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A memorandum that reportedly represents a "wish list" of initiatives the White House plans to include in its 2019 budget calls for requiring colleges to bear a share of the risk in student lending and letting Pell Grant recipients use their federal aid for "short-term courses and programs that lead to an industry-recognized credential," Crooked Media reported. The political website linked to the memo, which it said had been leaked.
Details about the proposals, both of which would represent significant changes in federal policy, are sparse in the memo, which contains a bullet point on each. The risk-sharing item says that Rob Goad, a White House education aide, has been working with the Office of Management and Budget to "developing the best path forward" for an approach that would require colleges to "assume a portion of the risk associated with student lending." The broad idea of risk sharing as a way to force institutions to share responsibility when their students are unable to repay their loan debt has gained bipartisan support, although exactly how is unclear.
The Pell Grant idea mentioned in the memo notes that a version of the approach has been put into legislative form in a bipartisan bill introduced over the summer (and explored in this article).
The leaked memo also mentions the prospect of overhauling Labor Department job training programs, with the goals of reducing overall spending and reconfiguring some Workforce Investment Act programs into block grants that give states more flexibility.
