Sen. Hawley: Break Up Higher Education Monopoly, Provide More Options for Career Training

Tuesday, July 16, 2019

U.S. Senator Josh Hawley (R-Mo.) is introducing two pieces of legislation this week that will expand federal aid for people pursuing vocational education and will put higher education institutions on the hook for students unable to repay student loans.

Senator Hawley said, “For decades, Americans have been told that you have to go to college to get a good job. But, in more and more places, college costs a fortune. And college degrees are no longer a guarantee of a good job.

“American students and workers need more pathways into the middle class, more opportunities to get good work and build bright futures. And they shouldn’t have to further enrich colleges by taking on a mountain of debt or mortgage their lives in order to get a good-paying job.

“Yet, we have a system that preferences students who want to attend a four-year college over Americans who want to learn a skill. This system protects higher education institutions that have been padding their endowments with taxpayer money while they raise tuition.

“It’s time to break up the higher education monopoly. It’s time to level the playing field and provide more options for career training. We also must hold higher education institutions accountable that take advantage of students who rack up mountains of debt, are unable to find a good job and default on their loans.”

Bill One

The first piece of legislation will make more job-training and certification programs, like employer-based apprenticeships and digital boot camps, eligible to receive Pell Grants through an alternative accreditation process.

This bill instructs the Department of Education to develop a new certification pathway to allow job training, apprenticeship, and certification programs to be eligible to receive Pell Grant dollars. The federal Pell Grant program is this country’s largest non-debt investment in higher education, providing grants to more than 7 million students from low-income families through annual spending of around $30 billion. Allowing students to use their Pell Grant at a greater range of career training programs will reduce reliance on debt and maximize opportunities for students to pursue their dreams.

Some examples include:

Example 1:

ACE Industrial Fittings is booming, but their growth is limited by the challenge of finding and retaining qualified, reliable employees. 10 years ago, ACE partnered with the local technical college to create an employee training program in which new hires spend half their time on the job and half their time developing more advanced skills. ACE pays for the training. They want to grow it, but the cost constrains their ability to do so. Under the Hawley bill, ACE employees could use Pell Grant dollars to pay for the training, allowing ACE to hire more workers at higher wages.

Example 2:

Since 2008, a local theater company has managed a 12-week summer apprenticeship program during which students learn the crafts of stage lighting and sound. Almost all graduates go on to full-time positions as in-house or contract lighting and sound technicians. The apprenticeship program costs $1200. Under current law, the program is ineligible to receive federal financial aid, so students enrolled in the program are prohibited from using their Pell award to cover program costs. Under the Hawley bill, the program could be authorized under the alternative pathway and students could apply their Pell award to the cost of the program.

Example 3:

Debbie is a single mom who works in retail. She always had a knack for computers and design, but dropped out of school before earning her high school diploma. Debbie recently learned about an online academy where she can learn web development, including JavaScript, SQL, APIs and more, at her own pace. However, though she is eligible for Pell Grants, under current law she is not allowed to use the money to cover the $400 registration cost for the online program. But, under the Hawley proposal, Debbie could use her Pell dollars to pursue her dream, in the way that works for her.

Bill Two

The second piece of legislation will require institutions of higher education to have skin in the game when it comes to cost and student outcomes by requiring them to repay a portion of the loan balance of students who are unable to repay their debt.

This bill requires colleges and universities to pay off 50 percent of the balance of student loans accrued while attending their institution for students who default, and forbids them from increasing the cost of attendance to offset their liability.