Letter from President Eisgruber to Congressional Leaders Regarding Reauthorization of the Higher Education Act.

April 25, 2019

Dear Chairman Alexander, Chairman Scott, Ranking Member Murray, and Ranking Member Foxx:

Princeton University is deeply committed to providing a high quality education that is affordable and accessible to talented students from all backgrounds. It is critically important to the country that the federal government assist all colleges and universities to achieve these goals and enable America to provide its young people with the educations they require to thrive and contribute productively to our economy and society.

I accordingly want to thank you for beginning the dialogue on reauthorization of the Higher Education Act, and I look forward to working with you on these issues. In this letter, I focus on three topics in particular: raising completion rates, increasing socioeconomic diversity, and improving accountability.

Raising completion rates. A college education is a long-term investment with tremendous returns. The returns, however, depend on completing the degree. This reauthorization presents an important opening for Congress to address a crisis in higher education: far too many students are beginning college, but not completing it. They thereby lose the benefits of a degree and leave taxpayers burdened with debt that the students cannot repay. Congress has the opportunity to strengthen the federal government's commitment to help increase socioeconomic diversity on college campuses, while putting in place measures to make sure the significant investment is well spent.

I share the concerns of many members of Congress about preserving the very large taxpayer investment in education and taking steps to guard against default on loans. All of us who are concerned about defaults should be concerned about completion rates. The highest default rates on student loans do not involve college graduates who accrue large debts. Instead, as highlighted in testimony before the House Education and Labor Committee last month by Douglas Webber, director of graduate studies in the economics department for Temple University, the highest rates involve students with small debts who never finish college and never get the earnings boost that comes with a degree.

It is time for Congress to act to promote policies that will help America's young people complete college. I urge you to give serious consideration to the bipartisan effort by Senators Coons and Isakson aimed directly at improving completion rates. Part of the "Access, Success and Persistence in Reshaping Education (ASPIRE)" Act is designed to identify institutions that are doing a poor job of graduating students when compared with their peers. Consumer warnings in documents such as the College Scorecard would provide information about low performers. A monetary penalty would be imposed on for-profit schools that fail to improve completion rates after five years. We must do a better job of educating students about the importance of completion rates, and we must hold institutions accountable when they fail to get their students not just into, but through, college.

Under the proposed legislation, when public institutions or non-profit private institutions have low completion rates in comparison to their peers', the federal government would provide them with significant resources aimed at improving their graduation rates. The schools would be required to develop and implement improvement plans; penalties would only be imposed if schools failed to show improvement after a prescribed period of time and an infusion of dedicated resources.

While the bill provides nonprofit private and public institutions with a choice about whether to opt into participation, I urge you to consider requiring participation by all schools. Research by University of Virginia Professor of Economics and Education Sarah Turner shows that low six-year completion rates for four-year schools are a problem in multiple sectors of higher education, although they are more pronounced at for-profit schools. Turner expresses concern that at a number of schools, students who borrow face a greater likelihood of defaulting than completing a college degree.1

As Congress considers this legislation, I hope that it will also pay attention to schools that have large gaps between graduation rates for Pell and non-Pell students. The Department of Education released graduation rates for Pell Grant recipients in 2017; analyses of this data has documented a disturbing gap in six-year graduation rates between Pell and non-Pell students.2, 3 Again, schools that underperform in graduating Pell students should be eligible for additional resources and also required to develop and implement a plan for improvement.

The graduation rate of students on Pell Grants is an important measure of a university's success at supporting students from a wide range of backgrounds, but it is only one measure. Consideration should also be given to incorporating into the legislation metrics based on the progress that schools are making in improving graduation rates based on racial and ethnic groupings. An American Council on Education report released in February finds that while black students' rates of completion increased in 2016 as compared with 20 years prior, large gaps remained. Black students who started college in the fall of 2011 had lower rates of first year persistence, and higher rates of dropping out than any other racial or ethnic group over all sectors.4

Increasing socioeconomic diversity. We are proud of the fact that Princeton's 2018 graduating class was the most socioeconomically diverse set of undergraduates in the 272-year history of the University. This year's class will be even more diverse. Princeton is increasing the number of low-income and middle-income students that it enrolls and graduates because we recognize that to achieve excellence as a University and as a nation, we must draw talent from every sector of society. If we want to heal the divisions that inequality has produced in this country, we must ensure that students from all backgrounds and financial circumstances receive the educations they need to develop their abilities and contribute to society.

The federal government has an important role to play in helping schools achieve greater socioeconomic diversity and enhanced student persistence. Now is the time for Congress to take bold steps to strengthen the Pell Grant program.

