U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402–0001

27–986 PDF 2006

PAYING FOR COLLEGE: INNOVATIVE

PRIVATE–SECTOR PROPOSALS TO COMPLEMENT

RECORD FEDERAL INVESTMENT IN STUDENT AID

HEARING

BEFORE THE

SUBCOMMITTEE ON 21ST CENTURY 

COMPETITIVENESS

OF THE

COMMITTEE ON EDUCATION 

AND THE WORKFORCE 

U.S. HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

May 23, 2006

Serial No. 109–42

Printed for the use of the Committee on Education and the Workforce

(

Available via the World Wide Web: http://www.access.gpo.gov/congress/house 

or 

Committee address: http://edworkforce.house.gov 

(II)

COMMITTEE ON EDUCATION AND THE WORKFORCE 

HOWARD P. ‘‘BUCK’’ McKEON, California, Chairman

Thomas E. Petri, Wisconsin, Vice Chairman 

Michael N. Castle, Delaware 

Sam Johnson, Texas 

Mark E. Souder, Indiana 

Charlie Norwood, Georgia 

Vernon J. Ehlers, Michigan 

Judy Biggert, Illinois 

Todd Russell Platts, Pennsylvania 

Patrick J. Tiberi, Ohio 

Ric Keller, Florida 

Tom Osborne, Nebraska 

Joe Wilson, South Carolina 

Jon C. Porter, Nevada 

John Kline, Minnesota 

Marilyn N. Musgrave, Colorado 

Bob Inglis, South Carolina 

Cathy McMorris, Washington 

Kenny Marchant, Texas 

Tom Price, Georgia 

Luis G. Fortun ̃ o, Puerto Rico 

Bobby Jindal, Louisiana 

Charles W. Boustany, Jr., Louisiana 

Virginia Foxx, North Carolina 

Thelma D. Drake, Virginia 

John R. ‘‘Randy’’ Kuhl, Jr., New York 

[Vacancy] 

George Miller, California, 

Ranking Minority Member 

Dale E. Kildee, Michigan 

Major R. Owens, New York 

Donald M. Payne, New Jersey 

Robert E. Andrews, New Jersey 

Robert C. Scott, Virginia 

Lynn C. Woolsey, California 

Rube ́n Hinojosa, Texas 

Carolyn McCarthy, New York 

John F. Tierney, Massachusetts 

Ron Kind, Wisconsin 

Dennis J. Kucinich, Ohio 

David Wu, Oregon 

Rush D. Holt, New Jersey 

Susan A. Davis, California 

Betty McCollum, Minnesota 

Danny K. Davis, Illinois 

Rau ́l M. Grijalva, Arizona 

Chris Van Hollen, Maryland 

Tim Ryan, Ohio 

Timothy H. Bishop, New York 

[Vacancy]

Vic Klatt, Staff Director 

Mark Zuckerman, Minority Staff Director, General Counsel 

SUBCOMMITTEE ON 21ST CENTURY COMPETITIVENESS 

RIC KELLER, Florida, Chairman

Jon C. Porter, Nevada Vice Chairman 

Thomas E. Petri, Wisconsin 

Michael N. Castle, Delaware 

Sam Johnson, Texas 

Vernon J. Ehlers, Michigan 

Patrick J. Tiberi, Ohio 

Tom Osborne, Nebraska 

Bob Inglis, South Carolina 

Cathy McMorris, Washington 

Tom Price, Georgia 

Luis G. Fortun ̃ o, Puerto Rico 

Charles W. Boustany, Jr., Louisiana 

Virginia Foxx, North Carolina 

Thelma D. Drake, Virginia 

John R. ‘‘Randy’’ Kuhl, Jr., New York 

Howard P. ‘‘Buck’’ McKeon, ex officio 

[Vacancy] 

Dale E. Kildee, Michigan 

Donald M. Payne, New Jersey 

Carolyn McCarthy, New York 

John F. Tierney, Massachusetts 

Ron Kind, Wisconsin 

David Wu, Oregon 

Rush D. Holt, New Jersey 

Betty McCollum, Minnesota 

Chris Van Hollen, Maryland 

Tim Ryan, Ohio 

Robert C. ‘‘Bobby’’ Scott, Virginia 

Susan A. Davis, California 

Timothy H. Bishop, New York 

Major R. Owens, New York 

George Miller, California, ex officio 

[Vacancy] 

(III)

C O N T E N T S 

Page

Hearing held on May 23, 2006 ............................................................................... 1

Statement of Members: 

Keller, Hon. Ric, Chairman, Subcommittee on 21st Century Competitiveness, Committee on Education and the Workforce .................................... 1

Prepared statement of ............................................................................... 3

Kildee, Hon. Dale E., Ranking Member, Subcommittee on 21st Century 

Competitiveness, Committee on Education and the Workforce ................ 4

Prepared statement of ............................................................................... 5

Statement of Witnesses: 

Davis, Tom, owner, Davis Brothers Construction .......................................... 7

Prepared statement of ............................................................................... 9

Jones, Allison G., assistant vice chancellor, California State University 

System ........................................................................................................... 10

Prepared statement of ............................................................................... 12

Supplemental presentation, ‘‘Early Assessment Program’’ .................... 44

Merisotis, Jamie P., president, Institute for Higher Education Policy ........ 22

Prepared statement of ............................................................................... 24

Salandy, Rassan, director of university recruitment and public relations, 

the Posse Foundation ................................................................................... 18

Prepared statement of ............................................................................... 20

Additional Submissions: 

Baum, Sandy, the College Board .................................................................... 40

(1)

PAYING FOR COLLEGE: INNOVATIVE

PRIVATE–SECTOR PROPOSALS TO 

COMPLEMENT RECORD FEDERAL

INVESTMENT IN STUDENT AID 

Tuesday, May 23, 2006

U.S. House of Representatives 

Subcommittee on 21st Century Competitiveness 

Committee on Education and the Workforce 

Washington, DC 

The subcommittee met, pursuant to call, at 10 a.m., in room 

2175, Rayburn, Hon. Ric Keller [chairman of the subcommittee] 

presiding. 

Present: Representatives Keller, McKeon, Petri, Johnson, Ehlers, 

Tiberi, Osborne, Inglis, Price, Fortuno, Foxx, Drake, Kuhl, Kildee, 

Payne, Tierney, Kind, Wu, Holt, McCollum, Ryan, and Bishop. 

Staff Present: James Bergeron, Counselor to the Chairman; Jessica Gross, Press Assistant; Richard Hoar, Professional Staff Member; Lucy House, Legislative Assistant; Chad Miller, Coalitions Director for Education Policy; Amy Raaf, Professional Staff Member; 

Deborah L. Emerson Samantar, Committee Clerk/Intern Coordinator; Denise Forte, Minority Legislative Associate/Education; 

Lauren Gibbs, Minority Legislative Associate/Education; Joe 

Novotny, Minority Legislative Assistant/Education; and Mark 

Zuckerman, Minority Staff Director/General Counsel. 

Chairman KELLER. Good morning. 

A quorum being present, the Subcommittee on 21st Century 

Competitiveness will come to order. 

We are meeting today to hear testimony on Paying For College: 

Innovative Private-Sector Proposals to Complement Record Federal 

Investment in Student Aid. 

Under committee rule 12(b), opening statements are limited to 

the chairman and ranking minority member of the subcommittee. 

Therefore, if other members have statements, they may be included 

in the hearing record. 

With that, I ask unanimous consent for the hearing record to remain open 14 days to allow member statements and other extraneous material referenced during the hearing to be submitted in 

the official hearing record. Without objection, so ordered. 

Good morning, and thank you all for joining us today. We are 

here to learn about how innovative private sector proposals can 

2

help increase college access and complement the record Federal investment in student aid. 

A college degree is the passport out of poverty for millions of 

American students each year. Without a college education, many 

workers today are shut out of quality, high-paying jobs. I believe 

our top priority should be opening the doors of higher education to 

low- and middle-income Americans. 

That is why I am proud of the record Federal investment and 

student financial aid in recent years. Funding for Pell Grants, the 

foundation of Federal student aid, has increased 71 percent since 

2000, up from $7.6 billion to $13 billion today. The maximum grant 

is up from $3,300 in 2000 to $4,050 today. We have paid down the 

Pell Grant shortfall and secured the program for years to come. 

With the passage of the College Access and Opportunity Act earlier 

this year, we further improved the Pell Grant program, the Perkins 

Loan program and increased college access for millions of American 

students. 

To my left, you can see a chart entitled, Strong Support for Pell 

Grant. That shows you where we are today compared to 2000. 

You will see on the far left a bar showing that we have increased 

the overall Pell Grant funding by 71 percent, and that doesn’t even 

include the additional $4.3 billion that we have paid to get rid of 

the Pell Grant shortfall. 

The middle chart reflects the maximum Pell Grant award from 

$3,300 up to 4,050. It doesn’t include the extra$1,000 for the Pell 

Grant Plus Initiative, which is in this bill for the high-achieving 

low-income students; and, very excitingly, also, it doesn’t include 

something that we passed currently called Academic Competitiveness Grant, which will be available to students this fall. Highachieving low-income students who take rigorous classes in math 

and science will be eligible to receive an extra $750 their first year 

if they are Pell Grant eligible, as well as an extra $1,300 their second year if they are Pell Grant eligible. Now this if they decide to 

major in math and science and they can maintain a 3.0 GPA, they 

will receive an additional $4,000 their junior year and an additional $4,000 their senior year, above and beyond the original Pell 

Grant. 

The final graph is very telling, and that is the graph showing the 

number of Pell Grant recipients that have gone up from 36 percent 

since 2000, from 3.9 million to 5.3 million. And some folks say, why 

can’t we just raise Pell Grant more above the $4,050? I am one of 

those folks. Frankly, I would like to see it much higher. That is the 

biggest number that is keeping us down, the dramatic increase of 

the number of students going to college. We will have an increase 

every year until 2008, which will be the record in terms of high 

school graduates. Then it will start to go down a bit, and that will 

free us up to spend a lot more money, which most of us believe is 

a wise investment. 

But the Federal Government, as much as we are doing and can 

do, can only do so much; and I know this firsthand. My mother had 

a family friendly employer who cut a check that allowed me to go 

to college, and I wouldn’t have been able to go if it wasn’t for his 

generous assistance as well as Pell Grant and students loans. That 

is why I am happy to be here today to learn about ways the private 

3

sector can help increase college access for our low- and middle-income students. 

One proposal we will discuss is my Family Friendly Employers 

Act, a bill to reward family friendly employers like my mother’s 

who help send their employees’ children to school. My bill allows 

employers to provide up to $2,500 in tax-free reimbursements for 

tuition, books and fees for their employees’ children’s education. 

Employees already enjoy a $5,250 benefit to help provide for their 

employees’ non-job-related education. My bill would simply expand 

the first $2,500 of that benefit to apply to the employees’ children. 

The cost of this bill would be low. Employers will be able to pro- vide the first $2,500 benefit to either their employee or his or her 

children but not both. Also, the benefit applies to each employee’s 

children in sum, so that an employee would receive the same benefit no matter the number of children. 

The Family Friendly Employers Act will encourage more generous businesses to invest in their companies, their communities 

and in our children’s education. That is one of the reasons we have 

pretty broad bipartisan support for that bill, including the co-sponsorship of the ranking member of Ways and Means, Charlie Rangel, and support from groups as diverse as AFL-CIO and the American Council on Education. 

We have an excellent panel of witnesses today to talk about this 

bill and other important private-sector proposals to complement the 

Federal investment in student aid; and I want to thank you for appearing before the subcommittee today. I look forward to your testimony. 

With that, I yield to Mr. Kildee for any opening statement he 

may have. 

[The prepared statement of Mr. Keller follows:]

Prepared Statement of Hon. Ric Keller, a Representative in Congress From 

the State of Florida 

Good morning, and thank you all for joining us today. We’re here to learn about 

how innovative private sector proposals can help increase college access and complement the record federal investment in student aid. 

A college degree is the passport out of poverty for millions of American students 

each year. Without a college education, many workers today are shut out of quality, 

high-paying jobs. I believe our top priority should be opening the doors of higher 

education to low- and middle-income Americans. 

That’s why I’m proud of the record federal investment in student financial aid in 

recent years. Funding for Pell Grants, the foundation of federal student aid, has increased 71 percent since 2000, up from $7.6 billion to $13 billion today. The maximum grant is up from $3,300 in 2000 to $4,050 today. We’ve paid down the Pell 

Grant shortfall and secured the program for years to come. With the passage of the 

College Access and Opportunity Act earlier this year, we’ve further improved the 

Pell Grant program, the Perkins Loan program and increased college access for millions of American students. 

But the federal government can only do so much. I know this firsthand. My mother had a family friendly employer who cut a check to allow me to go to college. 

That’s why I am happy to be here today to learn about ways the private sector 

can help increase college access for our low- and middle-income students. One proposal we will discuss is my Family Friendly Employers Act, a bill to reward family 

friendly employers like my mother’s who help send their employees’ children to 

school. 

My bill allows employers to provide up to $2,500 in tax-free reimbursements for 

tuition, books, and fees for their employees’ children’s education. Employers already 

enjoy a $5,250 benefit to help provide for their employees’ non-job-related education. 

My bill would simply expand the first $2,500 of that benefit to apply to employees’ 

children. 

4

The costs of this bill will be low. Employers will be able to provide the first $2,500 

benefit to either their employee or his or her children, but not both. Also, the benefit 

applies to each employee’s children in sum, so that an employee would receive the 

same benefit, no matter the number of children. 

The Family Friendly Employers Act will encourage more generous businesses to 

invest in their companies, their communities, and in our children’s education. 

We have an excellent panel of witnesses today to talk about this bill and other 

private sector proposals to complement the federal investment in student aid. I want 

to thank you for appearing before the Subcommittee today. I look forward to your 

testimony. With that, I yield to Mr. Kildee for any opening statement he may have. 

Mr. KILDEE. Thank you, Chairman Keller; and congratulations 

on your elevation to the chairmanship. This is, I think, your first 

hearing since that elevation; and I commend you for that. I have 

always enjoyed working with you. 

My private-sector investment in student aid is important and 

should be encouraged. Federal aid is and should continue to be considered as the cornerstone of college access and affordability. 

Pell Grants and Federal loans are the single most consistent resource for students struggling to pay for college and should be the 

driving force behind any conversation about college access and affordability. Earlier this year, Congress held a $12 billion heist on curbing 

student aid programs, while at the same time refusing to make increased investments in students by reducing interest rates or increasing the Pell Grant in a meaningful way. 

Along with Representative Miller, California, I recently introduced a bill that would reverse the rate on student aid. That is 

H.R. 5150. This bill would cut interest rates in half for students 

and parents taking out subsidized loans, the borrowers most in 

need. This bill would save the average borrower already saddled 

with $17,500 in debt about $5,600 over the life of their loan. 

Pell Grant, arguably the single strongest bridge to college access 

for low-income students, has seen no meaningful increase in the 

last 5 years. I commend Chairman Keller for putting internal pressure on his fellow committee leaders to increase the authorization 

level for Pell Grant by $200, but the appropriate level remains disappointingly low. Pell Grants today are worth $900 less in inflation-adjusted terms than they were in the 1975-’76 school year 

when I first came to Congress. 

Until we can convince the appropriators to restore the actual buying power of the Pell Grant to the $5,100 level promised by our 

President 6 years ago, we have not done anything meaningful in 

helping students and families struggling to pay for college. 

The majority claim to have increased spending on Pell Grants 

substantially since 2001. However, when making these statements, 

they fail to also disclose that Pell Grants are a semi-entitlement 

program, which means that if eligible students apply for Federal financial aid they automatically get a Pell Grant. This means that 

Congress and President Bush do not need to support a vote and 

have not voted to increase the overall spending level for Pell Grant. 

Instead, Congress votes on whether or not to increase, cut or freeze 

the maximum Pell Grant scholarship for students. 

When committee members gave the majority the opportunity to 

vote for increasing the maximum Pell Grant scholarship with guaranteed mandatory funds, the majority opposed the increase even 

5

though it was paid for through offsets coming at no additional costs 

to the taxpayers. 

Yes, overall, spending on Pell Grant is on the rise, as the chart 

indicates over there, but this is because more students qualify and 

more students are going to school. In other words, we have more 

poor students going to school that need help. 

And in Michigan that is certainly the case. Michigan’s economy 

is—particularly in Flint, the old industrial cities, more and more 

poor students depend upon those Pell Grants. The increases in the 

end are not necessarily doing more to help individual students 

make ends meet but are a minimal reaction to the rocky economy 

faced by low-income working families. 

Proposals such as tax benefits and employer benefits overwhelmingly favor students from middle-income families, not low-income 

students who otherwise would not attend college if it weren’t for 

the availability of aid. 

These benefits are important and should be encouraged, but they 

do not substantially serve to close the college access gap for lowincome students. To this end, we must continue to consider Federal 

aid to be the cornerstone of college access. 

I would like to thank our witnesses today, all of them, for joining 

us to share their wisdom with us; and I yield back the balance of 

my time, Mr. Chairman. 

[The prepared statement of Mr. Kildee follows:]

Prepared Statement of Hon. Dale E. Kildee, Ranking Minority Member, 

Subcommittee on 21st Century Competitiveness, Committee on Education 

and the Workforce 

Thank you, Chairman Keller, for convening this hearing, and congratulations on 

your recent appointment to this Committee’s leadership. 

While private sector investment in student aid is important, and should be encouraged, Federal aid is, and should continue to be, considered as the cornerstone 

of college access and affordability. 

Pell Grants and federal loans are the single most consistent resource for students 

struggling to pay for college, and should be the driving force behind any conversation about college access and affordability. 

Earlier this year, Congress held a $12 billion heist on student aid programs, while 

at the same time refusing to make increased investments in students by reducing 

interest rates or increasing the Pell Grant in a meaningful way. 

Along with Representative Miller, I recently introduced a bill, the Reverse the 

Raid on Student Aid Act (HR 5150). 

This Bill would cut interest rates in half for students and parents taking out subsidized loans-the borrowers most in need. 

