodies at your hearings, particularly those in Cynthia
Davenport's testimony for ASPA. We have watched and listened\--my Board
of Directors, in particular\--with interest to the deliberations of the
Commission on the Future of Higher Education.

And while we agree with many of the concerns expressed and proposals put
forward, we are troubled by what seem to be some of the underlying
assumptions. The rhetoric, for instance, that we are hearing about
learning outcomes, makes it seem as if accrediting bodies are forever
stuck in the bad old days when all they wanted to do was count the books
in the library. We have all heard that accusation many times. But, while
I agree with Elise Scanlon that we all could do a better job when it
comes to learning outcomes, in fact, most accrediting bodies have spent
a lot of time and effort in recent years shifting the focus of our
efforts to an assessment of outcomes. Specialized accreditors, in
particular, like CAAHEP, have always had as their primary goal the
assurance of educational programs that produce competent professionals;
that is what we are all about.

Over the last six years at CAAHEP, we have revised all 18 sets of
standards to reflect a renewed emphasis on outcomes assessment, but we
all know that it is not just about outcomes. The phrase that we hear at
ASPA meetings is that outcomes are trailing indicators, and, in fact,
they are. Often, by the time you discover there is a problem, if all you
are assessing are outcomes, you have already sacrificed one or two
classes of students in a program that has gone downhill or lost its
quality.

We know that there are certain things, like qualifications of faculty
and sufficiency of clinical slots, that are inputs, if you will, but
they are necessary if a program hopes to achieve the quality outcomes
that we are looking for. So, for us, it is a delicate balance of
assuring certain elements that are in place and that desired outcomes
are being achieved.

We are also concerned about the notion of using accreditation to compare
one program to another. We assess each program individually in the
context of its institutional mission, its community's needs, and its own
goals and objectives. Only a fraction, for instance, in CAAHEP, of our
2,000 programs is undergoing review at any one point in time. So
comparisons that might be based on accreditation decisions that may be
three, or four, or six years old, and some that may be current, would
never be equivalent or fair, and could be misused.

Another concern with the Commission's report relates to cost. Every
accrediting body struggles with trying to moderate the cost of the
process. Some of the recommendations on the Commission Report could
create increased burdens on the institutions that we serve. For
instance, the notion that every site visit might have to include a
public member would increase the cost to our programs of those
activities by as much as a third. For many of our disciplines, which are
small, we send out a site visit team of only two people. And so, to have
added a public member, then, is going to be a far greater burden on the
institutions.

The Commission Report concludes with this paragraph, "Working together
we can build on the past successes of the U.S. higher education to
create an improved and revitalized postsecondary system that is better
tailored to the demands, as well as the opportunities, of a new
century."

We are certainly committed to that same goal, and we hope that the
unintended consequences of some of the Commission's recommendations
don't end up making it harder to achieve that goal.

I really do appreciate the opportunity to testify, and I want to join
with you in commending all of these fantastically articulate students we
have heard all morning. I have far more hope for the future than I had
before I got here today. Thank you.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Hui-Min Wen.

**HUI-MIN WEN:** Good morning. Can you hear me? My name is Hui-Min Wen.
I am the Director of Institutional Research here at New College of
Florida.

Today I am representing the New College Florida Provost Office to
present our issue with the SMART Grant. As the University of Florida
student body president has just mentioned earlier, that New College
Florida students are not eligible for the SMART Grant, and that is the
problem we have with implementing this grant.

New College Florida is a public liberal honor college within the state
university system. Its mission is to provide a high quality, challenging
educational experience to students of high ability. The academic program
at New College is very unique. It allows the students to work with the
faculty very closely to design an educational program that suits their
needs and their interests. New College succeeds in achieving these goals
by using a highly selective admission process, and we are also promoting
a student faculty collaboration, and also a highly rigorous academic
contract system.

By the time that students leave, they have to go through this very
intensive Capstone Thesis project with their baccalaureate exam. So we
operate like a graduate program, but we award the undergraduate degree.
And the quality and uniqueness of this academic program has place New
College in several national ranking lists lately. In just past August
2006, we were ranked as the number one public liberal arts college in
the U.S. News & World Report. And also, earlier this year, we were also
named as the nation's number one best value college by the Princeton
Review.

New College currently has 746 students and has more than 70 full-time
instructional faculty members. Its academic program awards\--like I
said, it is a baccalaureate of arts degree, but in 33 areas of
concentration. And many of our areas of concentration\--when I say area
of concentration, it is equivalent to the major in other institutions,
and many of our areas of concentration include\--they are SMART Grant
eligible\--including biology, mathematics, physics, chemistry,
biochemistry, natural science, even Russian language and literature. The
number of faculty for each program usually ranges from one to five
full-time instructional faculty. We estimate that 20 percent of our
student body are majoring in those SMART-eligible programs.

However, due to our CIP\--CIP is Classification of Instructional
Program\-- reporting, none of our students are eligible for the SMART
Grant. Historically, New College has been using one single CIP Code for
reporting, 240199, which stands for liberal arts and sciences. The
practice of reporting only one CIP Code dates back to when New College,
at a time, was part of a big university system. From 1975 to 2001, New
College was part of the University of South Florida, and then, in 2001,
New College became independent and became an institution within the
Florida State University system. And then, after we became independent,
we continued using one CIP Code for reporting. This allowed the state
university system to easily identify a New College student as an honor
college student, and also differentiate the New College degree from
other degrees awarded by other programs within the system. However, this
has just incurred adverse consequences that\--because of this reporting,
New College students are excluded from the grant.

The CIP Code for a liberal arts and science, 240119, it is completely
excluded from the two letters for the SMART Grants. And, as one of the
University of Florida student body presidents mentioned before, we are
not the only institution facing this problem. Florida Atlantic
University Honor College also has this similar problem. They also use
the same CIP Code for their honor college program and their students
majoring in the biology, pre-med, mathematics, are equally, similarly,
unfairly excluded from SMART Grants.

So, for an institution like New College facing this problem, we would
like to propose three recommendations. Any of these alternative options
really will meet New College needs.

Number one, we are hoping the interim rule for 2006-07, if possible, and
2007-08 can be amended to lobby eligibility of the students attending
public honor colleges majoring in the concentrations specified in the
colleague letters. And this allows the institutions to continue its
current operation with a minimum change, and the institution can report
this concentration directly to the Department of Education for
monitoring purposes. And, in terms of implementation costs, we think
this will be the most cost effective.

The second proposal is that the interim rule for 2006-07, 2007-08, can
delegate the determination of eligibility to the board of governors of
the state university system for each state. If the U.S. Department of
Education feels that it is necessary to ensure that the process of
determination of eligibility is objective and in compliance with the
rule, then the college proposes to amend the interim rule to delegate
their determination of eligibility to the state university system. The
state university system work very closely with the institution within
the system, and has more understanding of the academic program. So,
compared to other external parties, we believe that the state university
system will be highly qualified to determine the eligibility for the
SMART Program.

The third proposal we have is that New College could change to report a
CIP from one CIP to the range of CIPs that reflect our students' area of
concentration. In terms of cost benefit, this would involve a major
change on our campus. Another major concern raised by the college, and
also by the state university system, is the auditing issue. We have been
advised that it is possible\--we need to have a strong justification to
change the CIP Code, not just for the eligibility for SMART. So to avoid
any audit criticism\--if the Department of Education feels that all the
institutions should go this route to report the wide range of CIP for
its students, then we request the Department of Education to provide the
auditing rule as a guidance for us to change the CIP Code, and we will
be in compliance with their rule for reporting.

