Student Loan Blog : Congress

Aid Administrators to Lawmakers: “Don’t Kill Guaranteed Student Loans”

Student Loan Girl — Wed, 25 Mar 2009 00:02:00 GMT

Just as Congress is about to vote on President Obama’s plan to end the government’s Federal Family Education Loan Program, through which families get their student loans from private third-party lenders, a lender advocacy group is urging lawmakers to consider an alternative to the president’s proposal, reports The Chronicle of Higher Education (“Student-Aid Administrators Urge Lawmakers to Reconsider Killing Guaranteed Loans,” March 19, 2009).

Currently, college students can take out student loans through private lenders using the FFEL program, or directly from the Department of Education through the government’s Direct Loan Program, which Obama hopes to establish as the sole provider of federal student loans.

Instead of doing away with FFELP lenders altogether, the National Association of Student Financial Aid Administrators proposes creating a new federal student loan model that would allow FFELP lenders to continue their participation in the federal student loan program, but under different roles.

FFEL Program Participants Would Serve New Roles

In a memo sent to Congress, NASFAA president Philip R. Day Jr. proposes that student loans be financed through the sale of government subsidized bonds to investors and that the proceeds be used to disburse student loans to colleges, who will in turn apply the funds directly to students’ accounts, similar to how direct lending functions today.

Under the NASFAA’s proposal, private lenders would no longer market college loans to students but could bid on Education Department contracts that would allow them to originate, disburse, and service the loans. Nonprofit agencies and former guarantors would no longer guarantee student loans, but would instead provide default- management services to students, including entrance and exit counseling on their repayment options.

A unique feature of NASFAA’s proposal would allow family members, friends, and private companies to receive a tax credit in exchange for paying off a portion or all of a borrower’s debt. State-based nonprofit lenders would still be allowed to offer loan-forgiveness programs for students entering in-demand professions.

Congress Urged to Consider Alternatives

Earlier last week, the NASFAA asked lawmakers to go slow when considering Obama’s plan. Lawmakers were also urged to engage in “deliberative” discussions regarding the future of student lending, The Chronicle reported, instead of just “ramming through” the government’s proposal to end the guaranteed lending program.

Obama’s plan aims to eliminate guaranteed lending for students through a budget resolution outlining the government’s spending plan.

If that resolution includes instructions to Congress’ education committees to consider Obama’s proposal by way of the budget reconciliation process, Day says it would be the death knell of the FFEL program and “prevent a full vetting of alternative proposals.”

The NASFAA has asked legislators to convene a stakeholder’s meeting to consider other viable options to reform the federal student loan program.

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Tens of Thousands of College Work-Study Students to Benefit From Stimulus

Student Loan Girl — Tue, 24 Feb 2009 22:08:00 GMT

An additional 130,000 college work-study students may have jobs next year thanks to the economic-stimulus bill that President Obama just signed into law which allocates approximately $200 million in new funding for Federal Work-Study Programs, reports The Chronicle of Higher Education (“Economic-Stimulus Law Creates Jobs for Students, Too,” Feb. 19, 2009).

The money, which colleges should receive by April 1 of this year, will not be tied to a new community service requirement as some higher education officials had expected. Work-study funds will be distributed to undergraduate and graduate students next year based upon “existing formulas and information that colleges have already submitted.”

With the additional $200 billion in stimulus money, Federal Work- Study Programs could receive $1 billion in total funding this fiscal year — a level not seen since 2001, The Chronicle reports.

College work-study programs have widespread support in Congress, unlike Pell Grants and tax credits, notes Cynthia Littlefield, director of federal relations for the Association of Jesuit Colleges and Universities.

“Federal Work-Study continues to be highly regarded in a very bipartisan manner on Capitol Hill because everybody realizes the importance and purpose of it,” said Littlefield. “Everyone understands the concept of working your way through school.”

Although the $200 million in stimulus funding for colleges is targeted at providing more work-study jobs, it may not be so easy for schools to get the money that will create the new jobs for their students, The Chronicle suggests.