This bill would save the average borrower, already saddled with $17,500 in debt, 

$5,600 over the life of their loan. 

The passage of this bill would offer real relief to students and families in need. 

Pell grants-arguably the single strongest bridge to college access for low income 

students-has seen no meaningful increases in the last 5 years. 

I commend Chairman Keller for putting internal pressure on his fellow committee 

leaders to increase the authorization level for Pell grants by $200, but the appropriated level remains disappointingly low. 

Pell Grants today are worth $900 less, in inflation adjusted terms, than they were 

in the 1975-76 school year. 

Until we can convince the appropriators to restore the actual buying power of the 

Pell Grant-to the $5,100 level promised by our President six years ago-we have not 

done anything meaningful in helping students and families struggling to pay for college. 

Republicans claim to have increased spending on Pell grants substantially since 

2001. 

6

However, when making these statements, Republicans fail to also disclose that 

Pell grants are a semi-entitlement program-which means that if eligible students 

apply for federal financial aid, they automatically get a Pell grant. 

This means that Congress and President Bush do not vote, and have not voted, 

to increase the overall funding levels for Pell grants. 

Instead, Congress votes on whether or not to increase, cut or freeze the maximum 

Pell grant scholarship for individuals. 

When Committee Democrats gave Republicans the opportunity to vote for increasing the maximum Pell grant scholarship-with guaranteed mandatory funds-Republicans opposed the increase, even though it was paid for though offsets, coming at 

no additional cost to taxpayers. 

Yes, overall spending on Pell grants is on the rise, but this is because more students qualify and more students are going to school-in other words-we have more 

poor students that need our help! 

The increases in the end are not necessarily doing more to help individual students make ends meet, but a minimal reaction to the rocky economy faced by lowincome working families. 

Proposals such as tax benefits and employer benefits overwhelming favor students 

from middle-income families, NOT low income students who otherwise would not attend college if it weren’t for the availability of aid. 

These benefits are important and should be encouraged, but they do not substantially serve to close the college access gap for low-income students. 

For this end, we must continue to consider federal aid to be the cornerstone of 

college access. 

I would like to thank our witnesses for joining us today for this discussion; I look 

forward to hearing your testimony. 

Chairman KELLER. Well, thank you, Mr. Kildee. 

We do have a very distinguished panel of witnesses today, and 

I am eager to hear their testimony. I would like to begin by introducing all of our witnesses, and then afterwards I will recognize 

you individually. 

First, we have Mr. Tom Davis, who co-founded Davis Brothers 

Construction Company with his brother, Robert Davis, in 1986. In 

the 20 years that Davis brothers have been in business, Tom has 

managed the construction of projects for many clients in Colorado, 

Florida, Georgia and Louisiana. 

Mr. Davis also offers a unique benefit to his employees, one that 

allows his employees to put away money for their children’s college 

education. Through this program, Tom has been able to assist 

seven students in achieving their college dream. 

Next, we have Mr. Allison Jones. Mr. Jones is the Assistant Vice 

Chancellor of Academic Affairs and Student Academic Support at 

California State University. In this capacity, he coordinates support to CSU’s 23 campuses in the areas of K through 12 academic 

outreach admission, enrollment, management, financial aid, educational opportunity programs, student services, student health, 

transfer services, disabled student services and remediation. He 

has been with CSU since 1985. 

In 2000, Mr. Jones was appointed by the California State Rules 

Committee to the Scholar Share Investment Board. Scholar Share 

was implemented by the California Governor and legislature to 

help California families save for college. Mr. Jones was also selected as a trustee of the College Board in 2005. 

Mr. Rassan Salandy is the National Director of University Recruitment and Public Relations at the Posse Foundation. In this position, he is responsible for managing press and developing partnerships with selective universities interested in recruiting students through the Posse program. Rassan is an alumnus of Posse 

7

and received his bachelor’s degree in 1997 from the great University of Vanderbilt, which I also happened to graduate from. 

He has worked as a New York City public schoolteacher under 

the New York City Teaching Fellows Program and has been involved with several other youth leadership development organizations. He holds a Master of Arts Degree in Philosophy from the 

University of Wisconsin and plans to pursue his doctorate in the 

same field. 

Finally, we have Mr. Jamie Merisotis. He is the founding President of the Institute for Higher Education Policy. Established in 

1993 in Washington, D.C., the Institute is regarded as a premiere 

research and policy organization, concerned with higher education 

policy development. 

As the Institute’s President, Mr. Merisotis has worked extensively on nearly every aspect of the Institute’s work. He is recognized as a leading authority on college and university financing, 

particularly student aid, and has published major studies and reports on topics ranging from higher education ranking systems to 

technology based learning. 

Prior to founding the Institute, Mr. Merisotis served as the Executive Director of the National Commission on Responsibilities for 

Financing Postsecondary Education, a bipartisan commission appointed by the President and the congressional leadership. 

Now, before the panel begins, I would like to remind the members that we will be asking questions of the witnesses after testimony; and, in addition, committee rule 2 imposes a 5-minute limit 

on all of the questions. 

As to the witnesses, each one of you will have 5 minutes to give 

your presentation. If your written remarks are longer, we will submit those in the record in total. 

Let me explain briefly the lights, which will be helpful to you. 

The green light says you have 5 minutes. Once you have only 1 

minute left, you will see a yellow light that will advise you that you 

only have a minute left. And then, finally, the red light means your 

time has expired and we would ask you to wrap it up pretty shortly 

thereafter so we can make sure all the members have time to get 

to your questions. 

With that, let me thank all the witnesses for being here; and we 

will begin with Mr. Tom Davis. 

STATEMENT OF TOM DAVIS, OWNER, DAVIS BROTHERS 

CONSTRUCTION 

Mr. TOM DAVIS. Thank you, Mr. Chairman, Ranking Member 

Kildee and other committee members. It is an honor to be here. 

To tell you a little bit about myself, my brother and I started a 

construction company in Houston 20 years ago, Davis Brothers 

Construction. We build dormitories for universities, high-end apartment projects and condominiums around the country; and we do an 

average volume of about $50 million a year. 

I was raised on a ranch in West Texas by two hard-working, loving parents that sacrificed a lot to put four kids through college. 

Out of the four, I am the only one that didn’t graduate. I didn’t 

take full opportunity—didn’t take full advantage of the opportunity 

I had. I partied too much. But so—and out of those—but I was 

8

raised with a strong belief that we owe our children an opportunity 

to go to college. And we as a family, we as a country, we as a people, we owe that to these kids that we have out here today. 

I am involved with three charities, all of them that have to do 

with children. The first is the Star Hope Mission in Houston, which 

is one of the largest missions of its kind in the country. Houston 

has, right now, over about 10,000 homeless people; and the average 

age of that homeless person in Houston is 9 years old. So there are 

lots of homeless kids out there that are starving to death. 

The other charity I work with is the Houston Livestock Show 

and Rodeo. It is dedicated to education, and each year we give 

about a little over $8 million in full scholarships to Texas youth. 

The third charity I am involved with is called Elves and More, 

and it is based out of Houston. It is a charity where we give away 

bicycles to children that live under the poverty level. Last year, we 

gave out roughly 21,000 bicycles; and it makes a huge difference 

to these children. It gives them freedom and allows them to go to 

school when their parents can’t take them, stuff like that. 

But my point I am making is that, by being active in these, I 

have seen what an education does for a child; and I have seen what 

not having a college education has done. And that is my point. 

Because of this, my brother and I decided to start paying for our 

employees’ children’s college education. We have 37 full-time employees, and now many of their children are reaching college age. 

So we pay for those that can’t pay. So we have seven kids right 

now that are enrolled in college full time, and we monitor each one. 

They bring us their grades. If they are in trouble, we hire tutors 

for them; and we make sure that they succeed. I do everything in 

my power not to let them fail. 

The average cost is running for us about $5,000 per child per 

year. So I know that—you know, we are glad to pay for this. We 

are able. The good Lord has blessed us with a successful company 

with many employees and many fine children. But a lot of companies can’t afford this; and your bill, Congressman, I think is a wonderful step in the right direction. 

So I encourage all of you all to pass this bill. I can’t see how it 

is nothing but a slam dunk. It makes a lot of sense. And I think 

money spent in this way, you know, when we are spending our 

company money, or even if I am able to deduct it from my taxes, 

I think I am more efficient with my money than many other organizations are that give out moneys for scholarships. 

And so—but there is nothing that will make this country stronger than educating our youth, and I support you wholeheartedly. So 

on behalf of all of my employees and their children and other businesses like mine, I thank you for the opportunity to be here. And 

God bless you. 

Chairman KELLER. Well, thank you very much, Mr. Davis; and 

we certainly appreciate all you are doing to make this country better with your innovative programs. 

[The prepared statement of Mr. Davis follows:]

9

Prepared Statement of Tom Davis, Owner, Davis Brothers Construction 

Introduction 

Good morning, Chairman Keller, ranking member Kildee and Committee Members. Thank you for inviting me here today to testify before the Committee about 

how the private sector can help expand college access. My name is Tom Davis and 

along with my brother Bob Davis, we are the owners of Davis Brothers Construction. We have been in business for 20 years. We are a general contracting firm 

building apartments, dormitories for Universities, and condominiums. We do an average dollar volume of $50,000,000 per year. 

Scholarships for the Children of Davis Brothers Employees 

I was raised on a ranch in West Texas by two hard working, loving parents who 

sacrificed much to put their four children through college. Out of the four children, 

I was the only one who did not complete his college education. It is the one failure 

in my life that I regret the most. The good Lord has blessed my brother and myself 

with a great company and many wonderful employees that have many wonderful 

children. Because of this and my strong belief that we owe our children an opportunity to attend college, my brother and myself have dedicated ourselves to helping 

children get an education. 

I am involved with three charities and they all involve children. The first is the 

Star of Hope Mission in Houston, Texas. It is one of the largest homeless missions 

in the country. The average age of the homeless person in Houston is 9 years of 

age. I served on their board for nine years and am still heavily involved. Another 

charity I am involved with is the Houston Livestock Show and Rodeo which last 

year gave out $8,000,000 in scholarships to Texas students. I am currently on their 

board of directors. The last charity I am involved with is Elves & More, a Houstonbased charity that gave away 20,800 bicycles last Christmas to kids living below the 

poverty level. This is our fifth year of existence and we have seen a marked increase 

in school attendance because these children can now get to school on their bikes, 

get to their jobs, get to their friends house, get to Scout meetings, etc. 

The point I am making is that by being an active board member of these charities, 

I see first hand what happens when a child gets an education and I see first hand 

what happens when a child does not get an education. 

Because of these experiences working with children and because several of our 

employees have children that have reached the age to attend college, my brother 

and I decided to start paying for their college education. Davis Brothers Construction currently has 37 full-time employees and as of today we have seven of our employee’s children enrolled in college full-time. All of these kids live at home with 

their parents and Davis Brothers pays for their tuition and books. On the average, 

it is about $5,000 per child per year. This is our third year since implementing this 

program. We monitor each student by requiring they bring us reports during the 

year and if they are having difficulty in a class, we help by getting them the necessary tutoring they need to succeed. Because of the way we treat our employees 

and their children, they literally would walk through fire for us. All companies, 

large and small are nothing without their employees. The Family Friendly Employers Act you are considering would make a huge difference, not only for companies 

making a decision to help their employees with their children’s education, but also 

in our society. I am of the opinion that dollars spent in this way will be much more 

effective than programs that merely give monies, because those other programs require large administrative overhead expenses. 

The State of Texas does not currently have any incentives that I know of to encourage companies to help with their employees’ children’s education. 

The Family Friendly Employers Act 

I believe this bill will encourage more businesses like mine to invest in education 

and help send more kids to school. While I am happy to provide this benefit for my 

employees and their children, I know that some businesses simply do not have the 

resources to pay for it out of pocket. A tax incentive like the one provided in the 

Family Friendly Employers Act would encourage more businesses to help send their 

employees’ children to college. 

A business is only as good as its employees. Because of what we do with our employees, our turnover in our employees is non-existent. Moral is high and the quality 

of work we receive from our employees is outstanding. 

Conclusion 

In conclusion, on the behalf of my employees their children, and businesses like 

mine across the county, I encourage Congress to pass the Family Friendly Employers Act. 

10

And I will say it one more time. We owe it to the youth of this country. 

Thank you, Chairman Keller and other Committee Members, for holding this 

hearing on a topic so important to our nation’s businesses, workforce and students. 

Chairman KELLER. Mr. Jones. 

STATEMENT OF ALLISON JONES, ASSISTANT VICE CHANCELLOR OF ACADEMIC AFFAIRS AND STUDENT ACADEMIC 

SUPPORT, CALIFORNIA STATE UNIVERSITY 

Mr. JONES. Good morning. Chairman Keller, Ranking Member 

Kildee and members of the subcommittee, thank you for inviting 

me to discuss the California State University programs that support access to California’s neediest students and the importance of 

Federal student financial aid to help achieve that goal. The CSU 

commends the committee for its attention to the important task of 

ensuring that every student who to chooses to do so can pursue a 

postsecondary education. 

Today, I would like to share with you several key outreach programs that CSU has developed, as well as Federal and State programs in which CSU is a key partner that supports student academic preparation and access to college. 

First of all, a slight word about CSU and who we are, to give you 

a sense of context. CSU, or the California State University, is the 

largest 4-year university system in the country, with 23 campuses 

and over 405,000 students. Our mission is to provide high-quality, 

affordable education. We play a critical role in preparing outstanding candidates for the job market not only in California but 

nationally. 

For instance, we confer 65 percent of all the bachelor’s degrees 

in business, over half of the degrees in agriculture and agricultural 

engineering, and nearly half of the degrees in computer and electronic engineering. Altogether, over half of the bachelor’s degrees 

in the State of California and a third of the masters degrees are 

awarded by the California State University. 

The students we serve are not typically the traditional student, 

the traditional 18- to 22-year-old. The average age of the students 

that we serve is 24; 44 percent of our students are independent 

from their parents; 40 percent are parents; 80 percent have jobs 

and 36 percent of those work full time; 20 percent are the first in 

their family to attend college; 40 percent come from households 

where the primary language is a language other than English; and 

well over half of our students qualify for Federal financial aid. 

So we spend as an institution a great deal of time building 

bridges with our State’s K-12 partners. We try to help more students prepare for and to succeed to enroll at the CSU, but particularly those students who are underserved and first-generation college students. 

One of the most important tools that the California State University has developed to reach high school students is our Early Assessment Program. It is 3 years old. It prepares students for the 

academic rigors of college, and it reduces the time to the degree—

to the extent that students are prepared academically to enter the 

California State University. As a result, it maximizes the use of 

both the Federal and State financial aid. 

11

The Early Assessment Program identifies students before their 

senior year—that is, students in the 11th grade—who need to do 

additional work in English and mathematics prior to entering the 

California State University. That is, they need to demonstrate the 

requisite skills expected of a graduating high school senior. 

More importantly, it provides an opportunity for students in high 

school to use their 12th grade year very effectively to master the 

requisite English and math skills expected again of a graduating 

high school senior, not only going in the workforce but entering the 

California State University. 

We have attached to our testimony a copy of a presentation 

which we would ask be included as part of the record. While this 

program is voluntary, nearly 200,000 students Statewide have 

taken this. It is voluntary on the part the students in 11th grade. 

Nearly 70 percent of the students will take it in math and about 

15 percent will take it in English, and they are using the senior 

year most effectively to try to increase those skills that they enter 

school without the need for remediation. 

Another important academic outreach program is our Steps to 

College poster. Members have been provided a copy of the poster, 

but it provides to information about academic preparation and financial aid beginning in 6th grade through 12th grade. 

For the next wave of California students, many of whom are the 

first in their families to go to college, information and planning is 

absolutely critical. To reach out to under-served communities and 

students, the California State University has been working with 

churches throughout the State of California. Earlier this year, we 

held what we call Super Sunday in south central L.A. We worked 

with eight churches and reached over 20,000 people. Our chancellor 

and president were invited to make presentations during the services. We handed out over 10,000 posters to families, their students 

and grandparents and aunts and uncles. It was a very successful 

program. 

Foster Youth is another group of students that we are providing 

services to that are often overlooked. These students, as wards of 

the court, have special needs that we need to attend to. 

There is also most recently a veterans’ initiative that we have 

begun with the Governor of the State of California as well as the 

military base commanders to provide access to men and women 

exiting California, in California. There are about 60,000 veterans 

who are exiting California, the military, and we want to provide access to them. 

TRIO and GEAR UP is a very important program to us as well. 

It reduces the need for remediation. About 11 of our campuses are 

actively engaged in this, and we continue to support and we are 

pleased that H.R. 609 continues to maintain TRIO and GEAR UP 

as separate programs which we would continue to request occur. 

Last, financial aid. The Pell Grant continues to represent the 

foundation of the Federal student financial aid program. It is absolutely essential to us. We note that in H.R. 609 the College Access 

and Opportunity Act has increased the authorized maximum Pell 

Grant, and we do in fact urge the subcommittee members to work 

with Appropriations Committee to increase the funded award. 

Thank you very much. 

12

Chairman KELLER. Well, thank you, Mr. Jones. 

[The prepared statement of Mr. Jones follows:]

Prepared Statement of Allison G. Jones, Assistant Vice Chancellor, 

California State University System 

Introduction 

Chairman Keller, Ranking Member Kildee, and members of the subcommittee, 

thank you for inviting me to discuss the California State University (CSU) programs 

that support access to California’s neediest students and the importance of federal 

student financial aid to help achieve that goal. The CSU commends the Committee 

for its attention to the important task of ensuring that every student that chooses 

to do so can pursue a postsecondary education. 

Today, I would like to share with you several key outreach programs that the 

CSU has developed and implemented, as well as federal and state programs in 

which the CSU is a key partner: the Early Assessment Program (EAP), Steps to College poster, Super Sunday, foster youth programs, California Veterans Education 

Opportunity Partnerships, Math, Engineering, and Science Advancement (MESA), 

TRIO, and GEAR UP. Each of these programs support student academic preparation and access. I will conclude with a few remarks about federal and state student 

financial aid. But first, a few words about the CSU and its students. 