We strongly urge the Department of Education to amend its interim rule
as soon as possible to allow the flexibility for our students to be
eligible for the SMART Grant. The financial burden, as we have heard
from so many students, is so great for students. Any grant dollars are
very precious, very important to our students. So it would help
alleviate any of the financial burdens of our students.

So we feel strongly that SMART is a great opportunity for our students,
and we believe that New College honor students should be eligible for
the SMART Grant. So we urge the Department to work with us to solve this
issue and ensure the SMART Grant is eligible for our students.

I really appreciate this opportunity to come in here to address the
issue with you. I also look forward in the near future that we can work
with you to solve this issue.

**DAVID BERGERON:** We look forward to working with you to resolve the
issue. I would note that we published final regulations on November
1^st^, reflecting the public comment we had received during the comment
period related to the National SMART and Academic Competitiveness
Grants. We did not make changes around the reporting\--the CIP Code
reporting scheme that were in the earlier rules, in the interim final
rules. We think, for reasons of compliance that we need to have some
data coming back to the Department that indicates that the students are
enrolled in the majors that Congress indicated that the funds should be
used for. We are happy to work with you to find other ways to work
through the issues you have.

**HUI-MIN WEN:** That would be great. Thank you.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Elvi Reyes.

**ELVI REYES:** Hello. My name is Elvi Reyes, and I am with the Longy
School of Music in Cambridge, Massachusetts.

I have been in financial aid for a long time, and I remember in the
1970s how grants went to really poor people, and then I remember in the
1980s I went back to working in financial aid, and it was still was
going to poor people, and then, somewhere in the 1990s, I felt that
there was a disconnect between the FAFSA and the tax return. I was
working at a big northeastern university, and during awarding season, I
would have to go home with an aspirin. I would be so angry, I would get
a headache. And the problem is that people with a negative AGI paying no
taxes who are self-employed are getting Pell, and it is because they
have these tax accountants.

Now, I am going to say that in my opinion, that one of the ways to
combat all these players who are really fixing up the
upper-middle-income people who are not paying taxes because they can
report a zero AGI, or a negative AGI, is just to, somewhere in the
formula, say, "If you have a negative AGI, you are not eligible, because
it means you have written off 100 million of your everyday activities of
life." And then, when you ask them how they live, because you are
working in a private northeastern university, then they give you these
huge amounts of money that they are paying on mortgage and all kinds of
different things, and so you have to give them Pell. So now we have ACG
on top of this.

I am a first generation American born in New York City, and I went to a
public school, and I know that there are still neighborhoods in some of
these urban areas that don't even offer some of the courses that you are
asking for in the ACG. So I am sitting there\--and, you know, a lot of
the Pell kids that I have dealt with, they need help when they come to
school. So my feeling is, here we have this upper crust of people
getting Pell because they have got these tax accountants, their taxes
are always a quarter inch or thicker, and I hate when I see them\--they
are going to get the ACG money; their kids are going to get the SMART
money.

In my opinion, if you want to really have this program be successful,
you cannot just continue to throw money at kids. If you really want a
poor kid who gets Pell to also get SMART, and keep the ACG in the second
year, you need to partner them with the TRIO program on campuses that
have TRIO. And on the campuses that don't have TRIO, you need to add the
support services that student development offers\--you know, the
tutoring, and the mental health, and the adjustment counseling, because
most Pell-eligible kids are not going to have a 3.0 at the end of the
year. So it is kind of like, you are going to throw money at them for a
year, and then they are just\--when they don't make it, they are going
to go home.

I just want to speak as a parent. I have one son who is at a private
university with a Gates Millennium Scholarship, and I am a single
parent, and thank God for that. I have another son here in Florida who
dropped out of school. He sees himself making more money than kids who
have graduated from some of the local schools here and who have a
mountain of debt. Now, he is an independent student and he does not want
to go back because he does not want to have the mountain of debt.

We used to say that in the global world, the United States was number
one in education. Now, Canada is ahead of us, and there are, like, ten
other countries in the world ahead of us. Globally, we are slowly
becoming a Third World country, and if we don't open up our eyes and
understand that all eligible non-citizens will be citizens\--we need to
give everybody the same opportunity. We need to also do what some of
these other countries are doing. When they give their students loans,
they have kind of a sliding scale on the repayment for the rest of that
person's life up to a certain number of years, and then, after that, the
loan is forgiven.

I own a music conservatory. I had an opera student who was in a master's
program tell me at an exit interview last year, "Elvi, I know that my
consolidated loan debt is \$489 a month, and I know that I am going to
be 71 years old when it comes time for me to finish paying it." Is that
ridiculous? That totally defeats the purpose. We need to make it so that
our children can have a life.

So I know that there are a lot of things that you cannot undo, but I do
know that there are a lot of things that, together, we have to do,
because we do not want to have another 1960s\--I would be afraid, and I
am Hispanic. I would be afraid if we go back to civil unrest in this
country over education and over jobs.

Thank you.

**DAVID BERGERON:** Thank you.

**DAVID BERGERON:** Larry Abele.

**LARRY ABELE:** Good morning.

**DAVID BERGERON:** Good morning.

**LARRY ABELE:** My name is Larry Abele, and I am speaking as a private
citizen. My comments are based on 32 years in higher education, serving
in every capacity from faculty to, currently, provost and executive vice
president. I also serve as Director of the Institute for Academic
Leadership, a statewide program designed to run workshops and training
for new academic administrators.

I am pleased to see the Spellings Commission. I am pleased to see some
of the anger coming out of that last draft. We are not enemies. We are
not opposed to a lot of things, and I felt that the first couple of
drafts were almost acidic in their tone, especially since I might be one
of the few people that agree with many of the recommendations.

As we are talking about access and affordability today, nobody has
really said, and I did not really see it in the Commission Report, that
the key in the 1940s and 1950s for the increase in educational
attainment was getting students whose parents were not college graduates
into college and graduating, because, as you know, if your parents
graduated from college, you have about a 65 percent chance of
graduating. It is a terribly low number, but that is the fact. If they
didn't, it is about a 15 percent chance. So, as that shift occurred, and
fewer students entered, it has resulted in the OED and other data that
shows relative educational attainment. So it is critical that we look at
those opportunities.

I think it is ironic that faculty members oppose standardized testing.
In fact, they require standardized testing. I have heard faculty members
at virtually every school in Florida talk about their SAT scores and how
they have gone up, you see press releases all the time; that is a
standardized test. They practically worship it when their scores go up
for incoming students. A standardized exam, I think, does three things:
First, it forces the faculty to define the knowledge content that they
need; second, they build the curriculum around that; and third, by
giving the test, they build that feedback loop for continuous
improvement; I think that is very important.

The state of Florida was a huge leader in this, beginning in the late
1970\'s. Faculty members pushed hard for an exam on core competencies.
It was passed eventually, and given between 1984, and about 1994 is when
it was watered down to nothing. Why was it watered down to nothing?
Well, more than half of the students in the state at community colleges
and universities did not pass all four units on their first try.
Frankly, they could not take the political pressure. So the excuse was,
"Well, you know, it is really an eighth of the class\--really an eighth
grade exam." Well, it is pretty pathetic if you have withdrawn an exam
because half of college students with 60 hours cannot pass an eighth
grade exam.

