State Lawmakers Call for Rethinking Federal Role in Higher Ed

The cost of college continues to rise. The student debt crisis has gained national infamy. A bachelor’s degree no longer guarantees a stable career. And the demographic cliff has enrollment numbers plummeting just as colleges and universities are relying more heavily on tuition for financial health.

Collectively, these issues represent a growing sense of national anxiety about the purpose and value of America’s higher education system. Colleges across the country are in the middle of an existential crisis, and state policymakers are noticing and looking to be more involved in addressing the underlying issues.

But they want the federal government to leave accountability measures to them, according to a new, three-part report released Thursday by the National Conference of State Legislatures’ Task Force on Higher Ed.

“There are just lots of questions being raised in our states related to higher education policy. So that has really catalyzed interest in understanding the relationship between the states and the federal government,” Utah state senator Ann Millner said at a press conference Thursday. “Sometimes it feels like we’re working parallel, but we’re not working in alignment with each other, and it’s important that we do that.”

In addition to suggesting that the Education Department and Congress leave accountability to the states, the task force expressed skepticism about student loan repayment and forgiveness programs and proposed investing more in state grants and maintaining the Pell Grant. State lawmakers do, however, want the federal government to collect and publish more data about how students fare in college programs.

The task force, which included legislators from both parties across 32 states, also dived into the debate over how to determine whether a degree pays off for a student. Although it didn’t create any one universal definition, it said that if a degree is of value, three things must be true: the degree is meaningful, obtainable and affordable.

They also outlined how states, institutions and the federal government could work in different, but coordinated ways to enhance the value of degrees. Primarily, though, they say it’s the job of higher education institutions themselves to deliver value by evolving to meet the expectations of students, particularly working-age adults.

Over all, Millner, a Republican, and her task force co-chair, Oregon state senator Michael Dembrow, a Democrat, hope that report leads to better communication among institutions, states and the federal government, among other goals.

“We need to convince our colleagues that those dollars are going to result in value for students,” Dembrow said. “So we need to be convinced of that ourselves … We’re hoping via this report to be able to start to make that case.”

‘In the Dark’

Backed by the NCSL, the task force represents the first effort of its kind since 2006 to address national issues in higher education.

NCSL decided to convene the task force now because the environment surrounding higher education and its governance has changed and the federal government has become more involved in overseeing colleges and universities.

“There were a lot of conversations happening at the federal level that had implicated states, but states had not actually been involved in those conversations,” said Austin Reid, federal affairs adviser at NCSL. “A lot of legislators, as a result, were sort of in the dark about what was happening.”

Dembrow said the task force’s creation was spurred by a range of factors, including the COVID-19 pandemic, the economic conditions it created and lackluster college-going rates.

“We need social workers, mental health professionals and teachers,” he explained. “We need to be encouraging students who are out of school to go back to school, and they just face so many barriers.”

In order to break down those barriers, the task force argues that they first need to rethink the relationship between states and Washington, D.C.

Historically, the NCSL report says, the federal government has played a “complementary” role in financing and governing higher education, primarily through accreditation and the Pell Grant program. But as student debt has risen and the Education Department has implemented new programs to forgive loans and make it easier for students to repay their debts, the footprint of federal spending in higher ed has grown.

The federal student debt portfolio has grown to nearly $1.8 trillion, making it the second-largest form of debt held by Americans after mortgages. And since 2021, the department has forgiven more than $168 billion of it.

In response, lawmakers on Capitol Hill have shown more interest in expanding the federal government’s role in overseeing colleges. That includes proposing that institutions pay back portions of their students’ unpaid loans.

And the Education Department has sought to crack down on college programs that leave students saddled with debt, adding new requirements for institutions that receive federal financial aid. The agency also has pushed accreditors and states, which also oversee colleges, to step up enforcement.

State lawmakers on both sides acknowledge that there is a “sensible” reason for their federal counterparts to care more about “suboptimal outcomes,” according to the report, but they argue states should be the lead authority.

“If we had a better, more coordinated relationship with our federal counterparts, we could really make some progress,” Dembrow said.

“Nobody is asking the federal government to come in and solve this for the states,” Millner added. “But the states do need to have meaningful conversations about what can we share? What’s best practice? How can we work together? How can we get the data that we need to make the decisions?”

‘Broad Consensus’

Dembrow and Millner joined other leaders across the higher ed sector and D.C. policy realm Thursday morning to discuss what the report’s findings look like in practice.

Education Department under secretary James Kvaal said that conversations about how to improve higher education at the federal and state level often occur in isolation, which needs to change. But he noted that whether you call it “an equity agenda” or “workforce development,” there’s “broad consensus” about the end goal.

“We want a system that is open to everyone who needs additional skills and credentials, is affordable, and gives everybody a fair opportunity to graduate and go on to a career of their choice,” he said. “People are working on different pieces of the puzzle without supporting each other.”

And though student loan programs are “the single biggest thing we do” at the department, Kvaal said, the task is broader than just relieving students who were left worse off because they borrowed money. It’s also a matter of thinking about the investment as a whole—loans, time and scholarships —and asking whether it’s creating an economic return.

“I think we need to think differently about how we invest in the higher education system that we want, and whether loans are the appropriate tool to finance education,” he said.

Cheryl Oldham, now executive vice president of human capital at the Bipartisan Policy Center, a Washington think tank, led a similar group in 2005. She reread the Spellings commission’s final report in preparation for Thursday’s panel and said it’s “shocking” how much has stayed the same. To her, the similarities make one thing clear: “We can’t do any of this without” the institutions, the state and the federal government.

Emily Rounds, an education policy adviser at Third Way, a center-left think tank, told Inside Higher Ed after the event that she was encouraged by the task force’s “actionable recommendations,” which include calls for robust student outcomes data reporting, improving affordability for low- and middle-income students, and investing in the Postsecondary Student Success Grant program.

“Colleges and universities fail to graduate 40 percent of their students, and it’s important to prioritize policies that will help students across the finish line,” she said. “This report and this morning’s event are important steps in advancing the work around college ROI and moving conversations about college value and completion into policies to support students.”