The California State University—Background 

Few, if any, university systems can match the scope of the CSU system. The CSU 

is the largest four-year university system in the country, with 23 campuses, approximately 405,000 students and 44,000 faculty and staff. The CSU’s mission is to provide high-quality, affordable education to meet the ever-changing needs of the people of California. Since the system’s creation in 1961, it has awarded about 2 million 

degrees. We currently award approximately 84,000 degrees each year. 

The CSU plays a critical role in preparing outstanding candidates for the job market. Our graduates help drive California’s aerospace, healthcare, entertainment, information technology, biomedical, international trade, education, and multimedia industries. The CSU confers 65 percent of California’s bachelor’s degrees in business, 

52 percent of its bachelor’s degrees in agricultural business and agricultural engineering, and 45 percent of its bachelor’s degrees in computer and electronic engineering. The CSU also educates the professionals needed to keep the state running. 

It provides bachelor’s degrees to teachers and education staff (87 percent), criminal 

justice workers (89 percent), social workers (87 percent) and public administrators 

(82 percent). Altogether, about half the bachelor’s degrees and a third of the master’s degrees awarded each year in California are from the CSU. 

One key feature of the CSU is its affordability. For 2005/06, the CSU’s systemwide fee for full-time undergraduate students is $2,520. With individual campus 

fees added in, the CSU’s total fees average $3,164, which is the lowest among any 

of the CSU’s comparison public institutions nationwide. We try to keep our costs 

down—and in fact Governor Schwarzenegger has proposed buying out a fee increase 

scheduled for this year—yet many of our students continue to have great financial 

need. Approximately half of our students receive financial aid. 

The California State University—Its Students 

CSU students are not necessarily the traditional 18- to 22-year-olds. A recent survey of CSU students revealed the following about students enrolled at the CSU: 

• The average undergraduate age is 24, 

• About 85 percent are commuters, 

• 44 percent are independent from their parents, 

• Nearly two in five have dependents, 

• Four out of five have jobs, and 36 percent work full time, 

• About one in five is in the first generation in their family to attend college, 

• 40 percent come from households where English is not the main language spoken, and 

• 54 percent of CSU students are students of color. 

The CSU prides itself on its ability to provide college access to students across 

California’s increasingly diverse population. The CSU provides more than half of all 

undergraduate degrees granted to the state’s Latino, African American and Native 

American students. 

Additionally, CSU students are closely connected and committed to the communities in which they live. More than 185,000 CSU students participate in community 

service annually, donating nearly 30 million hours, the minimum wage equivalent 

of $200 million. 

13

Public/Private Partnerships 

Public-private partnerships are vital for higher education. In today’s economy, 

higher education is more important than ever. According to the Census Bureau, a 

college graduate’s lifetime earnings ($2.1 million) are almost double that of a high 

school graduate. But a higher degree is more than just a ticket to a better job. It 

can improve the economic situation of both individuals and their communities. 

That’s why it is in everyone’s interest—communities, businesses, and educators—to 

help students succeed in school and pursue the highest degree they can. In fact, we 

cannot state this fact strongly enough: The future success of our country’s economy 

is inextricably linked with the educational attainment of our students. 

Given this conviction, the CSU recently sought to measure its impact, economic 

and otherwise, on California’s businesses and communities. A comprehensive study 

of the CSU and its campuses found that CSU-related expenditures create $13.6 billion in economic activity, support 207,000 jobs and generate $760 million in state 

taxes in a year. The report also found that the state of California reaps a four-fold 

benefit from every dollar it invests in the CSU. This study further cemented our 

belief that the CSU’s work is tightly bound to that of our local communities and 

economy. Essentially, we see ourselves as building bridges—building continuity 

across the spectrum from education, to the economy and workforce, to the community. 

K-12 Partnerships 

A good place to start this discussion is at the very beginning of the educationworkforce continuum, in the public schools. Given that the public schools are the 

source of nearly all CSU students, the CSU spends a great deal of time building 

bridges with our state’s K-12 partners. Specifically, we have been reaching out to 

middle and high schools to try to help more students prepare for and get ready to 

succeed in college. 

When we say that 54 percent of the CSU’s students are students of color, it may 

sound like a large number, but that’s not necessarily the case when you look at the 

students who are in the pipeline. Right now, approximately two-thirds of our state’s 

K-12 students are students of color. CSU believes the future of higher education in 

this country depends on its ability to reach those students of color and students 

from traditionally underrepresented groups whom we have not yet reached. 

Early Assessment Program 

One of the most important tools the CSU has developed to reach high school students is the Early Assessment Program, known in California as simply the ‘‘EAP.’’ 

CSU created this early assessment of college readiness program in collaboration 

with the California Department of Education and the State Board of Education. It 

provides 11th grade students a ’snapshot’ of their mathematics and English/language arts proficiency. The test incorporates the CSU’s placement standards into 

the California Standards Tests for English and math. 

The EAP identifies students—before their senior year—who need to do additional 

work in English and/or mathematics prior to entering the CSU. The EAP informs 

students, families, and high schools of a student’s readiness for college-level work 

in these subjects. Most importantly, it provides an opportunity for the high school 

to work with the students while they are enrolled in 12th grade to help them to 

master the requisite English and math skills expected of a graduating high school 

senior. Attached to this testimony is a copy of CSU’s PowerPoint that provides more 

detail about the three key components of the EAP: (1) early assessment in 11th 

grade in English and mathematics, (2) supplemental high school preparation in 12th 

grade, and (3) teacher professional development designed to equip high school 

English and mathematics teachers with the tools necessary to ensure student mastery of the content standards. Although the EAP is voluntary, over 186,000 students 

took the EAP test last year. 

‘‘Steps to College’’ Poster 

Another important outreach effort is our ‘‘Steps to College’’ poster. For the next 

wave of California’s students, many of whom are the first in their families to go to 

college, planning information is critical. The CSU created this popular poster, which 

describes for middle and high school students (grades 6 -12) and their families the 

steps they need to take to prepare and apply for college and financial aid. The poster, which has served as a model for similar publications at universities from Nevada 

to Pennsylvania, won a silver medal in the CASE Circle of Excellence International 

competition. 

For the last six years, we have distributed copies of the poster in English and 

Spanish to middle and high schools throughout California. Last year, we partnered 

14

with Boeing to create additional English/Spanish versions of the poster and expand 

the distribution to local libraries and youth organizations. We also partnered with 

three Asian newspapers to print and distribute copies of the poster in Chinese, Korean, and Vietnamese. 

Community Partnerships 

Over the past year, CSU has held town hall meetings with African-American, Hispanic, and Vietnamese communities to discuss how collectively we can better reach 

out to and serve students in those communities. We are continuing to meet with 

working groups from these and other traditionally underrepresented communities to 

help them to maximize their chances for success in higher education by providing 

information on how to prepare academically and financially for college. We are sharing with these communities the value of a CSU education as the bridge to economic 

opportunity and professional success. In addition to providing information to students and their families, the CSU is providing an opportunity to inform leaders and 

members of these communities about CSU’s role and impact on educating African 

American, Hispanic, and Vietnamese students. These activities are building longterm partnerships with African American, Hispanic, and Vietnamese community 

leaders who work with and influence the youth in their respective communities. 

Super Sunday 

For example, CSU is working with churches in the Los Angeles Basin that serve 

large African-American congregations in an effort to increase the pool of AfricanAmerican students, particularly male, to be eligible to attend a four-year university. 

Earlier this year, we held ‘‘Super Sunday’’ at West Angeles Cathedral and other 

churches in the Los Angeles area to provide information for students and their families about college. We went to eight churches and reached over 20,000 people. We 

handed out the ‘‘Steps to College’’ poster to about 10,000 parents, grandparents and 

students. Our follow-up has created a contact person at every church who is dedicated to college knowledge and college preparation. Previously only one church had 

a contact person for higher education. In the near future, we will be holding similar 

events in the Oakland area. 

We have also partnered with the Tomas Rivera Policy Institute and Sallie Mae 

on a large grant to support ‘‘Kids to College,’’ aimed at helping sixth graders in underserved communities learn what it takes to get to college. 

Foster Youth 

In 1996, the California Legislature called upon the CSU and the California Community Colleges (CCC) to expand access and retention programs to include outreach 

services to emancipated foster youth in order to encourage their enrollment in a 

CSU or a CCC. The CSU and the California Community Colleges were asked to review housing issues and to provide technical assistance to assist those prospective 

foster youth students in completing admission applications and financial aid applications for students who voluntarily disclosed their status as emancipated former 

foster youth. 

The Independent Living Program (ILP), administered by the California Department of Social Services (CDSS) through the local county social services departments 

and through the CCC, enables eligible foster youth to achieve self sufficiency prior 

to leaving the foster care support system by providing independent living skills assessments and providing services based on them. The ILP coordinators work with 

local area CSU campuses and county foster youth programs to provide outreach and 

student services. At the request of Chancellor Charles B. Reed, CSU campuses developed programs that addressed the special needs of foster youth enrolling on their 

campuses, including special attention to counseling foster youth about housing opportunities available on campus and in the local community during the summer preceding enrollment, Thanksgiving vacation, winter recess, and spring break. 

CSU Fullerton’s Guardian Scholars Program is a representative example of activities in which many CSU campuses are engaged. The program is committed to supporting ambitious, college-bound students exiting the foster care system. CSU Fullerton provides a comprehensive program that contributes to the quality and depth 

of the student’s university experience. It serves as a resource for young adults by 

assisting in their development and equipping them with the educational and interpersonal skills necessary to become self-supporting, community leaders, role models, 

and competent professionals in their selected fields. 

Difficult situations and backgrounds have left some foster care youth with significant hardships in their lives. Many of these young people have overcome these challenges. Their academic performance in high school has qualified them to meet CSU 

Fullerton admission standards. As wards of the court, these foster care youth become emancipated at age 18 and are forced to make a difficult transition to adultVerDate 0ct 09 2002 11:32 Nov 02, 2006 Jkt 000000 PO 00000 Frm 00018 Fmt 6633 Sfmt 6621 H:\DOCS\21CC\5-23-06\27986.TXT EDUWK PsN: DICK
15

hood often without traditional family support. By awarding a five-year scholarship, 

the Guardian Scholars program provides the opportunity to change individual lives 

and make dreams come true. 

Each fall semester CSU Fullerton endeavors to admit ten new students into the 

Guardian Scholars program with an ultimate goal of reaching fifty scholars in the 

program at one time. In addition to all annual fees, academic tuition, textbooks and 

supplies, the program provides support to emancipated foster youth such as an orientation to university life, year-round, on-campus housing, on-campus student employment opportunities, one-to-one counseling, peer and faculty mentoring, financial 

aid application assistance, assistance with off-campus employment in career fields, 

and post-graduation career planning and assistance. 

The Guardian Scholars program is a working partnership between the private sector and public agencies designed to achieve significant synergies which allow us to 

support our students effectively and cost-efficiently. CSU Fullerton, the Orangewood 

Children’s Foundation, public agencies, and private citizens create a powerful team 

dedicated to assisting deserving foster youth to achieve their dreams of a college 

education, realize true independence and reach their full potential. We urge Congress to encourage these types of programs on a national level. 

California Veterans Education Opportunities Partnership 

The CSU has pledged to work with Governor Schwarzenegger and California’s 

military base commanders to reach out to military men and women who are on active duty and who are exiting the service to facilitate their transition to college. Last 

month, the Governor announced the formation of the Veterans Education Opportunities Partnership, which will create a model for veterans’ education by developing 

an academic outreach, admission, and enrollment plan that targets and assists the 

approximately 60,000 California veterans exiting military service each year. The 

partnership consists of senior administration officials, military leaders, and leaders 

of the CSU, UC, and the CCC system. The partnership will seek to work cooperatively to provide education opportunities to veterans who are California residents 

or who are stationed in California at the time of their exit from the military. 

The total active U.S. Military force includes 1.42 million men and women of whom 

160,000 (11.2 percent) come from California. Approximately 175,000 active duty men 

and women are stationed in California. An additional 25,000 serve in the Reserves. 

The Montgomery GI Bill education benefit is the number one reason American men 

and women enter the U.S. military. Therefore, each member of the military pool of 

over 200,000 men and women serving in California is a potential candidate for admission to one of California’s 109 California Community Colleges, 23 CSU campuses, and 10 UC campuses. 

Approximately 60,000 of a pool of over 200,000 men and women exit military service annually. According to the U.S. Department of Defense, the average age of 

exiting Veterans is 25.3 years. Eighty-four percent are male, and sixteen percent are 

female. Ninety-six percent of exiting Veterans are enrolled in the Montgomery GI 

Bill, but only fifty percent are using their Montgomery GI Bill benefits. The CCC, 

the CSU, and the UC represent education opportunities for exiting Veterans, both 

for California residents and for service members stationed in California. 

A Memorandum of Understanding implementing the California Veterans Education Opportunities Partnership will be signed by the Governor Arnold 

Schwarzenegger, Chancellor Charles B. Reed for CSU, President Robert C. Dynes 

for UC, and Chancellor Mark Drummond for the California Community Colleges. 

The MOU will implement California’s vision to be the leader in becoming ‘‘Veteran 

friendly’’ for college and university education. California will become the model state 

for Veteran education and will ensure Veterans who are California residents or who 

are stationed in California at the time of their exit from the military access to California colleges and universities. 

MESA (Math, Engineering, and Science Achievement) 

Since 1970, MESA’s academic development programs have supported educationally disadvantaged students to encourage them to excel in math and science studies 

and to graduate with degrees in engineering, science, and technology. MESA tries 

to reach economically and educationally disadvantaged students. This program involves the CSU, University of California (UC), California Community Colleges, Independent Colleges, and industry partners. It is funded by the California legislature, 

corporate contributions, and grants. 

The MESA Schools Program serves middle and senior high school students 

throughout California to introduce them to math and science. MESA supports their 

mastery of these content areas in an effort to encourage them to enroll in college 

in math-based majors. This program partners with teachers, administrators, school 

16

district officials, and industry representative to provide an academic enrichment 

model. The MESA Community College Program supports community college students so they will transfer to four-year universities as majors in math, engineer, 

science, and technology. The MESA Engineering Program centers provide support 

to educationally disadvantaged students at four-year colleges to attain engineering 

or computer science baccalaureate degrees. 

Seventy-seven percent of MESA students successfully complete Algebra I before 

the 10th grade. More encouraging, fifty-four percent complete the CSU and UC college preparatory high school course pattern consisting of fifteen courses. Of MESA 

high school graduates, fifty-seven percent enrolled in college as math, science, or engineering majors. 

Nine of nineteen MESA pre-college sites and eight of ten MESA engineering programs are located on CSU campuses. Fifty-seven percent of MESA’s pre-college students were served by centers located on CSU campuses, and for the past five years, 

over twenty-five percent of MESA high school graduates have enrolled at a CSU 

campus. Nearly fifty percent of MESA community college students transferred to 

CSU campuses. 

TRIO and GEAR UP 

‘‘The California State University joins the education community in full support of 

the GEAR UP program, which is vital to preparing underrepresented students for 

college, encouraging persistence and ultimately graduation. Skills gained through 

the GEAR UP program will reduce the need for remediation, saving students and 

institutions time and money. This is a program we can all be proud of for what it 

does for students.’’

California State University Chancellor Charles B. Reed.

Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP) 

was authorized in the Higher Education Amendments of 1998 to provide low-income 

middle school students the skills, encouragement, and academic preparation needed 

to enter and succeed in high school and postsecondary education through partnerships between schools, universities, the private sector, and community organizations. GEAR UP provides six-year grants to states and partnerships to strengthen 

academic programs and student services at participating high-poverty middle and 

high schools. Grantees serve an entire cohort of students beginning no later than 

the seventh grade and follow the cohort through high school. GEAR UP funds are 

also used to provide college scholarships to low-income students. 

Eleven CSU campuses have been designated as the fiscal agent for GEAR UP 

Partnership Grants totaling over $112 million since the inception of the program in 

1999. These partnerships include at least one low-income middle school and at least 

two other partners. CSU campuses are also participants in other partnership grants 

for which a local school district is the fiscal agent. For example, four CSU campuses 

are participating in five 2005 partnerships: CSU Long Beach is a participant in a 

partnership grant awarded to the Bellflower Unified School District; CSU 

Northridge, with two partnership grants awarded to the Los Angeles Unified School 

District (LAUSD); CSU Dominguez Hills, with LAUSD; and San Diego State University with Sweetwater Unified School District. 

An example of a successful GEAR UP program at CSU East Bay is Successful Options for Academic Readiness (SOAR). The campus received a $2.808 million federal 

GEAR UP Partnership Grant to promote access to and success in higher education 

for low-income students enrolled in 7th grade in 14 of Oakland’s middle schools. 

SOAR consists of fours strands that will affect the needs of the middle school students: an academic strand, a parent strand, a partnership strand, and a systemic 

change strand. In addition to the partnership grants received by CSU campuses, 

California was awarded a second State GEAR UP Grant for a total of $21 million 

over six years, having just completed administering its first six-year grant totaling 

$30 million that was awarded in 1999. A total of 196,000 low-income students in 

187 middle schools in 80 school districts have been served by California GEAR Up. 

The number of schools represents 15.6 percent of all middle schools in California. 

The number of students represents 31 percent of all students who attend a low-income middle school in California. California receives the largest amount of GEAR 

UP resources of any state. 

An important outcome of GEAR UP is the documented increases in student academic preparation. California GEAR UP middle schools have offered more college 

preparation classes, and the number of students taking college preparatory courses 

has grown. 

17

• Participating GEAR UP middle schools have increased the number of college 

preparatory sections in English/Language Arts by 54 percent; Mathematics, by 46 

percent; Science, by 24 percent; and Social Sciences, by 92 percent; • 20 percent more students are enrolling in Algebra in middle schools; • 64 percent of the students are enrolled in advanced mathematics courses in 

high school; and • 48 percent of the students are taking Honors level courses in English in high 

school. 

GEAR UP is distinct from other federal and state initiatives. This program employs partnerships committed to serving and accelerating the academic achievement 

of cohorts of students through their high school graduation. GEAR UP partnerships 

supplement rather than supplant existing reform efforts, offer services that promote 

academic preparation and the understanding of necessary costs to attend college, 

provide professional development, and continuously build capacity so that projects 

can be sustained beyond the term of the grants. 