So I think we need some sort of exam. I do not understand different
missions. There ought to be core competencies for American citizens that
we are willing to state and certify that they have achieved.

When you talk about soaring costs as another part of your report, I
don't think that you have separated out\--you lumped tuition and fees.
Let's separate them for a minute. Tuition are the dollars that go into
the academic program, fees, in this state, approximately \$300 million
go into student affairs, student government. They control a large part
of that money. That has been the fastest growing component in the United
States, and those dollars constitute\--they nationally average about
\$1,700 dollars this year, per student, and many, many states, including
Florida, statutorily allow students to control those dollars. So we have
a beautiful new gym; we have got exquisite, well-lit intramural fields;
we have regular social services and concerts. I am not saying that is
good or bad, but you are lumping that into the so-called "soaring costs
of college" when, in fact, in this case, the university administrators,
although I think they should control it\--Florida statutes allow the
students to do it.

So there is a whole issue of how

students\--and they charge themselves these fees. It is not perfectly
permissible for the university to impose them without student agreement,
and, in fact, as I said, they often impose them on themselves. And they
increase them for things like expanding the gym on campus. They do not
increase them, unfortunately, for expanding mental health services, or
tutoring, or financial aid.

The last piece has to do with financial aid and the "F" that Florida
gets. I think Florida gets an "F" because we spend approximately \$250
million on so-called "Bright Futures," and you hear people talk about
how these students earned these scholarships, these merit scholarships,
because they have scored\--a 970 is the minimum SAT, which is below the
state average, and another piece that they do on the\--it is 1270. So
what happens when you then look\--you can do it by ZIP Code or family
income, it almost guarantees that families in excess of \$90,000 get one
of these so-called "earned merit scholarships." Those students, my
children, did nothing to earn those dollars. They were fortunate enough
to be born into a family with two parents who invested in them heavily.
I was embarrassed when my children got\--they were called something
different. And someone said, a legislator said, "Why didn't you give it
back?" I said, "Because I certainly do not trust you to do something
better with the money than I could do."

That is \$250 million with no need-based at all. So those three things,
the standardized testing, the student-driven, free market-driven arms
race for the improvement of residence halls, the improvement of
recreational facilities, the improvement of social activities on campus,
and calling it the Bright Futures merit when it is the luck of the birth
rather than merit for more than 60 percent of the students. There are
clearly students in every category who are needy.

I think people could drive down those costs if there was a greater
commitment and sacrifice, but I just do not see that coming\--bikes
instead of automobiles, there are lots of different ways to do it. You
can look at the residence halls that are the old style with the
bathrooms down the hall; they cannot fill up, while single room
apartments fill up instantly.

So let's keep\--I don't want the federal government in our business, but
I would like you to keep some pressure on dealing with these issues.

Thank you.

**DAVID BERGERON:** Thank you. We have one more witness before lunch.

**DAVID BERGERON:** Jeff Boyle.

**DAVID BERGERON:** As he is coming up, I am going to say one or two
things. I am going to be leaving after this and going back to
Washington, D.C. I have a meeting in the morning, and I am sorry that I
am going to miss the afternoon. Others of my colleagues will be here
through the afternoon to hear testimony, so I know I will get a full
report when I get back to Washington, D.C.

I have been very happy to hear from all of you, and I look forward to
reading the transcript from this afternoon. With that, Jeff.

**JEFF BOYLE:** Good morning. My name is Jeff Boyle. I am a financial
aid director at small, rural community college. We currently serve two
counties, we serve four high schools that are public, we have a charter
high school that we serve, and a small Christian school. I come more as
a representative of the small Christian school and someone with a
knowledge of financial aid.

With the ACG Grant, when I look at the students that are coming out of
this Christian school, when I have looked at their past performance, the
ones that have come, they have excelled at college. I see that the
rigorous education that we are looking at for the ACG has limited them
from being able to get this grant, because they do not have a foreign
language; it is the only thing they do not have. I feel that with the
rigorous education that we are trying to identify students who we
believe are going to excel and make it through college. These students
have demonstrated that, they are those students.

This small Christian school believed in No Child Left Behind long before
it was a policy, or an idea from the President. They were already
changing the way they were educating students. They were changing what
was going on in their school. They do not have a teenage pregnancy
problem, they do not have a drug problem, they do not have an alcohol
problem, and they do not have a resource officer that has to be
stationed at the door, but yet they cannot get this money because of one
issue, that foreign language. It is not that the students coming out of
that school would not have taken a foreign language, they simply do not
have the resources to offer that foreign language at this point.

So I would just like to ask that we look at those rigorous standards and
give some of the schools some ability to have a little bit of
flexibility in that, to where some of the students say, "We absolutely
know we are going to make it"\--that we can get them this money. Thank
you.

**DAVID BERGERON:** Thank you.

Thank you all for the testimony this morning. We will get back together
at 1:00 p.m.

**\[Recess for lunch.\]**

**[AFTERNOON SESSION]{.underline}**

**DAN MADZELAN:** Okay. Welcome back to the second half of our third
negotiated rulemaking hearing. We will pick up with the witness list
where we left off.

**DAN MADZELAN:** First is Frank Gerbasi.

**FRANCIS GERBASI:** Good afternoon. My name is Francis Gerbasi, and I
am the Director of Accreditation and Education for the Council on
Accreditation for Nursing Anesthesia Educational Programs, and I am also
with the American Association of Nurse Anesthetists.

The Council on Accreditation for Nursing Anesthesia Educational Programs
is an autonomous accreditation organization that accredits over 100
nursing anesthesia programs. The Council on Accreditation is both an
institutional and a specialized programmatic accreditor recognized by
the U.S. Department of Education as a Title IV gatekeeper. It is also
recognized by the Council on Higher Education Accreditation, or CHEA,
and it is also a member of the Association for Specialized and
Professional Accreditors, or ASPA.

The American Association of Nurse Anesthetists is a membership
organization, and it represents over 30,000 certified registered nurse
anesthetists across the United States. ASPA is a membership
organization, also, and it represents 51 accrediting groups in
professional fields and disciplines.

I appreciate having the opportunity to be here today, and the report of
the Commission on the Future of Higher Education was discussed during
our recent Council on Accreditation meeting, and also during the recent
ASPA meeting. The concerns I express here today reflect the concerns of
the Council on Accreditation for Nursing Anesthesia, and also the
American Association of Nurse Anesthetists.

The Council on Accreditation for Nurse Anesthesia and the American
Association of Nurse Anesthetists has developed an accreditation process
and educational system which has helped make anesthesia 50 times safer
today than it was in the 1980s. The U.S. Department of Education had
been part of this since the 1950s by permitting a system of
accountability for patients and for the public that far exceeds the U.S.
Department of Education recognition requirements.

However well-intentioned the Commission's proposal for a
one-size-fits-all approach, accountability threatens to disrupt this
effective system, increase cost, and fails to realize the intended
benefits. We ask that the U.S. Department of Education carefully
consider the potential harmful impacts some of the Commission's
recommendations could have on the specialized accreditors like the
Council on Accreditation for Nurse Anesthesia.

We agree with some of the aspects in the early pages of the Commission
Report, without agreeing with many of the proposals in the later
sections. We agree that there are opportunities to enhance higher
education through encouraging faculty, development of meaningful,
evidence-based performance measures. To facilitate the public in
decision-making, accreditors could make more information available and
accessible to the public, and provide the public with more information
regarding what is accreditation, and what does accreditation mean.

