Opening Statement of  the Howard P. "Buck" McKeon
Chairman
Committee on Education and the Workforce
Subcommittee on 21^st Century Competitiveness

July 10, 2003

Hearing On:
"Affordability in Higher Education: We know there's a problem; what's the solution?"

Good morning. Thank you for joining us for this important hearing today to hear testimony on college affordability, discuss the effects of ever-rising college tuitions and debate some of the possible solutions to this problem. This is our eighth hearing examining issues that affect our nation's colleges and universities, and the students they serve as the Committee continues its look at the reauthorization of the Higher Education Act (HEA).

In 1965, Congress enacted the Higher Education Act, which took on the central mission of ensuring that every low-income student in the country could be afforded the opportunity to pursue his or her educational goals. Because of this commitment, our country has made great strides in ensuring that millions of eligible students can go to the college or university of his or her choice. However, thousands of highly qualified students cannot afford to attend college and fulfill their dreams because higher education institutions or States are increasing their tuition and fees beyond the reach of students.

According to the Advisory Committee on Student Financial Assistance, which provided testimony last year, cost factors prevent 48 percent of all college-qualified, low-income high-school graduates from attending a four-year college and 22 percent from pursuing any college at all. Students from moderate-income families do not fare much better -- 43 percent are unable to attend a four-year institution and 16 percent are unable to enroll at any college. At the rate we are going, by the end of the decade, more than two million college-qualified students will miss out on the opportunity to go to college.

As college prices have continued to rise, the federal government has repeatedly increased financial support for higher education. In the four years since the last reauthorization of the Higher Education Act, federal student aid has grown by more than $23-billion. Last year, Congress also raised the maximum Pell grant to $4,050 a year. Student-loan interest rates are at their lowest levels in the program's 38-year history.

Now, I realize that the recent decisions of state legislatures to reduce their spending on higher education have exacerbated the problem. Appropriations have dropped in 14 states. At the same time, average tuition at four-year colleges has increased by more than 10 percent in 16 states; in Iowa and Missouri, tuition has risen by 20 percent, and in Massachusetts it has jumped 24 percent.

But that tells only half the story. It does not acknowledge that state support for higher education's operating expenses has grown more than 60 percent over the last decade. And it does not explain why tuition and fees continued to rise even in years past when state coffers have overflowed with taxpayer money.

I believe that it is time that we -- the federal government, States, institutions of higher education, the lending community, parents and students -- all take our role in addressing this crisis seriously.

There are some here in government and out in academia who will say that the federal government should not get involved in higher education -- they say, we're doing a great job, and should do nothing but send more money. There are some who say that all we need to do is to increase the Pell grant award and change the loan programs and that will solve the problem of college costs.

I respectfully disagree.

I think that we need reforms, and we need them now – because the rhetoric of the past decade has done nothing to stem the rapidly rising cost of college in America.

Earlier this year, I put forth a proposal to closely monitor tuition and fee increases by developing a college affordability index that will serve as a standard measure for institutions of higher education to measure increases in tuition and fees and a tool by which students and families can measure the extent of those increases in relation to the Consumer Price Index (CPI). The proposal would also create College Affordability Demonstration Programs for those colleges and universities that want to try new innovative approaches to improving higher education while reining in uncontrolled cost increases. Also, it would prohibit the denial of transfers of credit based solely on the accreditation of the institution from which the student is transferring, and encourage states to emulate federal efforts to streamline red tape in the student aid system.

While the details have not been released yet, some people in higher education have even gone as far as to say that the proposal will result in federal price controls and jeopardize institutional quality. While I don't argue with the fact that our higher-education system is the best in the world, I do think that we can do a better job of making college more affordable and more accessible. The last thing that I want to do is tell colleges is how to run their businesses, but I will not stand idly by as they continue to raise their costs each year to a level which has jeopardized students' ability to have access to postsecondary education.

While this hearing is not on my particular proposal, I look forward to ongoing discussions on solutions that address the increase in college costs.

There are many institutions developing creative ideas and taking action to help stem the tide of the ever-growing crisis of rising college costs.  Their students have not suffered a loss in services and, more importantly, has not suffered a decrease in quality. But many more higher-education institutions must think "outside the box" to ensure that low-income families are not priced out of the market.

With the Federal government providing between 30-35 percent of all funding for higher education, which totals approximately $90 billion annually, it is a federal issue and one where hard questions must be asked and solutions must be considered.

And so, as this Committee continues its effort to reauthorize the Higher Education Act, we will examine the issue of college affordability. We know that there is a problem. Today, we begin to find solutions.