The CSU notes that the Higher Education Act (HEA) reauthorization legislation, 

which originated in this subcommittee and recently passed the House, maintains 

TRIO and GEAR UP as separate programs, and CSU thanks you for that. The CSU 

joins the higher education community in support of both the TRIO and GEAR UP 

programs and proposes that these important programs be expanded to serve an increased number of disadvantaged and low-income students. The TRIO and GEAR 

UP programs are vital to preparing underrepresented students for college, encouraging persistence and ultimately graduation. Skills gained through the TRIO and 

GEAR UP programs reduce the need for remediation, saving students and institutions time and money. While these programs complement each other, each has a 

unique purpose and method, and each serves a unique cohort of students. Accordingly, the CSU supports keeping these two programs distinctly separate and complementary. 

In the spirit of today’s topic to encourage more public-private partnerships to complement federal investment in student aid, the CSU proposes three modifications to 

the TRIO and GEAR UP programs. First, the TRIO program should be expanded 

to include community-based organizations with experience in serving disadvantaged 

youth. Second, incentives should be created within both programs to encourage middle schools and high schools to form partnerships with colleges to develop college 

preparatory programs for disadvantaged students. Third, incentives within these 

programs should be created to encourage and prepare underrepresented students to 

pursue coursework and careers in fields such as science, technology, engineering, 

and mathematics (the ‘‘STEM’’ fields). 

Federal Financial Aid 

Pell Grant Program—The Pell Grant program continues to represent the foundation of federal student financial aid programs. As the most need-focused federal student aid program, a strong Pell Grant program is essential to closing the gap in college enrollment and completion that exists between low-income students and their 

more affluent peers. A continued commitment to the Pell Grant program, and to increases in the maximum Pell Grant award, are essential to ensuring access for disadvantaged students. Across the CSU System, 116,000 students receive $318 million 

in Pell Grant awards. The average CSU Pell Grant recipient receives $2,724 per 

year from the Pell Grant program, and Pell Grants account for 19 percent of the 

funds awarded to CSU students. On behalf of CSU students across California, I 

would like to thank the members of the Committee for that support. I also note that 

HR 609, the College Access and Opportunity Act, increased the authorized maximum Pell Grant award. I would urge members of the subcommittee to work with 

the Appropriations Committee to increase the funded maximum award. 

In addition, there continues to be a need for a year-round Pell Grant. Year-round 

study enables students to complete their academic degree in less time than might 

otherwise be required. This reduces the amount of time that a student spends in 

school, saves the student money (and reduces borrowing), and permits more efficient 

use of campus facilities and resources at a time when those resources are being 

stretched due to increasing enrollments and tight state budgets. Increasing enrollment demand will be a national trend for the foreseeable future, and we fully expect 

a number of institutions to utilize a year-round calendar as a resource management 

strategy. Such a move may also increase student persistence and graduation from 

college. 

The CSU strongly endorses the subcommittee’s efforts to provide additional Pell 

Grant funds to students for year-round study. On behalf of the CSU, I also want 

to thank you for including specific provisions which will allow students at the CSU 

and at other institutions serving large numbers of non-traditional students to parVerDate 0ct 09 2002 11:32 Nov 02, 2006 Jkt 000000 PO 00000 Frm 00021 Fmt 6633 Sfmt 6621 H:\DOCS\21CC\5-23-06\27986.TXT EDUWK PsN: DICK
18

ticipate. Finally, I would also note that probably the most beneficial year-round Pell 

grant provision, both for students and for institutions, would be to permit utilization 

of Pell Grants for students who enroll for summer study in order to complete their 

remaining degree requirements, even if they do not need to enroll full-time, rather 

than having them enroll for an entire term in the subsequent academic year. Such 

a provision should be open to students at any Title IV eligible institution. 

Campus-Based Programs—The Campus-Based programs (Perkins Loans, Federal 

Work-Study, and Supplemental Educational Opportunity Grants (SEOG)) are vital 

to the CSU’s efforts to attract, retain, and graduate disadvantaged students. Unique 

to these programs is the flexibility they provide to financial aid administrators to 

package aid awards to best meet the needs of their students. In addition, these programs require an institutional match, which leverages the federal investment to 

provide even more aid to more students. The CSU knows that these programs work, 

and joins the higher education community in urging increased funding for them. In 

addition, we thank you for continuing the Perkins Loan program, and again ask 

members of the subcommittee to work with the Appropriations Committee to fund 

the Perkins Loan capital contribution. 

California Financial Aid 

California is unique in that its Governor and Legislature enacted a state grant 

entitlement program in 2000. This historic financial aid program opened university 

doors for thousands more students. By taking this bold step, California announced 

to all financially needy students that if they earn the grades and are eligible for 

college, they are assured a state grant to help pay the entire cost of CSU fees as 

well as fees at the UC and grants to offset part of the tuition at other eligible California colleges. 

Because of fiscal constraints in 2000, however, some provisions were included in 

the authorizing language restricting entitlement grants to students under the age 

of 24. Because of this restriction, the state also implemented a Competitive Cal 

Grant program with a limited number of grants. Recently, legislation was introduced in the California Legislature to expand further the eligibility for Cal Grant 

Entitlement awards by increasing the eligibility for the entitlement grant from 24 

to 27 and by doubling the number of competitive grants. 

Summary 

All of these partnerships, and many, many others at our campuses, do more than 

simply enrich our existing programs. They serve as launching pads from which we 

are able to create new initiatives and ideas, and they allow us to identify and meet 

the ever-changing needs of our state’s vital industries. The end result is better preparation of students who are ready to enter the working world, filled with current 

and relevant knowledge that will allow them to ‘‘hit the ground running’’ in their 

chosen fields. It is these graduates who will form the basis for our future workforce, 

and our nation’s future economic success. 

Thank you again for taking the time to hear about the CSU system and its public/

private partnerships. Thank you also for your support for the federal student financial aid programs that are so important to CSU students. I will be glad to answer 

any questions you might have, and look forward to working with you in the future. 

Chairman KELLER. Mr. Salandy. 

STATEMENT OF RASSAN SALANDY, DIRECTOR OF UNIVERSITY 

RECRUITMENT AND PUBLIC RELATIONS, THE POSSE FOUNDATION 

Mr. SALANDY. Good morning and thank you for inviting the 

Posse Foundation to testify before this distinguished group. My 

name is Rassan Salandy, and I am the Director of University Recruitment for the Foundation. 

The Posse Foundation began back in 1989 because of a student 

who said I would have never dropped out of college if I had my 

posse with me. Now, back in the ’80’s, posse was sort of a cool 

term. Unfortunately, it no longer is. But the idea is basic, you 

know, a group of friends going off to school that can provide a support network for each other. 

19

So that is exactly what the Foundation proceeded to do, which 

was locate students, multi-cultural, and place them in a multi-cultural team of 10 or so to be a network of support and also be catalysts of change on campus. 

To date, we have sent over 1,500 students off to college. They have won over $142 million in college scholarships, and they are 

persisting at a rate of 90 percent. 

Let me say that again. They are persisting at a rate of 90 percent, which I am sure most of you know is well above the national 

average. 

We have got three goals. The first goal is to expand the pool from 

which top and selective universities recruit students. The second 

goal is to transform campus environments so they can become more 

welcoming places to students from all backgrounds. And, finally, 

we want to provide the kind of support our students will need to 

graduate and take on leadership positions in the workforce. 

So, to accomplish that, the program is divided into four parts. We 

have got a screening process, we have got an 8-month pre-collegiate 

training program, a 4-year on campus program and a career program; and, if I have time, I would like to talk about each of these 

in turn. 

The interview process, what we have got—what we use is a tool 

called the Dynamic Assessment Process, dynamic because it places 

students in an interactive situation. It allows us to really zero in 

on those students who show exceptional leadership qualities and 

academic promise. It is a tool that has worked for us. 

Beginning from—so if a student is selected for a Posse scholarship, beginning from January all the way through to August, 8 

months, every week they meet for 2-hour weekly workshop sessions 

with their peers and posse staff to work on issues related to leadership development, academic preparedness, team building and crosscultural dialog. 

Once on campus, they hit the campus—they hit the ground running, really. They continue to meet weekly with their peers in 

group meetings and also with a mentor that is established by the 

universities we partner with to get advice. We as a Posse staff also 

make visits to the campuses to check in with campus liaisons and 

mentors and our students. 

There is also a program component called the campus PossePlus 

Retreat, which is an effort to bring the larger campus community 

into the dialog and conversation that is taking place within Posse 

cohorts. 

Once students graduate and even during their time, we also have 

a career program that does what you think a career program ought 

to do, which is provide assistance in writing resumes and how do 

you conduct yourself in an interview. But we have also managed 

to develop some pretty incredible partnerships with high-profile 

companies and organizations that offer our students internships 

and other career-enhancing opportunities. 

So I hope what is becoming obvious about the program and what 

is unique about it is how comprehensive it is. It starts with the student in their high school years, and it follows them through to 

graduation and even into the workforce, and I think that is what 

make the Posse Foundation program unique. 

20

There are thousands and thousands of students whom programs 

like Posse could reach with increased governmental support to institutions of higher education. What we are seeing time and time 

again is that, even with scholarship awards, many students are 

struggling to make ends meet. Without Federal funding, programs 

like ours cannot grow or work on a large scale. The selective universities and colleges with whom we work are dependent on Federal funding, the Federal funding they receive, in order to recruit 

a diverse socioeconomic student body. 

Our partner institutions financially support our students as 

much as they can, but if they have to fully fund or to fund in great 

proportions every poor kid who qualified, they couldn’t afford a program like Posse. 

In summary, what we are able to do for the urban students we 

serve, a student population that is really high need, depends critically on the financial aid packages that our university partners are 

able to offer our students. 

Thank you. 

Chairman KELLER. Thank you, Mr. Salandy. 

[The prepared statement of Mr. Salandy follows:]

Prepared Statement of Rassan Salandy, Director of University Recruitment 

and Public Relations, the Posse Foundation 

The Posse Mission 

Posse started because of one student who said, ‘‘I never would have dropped out 

of college if I had my posse with me.’’ The Posse Foundation, founded in 1989, identifies public high school students with extraordinary academic and leadership potential who may be overlooked by traditional college selection processes. The Foundation extends to these students the opportunity to pursue personal and academic excellence by placing them in supportive, multicultural teams (‘‘Posses’’) of 10 students. Posse recruits outstanding student leaders in Boston, Chicago, Los Angeles, 

New York, and Washington, D.C and sends them to some of the top colleges and 

universities in the country. This year alone, over 6,500 students competed for 305 

slots. Posse has become a highly selective program whose reputation continues to 

grow. Nevertheless, there is still much room for growth. 

Posse’s partner universities and colleges award Posse Scholars four-year, full-tuition leadership scholarships. Currently, Posse has partnerships with 24 competitive 

colleges and universities. They are: Babson, Brandeis, Bryn Mawr, Bucknell, 

Carleton, Claremont McKenna, Centre, Colby, Denison, DePauw, Dickinson, Franklin & Marshall, Grinnell, Hamilton, Lafayette, Middlebury, Oberlin, Pomona, Trinity, Union College, University of Illinois-Urbana-Champaign, University of Wisconsin-Madison, Vanderbilt, and Wheaton. These incredible institutions work together with Posse to provide students the support they need to become outstanding 

leaders. 

The Posse Foundation has three goals. Posse aims to 1) expand the pool from 

which top colleges and universities can recruit outstanding young leaders from diverse backgrounds, 2) help these institutions build more interactive campus environments so that they can become more welcoming institutions for people from all backgrounds and 3) ensure that Posse Scholars persist in their academic studies and 

graduate so they can take on leadership positions in the workforce. Moreover, The 

Posse Program achieves its goals through four program components: 1) The Dynamic Assessment Process (DAP), 2) an eight-month Pre-Collegiate Training Program, 3) a four-year Campus Program, and 4) Posse’s Career Program. What follows 

is a description of each of these components. 

Recruitment 

From September to December each year, Posse conducts the Dynamic Assessment 

Process (DAP), a unique evaluation method designed to identify young leaders who 

might be missed by traditional admissions criteria, but who can excel at selective 

colleges and universities. Using non-traditional forums to evaluate potential, DAP 

offers students an opportunity to demonstrate their intrinsic leadership abilities, 

their skill at working in a team setting, and their motivation and desire to succeed. 

21

DAP has proven to be an extremely effective tool for identifying outstanding young 

leaders. In a three-part process, including large group and individual interviews, 

Posse staff and university partner administrators ultimately select a diverse group 

of 10 students for each college or university, thus forming a ‘‘Posse.’’

Pre-Collegiate Training 

From January to August of their senior year in high school, Posse Scholars meet 

weekly with staff trainers and their Posse peers for two-hour workshops. The Training Program consists of workshops that address four areas: 1) team building and 

group support, 2) cross-cultural communication, 3) leadership and becoming an active agent of change on campus and 4) academic excellence. The goal of the training 

program is to prepare Scholars for leadership roles on campus and for the high-level 

academic expectations of their colleges. 

The Campus Program 

Posse continues to offer support to Scholars once on campus. The Campus Program works to ensure the retention of Posse Scholars and to increase the impact 

of the Scholars and the Program on the college campus. Posse staff members visit 

each university four times a year for meetings with Posse Scholars, campus liaisons, 

and on-campus mentors. Each mentor meets weekly with the Posse as a team and 

with individual Scholars every two weeks during the first two years in college. In 

addition, Posse facilitates an annual weekend-long PossePlus Retreat attended by 

members of the larger student body, faculty, and administration, with the goal of 

discussing an important campus issue identified by Posse Scholars. 

The Career Program 

The Career Program-which consists of an internship component, career services, 

and an alumni network-supports Posse Scholars as they transition from being leaders on campus to becoming leaders in the workforce. Posse plays an integral role 

in the professional development of these young people by providing them with the 

tools and opportunities necessary to secure highly competitive and career-enhancing 

internships and jobs. One of the ways Posse achieves this is by partnering with exceptional companies and organizations, both nationally and abroad. 

Accomplishments 

Since 1989, Posse has sent over 1,500 students to selective colleges and universities across the country. Posse Scholars have won over $142 million in scholarships 

and are persisting in their studies, graduating at a rate of over 90 percent-a rate 

significantly higher than the national average. Moreover, Posses are having a dynamic effect on campus. Posse Scholars are joining and assisting existing student 

organizations, sometimes helping more tentative groups to feel more comfortable 

voicing their concerns and achieving their goals. They are establishing new studentrun organizations on campus that continue after they graduate. In fact, over 70 percent of Posse Scholars found new campus organizations or go on to become presidents of already existing ones. Posses also help to increase the numbers of Latino, 

African American, Asian, and other students from diverse backgrounds in the student populations at Posse partner institutions by helping to make the campus more 

appealing to students from all backgrounds. The benefits of the program extend well 

beyond the success rates of individual scholars. 

Long-Term Goals 

Posse currently has over 300 alumni and, as mentioned above, is partnered with 

24 highly selective universities and colleges. By the year 2020 The Posse Foundation 

expects to be operating out of 10 cities, partnered with approximately 80 universities, and boasting an alumni network of over 7,000. Posse is an organization driven by the belief that more can be done to identify students with exceptional promise 

and academic ability. These are extraordinarily talented and motivated young people who, if just given the opportunity, will excel. 

The Posse Concept 

The concept of a Posse works for both students and college campuses, and is rooted in the belief that a small, diverse group of talented students (a Posse) carefully 

selected and trained, can serve as a catalyst for increased individual and community 

development. As the United States becomes an increasingly multicultural society, 

Posse believes that the leaders of this new century should reflect the country’s rich 

demographic mix, and that the key to a promising future for our nation rests on 

the ability of strong leaders from diverse backgrounds to develop consensus solutions to complex social problems. The primary aim of the Posse Program is to cultivate these leaders of tomorrow. 

22

Chairman KELLER. Mr. Merisotis. 

STATEMENT OF JAMIE P. MERISOTIS, PRESIDENT, THE 

INSTITUTE FOR HIGHER EDUCATION POLICY 

Mr. MERISOTIS. Thank you very much, Mr. Chairman and Ranking Member Kildee, Chairman McKeon and members of the subcommittee. Thank you for the opportunity to be here. 

Improving access to higher education continues to be one of the 

most important contributions that the Federal Government can 

make to our national well-being. But I believe that we now stand 

at a critical juncture and face a great risk of creating a society 

cleaved along very distinct lines, those who are able to go to and 

complete college and those who are not. 

According to the Census Bureau, while 75 percent of high-income 

students enter college today, only 31 percent of low-income students do. Federal Advisory Committee on Student Financial Assistance Data clearly show that limited financial aid and declining affordability is already prohibiting hundreds of thousands of college 

qualified high school graduates from attending college. 

So the discussion about Federal policy and paying for college 

must focus on making educational opportunities possible for those 

who otherwise would not do so. It is not simply that it is the right 

thing to do, but it is that it is in our collective economic and social 

self-interest to do so. 

As the chairman has already noted, workers who have gone to 

college have low unemployment rates; and projections show almost 

all of the future job growth is in fields that require a college education. The significantly higher earnings for college graduates result in more government revenue that supports our national defense, economic development and Social Security. Increasing the 

number of college graduates also saves millions of dollars in avoided social expenditures every year as a result of improved health, 

reduced crime and reduced welfare and unemployment. 

Unfortunately, it is not hard to look at the recent Federal policy 

environment for higher education and conclude that there has been 

very little attention paid to the public good that higher education 

contributes to our society. The debate over the Higher Education 

Act reauthorization, the President’s budget and the disappointing 

$12 billion in cuts made in the reconciliation bill last year all suggest that this Congress is focused on the belief that individuals are 

the primary beneficiaries and therefore should shoulder the burden 

of paying, adding to what the Chronicle of Higher Education recently said is a growing divide between the haves and the havenots. 

I believe it is imperative to focus Federal policy in this area on 

four key issues: 

First, we must invest in need-based student aid as the best and 

most effective way to promote access to postsecondary education. 