To address these issues, accreditors and the Department of Education
need to work together and we need to develop a clear vision of higher
education. The goals, and the plans to reach those goals, should be
developed with input from all stakeholders.

Accreditation for Nursing Anesthesia has a long history of serving the
public. First established in the 1950s, nursing anesthesia education has
ensured the public with safe practitioners and competent practitioners.
The quality of the program graduates is reflected in the recognition
certified registered nurse anesthetists have achieved in providing high
quality anesthesia care.

Certified registered nurse anesthetists provide over 60 percent of the
anesthesia care given in the United States, and over 80 percent of the
anesthesia care given in rural areas. The accreditation process must
address numerous, often competing, elements of public interest. There is
no one single public interest. Mandating any single public interest
through either legislation or regulation would disenfranchise and
ultimately be a disservice to other public interests.

Nurse anesthesia accreditation is a discipline-specific review process,
which is based on professional expertise that takes years to develop.
Representatives of the public participate in the accreditation process,
and we believe that it is good practice to identify and train public
members. The public members are involved and contribute effectively in
the decision-making level of the accreditation process, which is the
most appropriate level for them to be involved in.

The Commission Report suggests that the accreditation process is
secretive. This is simply not true. The accreditation process for nurse
anesthesia provides accurate and appropriate public information that
does not compromise the integrity of the process. It is important to
make public all final accreditation actions, but maintain a level of
confidentiality that enables an accreditation process that promotes
honest disclosure. It is very important that nurse anesthesia programs'
efforts for improvement are not overshadowed by the need for good public
relations.

The Commission Report suggests accreditation has not paid enough
attention to program performance and student outcomes. The accreditation
process provided by specialized accreditors, like the Council on
Accreditation for Nurse Anesthesia has, for many years, monitored
student outcomes, certification pass rates, employer evaluations, alumni
evaluations. The continued success of nurse anesthesia education depends
on the extent to which students master the discipline and professional
content, not on how much data is collected, or the specific kinds of
accountability systems that are used.

The Commission Report suggests accreditation is stifling innovation.
Specialized accreditors, like the Council on Accreditation for Nurse
Anesthesia, support innovation, while assuring high quality educational
programs. Over 40 percent of the nurse anesthesia programs use distance
education, and the Council reviews and approves those distance education
offerings.

In addition, many nurse anesthesia programs now use simulation for some
of the clinical experiences. To ensure quality programs using these
innovative types of instructional methods, they are required by the
Council to show comparable student outcomes to traditional instruction.
The focus on innovation is not that it is being stifled, but to ensure
that the quality is still there.

Like other specialized accreditors, the Council on Accreditation for
Nurse Anesthesia does charge fees. They work to moderate the cost of
accreditation. The Council believes that some of the recommendations of
the Commission Report would create an undue burden on the programs and
the Council, in terms of both time and also money. Without providing
significant benefit, some of the issues could increase the cost, they
could increase litigation, maintaining an extensive data collection
system, and also including public members on the onsite review teams.

So, in summary, the U.S. Department of Education has established
recognition requirements that provide accrediting agencies with the
autonomy and the freedom to establish accreditation processes that
ensure quality in the institutions and the programs they accredit. We
are concerned that a one-size-fits-all approach will not address the
Commission's concerns, and will disrupt an effective accreditation
process.

Specialized accreditors, like the Council on Accreditation for Nurse
Anesthesia are hopeful that meetings with the accreditation community
will be scheduled to discuss the Commission's recommendations so that
potential harm from unintended consequences can be avoided.

I appreciate the time.

**DAN MADZELAN:** Thank you, Mr. Gerbasi.

**DAN MADZELAN:** Next, Paul De Giusti. And let me, since I forgot to
mention it just a moment ago when a witness comes to the podium to
speak, please state your name and your affiliation, or the organization
you are representing so that we are sure to have that in the transcript.
Thank you. Paul.

**PAUL DE GIUSTI:** Good afternoon, Mr. Madzelan, panelists. I am Paul
De Giusti, Director of Legislative and Regulatory Affairs for Corinthian
Colleges.

Corinthian is one of the largest companies devoted to postsecondary
education in North America. We operate 95 schools in 26 states in the
United States, and 32 schools in 7 provinces in Canada. Our schools
serve approximately 65,000 students, most of whom are non-traditional
students. We offer diploma programs and degrees up to the master's level
in a variety of high-demand occupational fields. For instance, here in
Florida we have a system called Florida Metropolitan University, which
has ten campuses, and has about 11,000 students. We have another smaller
system called National Schools of Technology, which represents four
campuses and 4,000 students.

Because of our emphasis on workforce preparation, Corinthian is a
participant in the Coalition for a Competitive American Workforce. This
coalition was organized by the U.S. Chamber of Commerce, which is
recognized as one of the largest business federations in the world. This
coalition was formed to address the critical need of American business
and industry for improvements in the educational system to prepare
students to enter and advance in the workforce.

We are pleased that the Department has engaged in this negotiated
rulemaking and willingness to address regulatory changes suggested by
the Commission on the Future of Higher Education. Corinthian agrees with
many of the findings and conclusions in the Commission's final report,
beginning with the observation and the preamble that not everyone needs
to go to college, but everyone needs a postsecondary education, and that
too many students currently graduate and enter the workforce without the
skill employers say they need. The Commission has laid a good road map
for reform.

Corinthian supports a wide range of negotiated rulemaking based on the
greatest extent possible on this report. We propose that the negotiated
rulemaking agenda include three things.

First is transfer of credit. At this point I would like to ally
Corinthians comments with that of Ms. Scanlon this morning. I think she
was spot-on. The Commission rightly emphasizes transfer of credit. It
calls for reducing barriers to transfer, and allowing students to move
easily between institutions. As the final report notes, this would
reduce costs, expand access, reduce time to completion, and improve
institutional transparency, all important goals.

Two regulatory reforms would begin to significantly address this
problem. First, institutions of higher education that participate in
Title IV should be required to establish clear policies on transfer of
credit, and to make those policies public. Second, such institutions
should not be permitted to base credit transfer decisions solely on the
accreditation of the institution from which the student is seeking a
transfer, provided that the latter institution is accredited by an
agency recognized by the Secretary.

Many institutions currently refuse to even evaluate the credits earned
by students at other institutions, based solely on the institution's
accreditation. Such accreditation-based policies have no educational
quality justification when institutions are accredited by agencies
recognized by the Secretary. By requiring students to retake courses,
the cost of education is driven up, and scarce financial resources are
wasted. Moreover, the ability of the postsecondary education system to
respond efficiently to workforce needs is constrained.

It is not an infringement on institutional autonomy to require
institutions to evaluate students' credits based on legitimate academic
criteria rather than an unfounded accreditation-based process.
Anti-competitive rules and practices should not be allowed to substitute
for an examination of what a student has actually learned and achieved.
We believe that the Department has sufficient existing statutory
authority to adopt regulatory changes to facilitate these policies. For
instance, Section 45 of the HEA, which deals with institutional
disclosures, as well as Section 496, on recognition of accrediting
agencies.

