POLITICS: PennAve

Obama wants to link new college ratings system to federal aid

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White House,Education,Brian Hughes,Barack Obama,President,Federal Budget,PennAve,Student Loans,Higher Education

This article was updated at 12:30 p.m. Thursday to reflect Obama's announcement of the college ratings system.

President Obama, lamenting a “crisis” in college affordability, said Thursday that his administration would create a new higher-education ratings system aimed at shifting federal aid to better-performing schools.

“We’re going to start rating colleges, not just by which college is the most selective, not just by which college is the most expensive, not just by which college has the nicest facilities,” Obama said, starting a two day-bus tour with a stop at the University of Buffalo in upstate New York. “What we want to do is rate them on who’s offering the best value so students and taxpayers get a bigger bang for their buck."

Obama is directing the Department of Education to develop a college ratings system based on factors such as graduation rates, tuition, graduates’ earnings and accessibility for low-income students.

Under the president’s plan, beginning in 2018, students who attend the schools receiving higher ratings would have access to larger Pell grants and more affordable student loans. However, such a blueprint requires congressional approval.

When questioned about the formula for the ratings, Obama’s aides said they had not determined how to weigh the various factors.

“You worry about perverse incentives, doing the wrong thing,” Education Secretary Arne Duncan told reporters aboard Air Force One. “So we'll take our time on it."

 Duncan said that although the administration doesn't need congressional approval to create the rating system, officials would seek lawmakers’ input.

The plan could win over some Republicans who would like to link taxpayer dollars to a school’s performance. But critics will argue that such a system would put certain institutions of higher learning at a competitive disadvantage in attracting students.

And some GOP leaders gave mixed early reviews of Obama’s proposals.

“While I am pleased the president’s new plan recognizes the importance of promoting innovation and competition in higher education, 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,” said House Committee on Education and the Workforce Chairman John Kline, R-Minn. "As always, the devil is in the details.”

Following his Buffalo stop, Obama will head to Henninger High School in Syracuse later Thursday. The president will hold a town hall at Binghamton University on Friday and an event at Lackawanna College in Scranton, Pa., with Vice President Joe Biden.

The federal government provides $150 billion annually in student financial aid, and states invest $70 billion in public schools and universities.

The White House is also pushing for legislation that would require students to complete a certain percentage of their classes before receiving continued aid.

And Obama also called for an expansion of the pay-as-you-earn program to allow student borrowers to cap their payments at 10 percent of their monthly income. Congress would have to approve such a proposal.

The president framed his approach as a major overhaul of how the government funds education.

“We are going to deliver on a promise I made last year,” Obama vowed. “Colleges that keep their tuition down and are providing high-quality education are the ones that are going to see their taxpayer funding go up. It is time to stop subsidizing schools that are not producing good results.”

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