The maximum Pell Grant today pays for less than half of the average price of attending a public 4-year institution compared to what 

it paid for in 1980. There has been no substantial increase in the 

Pell Grant maximum over the last 5 years, even as college prices 

continue to rise at a rate higher than inflation and family incomes. 

While more money is being spent on the Pell Grant program, the 

23

overwhelming reason is simply that more students qualified, that 

is there are more poor people who are eligible for the program. 

Meaningful increases in support for the Pell Grant program 

should be a centerpiece of efforts to make a college opportunity possible. We also need to look hard at student loans. They are critical 

in mitigating some of the effects of rising tuition, but they also 

have the potential negative effect of increasing student debt. 

One way to meet these seemingly divergent goals is to increase 

loan limits modestly for first and second year students, while also 

developing new opportunities for students to receive a low interest 

rate that reflects our commitment to their future and the benefits 

that they will provide to us as a society. 

On the other hand, strategies such as increasing tax benefits to 

reduce tuition expenses will have little if any affect on the populations most in need of further access to higher education. Many 

low-income student do not qualify for tuition tax benefits, and 

there is no evidence that tax benefits increase postsecondary education enrollment, a key reason to invest limited taxpayer resources. 

Second, we must decisively and unequivocally support increased 

investment in Upward Bound, Talent Search and GEAR UP as essential components of our national access strategy. These critical 

programs serve as key vehicles for improving the higher education 

prospects for low-income, first-generation and disabled students, as 

Mr. Jones has already noted. Nearly one-third of all low-income 

high school graduates who actually enroll in college have been 

served by a Federal TRIO program, an incredible record of achievement. 

The fundamental problem for Upward Bound, Talent Search and 

GEAR UP is not under performance. It is a simple fact that limited 

funding has allowed them to serve less than 10 percent of the eligible populations. 

Third, we must strengthenthe capacities of minority serving institutions to educate the Nation’s emerging majority populations. 

Tribal colleges, Hispanic-serving institutions and historically black 

colleges represent some of the Nation’s most important but underserved postsecondary resource. Given that they serve a high proportion of under prepared and underfinanced students, we must 

make minority serving institutions central to our overall strategy 

of improving student access and success. 

Finally, we must engage the private sector in this campaign to 

help students go to college, but only as a complement, not a substitute to the critical support provided at the Federal level. 

As chairman-elect of Scholarship America, the Nation’s largest 

private-sector scholarship organization, I know well that the more 

than $3 billion in scholarship aid provided by local communities, 

businesses and employers is important to those who receive it. But 

a significant proportion of private aid is not need based, and lowincome students and minorities are less likely than more affluent 

students and whites to receive private support. 

It is important to emphasize that private aid is not a substitute 

for government investment in need-based financial aid and can’t 

ever replace what is our essential Federal role of equalizing opportunity for students with needs. In these times of increasing concern 

24

about homeland security, global competitiveness and national economic growth, investing in increased Pell Grants, reduced interest 

on student loans, increased support for TRIO programs and minority serving institutions and increasing encouragement of privatesector investment and grant aid are key strategies that can make 

a difference in the lives of today’s most marginalized and underserved students. 

Thank you very much. 

[The prepared statement of Mr. Merisotis follows:]

Prepared Statement of Jamie P. Merisotis, President Institute for Higher 

Education Policy 

Chairman Keller and Ranking Member Kildee: Thank you for this opportunity to 

appear before you. 

It has taken centuries for our nation to construct the higher education system of 

today. Step by step, the country has built public and private universities, then 

sought to widen their reach through legislation like the Morrill Act (1862) that promoted ‘‘the liberal and practical education of the industrial classes’’; the GI Bill 

(1944) that provided educational benefits to World War II veterans; the Truman 

Commission and its support for community colleges; of course the Higher Education 

Act of 1965 that seeded today’s federal student aid system; and the Pell Grant 

(1972) program that created federal grants for low-income students. 

As each successive change has opened the doors to higher education, something 

equally if not more important has happened at the same time: the value of a college 

degree-indeed, the need for a college degree-has grown even faster. But we now 

stand at a critical juncture. We face a great risk of creating a society cleaved along 

a very distinct line: those who were able to go to and complete college, and those 

who were not. It is true that we have always had these two groups in our society. 

But in the future this division will be far more stratifying, far more oppressive for 

those without a college degree, than we have seen historically. 

So who are we really talking about? According to date from the U.S. Census Bureau, while 75% of high-income students enter college today, only 31% of low-income 

students do. Federal Advisory Committee on Student Financial Assistance (ACSFA) 

data clearly show that limited financial aid and declining affordability is already 

prohibiting hundreds of thousands of college-qualified high school graduates from 

attending a four-year institution in 2002, and over 40 percent of those students will 

not enter postsecondary education at all. Students with the highest test scores from 

the lowest socioeconomic group attend college at the same rate as students with the 

lowest test scores from the highest socioeconomic group. 

The same story holds true for enrollments of students of color. Of traditional age 

students who go to college after graduating from high school, college enrollment 

rates are about 10 percentage points higher for whites than for African Americans 

or Hispanics. These gaps are even wider for adult and so-called non-traditional students. 

We also need to consider the question of where students are enrolling. Former 

Princeton University and Mellon Foundation President William Bowen’s data shows 

that only 11 percent of students at selective public and private institutions come 

from families in the lowest income quartile (about $27,000 a year and under) and 

only 6 percent are first generation students. 

So the discussion about federal policy and about haves and have-nots, is about 

so much more than having and not having. A fundamental premise of our democracy is on the line, and the democratic ideals upon which our higher education system was founded are being undermined. While the nation’s attempt to provide equal 

opportunity to all of its citizens has been halting at best, it has at least made 

progress over the past century. If we start to go backwards-shutting more and more 

people out of the opportunity afforded by higher education-we risk creating groups 

that are bitterly divided and undermining the balance that creates a nation’s sense 

of shared interest. These groups are our fastest growing, and therefore most important, in the battle for our nation’s economic and social well-being. 

Research conducted both by my organization, the Institute for Higher Education 

Policy, and many other independent research groups demonstrates the dramatic 

benefits of the investment in higher education. These benefits have economic, social, 

public, and private dimensions. For example, statistics show that U.S. workers over 

the age of 18 with a high school diploma earn an average of $27,280 annually, while 

those with a bachelor’s degree who earn an average of $51,194, or nearly double. 

25

Over the course of a lifetime, those with a bachelor’s degree earn an average of almost one million dollars more than those with a high school diploma. Workers who 

have attended college also tend to have low rates of unemployment, and analyses 

of job growth and employer demands typically suggest future job growth will be increasingly concentrated in fields that require a college education. One analysis 

found that in 1996, 62 percent of people working in the nation’s most elite jobsmeaning the managers and professionals with the highest earnings-held a baccalaureate degree, and an additional 24 percent had some college experience. 

Economic benefits also flow to society, on both a national and a regional basis. 

Higher earnings for college graduates result in more revenue for government coffers 

through increased tax collections. In addition, increasing the number of college graduates would save millions of dollars in avoided social costs every year, as a result 

of improved health, reduced crime, and reduced welfare and unemployment. For example, social costs for a 30-year-old White non-Hispanic woman with a college degree average $800 per year less than the costs for one with only a high school diploma. The social costs saved for 30-year-old Black and Hispanic women with a college degree is even greater, averaging $2,500. Experts estimate that the nation’s 

Gross Domestic Product (GDP) would increase by $231 billion-creating $80 billion 

worth of new tax revenues-if college participation for students of color were raised 

to the same level as for non-Hispanic Whites. State and federal budget deficits may 

discourage policymakers from investing more taxpayer money into any area, but 

higher education provides a significant return on that investment. 

Social benefits of postsecondary education also accrue to individuals and to the 

public. For example, people with more education tend to have greater health/life expectancy. In 2004, 93 percent of people age 25 and older who had attained a bachelor’s degree described their health as good, very good, or excellent, compared to 82 

percent of people whose highest level of education was a high school diploma. Public 

benefits from higher education include reduced crime rates, increased civic participation, and more charitable giving and volunteerism. For example, in 2004, 36 percent of people age 25 and older who had earned a bachelor’s degree or higher reported they had ever volunteered for or through an organization, compared to 21 

percent of people whose highest level of education was a high school diploma. 

Given these benefits, the American public generally sees the need for at least 

some college education. A 2003 survey found that 87 percent of respondents thought 

a high school graduate should continue on to college instead of starting a job, 37 

percent said that a college degree is necessary for success, and 76 percent felt that 

college is more important today than it was ten years ago. 

Unfortunately, it’s hard not to look at the recent federal policy environment for 

higher education and come to a sobering conclusion; namely, despite this evidence, 

the reality is that there has been very limited attention paid to the demonstrable 

public good that higher education contributes to our society. The debate over HEA 

reauthorization, the President’s budget, recent trends in funding of programs, and 

the disappointing $12 billion in cuts made in the reconciliation bill last year all 

clearly indicate that this Congress is focused narrowly on the belief that individuals 

are the primary beneficiaries and therefore should shoulder the burden of paying. 

Even with the veritable mountain of data that has been amassed to demonstrate 

that higher education does much more than simply provide individuals with greater 

earnings capacity, what we are spending most of our federal policy energy on is getting more for less, squeezing so-called inefficient institutions, and improving opportunities for middle income families, adding to what the Chronicle of Higher Education recently said is a growing divide between the haves and the have-nots. 

It’s also increasingly apparent that politics has trumped policy when it comes to 

higher education. With the exception perhaps of the deliberate strategy being taken 

by the National Commission on the Future of Higher Education appointed by Secretary Spellings, there has been virtually no effort to have a reasoned public debate 

about higher education and its importance to the nation. There has been no serious 

effort to understand what happens if we leave more and more of our fastest growing 

and must vulnerable populations behind. This is not the way it has always been, 

despite our persistent cynicism in Washington. Funding for education, support for 

student opportunity-these have been hallmarks of bipartisan, collaborative efforts in 

the Congress, even in deeply partisan times in our past history-in 1998, during the 

Clinton impeachment debate, in 1980, with the Iran hostage crisis and crippling inflation, and in 1972, during what was then the beginning of the end for President 

Nixon. 

Sometimes we get so caught up in the details of the policy debates-speaking a language that anyone outside of the small circle of policy technicians would find bewildering and nonsensical-that I think we lose sight of some of the simplest, most 

26

straightforward strategies. So here are just a few ideas about what I think needs 

to be done: 

First, we must invest in need-based student aid as the best and most important 

way to promote access to postsecondary education. In the early 1990s, a bipartisan 

federal commission called the National Commission on Responsibilities for Financing Postsecondary Education (for which I served as Executive Director) issued a 

widely-circulated report called Making College Affordable Again. The legislation creating the commission, authored by Senator Jeffords of Vermont in the late 1980s, 

noted that the purchasing power of aid had been rapidly declining through the decade of the 1980s, leading to increasing concerns about access to postsecondary education. In commenting on the legislation, Senator Jeffords noted, ‘‘Without affordable postsecondary education, without national support for meaningful access for 

able students to take advantage of higher education opportunities, we will not be 

able to accomplish any of the objectives that we strive for as a nation and a leader 

of nations.’’ The final report of the commission, issued in 1993, recommended several important improvements to federal student aid, many of which have subsequently been enacted. But the Commission’s major recommendation-to guarantee access to higher education for all students, based on a sliding subsidy scale tied to 

financial need-remains elusive. Regrettably, many of the commission’s concerns regarding affordability and accessibility resonate even more profoundly with students 

and families more than a decade later. 

I firmly believe that investment in need-based financial aid is the best and most 

important contribution that the federal government can make to keeping the dream 

of a college education a reality for all Americans. The declining purchasing power 

of federal aid continues to be a critical barrier to access to higher education. The 

maximum Pell Grant today pays for less than half of the average price of attending 

a public four-year institution compared to what the maximum Pell Grant paid for 

in 1980. There has been no substantial increase in the Pell Grant maximum over 

the past five years, even as college prices continue to rise at a rate higher than inflation and family incomes. While more money is being spent on the Pell Grant program, the overwhelming reason is simply that more students qualify-that is, there 

are more poor people who are eligible for the program. Meaningful increases in support for the Pell Grant program should be a centerpiece of efforts to make college 

opportunity possible. Let’s not pretend that these efforts to do more with less, or 

to do less with less, will do anything to dramatically narrow the opportunity gaps. 

Significant investment is the only thing that has worked in the past, and it’s what 

needs to be done now. 

We also need to look hard at student loans. Loans are not a preferred method of 

paying for college. But they are a reality in today’s world of college financing. The 

key is to simultaneously increase loan limits for some students to mitigate some of 

the effects of rising prices while also limiting the potential negative effects of increasing student debt. One way to meet these seemingly divergent goals is to increase loan limits modestly, especially for first and second year students, while also 

developing new opportunities for students to receive a low interest rate that reflects 

our commitment to their future and the benefits that they will provide to us as a 

society. 

On the other hand, strategies such as increasing tax benefits to reduce tuition expenses will have little if any effect on the populations most in need of further access 

to higher education. Many low income students do not quality for tuition tax benefits-only about a quarter of the Hope and Lifetime tax credits go to students with 

adjusted gross incomes less than $30,000-and there is some evidence that many eligible students do not claim the tax benefits, especially those from minority groups. 

Perhaps most importantly, there is no evidence that tax benefits increase postsecondary education enrollment-a key reason to invest limited taxpayer resources. 

Second, we must decisively and unequivocally support programs such as Upward 

Bound, Talent Search, and GEAR UP as essential components of our national access 

strategy. These critical programs serve as key vehicles for improving the higher education prospects of low-income, first-generation, and disabled students. The programs provide a continuum of services from pre-college to pre-graduate level study 

for the nation’s low-income, first-generation, and disabled students. In FY 2006, the 

$828 million in funding for TRIO programs supported more than 850,000 students 

in over 2,700 distinct TRIO programs. Yet despite this support, less than 10 percent 

of the eligible populations are served by TRIO programs. 

There are a total of seven TRIO programs. The pre-college programs include Talent Search, which provides counseling and information about college admissions requirements and student financial aid to young people in grades six through 12, and 

Upward Bound, which works with students starting in the 9th grade to provide instruction in literature, composition, mathematics, and science on college campuses 

27

after school, on Saturdays and during the summer. In addition, Upward Bound 

Math Science helps students from low-income families to strengthen math and 

science skills, frequently providing research opportunities for underrepresented students, while Veterans Upward Bound provides intensive basic skills development 

and short-term remedial courses for military veterans to help them successfully 

transition to postsecondary education. 

At the college level, Student Support Services programs provide tutoring, counseling, and supplemental instruction to help students stay in college through the 

completion of a degree, and in the case of community colleges, assist them in the 

transfer process. The Ronald E. McNair Post-Baccalaureate Achievement programs 

are designed to encourage low-income students and minority undergraduates to consider careers in college teaching as well as prepare for doctoral study. Students who 

participate in this program are provided with research opportunities and faculty 

mentors. Finally, the Educational Opportunity Centers located throughout the country primarily serve displaced or underemployed workers from low-income families 

with incomes. 

For the last two years, the Upward Bound, Talent Search, and GEAR UP programs have inexplicably been proposed for elimination as part of the President’s 

budget. Given their importance to the populations most in need of college accessnearly one-third of all low-income high school graduates who actually enroll in college have been served by a TRIO program-we must not only be categorically opposed 

to the elimination of these programs, but we should also support significant funding 

increases in each of these programs and not allow the diversion of funding from 

these proven programs to support other education initiatives. 

Third, we must strengthen the capacities of minority-serving institutions (MSIs) 

to educate the nation’s emerging majority populations. Tribal Colleges and Universities (TCUs), Hispanic-Serving Institutions (HSIs), and Historically Black Colleges 

and Universities (HBCUs) and other predominantly Black institutions represent 

some of the nation’s most important but underserved postsecondary education resources. Combined, more than 1.8 million students are educated by these institutions. Most MSIs have taken on the responsibility for educating students who traditionally have been denied access to adequately funded K-12 schools, especially lowincome, educationally disadvantaged students. As institutions that play a major role 

in educating the nation’s emerging majority populations, HBCUs, HSIs, and TCUs 

are integral to the country’s potential and promise. Given that these institutions 

educate the populations that are the fastest growing in the nation, it is clear that 

MSIs must be recognized as a leading voice for underrepresented populations. 

I believe that several important steps could be taken to strengthen the capacity 

of MSIs. One is to expand both the appropriation and authorization levels of Titles 

III and V to ensure the continued development and growth of MSIs. Additional 

funding is required for MSIs to reach a level of financial stability that ensures the 

students enrolled at these institutions receive the same quality academic programs 

offered by majority institutions. 

Congress also could take steps to encourage improvements in the infrastructure 

and application of information technology at MSIs. The digital divide between better-funded and endowed majority universities and MSIs has impeded MSIs’ ability 

to deliver state-of-the-art programs in information technology-related areas. The Minority-Serving Institutions Digital and Wireless Technology Opportunity Act represents an enormous opportunity in this area. The legislation addresses an array 

of needs at MSIs by providing for both equipment and training, as well as allowing 

MSIs that are more advanced in their use of technology to partner with and mentor 

their peers. Moreover, the bill addresses systemic disenfranchisement by providing 

a means for partnership between MSIs and K-12 schools. 

Investment in programs such as the Model Institutions for Excellence (or MIE) 

program, a ten-year NSF- and NASA-supported initiative that provided significant 

support to just six MSIs, can serve as a model for much more significant investment. The MIE schools concentrate on the recruitment and retention of students in 

the STEM fields (Science, Technology, Engineering, and Mathematics), counseling, 

academic enrichment, encouraging students to attend graduate school, and enhancing the education of their students. The results achieved by these six MIE schools 

has been impressive and could be replicated at other minority-serving institutions, 

and indeed at non-MSIs, in a way that could substantially improve our nation’s capacity in these critical areas. 

Fourth, we must engage the private sector in this campaign to help students go 

to college, and to tell the story about the payoff of investing in higher education, 

as complements-not substitutes-for the critical support provided at the federal level. 