The next subject, I think the Neg. Reg. should take a look at is the
90/10 Rule. The Commission's final report makes a number of points that
support regulatory reform of the 90/10 Rule. The preamble to the
Commission's report states that distinctions based upon ownership
structure are irrelevant, and that for-profit institutions are one of
the new paradigms that have developed to adapt to the challenges at the
heart of the Commission's concerns. In addition, one of the central
themes of the Commission Report is access to postsecondary education,
how to promote it for under-served and non-traditional groups,
especially low-income, minority, and adult students.

The Commission focuses on the purchasing power of the Pell Grant, yet it
notes that the value of the Pell Grant can be undercut by tuition
increases. All these points suggest that reform of the regulations
implementing 90/10 would further the goals of the Commission and, I
would imagine, the Department, as well. Experience under the Rule shows
that it does not measure institutional integrity and quality, but rather
the socioeconomic background and status of students. Simply put, the
more needy an institution's students, the more they will qualify for
Pell Grants and other forms of financial aid. The more aid they receive,
however, the more the institution is at peril of violating the 90/10
Rule, thus the Rule gives institutions incentives to either not serve
the most needy students, or to raise their tuition, results that are
contrary to achieving the goals of access and affordability.

While we believe the 90/10 should be repealed, that is a statutory
change. I understand that this is outside of what the Department can do.
Nonetheless, the Department can and should revise its current
regulations to lessen their contra-productive impact, and thus the
degree to which they single out institutions in the face of an
irrelevant factor, like ownership structure.

There are a number of anomalies in the current regulations that have the
effect of maximizing the counting of Title IV revenues rather than
recognizing the legitimate non-Title IV revenues that institutions earn.
This Neg. Reg. offers an opportunity to correct these problems.

Lastly, transparency and accountability. These are also major themes in
the Commission's final report. As the Commission finds, students and
parents lack good comparable information on the value the colleges will
provide, and the policymakers lack data to help them decide whether the
national investment in higher education is paying off. The Commission
proposes that the creation of a consumer-friendly information database
that would protect student privacy, but still provide a vital tool for
accountability to policymakers and for consumer choice. Corinthian
endorses these concepts. Indeed, as a public company, we already live
with a great deal of transparency, and the national agencies that
accredit most of our campuses have been at the forefront in establishing
objective and quantitative accountability measures that also assist
consumers to make decisions on where they go to school. There is no good
reason why other higher education institutions and accrediting agencies
cannot do more in this area.

That concludes my remarks, and I thank you very much. Any questions?

**DAN MADZELAN:** No. Thank you, Mr. De Giusti.

**PAUL DE GIUSTI:** Thank you.

**DAN MADZELAN:** Next we have Matthew Tuckman?

**MATTHEW TUCHMAN:** It's Tuchman.

**DAN MADZELAN:** Tuchman. Sorry. Anybody else, please correct me when I
get your name wrong.

**MATTHEW TUCHMAN:** First, I would like to thank the Department of
Education for this opportunity to speak, and I would also like to show
gratitude for these series of hearings, giving the public and, more
specifically, students, a chance to testify on higher education.

My name is Matthew Tuchman. I am the Director of Legislative Affairs,
representing the 40,000 members of the student body at Florida State
University.

I come to you with the concerns of students at other universities, too,
who attend public universities\--I come to you with the concerns of
public education institutions nationwide. I come to you with the message
from parents of students, and the insights of families with students. I
come to you with a simple, fundamental question. What would be a better
investment for a country than education?

I am here today as a fortunate and grateful man, a man who is lucky
enough to solely focus on school without having to work. I am blessed to
be receiving funding from Bright Futures Scholarship and the Florida
Prepaid Program. Consequently, I urge you to take into consideration
recent trends with respect to financial aid, comparatively acknowledging
the inequalities in our K through 12 public schools, need-based
financial assistance is imperative.

I ask for your support in mitigating student debt and rendering loan
debt to a more manageable system. I cannot overemphasize my belief in
the importance of accessibility and affordability in higher education.

I would like to show my appreciation again for this opportunity to speak
and thank you for your time.

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

**DAN MADZELAN:** Next, Jan Friis.

**JAN FRIIS:** My name is Jan Friis. I am the Vice President of
Government Affairs for the Council for Higher Education Accreditation,
also referred to as CHEA. I would like to thank the Department for the
opportunity to provide this testimony.

CHEA is a national advocate and institutional voice for self-regulation
in academic quality and accreditation. CHEA is an association of 3,000
degree-granting colleges and universities, and recognizes 60
institutional and programmatic accrediting organizations. CHEA
recognizes 21 specialized accreditors that the Department of Education
does not recognize because they are not Title IV gatekeepers.

As an example, CHEA recognizes the Council on Aviation Accreditation,
which accredits air traffic and professional piloting programs, among
other programs. Because the majority of these programs are
degree-granting, the Department of Education does not recognize this
accreditor, because the aviation accreditor is not a Title IV
gatekeeper. In contrast, the Department of Education recognizes the
National Accrediting for Cosmetology Arts and Sciences. CHEA does not
recognize this accreditor, because most of its institutions are not
degree-granting.

I think we would all agree that it is important to review and recognize
and Title IV gatekeeper, but I think we also would agree that it is
important to recognize an accreditor of professional piloting and
airline traffic control programs if they warrant accreditation.

Through these hearings you have heard a great deal about accreditation,
what it is doing, and that negotiated rulemaking ought occur after the
reauthorization of the Higher Education Act. I believe it is important
that we review the fundamentals of accreditation for the record.

Accreditation is the primary symbol of legitimate institutions of higher
education, and has been so for the last 100 years. It is a threshold
litmus test for academic quality at an institution. There are currently
7,000 higher education institutions and 17,000 programs that are
accredited.

Not only is accreditation required for student access to federal and
state loans and grants, it is also a requirement for institutions to
receive federal and state funds for research and operations. And it is a
gateway for private foundation and corporate support of institutions.
The current national structure of accreditation has encouraged and grown
with the major innovations in education, such as the development of the
community colleges, the advent of distance learning, and the growth of
for-profit institutions. It is a major source of protection against
fraud and abuse of students and other consumers of higher education. In
addition, it is currently the primary bulwark against degree mills and
diploma mills.

This national structure is a private enterprise which is currently
operated by 81 recognized accrediting organizations, and that is between
the Department of Education and CHEA. They have 650 full- and part-time
staff. This also includes 16,000 volunteers. In the years 2004 and 2005,
accreditors took major actions with regard to approximately 1,200
institutions and 3,800 programs. All of this was accomplished on a \$70
million private budget. The federal government, in my view, could not
replicate this level of action with this degree of participation from
the community on the same budget.

The accreditation community is responsive to the current climate of
accountability. Its organizations have made significant progress as it
relates to student learning outcomes, improving institutional
performance, improving transfer of credit, and moving toward greater
transparency. CHEA has set forth an accountability agenda, as given by
its president, Judith Eaton, to Secretary Spellings Commission on the
Future of Higher Education on April 6, 2006, which, when adopted by the
accrediting community, will improve accreditation. She will discuss
those suggestions at your hearing in Washington, D.C.

The current accreditation system is vital in maintaining the key
features of higher education that have contributed to keeping the
enterprise among the best in the world. The current mission-based
accreditation is established among diverse institution. It allows
institutional independence for academic judgment, which permits academic
freedom, and that is vital to an open and free society.

Additional federal control of accreditation is not needed. Our current
national structure of accreditation has proven to be highly successful
and a well-tested program of quality assurance and quality improvement.
The current system of accreditation and federal interaction is an
excellent example of the effective government use of the results of a
private regulatory system. Accreditation is the premier national example
of a reliable and responsible self-regulation organization.