Since colleges match the Federal Work-Study money on a 25-percent to 75-percent basis, schools can only qualify for the additional funds if they have the extra institutional funds on hand to match the federal money.

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Student Loan Providers Get More Help From the Government

Student Loan Girl — Thu, 13 Nov 2008 22:39:00 GMT

In a move intended to avoid a shortfall in student loans next year, Congress has expanded the government program to buy federally guaranteed student loans from private lenders.

Under the updated loan-purchase plan, the Education Department can now buy lenders’ student loans with origination dates between Oct. 1, 2003, and July 1, 2009, The New York Times reports (“U.S. Buying More Loans to Students,” Nov. 8, 2008). The original buyback parameters only allowed lenders to purchase loans made for the current academic year and for the 2009–10 academic year.

Federal officials say that as much as $60 billion in student loans may be eligible for purchase under the new expansion.

“We were able to provide stable, reliable funding for students this school year,” said Education Secretary Margaret Spellings. Now the government is taking action to avoid problems in student loans for next year, she said.

Expanded Program May Solve Liquidity Problem

Many lenders were initially unable to participate in the student loan buyback program because the original version of the program only allowed lenders to sell loans on the secondary market that were generated prior to 2008.

The economic conditions during the current academic year have made it difficult for lenders to secure the financing needed to make new student loans that would be eligible for sale through the buyback program. Unable to sell their loans, lenders were then forced to carry their loans on their books.

“They have these government-guaranteed loans and nobody wants to fund them,” said Sameer Gokhale, a financial analyst for Keefe, Bruyette & Woods in New York. “The government is agreeing to buy more of the loans to give more liquidity.”

The Education Department hopes that the new initiative will provide lenders with the required funds to generate new federal and private loans next year, as lenders may be more likely to participate in the program once they can free up billions of dollars in loans under the new requirements of the buyback program.

“We need to do everything we can to prevent students from becoming the next victims of the financial crisis,” said Sen. Edward Kennedy, chairman of the Senate Education Committee. “Next year, we need to take a closer look at these programs to insulate them from fluctuations in the market so students’ ability to access loans is not threatened.”

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Sen. Schumer Calls for Government to Protect Student Loans Amid Passage of $700 Billion Bailout Bill

Student Loan Girl — Tue, 14 Oct 2008 20:17:00 GMT

Concerned that students who are eligible to go to college won’t be able to pay for their education costs in light of the current credit crisis and a steadily worsening economy, Sen. Charles Schumer is urging the federal government to make sure student loans are still available, according to an Associated Press article (“Schumer Wants Student Loan market to Be Protected” Oct. 6, 2008).

Schumer recently wrote Secretary of Treasury Hank Paulson and Federal Reserve Chairman Ben Bernanke, advising them to keep tabs on the student loan market as the government implements a $700 billion bailout plan for the financial sector. The senator fears that the deteriorating credit market might burden college students with higher interest rates on loans or may prohibit borrowers from qualifying for student loans all together.

“The price we’ll pay will be that of a generation,” Schumer said.

Over 100 third-party lenders in the Federal Family Education Loan Program have suspended their participation in the federal student loan program, which is responsible for nearly half of all public and private student loan money, or about $60 billion. Students can access these federal student loan funds either through private lenders in the FFEL program, or through the government itself using the Direct Loan Program.

Schumer recommends that all colleges allow students to get loans through the government’s Direct Loan Program, instead of through a middleman, FFELP lender. The senator says he will be drafting letters to encourage New York college presidents and the American Council on Education to pursue a similar course of action.

Just last month, Congress passed legislation that will enable students who rely on loans to continue their education, regardless of the difficulties in the private credit market. The legislation is effective through the 2010 academic year.