When Secretary of Education Spellings met with college presidents, government officials, and business leaders last year as a prelude to the establishment of the ComVerDate 0ct 09 2002 11:32 Nov 02, 2006 Jkt 000000 PO 00000 Frm 00031 Fmt 6633 Sfmt 6621 H:\DOCS\21CC\5-23-06\27986.TXT EDUWK PsN: DICK
28

mission on the Future of Higher Education, the discussion focused on improving 

higher education’s capacity to enhance the nation’s workforce and global competitiveness. Well, one way that the nation clearly does this is by helping students-the 

nation’s future workforce-through financial aid. Last year, we released the first-ever 

national study on the role of private scholarship aid in the overall financing equation, called Private Scholarships Count, and found that private scholarships are an 

important part of the college financing equation, for numerous reasons. 

Private aid is already a significant piece of the student aid pie. We estimate that 

private aid totaled more than $3 billion in 2003-04, or 7 percent of all college grants 

awarded. Seven percent of undergraduates received private scholarships with an average value of just under $2,000, 5 percent of graduate students received private 

scholarships averaging just over $3,000, and 10 percent of professional students-students in fields like medicine and law—received an average of slightly more than 

$5,000 in private scholarship aid. So clearly, private aid is not something trivial—

more than $3 billion a year makes private aid more than three times the size of 

the well-known federal Perkins Student Loan Program, and about one half of the 

entire support provided by all 50 states for student aid. 

But perhaps equally as important as how much private aid exists is what it is 

used for. We found that private scholarships often complement the federal, state, 

institutional, and other aid that is given. One way they do this is by targeting primarily middle income students with support that improves their choice of institution. They also are useful in targeting support for diverse groups of students-ranging from foster children to students with unique academic talents to students who 

are deeply involved with their communities. 

I think the private sector’s commitment and support for helping students go to 

college should be better recognized and understood as a valuable complement to federal aid, but never as a way of supplanting the critical federal support. One specific 

way to do this is via the Leveraging Educational Assistance Partnership (LEAP) 

program, which encourages state governments to provide state tax dollars to assist 

students in their states to gain the critical benefits of postsecondary education. This 

program could be enhanced to leverage a much greater amount of aid for students 

if it were used to stimulate not just state dollars for student aid, but significantly 

increased private sector aid in each state as well. For example, in the state of Washington the legislature has provided small challenge grants to communities to encourage the creation of local scholarship fundraising chapters. As a result over 100 

new volunteer-supported, community-based scholarship chapters are now raising 

money each year to help their local students pursue college, university, or vocational 

education. The current LEAP legislation could be modified to reward those states 

where significant increases in student aid are produced by working in partnership 

with local community-based scholarship providers. This idea dovetails nicely with 

the important recommendations of ACSFA in its partnership proposal that has been 

included in the Senate HEA reauthorization bill under consideration at the Committee level. 

It is important to emphasize, however, that private aid is not a substitute for government investment in need-based financial aid. Private aid plays an important role 

in meeting specific needs of middle income students and special populations and 

plays a useful role in supporting institutional choice. But it cannot ever replace 

what is the essential federal role of equalizing opportunity for students with financial need. The example set last year with the $12 billion in cuts to federal student 

aid is a disturbing development at a time when increasing access to higher education has clearly become a national security and economic competitiveness priority. 

Pell Grants and other federal need-based aid programs are the single most important and consistent resource for students struggling to pay for college, and should 

be the driving force behind any national conversation about college access and affordability. 

In these times of increasing concern about homeland security, global competitiveness, and national economic growth, investing in what we know works best-federal 

support for students who otherwise wouldn’t be able to go to college-is absolutely 

essential. Major investment in Pell Grants, reduced interest on student loans, increased support for TRIO programs and minority-serving institutions, and increased 

encouragement of private sector investment in grant aid are key strategies that can 

make a difference in the lives of today’s most marginalized and underserved students. That is, in my view, the best way that the federal government can achieve 

the goals of prosperity, security, and harmony for all Americans. 

Thank you for this opportunity to be here. I would be pleased to answer any questions you may have. 

29

Chairman KELLER. I want to thank all of the witnesses for their 

testimony, and I will begin by recognizing myself for 5 minutes. Let 

me start with Mr. Davis. 

One of the major employers in my area in Orlando and a hotel 

owner told me that the big benefit he sees from the Family Friendly Employer Act is that, while the existing IRS Tax Code allows 

him to put his employees through college and allows him to write 

that off, it doesn’t allow him to put their children through and 

write that off. In fact, the janitors and maids who work in his hotels, frankly, don’t want to go to college, but they have 17-year old 

kids in high school who very much do, the next generation. 

As someone who owns a construction company, have you seen a 

similar experience in that and is that why you are involved in helping put seven of your employees’ kids through college? 

Mr. TOM DAVIS. That is exactly the reason. Our employees, you 

know, they don’t want—they have already—they either had a 

chance when they were young to go to college—none of our employers have asked or have a desire that I know of to go to college, but 

all of their children do, and it is very important to them. And 

they—probably most of our field people, you know, that we are 

helping make $35,000 a year, and they have five kids and a house 

and a car note, and they just can’t do it. 

So—but it is the kids that need the money. It is not the employees. I mean, we would pay for employees if they wanted to go, but 

none of them have asked. 

Chairman KELLER. Well, thank you. 

Mr. Jones, I am intrigued by your Super Sunday Initiative when 

you went into, I guess, eight different churches and parts of L.A., 

that a lot of times their young people don’t go to college and you 

let them know about the opportunities. One of the things that 

struck me is I believe in the California system it is only about 

2,500 bucks a year for the tuition, and I would imagine a lot of 

folks don’t go to college or try to go to college because they don’t 

think they could afford it. 

Is part of your outreach and your Super Sunday Initiative to let 

people know what is out there and that it can be afforded through 

various grants and opportunities like you provide? 

Mr. JONES. Yes, Mr. Keller. It is multi-phased, actually. The 

myth is largely that education is outside the reach of low-income 

families because of costs. 

So, first of all, we want to be sure that families are aware not 

only of the cost—and the fees for the State university—you are correct—are about $2,500 a year. There are still books and supplies, 

transportation, room and board, all of the other expenses; and 

when you total that together we are talking about a cost of attendance, on average, even for our system, of around 12 to $13,000 a 

year. 

Families need to know that financial aid is available, Pell Grant 

is the foundation for that. The State of California has Cal Grant 

Entitlement, one of the first in the Nation to have an entitlement 

State grant program; and the California State University trustees 

have dedicated $200 million for that. But the key is the academic 

preparation as well. Students need to know about college, not just 

30

financing but what does it take to be eligible in terms of meeting 

the academic expectations. 

Chairman KELLER. Do you find that, meeting with those 20,000 

people and passing out your 10,000 posters, that a lot of folks 

didn’t know what financial aid options were out there? 

Mr. JONES. Oh, I can guarantee you they did not know. No matter what we do, no matter what publicity, I think everybody at the 

table will tell you that is engaged in this—and I have been doing 

this for 37 years—no matter what efforts we make there is still a 

misunderstanding, a mystique that surrounds the cost and financing; and getting the message out of is critical. 

Chairman KELLER. Mr. Salandy, sounds like the Posse program 

is an excellent program, a great track record, 1,500 students in college, 90 percent staying in school. I see that you have various universities that partner up with you, including your own alma mater, 

Vanderbilt. Tell me how that would work in terms of—let’s say 

someone has been selected as one of the recipients of the 305 Posse 

slots and they want to go to Vanderbilt. Do you meet with the financial aid people at Vanderbilt to help them get a more attractive 

package or do you all cut the check for the very expensive tuition 

at Vanderbilt? How does that work? 

Mr. SALANDY. The interesting thing about the program, we don’t 

fund our students, and we don’t give them a penny. It all comes 

from the universities with whom we partner. So a student who is 

nominated for a Posse scholarship and actually, I suppose, gets into 

Vanderbilt, let’s say, Vanderbilt funds that student’s entire tuition, 

that tuition portion of his or her college experience. 

Chairman KELLER. That is as a result of a relationship you have 

established with the folks at Vanderbilt? 

Mr. SALANDY. Right. So we have 24 partner institutions like 

Vanderbilt who say, you know, these are students we think are, 

you know, great kids, and we think they will be a huge benefit to 

our campuses. There are also students that are very often nontraditional that might be overlooked by traditional recruitment 

processes. So that is where the value and the benefit of working 

with Posse comes in. 

Chairman KELLER. OK, Mr. Merisotis—I am sorry. My time has 

expired. I didn’t get to my question to you. But let me recognize 

the ranking member, Mr. Kildee. 

Mr. KILDEE. Thank you very much, Mr. Chairman. 

First of all, I would like to thank Mr. Davis for wishing God’s 

blessing upon us. We certainly need it individually and collectively, 

and I deeply appreciate that. 

It is great to see in the audience George Conant, who used to 

serve on this committee, well-respected on both sides of the aisle 

and now with the California State University system. Welcome 

back, George. 

Let me address a question to Mr. Merisotis. In your testimony, 

you discuss both how increased access to college would benefit our 

economy and how reduced interest rates would increase that access. I know that from 1945 when in my side of town in Flint, 

Michigan, the first people to go to college were those who had a GI 

bill of rights. Because no one went to college in the east side, but 

the GI Bill of rights really made that available. 

31

As I mentioned earlier, Mr. Miller and I have introduced a bill 

which would cut the interest rates in half for subsidized student 

and parent loans; and I think we can all agree this and other programs would make college more affordable for many students. But 

could you expand on how this would be available investment in our 

economy, especially with the growth of the global competition? 

Mr. MERISOTIS. Well, the lower interest rates I think, Mr. Kildee, 

are an excellent example of our investment in those students, because we reduce the expenses that they will accrue over time as 

well as what they will need to repay on their loans afterwards. 

The prospect of debt and indeed the real consequences of student 

debt are enormous in today’s society. They not only influence 

whether or not students go to college. They influence where they 

go to college, what happens when they are there, and what choices 

they make after college, what kind of job to take, where to live, 

what kind of lifestyle to lead. 

So it is a very important investment I think for us as a society 

because we are investing in our own collective well-being. By that 

I mean that those individuals who get the college education, those 

individuals who choose the jobs that are most productive in our 

economy, are going to benefit all of us as a society because of the 

fact that they attended college and benefited from what is, frankly, 

a modest level of Government subsidy. 

Mr. KILDEE. I can recall when my father and mother had five 

children and they could pick one of their children to go to college 

and, for some luck of the draw, I was the one. That is a terrible 

choice for parents, but I felt my brothers and sisters were at least 

or more intelligent than I, but they—my father did not have the 

resources. So there is a role for Government, and there is a role 

for business. 

Mr. MERISOTIS. And you have seen the data that, in today’s terms, if we had a GI Bill, the GI benefit would be $10,000, compared to the maximum Pell Grant of $4,050 today. 

Mr. KILDEE. Mr. Jones, I have been very involved in the TRIO 

and GEAR UP program for years and have seen then work very effectively in my own State of Michigan. What would the effect of the 

President’s proposal be to terminate those programs and how do 

you interface with the school districts in California on those programs? 

Mr. JONES. Well the TRIO program is very, very important to 

California State University. With the five or six programs, we are 

serving probably close to 10 to 15,000 students through the TRIO 

program throughout the State. So many of the programs are designed for low-income, first-generation of students that we find any 

of the programs that are designed to help us reach out to students 

to help them to prepare academically and to help them to succeed 

once they reach the college, the California State University, those 

programs are very critical to us; and we would hope that there 

would be continued funding to support those. 

Mr. KILDEE. Anyone have any comments on Mr. Merisotis and on 

the TRIO programs? 

Mr. MERISOTIS. The TRIO programs represent such an enormous 

part of the potential investment, and it is not an investment in 

needs-based financial aid. It is an investment in the reality of the 

32

life of those students. Counseling, tutoring, mentoring, that kind of 

support is absolutely essential in the lives of many low-income and 

disadvantaged populations, including first generation and disabled 

students; and those programs, again at a fairly modest level of investment, provide an extraordinary opportunity. I think the fact 

that a third of all low-income college students enrolled today participated in a Federal TRIO program has got to be one of our great 

Federal accomplishments in education policy. 

Mr. KILDEE. What I have noticed in the TRIO program and 

GEAR UP program in Michigan—and I get out and interface between the colleges and the school systems—is that for some of 

these young people it is the first time in their life it has occurred 

that they could go to college. It is really an outreach program. Very 

often, they never realized that they could go to college; and this 

program really helps them realize that possibility. 

Thank you very much. 

Thank you, Mr. Chairman. 

Chairman KELLER. Thank you, Mr. Kildee. 

Members on our side, I want you to know that we will recognize 

you in order of appearance here today. 

Next, Dr. Ehlers for 5 minutes. 

Mr. EHLERS. Thank you, Mr. Chairman. 

First of all, I want to commend you, Mr. Davis, for what you are 

doing. I think that is an ideal solution in many cases. A few questions on that. 

When you provide these scholarships for the students, you pay 

the full cost, or do they have to get student loans in addition? 

Mr. TOM DAVIS. All of our children, the seven we have in college 

currently, live with their parents and attend local college there in 

the Houston area. So we pay all their tuition, their books, lab fees, 

things like that. I mean, we don’t pay their living expenses, because they live with their parents, but it is averaging about $5,000 

per child per year. 

Mr. EHLERS. And the child can pick whichever school they want 

to go to? 

Mr. TOM DAVIS. That is up to the child. I just want him to go 

to college. 

Mr. EHLERS. OK, and if someone picked Harvard? 

Mr. TOM DAVIS. Well, we might have to talk about it, but——

Mr. EHLERS. That might break the bank even further. 

Well, thank you very much for what you are doing. I think that 

is outstanding. 

Mr. Salandy, I hope I pronounce your name correctly. Again, I 

didn’t quite get the picture of how you used the Federal funds that 

are available to you on this and how that correlates with the work 

the Foundation is doing. Could you just summarize that for me 

again please? 

Mr. SALANDY. Definitely. So we work with selective colleges and 

universities, and they offer our students scholarships. But they are 

able to afford the program and offer those scholarships because 

they make up the difference of what financial aid does not award 

those students. 

So since we are working out of urban centers—we are based in 

New York City, Boston, Chicago, L.A., and Washington, D.C—a lot 

33

of our students tend to be high need. And we work in public high 

school systems. So the colleges that we work with can only afford 

the program and are only able to extend those scholarships to those 

students because of what they receive in financial aid. They make 

up that difference. Does that clarify things a bit? 

Mr. EHLERS. Do most of these students live at home, too, in order 

to reduce costs? 

Mr. SALANDY. No, they are on campus. They are living on campus, yes. 

Mr. EHLERS. So your scholarship program doesn’t cover any of 

the living expenses, does it? 

Mr. SALANDY. No, it does not. No, it does not. 

Mr. EHLERS. Also, I want to point out someone—I forgot which 

witness—mentioned the Pell Grants have not been increased. I 

have here a graph which shows they are increased. There are double what they were 20 years ago. I don’t know what the rate of inflation is. I suspect this hasn’t matched the increase in tuition. But 

it certainly has more than matched the CPIs, so far as I know. I 

don’t think that has doubled in the past 20 years. 

Mr. MERISOTIS. The total funding for Pell Grants has increased, 

but, as the chairman pointed out, there has been a significant number of increase in the number of students who received Pell Grants. 

The chart that was shown here previously, on the boards here, 

showed a 36 percent increase in the number of recipients since 

2000. Only about 11 percent of that is accounted for by increasing 

enrollment. The rest really is because of increasing eligibility. That 

is, as a so-called quasi-entitlement, we have more people eligible 

for it. So for all of the people who are eligible, they are eligible to 

receive up to the maximum benefit. That is one of the reasons why 

the maximum Pell Grant hasn’t been raised since 2000, is that we 

have more people who qualify. So there is increasing support for 

Pell Grants, and that is a good thing. But a lot of it has to do with 

the fact that we have seeing an increased number of recipients because of the growing eligibility. 

Mr. EHLERS. My points simply is we have increased the maximum award amount considerably, particularly in the last 10 years. 

It has almost doubled just in the last 10 years. So I am not very 

pleased with that. I am not bragging about it. I just want to set 

the record straight that we have put a substantial amount of 

money in that. 

I am just very pleased with what I heard about the different programs. I think this is—in view of the rapidly increasing costs in 

higher education, there has to be additional financial aid; and I am 

pleased that many businesses, organizations are increasing their 

scholarship aid. That is certainly a plus. 

We do our part through the Pell Grant, through the student loan 

programs, which also are very expensive, but we need the private 

sector to dig in. I appreciate in each and every case your involvement as well, so thank you; and I yield back. 

Chairman KELLER. Thank you, Mr. Ehlers. 

Next, Mr. Holt is recognized for 5 minutes. 

Mr. HOLT. Thank you, Mr. Chairman. 

Mr. Merisotis, what can you say about the demographics of higher education? What will be the need for aid in the future? 

34

And, any of you, what can you say about the trends in the share 

of student aid that comes from the Federal Government? It is now 

approaching two-thirds, counting loans and all of that. I am just 

wondering under what circumstances you think that might decrease or increase and whether there is a greater need for the institutions, the colleges themselves or private corporations or others to 

pick up the change. 

Mr. MERISOTIS. There is a famous saying, ‘‘demographics is destiny;’’ and our destiny is pretty clear in this point. That is that by 

far the fastest-growing populations in our country in the next several decades will be African Americans, Asian Americans and, of 

course, Hispanics, the demographic juggernaut in our society. 

Those three communities have significant educational needs and 

lower average family incomes, particularly in our urban areas and 

some of our poor communities. 

So we look at the demographics of the population where a significant proportion of the eligible population for higher education is 

going to be from communities that are currently underserved, and 

clearly our Federal investment needs to be increased. The question 

is, how do we do that? 

I do believe in a partnership. I think the Federal Government 

has and is in the best position to serve as the coordinating partner 

in this partnership, because the Federal Government has, naturally, a national focus. But I think States have responsibility, families have responsibility, institutions have responsibility, and, yes, 

indeed, the private sector has responsibility. But the Federal Government has got to drive this train here, because the Federal Government is by far in the best position to impact the lives of these 

students that are going to impact our collective well-being. 