Thank you very much.

**DAN MADZELAN:** Thank you, Mr. Friis.

**DAN MADZELAN:** Next is Gary Raab.

**GARY RAAB:** I would like to begin by expressing my gratitude to
everyone who has allowed this event to take place today.

Today I present myself before you as an undergraduate of Florida State
University, but more importantly, a patron of the United States of
America. As a patron, it is my duty to explicate the crisis at hand; a
crisis that may eventually reshape this great country, a crisis which
can be resolved.

This extremity that I speak of is one that exists throughout our
nation's graduate and professional schools, a predicament resulting from
the lack of federal grants and scholarships available to our nation's
graduate students. Currently, a state of Florida resident enrolled in
the University of Florida, College of Medicine, will incur fees of
\$18,016 annually, not including costs of living. With added living
expenditures, Florida in-state medical school will cost a student over
\$30,000 yearly. Over the course of four years, this student will
succumb to approximately \$120,000 in medical school fees.

Due to the high cost of tuition and lack of federal grants and
scholarships, the majority of our students are forced to take out
student loans that average seven percent interest rates. Once completing
medical school, the doctor-to-be will then complete years of residency
that are usually unpaid, still incurring the interest rate on their
loans. After residency, the new medical doctor can start paying off his
or her debt. However, with added interest, the original of \$120,000 now
becomes over \$160,000. At this time, our doctor will be about the age
of 30, and they will want to start a family, which will cause him or her
to incur many other living expenses that will hinder our doctor's
ability to pay off his or her debt promptly, causing the seven percent
interest rate to increase debt owed to hundreds of thousands of dollars.

Medical school debt presents an acute problem, not only for the
soon-to-be M.D., but for our nation's healthcare system. In a world
where doctors will owe more money than ever before, it can be a viable
assumption that healthcare costs will accelerate as well.

It is important to note that lack of federal grants and scholarships
affect not only medical students, but most United States graduate and
professional students. A current state of Florida resident enrolled in
the University of Florida's Levine College of Law will incur expense of
approximately \$20,000 a year, including living expenses, and over
\$40,000 in overall debt when he or she receives his or degree.

Currently, I am a scholarship student and am able to attend the Florida
State University with little financial obligation. I personally have an
inclination to attend a United States law school, however, fear that
enormous pecuniary commitment.

Today I stand before you as a grateful scholarship undergraduate.
Tomorrow, I hope to stand before you as an incoming law student applying
for newly created federal graduate grants.

Thank you.

**DAN MADZELAN:** Thank you, Mr. Raab.

**DAN MADZELAN:** Samuel Reda.

**SAMUEL REDA:** Hello. How are you guys doing today?

**DAN MADZELAN:** Well. And you?

**SAMUEL REDA:** Good. Fine, thank you. To start off, I would like to
tell you a little bit about myself. My name is Samuel Reda. I am 22, and
a senior at Florida State University. I am from Sarasota, Florida, and
my future goals are to attend law school.

I am here speaking because I do not want to see any young adults in the
future not be able to benefit the same way that I have. I want to give
back to higher education the same way my professors have given to me.

Today there are over 400,000 eligible students that do not receive
higher education because of cost alone. Now, I would like to ask you
three a question: What is the first word that comes to mind when you
think about higher education? To me, this word is "opportunity."
Opportunity is defined as a good chance or a favorable occasion, quoted
from the Oxford American Dictionary. However, because of certain
measures or circumstances, there are hundreds of thousands of students
today whose opportunity is blemished.

The most influential reason why these students' opportunity is blemished
is because of cost alone. Students today are taking out loans and
graduating with more debt than ever. The average debt upon graduation is
\$19,300. This amount is continually growing and unmanageable. The
government has control of certain financial issues, such as loans and
grants. The government also has the power to make these loans affordable
by implementing a debt forgiveness policy. On behalf of the FSU student
body, we support a policy of this nature. This policy would be
successful if the debts were paid back at an income-based rate.

Institutions should increase need-based student aid and give more
purchase power to the Pell Grant. Higher education should be an
opportunity, not a nightmare. With students' growing knowledge of this
issue, they are doing what they can to make a difference.

Thank you, guys, for this opportunity and for your time. I hope you have
a great afternoon.

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

**DAN MADZELAN:** Next, Anisha Singh.

**ANISHA SINGH:** I would like to start off by thanking the Department
of Education for allowing me to speak today.

My name is Anisha Singh. I am currently attending Florida State
University, and am majoring in political science and communications,
with dreams of one day going to law school.

My parents came here from India in pursuit of opportunity and a better
life. Fortunately, my father was able to work hard enough to afford a
college education for me. I receive absolutely no financial aid, and the
only answers I receive when I ask why not is that my father has a high
enough income to afford my expenses in school.

In addition, I do not receive any scholarships other than Bright
Futures. The amount of scholarships I can apply for are limited. This is
because, although I am a minority in this country, I am unable to
qualify for any minority scholarships. Minorities in the education
system are generally classified as African Americans and Hispanics, not
Asians.

Most colleges use the FAFSA to determine if I am really need-based,
however, debt is not taken into consideration for FAFSA. I feel the fact
that my dad is in debt is ignored. In order to put me in school, my dad
has taken thousands of dollars in parent loans because he does not want
me to have to. He has other obligations and expenses, and I worry that,
by the time my 11-year-old brother goes to school, my dad may not be
able to pay for it because of tuition increases and other fees that are
being added.

I also hope that other loans won't be taken out to support my brother's
education, because I don't know how my dad would manage to pay that off.
As I contemplate law school, even though it is a few years away, I worry
that, even though I have high grades and I am working so hard to ensure
my admission into a prestigious law school, that dream may not become a
reality. Around the time I will need the money to go to law school, my
dad will be saving up to pay for my brother's college tuition and
expenses, as well.

According to the Spellings Commission Report, from 1995-2005, average
tuition and fees at public four-year colleges and universities rose 51
percent after adjusting for inflation. The same report states that
average debt levels for students that graduated from four-year colleges
and universities total over \$19,000. By no means am I that average
student because by the time I graduate, my parents will have taken quite
a bit more.

In addition to sharing my story today, I would like to share that of my
roommate, Natalie. Natalie worked every day throughout her high school
career to be able to save up enough money to go to college. She had
calculated how much tuition money she needed to save and accordingly
worked close to full time. Natalie was one of the lucky ones. Nearly
400,000 students don't attend college simply because they cannot afford
it. Many of those same students save for college only to learn they do
not have enough because of skyrocketing tuition and fees and decreasing
aid from the federal government.

The Spellings Commission Report also stated that 90 percent of the
fastest growing jobs in the new information service economy will require
some postsecondary education. As millions more students each year pursue
a degree, we need to make sure that there is a funding for these
students. As the Department begins its negotiated rulemaking process, I
urge you to consider the following things:

Simplifying the FAFSA to be less intimidating will open doors for access
for more students.

Taking into account an applicant's debt, and not just the adjusted gross
income will also allow more students the security of knowing they will
be able to attend college.

Also, making loans more manageable and increasing federal grant aid to
students who need it the most should definitely be a priority.

There are thousands who thirst for higher education, unable to get one
because of finance issues and lack of funding from the government. Then
there are thousands like me, who seem to be ignored in the process,
Americanized minorities with money to get by, but still find themselves
waking up every morning wondering if they will always be so lucky.

