Obama proposes college-rating system in bid to increase affordability

President Obama hits the road with a two-day bus tour through New York and Pennsylvania to tout his new plan to make college more affordable. The Post's chief White House correspondent Scott Wilson tells us the three things to watch from the road. (The Washington Post)

For decades, magazines have rated colleges to help families navigate the higher education market. On Thursday, President Obama proposed that the federal government rate the nation’s schools to hold them accountable for performance and help bring soaring tuition under control.

By the 2015 school year, Obama said, his administration will begin evaluating colleges on measures such as the average tuition they charge, the share of low-income students they enroll and their effectiveness in ensuring students graduate without too much debt.

The president also will seek congressional approval — which could prove difficult — to steer more federal student aid toward colleges that score highly in the ratings. A student in financial need at such schools might qualify for a larger Pell grant or a better interest rate on a federal loan.

The result, officials hope, will be relief for families from college bills that are in many cases three times as high as they were 30 years ago even after adjusting for inflation. Average tuition and fees topped $8,600 last year at public four-year colleges and $29,000 at private and nonprofit schools. The total annual bill, counting room and board, exceeds $50,000 at many elite schools.

“Higher education should not be a luxury. It is an economic imperative that every family in America should be able to afford,” Obama told students packed into a basketball arena at the University at Buffalo.

Graphic

See the shift in revenue and costs for colleges since 2000.

Obama’s plan relies in part on his executive power to collect, manage and publish data. But it is likely to draw significant criticism from colleges intent on protecting their market share, and a divided Congress will present an immediate obstacle to elements of the plan that require legislation.

Obama said that in a global, knowledge-based economy, a quality college education is more important than ever. He pitched the ratings system as a consumer guide for prospective students and parents, evaluating which schools offer “the bigger bang for the buck.” His idea is that accountability will yield affordability.

“Colleges that keep their tuition down and are providing high-quality education are the ones that are going to see their taxpayer money going up,” Obama said.

College leaders say rising tuition is a function of labor costs and, in the case of public institutions, declining state financial support. They also note that affluent students who pay full price often subsidize those in need, who obtain steep discounts. They said they support giving consumers more information but signaled that Obama might face a fight over attempts to enlarge the federal role in the college market.

“We will be vigilant in working to prevent tying the receipt of aid to metrics, which could have a profoundly negative impact on the very students and families the administration is trying to help,” said Molly Corbett Broad, president of the American Council on Education, which represents colleges and universities. Fluctuations in federal student aid, many educators argue, would produce problems for students in financial need who depend on grants to pay their bills, especially if those students attend a school that receives a lower rating.

Colleges that oppose the Obama plan could find allies on Capitol Hill. Obama is preparing to battle House Republicans on a series of fiscal issues this fall, and it is not clear whether he can succeed in persuading lawmakers to back him on college affordability.

Of Obama’s plan, Rep. John Kline (R-Minn.), chairman of the House Committee on Education and the Workforce, said: “I remain concerned that imposing an arbitrary college ranking system could curtail the very innovation we hope to encourage — and even lead to federal price controls.”

Sen. Marco Rubio (R-Fla.), a potential 2016 presidential candidate, said: “This is a slippery slope, and one that ends with the private sector inevitably giving up more of its freedom to innovate and take risks. The U.S. did not create the best higher education system in the world by using standards set by Washington bureaucrats.”

Much of Obama’s plan would require legislation, including a proposal to spend $1 billion to spur state overhauls of higher education that is certain to draw stiff Republican opposition. Any measure to restructure student aid will face close scrutiny from both parties.

But officials said they plan to use Obama’s executive authority to forge ahead with new federal ratings, consulting with colleges as they craft metrics. The effort will build on a “college scorecard” Obama launched this year.

The influential U.S. News & World Report college rankings have shown that the very act of publishing such analyses often has a profound effect as colleges adjust their admissions and financial policies in an effort to stand out from the crowd. Critics say that ratings are often based on flawed data.

If Obama succeeds in pointing out schools that have questionable performance on graduation rates and other measures, “he’s really pointing the finger at a third to a half of the higher education system in the country,” said Brian Kelly, editor of U.S. News. “It’s pretty bold.”

Over the past decade, as public elementary and secondary schools have been held responsible for improving test scores under the No Child Left Behind law, analysts have wondered whether the government would use the same strategy to reshape higher education.

With a powerful lobby in Washington, colleges have so far beat back such efforts, contending that no accountability system can effectively rate performance for 5,000 degree-granting schools that encompass two-year community colleges; the Ivy League; research universities; regional state schools; private, nonprofit liberal arts colleges; and for-profit institutions.

Exactly how to compare colleges and judge outcomes is a matter of fierce debate within academia. Many colleges can’t even agree on which schools are their peers. There are major questions about how to calculate graduation rates and measure the earnings potential of graduates.

“The devil is in the details. How do you define value?” asked Sarah L. Flanagan, vice president for government relations for the National Association of Independent Colleges and Universities. She wondered if some colleges would be penalized under a ratings system that did not take into account the modest salaries of graduates entering public service, religious ministries or careers in the arts.

Amy Laitinen, an analyst with the New America Foundation who served in the Obama Education Department, said possible flaws in a federal rating system are outweighed by the public interest in containing prices. “What we have now is not working,” she said. “The idea that we would keep the status quo because the alternative is less than perfect is crazy.”

Some education leaders say colleges must become more transparent. The Association of Public and Land-grant Universities is spearheading a campaign this year to publish more graduation data.

“We also strongly support President Obama’s efforts to link federal student aid to student progress and degree completion rates,” APLU President Peter McPherson said in a statement.

Obama’s visit to Buffalo had a distinct campaign feel. The president, wearing a blazer and no necktie, sought to rally students and educators around his plan with a 38-minute address.

On Friday, he will have a town-hall-style event at Binghamton University in New York and visit Lackawanna College in Scranton, Pa.

In Buffalo, Obama noted that he and his wife, Michelle, took out student loans to attend college and law school and did not pay them off until they were in their 40s. But he lamented that, on average, students today have far more loans than he had, saying the average college student graduates with more than $26,000 in debt.

Obama’s plan includes measures to ensure that students receiving federal aid complete their courses each semester before receiving the next semester’s grants.

“We need to make sure that if you’re getting financial aid, you’re doing your part to make progress toward a college degree,” Obama said.

Rucker reported from Buffalo.

A former Post education editor, Nick writes about college from the perspective of a father of three who will soon be buried in tuition bills.
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