Mr. HOLT. Any of the others of you care to comment on that, on 

this point, and kind of what—how is the pie being reshaped and 

re divided? 

Mr. JONES. Yes. 

Financial aid has grown considerably, but it has been through 

the Federal Treasury, largely. For the California State University, 

of our total financial aid, $7 billion, 72 percent is Federal financial 

aid; and, of that, really 50 percent really is the Federal student 

loans. We are lucky in that the cost of attendance is one of the lowest in the country for a public university, so the average indebtedness of our students is a little under $14,000 for a bachelor’s degree. 

But keying off what Jamie said, one of the things that concerns 

us is the academic preparation of students. In California, the academic preparation and eligibility for the California State University—and I should say we are charged to admit the upper one-third 

of the graduating senior class which a B average or better. The eligibility of African Americans in our State is in the single digits in 

percentages. It is about 6 to 7 percent. Latinos, which make up far 

over half the population of the State, only about 26 percent of those 

students graduating from high school meet eligibility requirements 

for admission to CSU. And we don’t even begin to talk about the 

dropout rates in 8, 9 and 10 grades in the State of California and 

nationally. 

35

Financial aid is a critical key point to this whole area of higher 

education. But academic preparation in K-12 is an area that we 

haven’t spent a great deal of time and attention to and one I think 

we need to. 

Mr. HOLT. Mr. Salandy, first of all, I applaud you and your member organizations and your supporters for putting together what is 

a creative program and evidently quite a successful one. I am particularly pleased to see that the college that I am proud to have 

attended, Carlton College, is one of your participating organizations or participating colleges. 

I am wondering about the 10 percent of your students who don’t 

graduate. You—you have said a little bit, but I want to understand 

better whether that that is a necessary 10 percent or whether there 

is something that might have been done, particularly since we’re 

talking about financial aid, in the financial realm that would have 

made the outcome different for that 10 percent. 

Mr. SALANDY. Yeah. I think that, first of all, the number of students that make up that 10 percent drop out for, you know, reasons 

that are pretty typical in the general population of why students 

drop out. Some of them change majors and ideas of what they want 

to become. But, also, you can’t get away from the fact that the 

more financial dollars and the more support we can get at that 

level, we are able to serve more and more students. 

What we found is that—that, you know, the whole debate over 

equity versus excellence in trying to find those students who are 

actually capable of taking advantage of a prestigious or quality 

education, we found them, and we found them using unique indicators. But, yeah, the financial burden on some of them, some of 

them are—you know, they have issues related to, you know, back 

home, whether or not they are helping to support family members 

back home, and how much support they can get from family members back home in order to fill that gap of for room and board and 

issues like that. 

So, yeah, we do get quite a bit of that, of the financial reasons 

being behind the 10 percent that do drop out, but——

Chairman KELLER. Thank you, Mr. Holt. 

Next we recognize Mr. Osborne. 

Mr. OSBORNE. Thank you, Mr. Chairman, and thank you for having this hearing, and thank you for the exemplary way in which 

you are conducting your first hearing. 

Just a couple of comments. 

I was interested in the comment that roughly 75 percent of highincome students go to college, and roughly 30 percent of low-income 

student attend college. I guess for my own observation, that would 

probably be fairly accurate. I am sure it is accurate. And one thing 

that seems to occur to me is that sometimes vision is really important, and whether you go to school or not, and if you are raised in 

an environment where you don’t see many people around you or 

come into contact with many people who have gone to college, you 

are probably not going to think about it much. On the other hand, 

if you come from a home where this is kind of expected, you are 

very apt to go. 

And so one thing that I have noticed is that you have been very 

interested in mentoring, and a young person who is in a mentoring 

36

relationship is much more apt to have their horizons broadened 

somewhat by that mentor. Some possibilities are often broached 

that otherwise might not be considered by the young person. So I 

think that is a good idea. 

The question I would like to ask you all is probably a little bit 

outside your area of expertise, but we have already pointed out 

that there has been a fairly dramatic increase in funding, but the 

actual grant itself is not increased because of the expanding numbers who are receiving Pell grants, and we all understand that. 

One of the variables that is really distressing is that—the rate 

at which the cost of higher education is increasing. It is about 8 

percent a year, which is far outstripping inflation. And so we have 

more and more pressure being put on people here in Congress and 

the Federal Government to fund education. And have you given 

any thought or do you have any ideas as to how we might control 

the cost of higher education, because if that—if that cost continues 

to expand as it is, it might be very, very difficult, no matter what 

we do, to make the college education affordable to so many low-income students. 

So I don’t know if this is something you have thought about 

much, but we think about it a lot, and every time we try to make 

a proposal, it gets beaten down very quickly by the powers that be. 

And so any thoughts that you might have as to how to make college more affordable other than simply more Federal money? 

Mr. MERISOTIS. As I know you are aware, there is a disconnect 

here. The vast majority of the Federal investment is in financial 

aid. Financial aid goes to students. The problem is we are concerned about rising prices charged by institutions. The only mallet 

we have to try to address those issues, therefore, is financial aid. 

But if we use that mallet, we negatively impact students, and I 

don’t think that is what anybody wants to do. 

One proposal that I have made previously is a very modest proposal to put some competitive money on the table for institutions 

to develop innovative solutions for cost control. Institutions love to 

compete for money, and a modest amount of expenditure could actually generate some really interesting ideas that you just don’t 

see. 

Another possibility is to create incentives for States to also encourage those kind of efforts in public institutions, though it clearly 

won’t address issues in the private sector. 

Unfortunately we live with a situation where, because of the way 

the programs are structured, we would end up negatively impacting students if we try to limit availability of financial aid, and that 

is where the vast majority of the resources are. So I really hope 

that this Congress won’t choose those kinds of solutions. But modest, and I do mean modest, incentive money, competitive money, for 

institutions might actually lead institutions to think outside of the 

box and develop some new ideas. 

Mr. OSBORNE. So often what seems to me as we increase Federal 

aid, this simply gets capitalized into the increasing cost of education. And so your thought is well taken. There may be some way 

that we can, by putting some money on the table to be innovative 

and holding down the costs, might be helpful, might be a good 

thought. 

37

Anybody else have any thought on this issue? 

Yes, sir. 

Mr. TOM DAVIS. Well, I have noticed one of the students we paid for goes to junior college. Tuition there is $750 a semester for 15 

hours. Another student goes to a State college there in Texas. Tuition for 15 hours for a semester is about $2,700, you know. And so 

if both of them are accredited schools, and you see such a vast 

range in the cost of an education, and so, you know, maybe you 

take in the—I have no idea why universities’ cost is increasing so 

rapidly, but maybe from a Federal level you start pushing more of 

these kids toward junior colleges and stuff to get them started their 

first 2 years instead of sending those moneys to the more expensive 

colleges. I don’t know. It is a thought. 

Mr. OSBORNE. Thank you. I think my time is up, and I yield 

back, Mr. Chairman, but appreciate you all being here. 

Chairman KELLER. Thank you, Mr. Osborne. 

Next, Mr. Wu, you are recognized. 

Mr. WU. Thank you very much, Mr. Chairman. It is good to see 

you there. 

I know that we are here to talk about employer-based private 

programs, but I want to broaden our horizons just a little bit. 

Mr. Merisotis, I was struck by a comment you made earlier in 

your testimony that tax incentives—that there is no evidence that 

tax incentives increase the number of lower-income students who 

can attend. And I was just thinking very quickly to the analogy in 

the housing market where there is a mortgage interest tax deduction. It has helped a lot with middle-income of housing affordability, and there is, you know, that kind of getting a piece of the 

rock kind of—well, a broad public policy about housing. The middle 

class basically has access to two appreciating assets, and housing 

is one, and education is the other. And for housing we have these 

other things that we consider to help with low-income housing. 

And the question I had for you is if we were to help one group 

of people, whether it is employment-based or individually based, by 

permitting the deduction, the full deduction, of student loan interest, and then work on some kind of concept of something based on 

refundable tax credits like we had for the low-income refundable 

tax credit, would that help address what you said about the lack 

of breadth of a straightforward tax deduction? 

Mr. MERISOTIS. I am not sure. I think the fundamental problem 

with tax policy in this area always has been that tax benefits are 

awarded, take place, after the action has already occurred. That is, 

you are getting the tax benefit after you have done what you otherwise would have done. So there is not a lot of incentive there. I 

don’t know a lot of people who make decisions, at least in this area 

of education. It may be true in your example with mortgages, but 

I don’t know anybody who——

Mr. WU. I never would have purchased a house if I wasn’t forced 

to by the Tax Code. 

Mr. MERISOTIS. So it seems unlikely that someone is going to 

say, I think I will go to college because I am going to get a deduction on my student loan interest in the following year. It doesn’t 

seem very likely to me, and we see from the HOPE and Lifetime 

Learning Tax Credits that only about a quarter of the recipients 

38

of those have incomes below $30,000. An awful lot of eligible populations, by the way, for those programs actually don’t take advantage of the tax benefits, which is another problem, getting back to 

Mr. Jones, about the lack of information being one of our other critical barriers. 

Mr. WU. And that is a separate issue of getting the information 

out there. 

One of the things we do is student financial aid for universities, 

and that is one of the most well-attended things we do congressionally. 

I just want to ask whoever would like to answer this on the 

panel, we have looked at the whole pie chart of where student financial aid—the various sources of student financial aid, and one 

of those sources is institutional financial aid from the college or 

university. Where does that money come from? Is that from endowment funds? Is that from other restricted funds? Are there transfer 

payments from the nominal tuition rate? Can anybody address 

that? 

Mr. JONES. Speaking for the California State University and the 

State of California, there is another partner in this, and that is the 

State itself. And the State of California has an implement through 

the general fund. It just comes through the tax—the general revenue to the State to fund student financial aid and make access 

possible. But from the State university standpoint, it is a policy of 

our chancellor and our board of trustees. We provide over $200 million in another grant program, which augments the Pell grant and 

the State grant program for students, and that, again, is—a fraction of that was paid by State general funds, but I must tell you 

most of it comes from the fees that students pay. 

Our students have agreed that about one-third of the fees that 

they paid should be returned to aid and provided to other students 

with financial need. So as we increase our fees, one-third goes right 

back into our State grant or the California State University grant 

program, and the fee increases and so forth occur somewhat regularly, but they are limited to about 10 percent per year. 

Mr. WU. So even at a California State university, a substantial 

amount of that institutional aid comes from other students, and 

one would assume that at private colleges, universities, that might 

be even higher. It comes from either students or endowment funds. 

Mr. JONES. Yes. Having worked at a prior institution in my early 

part of my career for about 15 years, that is where your endowment funds and your contributions come in. 

But I would say in California our State grant program students 

can use that grant. It is very much like a Pell grant in the sense 

it is an entitlement. The value is worth the amount of fees at the 

California State university, or the amount of fees at the University 

of California, and up to about 10- to $11,000 of the independent colleges. So the State general fund is supporting students to go to 

independent colleges as well. 

Mr. WU. I thank the witnesses for your good work, and thank 

you, Mr. Chairman. 

Chairman KELLER. Thank you, Mr. Wu. 

Ms. Drake is now recognized for 5 minutes. 

39

Mrs. DRAKE. Thank you, Mr. Chairman, and thank you for the 

opportunity to be here. 

What a great idea of a bill to encourage our businesses to partner with us, with the government, to make sure our children have 

opportunities. 

Mr. Davis, I am really intrigued by what you have done, and I 

want to thank you for doing that, and it sounds like this is something that your company just said that is an opportunity we had, 

even though you chose not to take it, and we want to make it available; and I think what you have done—and you have heard in here, 

the three big things I think that keep children from going to college: No. 1, they don’t believe they can afford it; No. 2, they don’t 

know that they can do it. It is not on their radar screen if their 

parents didn’t go, and we talked about it, and the percentages of 

income, higher income, certainly a much clearer percentage go; and 

then the third thing is the academic achievement. 

But what you have done is said if you want to go to college, I 

have the money. So No. 1, they are going to be more concerned 

about academic achievement; and No. 2, they know they can do it. 

So I have just a couple questions for you on that. Is there also 

a support mechanism within your business for that child or for that 

parent if that parent knows now they have the money, but how do 

they do it? Are there also people that help them work through that, 

or is that done through the child’s school when—because they know 

they have the funding to go? 

Mr. TOM DAVIS. I am not sure I totally understand the question, 

but we—for one, most of our employees are Hispanic, and their 

parents did not—or our employees did not have the ability to go to 

college. Most of them didn’t even finish high school, and so their 

kids—we are a small enough company that I know every child 

whose parents work for us, and I make a point to make them understand that they can go to college, and that it is a possibility. 

And even if their high school grades aren’t good, I even go help 

them at high school, you know, to get them out of high school. And 

it is a struggle. 

Mrs. DRAKE. So you do that at the high school level as well as 

monitoring their college grades. 

Mr. TOM DAVIS. Yes. And one of the side effects of this whole 

program has been company morale. Our employees, they literally 

walk through fire for us. They—nobody is—we hadn’t had anybody 

resign from our company or move on in 15 years, I mean, because 

we take good care of them, and they, in turn, take good care of us. 

Mrs. DRAKE. And the final question for you, because we are going 

to go vote, is, first of all, if a child wanted to be more in a career 

training, whether it is automotives or refinery people or—do you 

also help them with funding for that if it is not just regular college, 

if it is more workforce? 

Mr. TOM DAVIS. I don’t care what the child wants, what form of 

education they want to get, you know, whether it is college or trade 

or, you know, we will help them. 

Mrs. DRAKE. And have you shared what you are doing with your 

business community there in the Houston area so they know the 

model that your company has put together, or are you not patting 

yourself on the back? 

40

Mr. TOM DAVIS. No. It is really through word of mouth; but, no, 

we don’t advertise it. 

Mrs. DRAKE. Right. But as far as your fellow builders or other 

people within the business community, to let them know this is a 

program that works very well for you. 

Mr. TOM DAVIS. I share with them at lunch or something like 

that, but it is not a public thing. 

Mrs. DRAKE. OK. Thank you very much, Mr. Chairman. I will 

yield back so maybe you can have a couple other questions before 

we go. 

Thank you, Mr. Davis. 

Thank you all for being here. 

Chairman KELLER. Well, thank you. I know in just a second Mr. 

Kildee is going to insert something into the record. Let me tell the 

witnesses and Members we have been called for votes. We have 15 

minutes to be there. We are probably going to have time for about 

5 minutes more of questions, and then we are going to adjourn because we will be there for about 40 minutes, and then it is going 

to be lunch, and I know some of you have flights to catch. 

Mr. Kildee. 

Mr. KILDEE. Mr. Chairman, I ask unanimous consent to include 

in the record the comments from Sandy Baum of the College Board. 

Chairman KELLER. Without objection, so ordered. 

[The prepared statement of Sandy Baum follows:]

Prepared Statement of Sandy Baum, the College Board 

Both tuition assistance from employers and private grant aid play an important 

role in student financing. In 2004-05, the $8.4 billion in subsidies from these sources 

constituted about 15 percent of the total $57 billion in grant aid undergraduate and 

graduate students used to help defray the costs of higher education. However, this 

source of funding is most important for graduate students. Less than $4 billion, or 

only about 8 percent of undergraduate grant aid, comes from either employer assistance or private grants. 

Grant aid from private sources is very valuable to the students who receive it, 

but it is not need-based assistance and low-income students are less likely than 

more affluent students to receive this form of aid. Black and Hispanic students are 

less likely than white students to get help from these sources. 

About 8 percent of undergraduate students receive employer assistance, but only 

4 percent of dependent undergraduates enjoy this benefit, compared to 13 percent 

of independent undergraduates. Among independent students, those in the highest 

income quartile are about 4 times as likely as those in the lowest income quartile 

to receive employer assistance. This is not surprising, since individuals working 

more hours and in the labor force for a longer time are most likely to enjoy this 

benefit. 

Among dependent undergraduates, about 5 percent of those from families with incomes $70,000 or higher receive subsidies from their parents’ employers, but fewer 

than 3 percent of those from families with incomes below $30,000 receive this funding. This reality is consistent with the general pattern of more generous employee 

benefits for higher-earning employees 

While private organizations such as Scholarship America do make important contributions to needy students, much private grant aid is distributed according to criteria other than financial need. Only 8 percent of dependent students from families 

with incomes below $30,000 receive private grants, compared to 10 percent of dependent undergraduates overall. 

Grant aid from private sources makes a significant contribution to students. The 

federal government might be well-advised to explore ways of encouraging increased 

participation of employers and other private entities in financing college and in particular, of targeting the subsidies to students with significant financial need. Federal matching funds could certainly be an effective means of accomplishing this goal. 

There is, however, no substitute for federal grants to low-income undergraduates. 

Assistance from private sources will never provide more than a small but helpful 

41

supplement to the public funding on which low- and moderate-income students rely. 

Without continued increases in federal grant funding, the gap in college enrollment 

between students from families in the lower half of the income distribution and 

those from more affluent families will not close. 

Chairman KELLER. And now Mr. Ryan is recognized. 

Mr. RYAN. Thank you, Mr. Chairman, and I also want to lend my 

voice to your great hearing that we are having here and how important this is. I think this is really the most important discussion 

that we need to have, and we are competing against 1.3 billion Chinese citizens, over a billion citizens in India, and we only have 300 

million citizens in this country. So I think it makes it that much 

more imperative that we get all of our kids on the field playing for 

us. We can’t afford to have, you know, the poverty rates we have 

in some of the other schools and the drop-out rates we have, as 

some of you have already mentioned. 

I want to take this opportunity, too, Mr. Davis, to thank you. I 

can’t stress how important it is to have the leadership in the private sector on these issues. We hear a lot from businesses on how 

important it is to have an educated workforce, and I see your commitment not only in education, but a lot of other community things 

that are going on down in your community; and I want to thank 

you for being a leader in your community and how important it is. 

I have one question. I really don’t even know who to ask it to. 