Thank you for allowing me the opportunity to speak before you today.

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

**DAN MADZELAN:** Next we have Lisa Primiani.

**LISA PRIMIANI:** Hello. My name is Lisa Primiani, and I am a freshman
at Florida State University. I am planning to study communications and
political science, and one day hope to become a lobbyist and make
changes in policy for things that I think are important. This is
partially the reason that I am here today.

Student loans affect everyone. They have affected my family, but have
also affected the state and country. They prevent people from giving
back to the economy, and stop people from providing for the success of a
competitive workforce. My family has been directly affected by student
loans, and my story is one of millions. Let me share with you my
personal story.

Ten years ago, my cousin Danielle was a student at Florida State
University. During her junior year, she met a great guy named P.J., and
they quickly began dating. After dating for a few years, the topic of
marriage came up. PJ is the youngest of seven children and is an
out-of-state student, so he paid for his college solely based on student
loans.

After graduation, my cousin Danielle moved in with P.J., and they both
put their lives on hold, because P.J. still owed an incredible amount in
student loans. Even with family pressure and the desire to get married,
they had to put their futures on hold because of the burden of student
loans.

Finally, after ten years of dating, P.J. got his debt to a manageable
level and proposed to my cousin. It took ten years of waiting and ten
years of paying student loans for P.J. to be in a position to start a
family, buy a house, be financially stable, all because of student
loans.

They are happily married now, but Danielle and P.J. are just now
starting their lives together after having to wait so long because of
student loans. I can only imagine the hardships that they went through,
and I would never want to go through what they endured.

Not only for myself, but this is a problem for all current students and
future graduates. Graduating college is supposed to be a new beginning,
but how are you supposed to start anything if you are drowning in debt?

I hope you will consider ways to make student loans more manageable and
realistic. For a recent graduate, a full year's salary will only make a
dent in the amount of student loans they still owe. Remember that our
stories and recommendations are the voices of only a fraction of
millions of students that are impacted by student loans, federal
financial aid, and the programs the Department will be implementing.

Thank you for your time.

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

**DAN MADZELAN:** Kimberly Copley.

**KIMBERLY COPLEY:** Good afternoon. My name is Kimberly Copley. I am
currently a sophomore at Florida State University. I am studying
nursing, and I am also studying Spanish. I hope to go on and get my
higher education and master's degree and pursue nursing in the field of
being a nurse practitioner.

I am so very, very grateful to have the opportunity to stand here before
you today, and I would like to share with you a story that is very near
and dear to my heart.

Not too very long ago it was my senior year of high school, and I
realized that I could be getting as good grades as I wanted, I could be
in the most advanced as I could possibly be in, but, somehow, if I
wanted to have this dream of higher education, I was going to have to
come up with the reality of finding the funds to do so. I took out
loans, I bought my own car, I started to work full-time, all the
meanwhile juggling school. I went and saw my guidance counselor and
started getting applications. As expensive as they may be, I applied to
as many schools as possible.

Once I found out how expensive it was going to be, even being in
Florida, which is the second lowest of any of our states as far as
in-state tuition costs, still was just out of reach for what I was going
to be able to afford on my own. Not too much longer after that, I found
myself in a hospital bed.

I live with a chronic illness, Crohn's disease, which is something that
I have learned to deal with my entire life, but on the same token it has
been something that has always brought me back to reality. As I lay
there, missing days and days and days of high school of my senior year,
my dad flew down\--he lives out of state, in the state of Indiana, and
sat down with me. We had never had a very serious conversation about
college, and I was very nervous and I was ready to take on the burden on
my own by staying home at a local community college. That seemed to be
the only one I would be able to afford.

My dad sat down with me and told me\--and for the first time in my life
I saw him cry, because he told me that he had been saving money for me
the last ten years. I, unfortunately, am the minority in a group of
student leaders at FSU. The vast majority of my peers, who I represent
and who I respect with the utmost diligence, graduate with unmanageable
debt, graduate with 40 percent\--just outrageous amounts of
debt\--credit card

loans\--I mean, it is just so sad to watch because they have to put
their lives on hold because they have to try and pay off these high
interest loans, and because they continue to see their education get
more and more out of reach.

I have a stepbrother who goes to school in Indiana, and my dad has had
to make more adjustments for my two younger brothers and sisters, and
from his budget there, because their tuition rate increased eight
percent last year, which is more than double what the inflation rate was
nationally.

So I ask you all to really take into consideration the students, and we
hope that we represent the actual faces of those that are being affected
at Florida State University.

So thank you so much for the opportunity to come here and speak. I want
you to know that I take not one class, not one lab, not one hour for
granted, because I have had the opportunity to have a higher education.
Thank you.

**DAN MADZELAN:** Thank you very much. We are a bit ahead of schedule on
our sign-up sheet, so we do have a couple of people that have signed up
for a little bit later. I will ask if they are here now.

**DAN MADZELAN:** First, Rebecca Thompson. I am sorry we sprung that on
you.

**REBECCA THOMPSON:** Oh, no. It's okay. Just give me a few seconds.

**DAN MADZELAN:** Take your time.

**REBECCA THOMPSON:** Again, my name is Rebecca Thompson, and I am the
Legislative Director for the United States Student Association. The USSA
is the country's oldest, largest national student association,
representing millions of students across the country.

For nearly 60 years, USSA has been the student voice on Capitol Hill, in
the White House, and the Department of Education. As a coalition of
student governments and statewide Student Associations, we are here
again today, as we were in Berkeley and Chicago, to express our concerns
in high hopes that they will be adopted in the Department of Education's
negotiated rulemaking process.

The state of higher education today is very different from that of just
10 or 20 years ago. In the past, students who dreamed of pursuing higher
education had the opportunity to do so, oftentimes with much of that
opportunity subsidized by the federal government. From the Pell Grant to
low-interest federal loans, students could access the doors of higher
education with very few barriers. Today, those doors are accessible to
only the few who can afford it.

With the dwindling Pell Grant and low-interest loans disappearing fast,
a qualified needy student has very few options. The Pell Grant has been
under-funded five consecutive years. In the past year alone, the average
Pell Grant award has declined by \$120. Twenty years ago, the maximum
Pell Grant covered nearly 60 percent of tuition and fees. Today, the
Pell Grant covers only 33 percent of those costs. Earlier this year we
saw the largest cuts to student loan programs in the history of the
program, which will cost students thousands more in additional loan
repayment.

As our nation attempts to compete in the ever-changing global economy,
our citizens must be highly educated to do so. The Spellings Commission
reported that 90 percent of the fastest growing jobs in the new
information and service economy will require some postsecondary
education. If the federal government continues to divest in higher
education, the impact on our economy could be disastrous. One of the
most frightening new trends in higher education is the rate at which
many students take on student debt burdens. The average student now has
over \$19,300 in student loan debt. With more and more students taking
on unmanageable debt, this prevents them from buying their first home,
getting married, or starting a family, all major life decisions that are
put on hold simply because they spend a large portion of their income
paying student loans.

Although the Department of Education does not have the jurisdiction over
the funding of many of these programs, we ask that you do everything you
can to make sure that higher education is more affordable and more
accessible to students.

As students from across the state and country, we urge the Department of
Education to prioritize the needs of students as it begins its
negotiated rulemaking process. This can be done in a variety of ways.