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Government Warns: Pell Grant Program in Trouble

Student Loan Girl — Mon, 22 Sep 2008 21:47:00 GMT

Without additional taxpayer funds next year, the government’s “most important” federal financial aid program may be unable to provide Pell Grants to millions of eligible low-income students, likely pricing these students out of a higher education, according to an article in The New York Times (“Pell Grants Said to Face a Shortfall,” Sept. 17, 2008).

In a memorandum issued last week, the Department of Education warned that it predicts a $6 billion shortage for the federal Pell Grant program next year, stemming from continuous budget shortfalls and compounded by the record-high number of students qualifying for the federal Pell Grant program.

Rising tuition costs, shrinking state aid to colleges and universities, and a growing number of adults who are reenrolling in college are all putting a strain on federal financial aid resources, particularly on Pell Grants, which don’t have to be repaid. This school year alone, six million students out of the nine million who applied for federal financial aid received Pell Grants, some of the highest numbers the program has seen since its inception in 1972.

“It’s the mother of all shortfalls,” said Barmak Nassirian, associate executive director of the American Association of Collegiate Registrars and Admissions Officers. “There’s more unmet need than anyone predicted.”

Last year Congress appropriated nearly $14 billion for the Pell Grant program, but as the troubled economy continues to force adults out of the workforce and back into the classroom, the Department of Education said it will either need to allocate more taxpayer money to the Pell Grant program or decrease the grant award amounts students can receive next year.

Should the Education Department decide to reduce Pell Grant awards, it would make an announcement detailing its decision sometime in February 2009, according to the memorandum.

“If [the Pell Grant program] is threatened, you’ll hear about it,” said Edward M. Elmendorf, senior vice president of the American Association of State Colleges and Universities. “The decibel level will be deafening.”

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Student Loan Providers May Get Government Help for One More Year

Student Loan Girl — Thu, 18 Sep 2008 00:08:00 GMT

With problems in the credit markets continuing to plague student loan providers, the U.S. House of Representatives overwhelmingly approved a year-long extension of the Ensuring Continued Access to Student Loans Act, which allows the secretary of education to buy student loans from cash-strapped lenders.

If approved by the Senate, the measure, which Congress originally passed last spring, would extend the education secretary’s loan purchasing power through July 1, 2010 to help ensure that students have access to federal student loans for the 2009–10 academic year. The bill was set to expire July 1, 2009.

The act gives the Department of Education the authority to buy student loans from third-party private lenders in the Federal Family Education Loan Program who have been unable to sell their loans to investors following fallout from the subprime mortgage crisis.

“Our rough economy is already dealing a huge blow to American families and we can’t allow trouble in the credit markets to further price students out of a college degree,” said Rep. George Miller, D-Calif., chairman of the Committee on Education and Labor (“House Moves to Protect Student Loans,” Associated Press, Sept. 15, 2008).

“With market conditions showing no signs of letting up,” Miller added, “it’s only prudent to make sure that students have every assurance that the federal student loans they need will be there next year.”

The measure would also extend the secretary’s authority to advance federal funds to guarantee agencies so those agencies can make loans, if necessary, as a “lender of last resort” for the nation’s colleges and universities.

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Sex Offenders May Lose Pell Grant Eligibility Under Revised Higher Education Act

Student Loan Girl — Mon, 04 Aug 2008 23:49:00 GMT

Starting July 1, 2009, sex offenders confined in treatment centers throughout the country may no longer be eligible to receive need-based federal Pell Grants, under a new provision of the reauthorized Higher Education Act, according to an article in the Associated Press (“Congress Cuts Off College Aid For Sex Offenders,” Aug. 4, 2008).

President Bush has yet to sign the act into law, but after the act passed through Congress July 31, Rep. Ric Keller, R-Fla., said, “Today, the most insane wasteful spending program in America comes to an end.”

Keller cited an AP article from March that revealed dozens of rapists and child molesters had taken higher education classes at taxpayers’ expense while confined to treatment centers after serving their prison sentences. Some prisoners were using the financial aid to buy clothes, DVD players, and music CDs even after they had dropped their classes in some cases.

