Congressional Hearing Takes on College Pricing

In a Subcommittee on Higher Education and Workforce Development hearing held this week, lawmakers focused on college pricing transparency and questioned witnesses about how higher education could be more clear in conveying costs to students and families. 

Both Democrat and Republican lawmakers emphasized their belief that college sticker prices are misleading, and financial aid offers frequently do not reflect what students actually pay. Lawmakers on both sides of the aisle also agreed that transparency is essential so students and families can better plan and understand the total cost and expected return on investment on their educational expenditures. 

Several proposals for price transparency reform were discussed, including: the College Transparency Act, which aims to provide data on enrollments, completions, and earnings by major/institution; the Understanding the True Cost of College Act, which would require a standardized format for financial aid offers; and maintaining financial value transparency (FVT) regulations so schools or the Department of Education can publish more accurate cost estimates.  

Witnesses, who included representatives from Washington, DC think tanks and foundations, and a college chief marketing officer, called for standardized language on financial aid offer forms, all-in costs for programs, and better tools to compare institutions and aid offers.  Witness testimony also noted that many institutions have already committed to clearer price information through the College Cost Transparency Initiative, of which NAICU is a founding member. 

The discussion also recognized that there are limits to transparency efforts alone. Simply publishing more information on costs will not solve any of the deeper issues driving rising college costs, so any pricing transparency effort must be coupled with addressing root causes, such as institutional spending and regulatory burdens. Generally, the committee members and panelists agreed that more transparent, consistent, and accessible information is needed and that Congress has leverage through legislation and regulation to move toward that goal.