But one of the ideas that I have read about, and the idea, the concept, was mentioned here earlier, about kids and parents, especially poor kids and lower-middle-class kids, they don’t even think 

education is an option for them. They don’t know how much they 

qualify for the Pell grant or what is available. 

One of the ideas I read about last week that I think we need to 

maybe massage and kick around here because I think it could be 

a good bipartisan issue is to have a form sent to families based on 

their previous year’s IRS forms that they filled out on what their 

income is. And if they have kids that are 14, 15, 16, 17, getting 

ready to go to college, they merely get an envelope that says, your 

kid John, who is 15, would qualify in your State of Ohio, for example, for $5,000 in Pell grant or $4,000 in Pell grant, and would be 

eligible for $1,500 in loans and, therefore, could graduate from the 

Ohio State University in 4 years with, you know, $20,000 of it covered, whatever the numbers may be. 

Do you think that would be an effective use of our time, energy, 

and resources here from the government? Would that have the 

kind of impact that you are talking about here for not that much 

of a cost? And you are all welcome to comment. 

Mr. JONES. Any way we can effectively find to communicate—I 

am trying to find the calculation in my mind, the cost to doing 

something of that nature. I know States need to do a better job. 

California does a very good job in trying to communicate very early 

to families at those age levels about that very thing, the Cal grant 

entitlement, Pell grant, and so forth. And let us not forget Gear 

Up, which is another very important program which we are very 

actively engaged in. That is reaching out to more families at an 

earlier age, and what it is doing is helping them to prepare academically. 

42

Our problem is not just cost, and I can’t just emphasize this 

enough. It is the academic preparation and reaching a 14- or 15-

year-old at that point who has not taken the requisite courses in 

elementary or middle school necessary to be successful, and taking 

English as early as eighth or ninth grade or algebra, is not going 

to be as successful as early on as we would like. 

So there is a combination. I applaud the thought, and I think we 

do need to brainstorm on ways of communicating the message, because I think you have hit on a key point in at least my 37 years. 

We do everything we can. 

Our Super Sunday, quite frankly, when a chancellor stands up 

on the pulpit and addresses a congregation in the church, and our 

presidents are there after the sermon and has time to address, that 

was getting out the message. We are doing it in the Bay area. We 

are doing it throughout the State with all underrepresented groups 

of students. And we just started with the African American because 

of the lowest college-going rate. But I go applaud that effort, and 

I think we should think about it. 

Mr. SALANDY. I think also, in addition to the issue of academic 

preparedness, what we found is that the Posse Foundation—is that 

there are thousands of students out there that can succeed and 

that can do well, but are not being served because of financial limitations. And what we have done as an organization, how we get the 

word out is by reaching out to community-based organizations, and 

establishing relationships with public high school systems, and 

talking to counselors and principals so that they, in turn, disseminate that information about the availability of quality education to 

their students. And I think—I don’t know how that might be applied more broadly, but——

Chairman KELLER. Thank you. Time is about expired. I know we 

have got two gentlemen who have been waiting. 

Dr. Price, if you can get off your best question, then I will go to 

Mr. Bishop real quick. 

Mr. PRICE. Thank you, Mr. Chairman. I want to commend you 

for this hearing, and I want to thank you all for coming. 

I can sit here all day and talk about this, because I agree with 

others, it is probably the most important thing we could discuss. 

It allows that pursuit of happiness to occur for all of our citizens. 

I come from Georgia, the Sixth District of Georgia. Twelve, thirteen years ago we adopted the HOPE Scholarship program there, 

which I think is the first State that has truly sequestered money 

from their lottery program and utilized it to fund tuition for all students, any students who go to a State school or private school and 

maintain a B average. It has been incredibly successful in keeping 

high-quality students in Georgia. It has also been successful in allowing individuals in a very public way—in providing them the incentive to say, if I can keep my academic scholarships up, I will 

be able to go to college. 

If you, in your wildest dreams or in your most creative mindset, 

could think about how we could provide that kind of vision for 

young people all across this Nation, do you have any thoughts that 

you haven’t shared with us today or that you—or that you haven’t 

written down somewhere that if we could just do this thing, it 

43

would be a wonderful, wonderful opportunity for all students across 

our Nation? 

Mr. MERISOTIS. A decade ago I was executive director of this bipartisan commission. One of the major recommendations was to 

create a uniform level of support available to all students irrespective of their financial situation; that is, that if you come from a 

higher-income family, you would be eligible for X thousands of dollars primarily in loans, and if you come from a very low-income 

family, you would be eligible for the same amount of money primarily in grants. 

The point is we can send a message, much of what you are talking about with the HOPE Scholarship in Georgia, to all students 

in this country, the Federal Government is going to make a specific 

commitment irrespective of their status; and I still think it is a 

very big idea that could have huge consequences for us as a country and should be one that would achieve bipartisan support. 

And I would be glad share with the subcommittee more of the 

information from that commission. 

Mr. PRICE. That would be great. 

Anybody else? 

Mr. SALANDY. I would love to see—when I dream, I dream of recruitment processes that do not place the kind of emphasis that is 

now being placed on SAT scores and standardized testing, and I 

think that is a huge obstacle for students, the overreliance on those 

sorts of indicators of academic aptitude. I think that is a huge obstacle for students who might not perform well on those tests, but 

nonetheless, given the right kind of support, can be stars on campus. 

So in my—when I think of big, and I dream big, I dream of other 

measures, and perhaps also standardized, of course, but implemented on a large scale that don’t simply test for the things that 

the current standardized tests test for. 

Chairman KELLER. Mr. Salandy, I hate to cut you off. We will 

be happy to chat with you right after this. 

Dr. Price, if it is all right, let me yield for one question for Mr. 

Bishop. He has been waiting. 

Mr. BISHOP. I have lots of questions, but I will ask one. I will 

ask it of Mr. Jones. 

In your testimony you talked about the importance of increasing 

funding for the Pell grant, increasing the Pell grant maximum, increasing funding for campus-based aid, restoring Perkins, which, as 

you know, the President’s budget recommends that we eliminate. 

Quickly, we have passed—some of us disagreed—now a meritbased component to Pell. Do you believe that a merit-based component to Pell is a best limited resource, or will we be taking those 

resources and putting them toward either increasing campus-based 

funds or increasing the Pell grant maximum? 

Mr. JONES. It is too early to tell yet, particularly in the first year, 

first and second year awards, because we don’t know what the academic criteria will be. We know many of our CSU students will 

benefit from that. And the third and fourth year competitive 

grants, the Smart grants, are intended to address the workforce 

need that the Nation has identified, as well as the State of CaliVerDate 0ct 09 2002 11:32 Nov 02, 2006 Jkt 000000 PO 00000 Frm 00047 Fmt 6633 Sfmt 6602 H:\DOCS\21CC\5-23-06\27986.TXT EDUWK PsN: DICK
44

fornia, to encourage students to go in science and math and technology. 

I think always the California State universities’, and certainly 

California joins with others, the greatest need is the need-based financial aid. But many of those students, by attaching it to the Pell 

grant, are, in fact, your neediest students. Ideally what we will do 

with the additional grants is reduce the student loan indebtedness. 

It would certainly in the CSU. I can’t guarantee how it will be 

played out in other institutions, how they may, in fact, replace 

their institutional grant with another Federal grant and keep 

the——

Mr. BISHOP. That is my concern. 

My other concern is I come at this from a perspective of an exfinancial aid director, and my perspective would have been to add 

it to the campus basing, but let the financial aid officer use his or 

her discretion to assist the students who are in the greatest of 

need. 

Thank you for your answer. 

Chairman KELLER. Thank you, Mr. Bishop. 

If anyone has any additional questions or additional responses, 

you can submit it to us, and we will certainly put it in on the 

record. 

I want to thank the witnesses for their important and invaluable 

time, and for Members for their participation. 

If there are no further questions, the subcommittee stands adjourned. 

[Whereupon, at 11:25 a.m., the subcommittee was adjourned.] 

[Additional material from Mr. Jones follows:]

Supplemental Presentation by Allison G. Jones, Assistant Vice Chancellor, 

California State University System 

EARLY ASSESSMENT PROGRAM

Goal of the CSU Board of Trustees 

Reduce the need for remediation in English and mathematics to 10% by 2007

45

Percentage of First-Time Freshmen Entering with College Level Mathematics Proficiency

Percentage of First-Time Freshmen Entering with College Level English Proficiency

Collaboration 

• California State Board of Education 

• California Department of Education 

• California State University 

Purposes of Early Assessment Program (EAP) 

• Early warning 

- Identify students before their senior year who need to do additional work in 

English and/or mathematics before entering the CSU 

• Identify student readiness 

- Inform students, families, and high schools of students’ readiness for collegelevel work in English and mathematics 

• 12th grade interventions 

- Motivate students to take needed steps in 12th grade to assure readiness 

EAP Development Principles 

• Identify and develop common expectations of college readiness standards 


jones1.eps jones2.eps
46

• Align collegiate readiness expectations with K-12 standards and assessments 

• Assess college readiness standards 

• Minimize additional tests or testing time 

• Identify assessments appropriate to student academic preparation 

- 11th grade California Standards Test 

• Provide feedback to students, families, and schools in time to focus additional 

academic preparation in 12th grade 

• Cost-effectiveness 

- Reduce students’ need for remediation 

- Improve path to the baccalaureate degree 

Components of EAP 

• 11th grade testing (early assessment of college readiness) 

• Supplemental high school preparation in 12th grade 

• Teacher professional development 

Why should eleventh grade students participate in the EAP? 

• Earn an exemption from CSU-required English and/or mathematics placement 

tests 

• Identify the need for additional preparation for college-level courses while in 

high school 

• Adjust senior-year coursework to prepare for college-level courses 

• Avoid investing time and money in college remediation courses that do not 

count toward a baccalaureate degree 

Early Assessment of Readiness for College 

• Voluntary examination 

• Administered in 11th grade 

• In conjunction with California Standards Test 

• In English and mathematics 

• Contains 15 additional multiple-choice items in both subjects 

• Essay required in English 

• Selected items from CST and additional EAP items (including essay in English) 

are scored to determine student readiness for college English and/or mathematics 

What is Assessed in Math 

• CSU questions on CST are from State Board Standards 

- However, CSU does not cover Proof, Trig Functions, Probability, and Logarithms 

• Important topics that need to be learned but not essential skills for success in 

GE math 

• Purpose: measure depth, not breadth of content knowledge 

- Depth important because CSU grants exemptions 

What is Assessed in English 

• CSU questions on CST are from State Board Standards 

• Reading: comprehension 

• Reading: literary response 

• Writing strategies 

• Written essay: student explains author’s argument and extent to which student 

agrees with author’s analysis and conclusion 

Early Assessment of Readiness for College 

• English 

- College Ready (Exempt) 

- Not College Ready (Non-exempt) 

• Mathematics 

- College Ready (Exempt and Conditionally Exempt) 

- Not College Ready (Non-exempt) 

What Do Results Mean? 

College Ready (Exempt) 

• Student demonstrates readiness for college level coursework in English Language Arts and/or mathematics and is exempt from further CSU testing. 

College Ready (Conditionally Exempt) 

• Student demonstrates readiness for college level coursework in mathematics at 

that point in time,; However, successful completion of a senior year math experience 

is required to retain the exemption. 

Not College Ready (Non-Exempt) 

47

• Student does not demonstrate readiness for college level coursework in English 

Language Arts and/or mathematics and is encouraged to participate in a senior year 

experience in either or both areas. 

Incomplete 

• Student did not complete a sufficient amount of one or both exams to render 

a designation. 

Not College Ready (Non-Exempt) 

• Students, once admitted, must take appropriate placement test to determine if 

they will enter regular or remedial coursework 

- English Placement Test (EPT) 

- Entry Level Mathematics Exam (ELM) 

• Exemptions may be gained through other means, such as AP, SAT, ACT, IB, 

etc. 

College Ready: Conditionally Exempt in Mathematics 

• Students will be required to do further work to maintain their skills in mathematics to retain exemption. 

- Another math class with Algebra II as a prerequisite 

- Monitored, online mathematics e-learning program, such as ALEKS 

How CSU supports high schools and students to gain proficiency in English 

• CSU English Success Website 

• Twelfth Grade Expository Reading and Writing Course 

- Aligned with English-Language Arts Content Standards 

- Helps prepare students for college-level English 

• Teacher Professional Development 

CSU English Success Website 

• Customized information for students, teachers, and counselors 

• Checklists and guidance tips for parents (English and Spanish) 

• Personalized roadmaps with step-by-step advise and e-mail reminders 

• Advice on EPT requirements 

• Online English resources for students, parents, counselors, and teachers 

- CSU Focus on English 

CSU English Success Website 

• Tips and tools to help students improve their critical reading and writing skills 

• Online multiple-choice module offering two practice EPT exams 

- Students receive a score report with detailed feedback about their responses 

• Diagnostic Writing Service (DWS) 

• Calibrated Peer Review (CPR), an online essay-writing tool 

• Testimonials 

• www.csuenglishsuccess.org 

48

English for Success Home Page

12th Grade Expository Reading and Writing Course 

• Developed by CSU English faculty and high school teachers • Aligned with ELA content standards for 11th and 12th grades • Structured around assignment template addressing reading and writing • Lessons based on non-fiction and fiction texts • Engages students in a study of rhetoric and composition • Enables students to read and write academic prose effectively and strategically 

12th Grade Expository Reading and Writing Course 

• Increases students’ mastery of academic language • Emphasizes in-depth study of expository, analytical, and argumentative writing 

• Deepens students’ critical reading, writing, and thinking skills 

• Designed to fulfill the B requirement of the A-G subject area requirements 

• Not intended as an honors or remedial course 

• Full course or modules 

Preliminary Evaluation of 12th Grade Expository Reading and Writing Course 

Study Design 

• Effect of course on students who experienced two modules with student in traditional courses 

• Extent to which instructional context related to increased proficiency students 

in course 

• Administration of EPT to 12th graders enrolled in course using modules and enrolled in traditional course 

• Observations and interviews with teachers and students in 10 classrooms, 

teacher survey responses (N=214) 

Preliminary Evaluation of 12th Grade Expository Reading and Writing Course 

Effect on Teachers 

• Experienced strong success with curricular materials 

• Found material academically rigorous and engaging 

• Systemic changes in teaching 

• Observed that * * *

- Depth, rigor, and intensity contributed to strong, positive outcomes for students 


jones3.eps
49

- College expectations increased 

- Students experienced increased confidence as writers and readers 

- Worked well for English language learners 

Preliminary Evaluation of 12th Grade Expository Reading and Writing Course 

Effect on Students 

• Increased skills in reading comprehension, expository writing, and independent 

thinking 

- Analyzed text material more thoroughly 

- Reexamined ideas in text 

- Read text with different/multiple purposes 

- Evaluated and analyzed strength of writers’ arguments 

- Read more, including more complex texts by choice 

- Applied skills learned with expository texts with traditional English language 

arts texts 

• Students enrolled in course using modules scored higher on EPT than students 

in traditional classes 

Professional Development in English 

• Offered by County Offices of Education and the CSU to high school English 

teachers Introduces teachers to expectations of college-level English 

• Emphasizes teaching expository text and rhetorical analysis 

Professional Development in English 

• Provides teachers with skills necessary to teach the 12th Grade Expository 

Reading and Writing Course 

• Reading Institutes for Academic Preparation offered through selected CSU campuses for teachers in grades 9-12 in all subject areas to improve capacity to teach 

reading/academic literacy across the curriculum 

How CSU supports high schools and students to gain proficiency in Math 

• CSU Math Success Website 

• Twelfth Grade Math Course (under development) 

• Teacher Professional Development 

CSU Math Success Website 

• Advise students how to meet ELM and EPT requirements 

• Motivate students to take proactive steps to satisfy ELM and EPT 

• Provide educational tools and planning resources to help students improve their 

math skills 

CSU Math Success Website 

• Diagnostic services (MDTP) 

• Online math resources for students, parents, counselors, and teachers 

- CSU Focus on Mathematics 

• Online e-learning mathematics tutorial (ALEKS) 

• Live online math tutoring 

• 10-, 50-, 114- online ELM practice problems 

• Roadmap advises students how to prepare math skills 

• Video Testimonials 

• www.csumathsuccess.org 

50

Math for Success Roadmap

12th Grade Course in Mathematics 

• Design of new 12th grade course 

- Under development 

- Will emphasize math skills needed for college readiness in mathematics 

Professional Development in Mathematics 

• Increase teacher’s knowledge and understanding of EAP program • Examine student performance on ELM to identify and analyze patterns of student strengths and weaknesses • Increase teacher’s knowledge and understanding of options that exist to increase and sustain student math skills 

• Agreement with Curriculum and Instruction Steering Committee (CISC) of California County Superintendents Educational Services Association (CCSESA) to deliver professional development to high school mathematics teachers 

Just for the Kids 

• User-friendly website provides data charts based on CST and EAP for Mathematics and English/Language Arts 

• Helps schools benchmark performance against top performing schools with comparable student populations 

• Connects schools with high performing schools to learn and implement effective 

strategies that improve student achievement 

• Helps schools predict how 9th graders may perform by 11th grade if nothing 

changes 

• Identifies effective 12th grade interventions 

• www.jftk-ca.org 

EAP Statistics—Spring 2005

• EAP testing available in all public high schools 

• English EAP 

- 186,000 of 407,000 eligible juniors took English EAP (46% of all eligible) 

- 23.5% exempt 

• Mathematics EAP 

- 119,000 of 172,000 eligible juniors took Math EAP (69% of all eligible) 

- 56% exempt 

2004: 153,000 of 386,000 eligible juniors took English (22% exempt) 

2004: 115,000 of 157,000 eligible juniors took math (55% exempt) 

Resources 

• Early Assessment Program Home Page: 

- www.calstate.edu/eap 

• Math Success Website: 

- www.csumathsuccess.org 


jones4.eps
51

• English Success Website: 

- www.csuenglishsuccess.org 

• ALEKS ELM Tutorial: 

- www.csumathsuccess.org/alekslink 

• Frequently Asked Questions (FAQs): 

- www.calstate.edu/eap/documents/eapfaqfinal/pdf 

• Just for the Kids 

- www.jftk-ca.org

Æ