Home Education Obama’s Higher Education Plans May Affect OU’s Federal Aid

Obama’s Higher Education Plans May Affect OU’s Federal Aid

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President Barack Obama delivers the State of the Union address in the House Chamber of the U.S. Capitol on Feb. 12, 2013. // Official White House Photo by Chuck Kennedy

The White House introduced initiatives last week to make colleges more accountable for  high tuition rates, which may have an effect on the amount of student aid Ohio University receives.

President Barack Obama, in his State of the Union address on Feb. 12, talked briefly about college affordability, saying “skyrocketing costs price too many young people out of a higher education or saddle them with unsustainable debt.” After the address, the administration released a press release outlining Obama’s goals for his second term in office, detailing specific initiatives for higher education.

The press release stated that Obama would call on Congress to develop a plan for allocating federal student aid based on value, affordability and outcomes of each higher education institution. Congress, the press release said, would do this either by incorporating this plan into the existing accreditation system or by establishing a new one that would rate colleges based on performance and results and distribute federal funds accordingly.

The second initiative, talked about in more detail during the address, is the development of a “College Scorecard,” that gives prospective students and parents the ability to compare colleges based on value, affordability and results, and how much federal aid said institution receives.

The Scorecard is already operating on the White House’s website. Ohio University’s Athens campus is rated medium in costs, high in graduation rates, below the national average for number of loan defaults and low on median borrowing.

OU President Roderick McDavis seems optimistic about Obama’s Scorecard and where the university stands. “Academic excellence, access and affordability are among Ohio University’s highest priorities,” he said in a statement through email. “It’s great to see a national conversation about these priorities, which Ohio University shares with President Obama.”

McDavis noted that OU’s focus on graduation, as part of Gov. Kasich’s higher education funding formula, would strengthen the performance of universities on the College Scorecard in the future.

The College Scorecard scores OU as high on graduation rates, with 65 percent of full-time students graduating and 27.3 percent transferring to other colleges.

But where the university stands on affordability may serve as an issue if the federal government establishes an accreditation system based on tuition rates. According to the College Scorecard, OU’s average net price has increased 4.8 percent from 2007 to 2009 and stands at $18,142 for in-state undergraduates.

About two-thirds of OU students receive some type of financial aid.

OU undergraduate students may have a low median borrowing rate at $13,750, or about $158 per month for 10 years, but as tuition rates have increased almost every year for the past few years by the maximum rate allowed by the state, that score might change.

According to the Budget Planning Council, OU experienced a .53 percent decrease in federal funding to the budget in the fiscal year 2013, the causes of which are not readily available.

An article by “Inside Higher Ed” said Obama’s plans “seemed to indicate that he is not inclined to trust accreditors to choose the criteria on which they evaluate colleges, and that he would like to see the federal government play a larger role in determining what constitutes a high-quality education.”

The article also stated Obama’s plans may face resistance from universities and colleges that fear further federal regulations.

The changes to federal aid to campuses, the administration predicts, would leverage about $10 billion annually.

Among the federal changes to financial aid and the College Scorecard, the Obama Administration has proposed two more initiatives: a $1 billion investment through Race to the Top and a First in the World competition, both of which would encourage higher education institutions to boost performance and results when educating students.

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