The original vision of the Pell Grant-the nation's most significant program for the support of low-income students in higher education-was that the maximum grant would cover three-quarters of the total price of college at a public four-year institution. We have lost sight of that goal. Today, the Pell Grant covers less than one-third of an in-state public four-year education. Congress should strengthen the Pell Grant program by: increasing the maximum grant with the goal of doubling the total amount available to students; expanding the program's eligibility to include students from a broader range of family incomes; increasing the number of students eligible for the maximum Pell Grant; and putting in place an automatic indexing of the grant to inflation. Additionally, DREAMers and incarcerated persons should be eligible for Pell and other student aid. This opportunity for DREAMers would enable more young people to pursue their educations, develop their talents, and contribute positively to our communities. Allowing incarcerated individuals to access Pell Grants would reduce recidivism rates and improve employment options after release. It is also a smart investment: every dollar invested in prison-based education results in a taxpayer savings of approximately $5 in reduced incarceration costs.5

Improving accountability. I also encourage Congress to adopt two measures to improve accountability for the large investment made by the federal government in higher education: a national student unit record database and a restoration of the gainful employment regulation.

The College Scorecard and other state and federal reporting databases are impressive efforts to provide information that can be used to evaluate federal spending on education, but they collectively contain large gaps when it comes to important, actionable information. Completion statistics and cost and earnings data are often incomplete and fail to capture information on many students. We need a comprehensive and integrated data base that spans state lines and brings together information on student enrollment, cost and outcomes in one place.

More complete data would provide a better picture of student outcomes, which in tum would allow a more accurate assessment of the return-on-investment for federal student aid used at different-and different types of universities. Improved and more comprehensive data will also help students make better informed college selections. Students would be able to see how people similar to them (including by age, race/ethnicity, economic circumstances, first generation status, and college readiness) performed at a given institution or in a particular program-such as whether they completed their course of study, entered a productive career, repaid their loans, or earned a good salary after graduation.

To be successful, this system must respect privacy and ensure the safe and secure storage of information relating to students and their families. As we design these systems, we must ensure that proper protections are put in place so every student can be confident that his or her personal information will be secure.

I believe that the federal database can both respect privacy and promote transparency; indeed, state databases, the Department's National Student Loan Data System, and the National Student Clearinghouse all regularly collect and leverage such information in a secure, responsible way. The Department has a long-standing and robust research program that respects privacy and manages student unit record data effectively.

Finally, the Administration's decision to rescind the gainful employment regulations was a huge step backwards in the effort to improve institutional accountability. More than 800 programs failed the standards in 2015, with another 1,200 placed on probationary status. Prominent economists have noted that the rules appropriately focused on poor-performing institutions in the for-profit sector because "the probability of experiencing a poor outcome is dramatically higher for students entering for-profit institutions. "6 These institutions were exploiting vulnerable students in large numbers and ripping off the American taxpayer; the gainful employment regulations helped curb a despicable practice. They should be restored immediately.

Our nation's sustained commitment to higher education has helped build an engine of innovation and progress unparalleled across the globe. To ensure our continued status as a world leader, we must focus on making sure that our colleges and universities are affordable, accessible and accountable. I look forward to working with you as the reauthorization process proceeds.

With best wishes,

Christopher L. Eisgruber
Princeton University

1 Sarah Turner, "The Policy Imperative: Policy Tools Should Create Incentives for College Completion," American Enterprise Institute, May 30, 2018, p. 7. http://www.aei.org/publication/the-policy-imperative-policy-tools-should-create-incentives-for-college-completion/

2 Elissa Nadwomy, "We Now Know a Lot More About Students Who Receive Federal College Grants," National Public Radio, June 3, 2018. https://www.npr.org/sections/ed/2018/06/03/610399546/we-nowknow-a-lot-more-about-students-who-receive-federal-college-grants

3 Melissa Korn, "Even at Top Colleges, Graduation Gaps Persist for Poor Students," The Wall Street Journal, February 18, 2019. https://www.wsj.com/articles/even-at-top-colleges-graduation-gaps-persist-for-poor-students-11550491200.

4 "Race and Ethnicity in Higher Education," American Council on Education, February 2018, p. 6. https://www.equityinhighered.org/resources/report-downloads/

5 Lois M. Davis, Jennifer L. Steele, Robert Bozick, Malcolm Williams, Susan Turner, Jeremy N. V. Miles, Jessica Saunders and Paul S. Steinberg, "How Effective Is Correctional Education, and Where Do We Go from Here? The Results of a Comprehensive Evaluation," Rand Corporation, 2014, p. 78. http://www.rand.org/pubs/research_reports/RR564.html