First, recognize that students with families have less income to devote
to loan repayments than their counterparts. Also, we must simplify the
process of applying for hardship deferrals. And lastly, we ask that you
cancel remaining debts for borrowers who have made income-based payments
for 20 years.

While federal student loans are an important aspect of a students'
financial aid package, increasing grant aid would make it possible for
students to have significantly less debt. And, as a recent graduate
myself, I have over \$35,000 in student loans and, coincidentally, my
identical twin sister also has about \$35,000 in student loans.

We need the Department's help in saving millions of students from
drowning in debt. We urge you to consider our requests. The state of
higher education rests in the Department's hands, and we hope that you
will help make it possible for current and future college and university
students to access the doors of higher education. Thank you.

**DAN MADZELAN:** Thank you very much. We have one more person who has
signed up and, like Rebecca, a little bit later, but I will call Ahmad
Abuznaid. Please restate your name for the record.

**AHMAD ABUZNAID:** Good afternoon. My name is Ahmad Abuznaid.

**DAN MADZELAN:** Sorry about that.

**AHMAD ABUZNAID:** No problem. My teachers did it all the time.

**DAN MADZELAN:** This last name gets it, too.

**AHMAD ABUZNAID:** I can see. Well, thank you for the opportunity. I do
not have anything prepared. I just wanted to share some of the same
sentiments that the other students spoke of. I am a recent graduate of
Florida State University. Fortunately, I do not have any loans or any
kind of debt that I am supposed to be drowning in, but I am one of the
more fortunate students. My parents made a decent enough wage to be able
to help me out, but I also did work 40 hours a week throughout my tenure
at Florida State University.

I am actually of Palestinian descent, so I share some of the same
sentiments as Anisha, who was just up here. I was born in Jerusalem, and
being here in America, you get a lot of opportunities that you do not
get elsewhere, but, with that being said, there are still some issues I
think we need to work on.

A lot of our students are struggling these days with costs, and I
believe that the education here needs to be a priority of investment in
propelling the future of this nation to the top.

So, with that being said, I just want to say that, while I am not in
debt, I have a younger brother that is 11 years old, and a lot of my
friends are in debt, and I can see the future of our nation struggling
with this issue, and I am one student that does not want to stand for
that. Thank you for your time.

**DAN MADZELAN:** Thank you for yours.

We currently have no one else signed up. So it is just about 2:00. I
think we will break, let us say, until 2:15. We will be back here and
see if we get some more people who want to testify this afternoon.

We will see you back here, or not, at 2:15. We will be here. Thank you.

**\[Brief recess.\]**

**DAN MADZELAN:** Well, we are back from break, but we still have no
additional witnesses signed up. We do know, however, that the breakout
sessions currently going on here in the conference end at about 2:45, so
let us take another break until about 2:45, and we will see if we get
anyone signed up between now and then.

If we do have someone signed up before 2:45, we will come back in here
and let them speak.

So, for now, we are back on break. Thank you very much.

**\[Brief recess.\]**

We are now reconvening this public hearing on negotiated rulemaking
agenda for this fall and winter, and our witness is Thomas Ratliff.
Thomas, please restate your name for the record, and your affiliation.
Thank you.

**THOMAS RATLIFF:** Thank you very much. I am Thomas Ratliff, Director
of Student Financial Aid at Indiana State University, as well as a
doctoral student in leadership and higher education at the same
institution.

When listening to some of the witnesses earlier convey their thoughts
and concerns about their deep debt, it reiterated to me the whole
purpose for the Higher Education Act in 1965 as a major component of our
War on Poverty. I went in and looked during our break, and checked that,
indeed, in 1965, the poverty level in the United States was at 15.8
percent, down consistently in the five years previous from about 20.3
percent. It continued to drop for another five years to about 10.4, and
then, since then, basically has not changed.

We have had billions of dollars going out in federal financial aid since
1965, and our current poverty rate is at 10.8 percent, no better than
what we saw in 1969. It seems that either one of two things has to
happen: Either we need to stop this experiment and let higher education
go back to being funded by the states and being funded by the
institutions themselves, or we need to raise the bar back to where it
should be.

The Basic Educational Opportunity Grant in 1965 paid for in-state
tuition and fees at most institutions. It is not close anymore. Since
2001, tuition and fees have accelerated at an average rate of about 10.4
percent, by some of the studies that I have looked at. Cumulatively, for
public four-year institutions, they rose by about 54 percent in the last
five years, the reason being not because schools are greedy, not because
they are wanting to pull in excess moneys, the reason being they have
costs that they have to meet to be able to educate our population, and
the states are pulling back their funds, because their commitment to
education is not as keen as it once was.

The Federal Pell Grant has been stagnant and stuck at \$4,050 for too
long. I know the proposal comes up on an annual basis to try to raise
that. I know that there has been a push to try and double it. I know
there has been a push to try to get \$100 increase mandated for the next
five years. And yet, I am looking at a likelihood that \$4,050 is still
going to be a magic number next year. The percentage of tuition and fees
that is going to pay at most institutions will go down, and students
will have less access than what they have seen in the past.

I do not believe we need to stop this experiment and cut the losses,
because the War on Poverty has not been won. I believe that it is still
an admirable feat that we can go after, and something that indeed can
help, but it does appear by looking at the numbers that our focus on our
neediest students, perhaps, is the key point in this war to try to win.

Those that are below the poverty level are now being recognized as such,
to some degree, by the means test, which are being added to the FAFSA
this coming and were added into law this year, allowing more students
the opportunity to at least be considered for simplified needs analysis,
as well as the auto zero EFC, but that is just opening a little bit of a
door. I think that door needs to go wider.

It appears that students struggle the most during their freshman year.
Dropout rates for colleges are typically highest between freshman and
sophomore experiences, and to be able to retain those students and help
them avoid debt does make very good sense to me, that we should front
load Pells, maybe even to the point of making Pell Grants only available
for freshman and sophomore experiences. And saying that, which could
send shivers up many people's backs, including my own for a while until
I considered it\--with an associate's degree, students can either have
the basis that they need upon which they build through loans and other
options, particularly scholarships that they can prove themselves worthy
of after two good years of academic demonstration in college to pay for
those last two years of their bachelor's degree. If not, then at least
with an associate's degree, perhaps they can pull themselves out of that
poverty line, which was the underlying goal for the Higher Education Act
in 1965 to begin with.

So it seems by doing a front load of the Pell Grant, perhaps we can
amend two issues, one to help accomplish this goal of beating the War on
Poverty, and two, to accomplish the goal of helping students encourage
themselves through their academic accomplishments in the first two
years, knowing that they will have to rely on that to help them pay for
their last two years of their bachelor's degree. With that, I think that
we could see some forward progress.

I thank you all very much for reconvening and giving me your time.

**DAN MADZELAN:** Thank you very much. I would also just like to state
for the record that up here on the panel Carney McCullough joined
Elizabeth McFadden and myself.

And with that, we will deconvene for a short while, and see if we have
additional witnesses to come forward in the next hour or so.

See you shortly.

**\[Brief recess.\]**

**DAN MADZELAN:** I want to thank everyone who came by today to offer
their testimony. I also thank our federal panel, David Bergeron, Jim
Manning, Elizabeth McFadden, and Carney McCullough.

This concludes the hearing on negotiated rulemaking.

**\[Whereupon, the hearing was concluded at 3:50 p.m.\]**