The Congressional Risk-Sharing Proposal Creates New Incentives and Uncertainty for Postsecondary Institutions
Uložené v:
| Názov: | The Congressional Risk-Sharing Proposal Creates New Incentives and Uncertainty for Postsecondary Institutions |
|---|---|
| Jazyk: | English |
| Autori: | Kristin Blagg, Urban Institute |
| Zdroj: | Urban Institute. 2025. |
| Dostupnosť: | Urban Institute. 2100 M Street NW, Washington, DC 20037. Tel: 202-261-5687; Fax: 202-467-5775; Web site: http://www.urban.org |
| Peer Reviewed: | N |
| Počet strán: | 14 |
| Dátum vydania: | 2025 |
| Sponsoring Agency: | Arnold Ventures |
| Druh dokumentu: | Reports - Evaluative |
| Education Level: | Postsecondary Education Higher Education |
| Descriptors: | Postsecondary Education, Federal Legislation, Educational Legislation, Student Loan Programs, Loan Repayment, School Responsibility, Risk, Educational Finance, Low Income Students, Grants, Federal Aid, Graduation Rate, Income, Paying for College |
| Laws, Policies and Program Identifiers: | Pell Grant Program |
| Abstrakt: | The reconciliation bill House Republicans passed outlines several proposed changes to higher education financing, including a new risk-sharing formula that would have colleges pay back a portion of their students' unpaid student loan bills. The amount colleges must pay is based on borrowers' unpaid loan payments each year (missed payments or payments the federal government subsidized). The share of that amount varies primarily based on program graduates' earnings, relative to tuition paid, and on the program or institution graduation rate. This reimbursement would be due for each cohort each year, such that risk-sharing payments would start small but would grow as more borrowers enter repayment and repay over the lifetime of their loans. This report analyzed the risk-sharing formula using typical values for different levels of programs. Some institutions would receive funding from the reconciliation bill's proposed Promoting Real Opportunities to Maximize Investments and Savings in Education (PROMISE) grants, which allocate dollars based on Pell volume and graduation outcomes for low-income students. Institutions that offer graduate programs are more likely to be disadvantaged by this proposal, as only undergraduates are eligible for Pell grants. |
| Abstractor: | ERIC |
| Entry Date: | 2025 |
| Prístupové číslo: | ED673521 |
| Databáza: | ERIC |
| Abstrakt: | The reconciliation bill House Republicans passed outlines several proposed changes to higher education financing, including a new risk-sharing formula that would have colleges pay back a portion of their students' unpaid student loan bills. The amount colleges must pay is based on borrowers' unpaid loan payments each year (missed payments or payments the federal government subsidized). The share of that amount varies primarily based on program graduates' earnings, relative to tuition paid, and on the program or institution graduation rate. This reimbursement would be due for each cohort each year, such that risk-sharing payments would start small but would grow as more borrowers enter repayment and repay over the lifetime of their loans. This report analyzed the risk-sharing formula using typical values for different levels of programs. Some institutions would receive funding from the reconciliation bill's proposed Promoting Real Opportunities to Maximize Investments and Savings in Education (PROMISE) grants, which allocate dollars based on Pell volume and graduation outcomes for low-income students. Institutions that offer graduate programs are more likely to be disadvantaged by this proposal, as only undergraduates are eligible for Pell grants. |
|---|