June 7, 2011
There’s a new report out from the Federal government entitled “The Bottom Line: Ensuring That Students And Parents Understand The Net Price Of College.” Eighty-five pages long, it was prepared by the Advisory Committee on Student Financial Assistance,” which provides advice to the Congress and the Sectretay of Education. Accounts of the report are in today’s Chronicle of Higher Education (here) and Inside Higher Education (here).
Colleges and universities are putting net price calculators on their websites in response to a federal requirement in the last authorization of the Higher Education Act (2008). The report notes that these are useful, but produce results that are difficult to compare from one institution to another because of a lack of standardization.
The recommendation? The Advisory Committee says, “While it is understandable that the design and use of net price calculators and financial aid award letters might vary somewhat across colleges, given significant differences in institutional mission and operations, closer alignment of components, definitions, and output appears possible. Given the near unanimous agreement among the hearing‟s panelists that neither further legislation nor regulation is the answer, a broad coalition of representatives from the higher education and policy making community should be formed to standardize and integrate these two financial aid tools to the extent possible.”
That recommendation is straightforward and well-meaning, but I doubt it will have any effect. Financial aid awards are a way colleges and universities compete with one another. Once compelled to have a net price calculator, very few institutions (generally the ones with lowest net price) will have an incentive to make aid offers easily comparable. I am grateful the panel didn’t call for further standardization through law or regulation.
Who makes up the federal Advisory Panel? There’s a list on page 69 of the report. They are mostly experienced administrators in higher education. Some are appointed buy the U.S. Senate, some by the House of Representatives, and some by the Secretary of Education.
Where’s Earlham’s net price calculator? We’re still working on coming into compliance. We have to have one in place by August 2011.