While the U.S. Department of Education does not know exactly how many sex offenders receive Pell Grants, spokeswoman Stephanie Babyak predicted that making sex offenders ineligible for the aid would save taxpayers millions.

Critics say the new measure may rule out a higher education for sex offenders who are trying to rehabilitate themselves. Instead of cutting off grant aid to all sex offenders, Congress should better regulate how it administers the program in order to help prevent abuses, said Michael Macleod-Ball, chief legislative and policy counsel for the American Civil Liberties Union.

The grant aid provision would affect the 20 states that allow violent sex offenders — those who it is believed would likely repeat their crimes if they were to be released — to be held indefinitely in treatment facilities after they have served their prison sentences. Prison inmates have been ineligible for Pell Grants since 1994, but sexual offenders can qualify for the grants once they are transferred from prison to treatment centers.

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New Higher-Ed Bill May Get Through Congress This Week

Student Loan Girl — Thu, 31 Jul 2008 01:54:00 GMT

Five years overdue, the House and the Senate may finally reach a compromise on the re-authorized Higher Education Act, the law that predominantly governs student aid, according to an article in The Chronicle of Higher Education (“With Compromises, Higher-Ed Bill Could Move Through Congress This Week,” July 28, 2008).

If the bill makes it out of the House education committee, it would then have to get a majority vote in both the full House and Senate before the bill is sent to the president, which legislators hope to do before Congress breaks for its August recess next week.

Legislators, however, must first agree on two major sticking points: how to structure a new program that would provide graduate education grants to schools that enroll a large number of African American students, and whether states should be penalized if they reduce the amount of funds they allocate for higher education in their annual budgets.

Legislators Close to Resolution on Two Main Issues

On July 25, legislators said that they had come to an agreement on the graduate grant-program provision. Under the negotiated agreement, both predominately black institutions with at least 40 percent black student enrollment, and historically black institutions will be able to benefit from the new grant program. However, the grant will be distributed under two separate programs, one for historically black colleges and universities and one for predominantly black institutions.

Legislators are still negotiating a provision that would require states to increase spending on higher education each year over the next five years.

Although Congress may come to an agreement on the various tenets on the bill before its August recess, if legislators fail to resolve these issues this week, the bill won’t be revisited until after the November presidential election.

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Provision of Higher Education Act May Force Schools to Spy on Online Students

Student Loan Girl — Tue, 29 Jul 2008 04:24:00 GMT

Language in the bill, currently before Congress, to re-authorize the Higher Education Act could lead distance-learning institutions to use home-monitoring devices to police their students who take courses online, according to an article in The Chronicle of Higher Education (“New Systems Keep a Close Eye on Online Students at Home,” July 25, 2008).

The provision, contained within a single paragraph of the 1,200-page bill, is intended to prevent students enrolled in online programs from cheating. The clause requires providers of online postsecondary programs to prove that the person submitting the online classwork is the student who’s actually enrolled.

Hearing no objections from Congress to the provision, a handful of online colleges are now testing home-monitoring systems that authenticate online test-takers through fingerprinting, watch students in their homes via webcams, and record key strokes on students’ home computers.

Some colleges claim one chief advantage to these types of devices: Students will no longer be required to travel to a distant location where a proctor can oversee them taking the test in person. Instead, students will be able to take tests online in the comfort of their own home, with an installed approved monitoring system acting as an on-site proctor.

A few administrators, however, are concerned that these new technologies, which will are managed by third-party vendors, may not adequately safeguard students’ privacy. “This is taking a step into a student’s private life,” said Rhonda Epper, co-executive director of Colorado Community Colleges Online. “I don't know if we want to extend our presence that far.”

Debates about privacy and institutional intrusions aside, there may be at least one upside: The provision could bring online degrees a greater reputability since the schools would be verifying that their graduates had actually completed the coursework, said John Ebersole, president of Excelsior College, an online institution in Albany, N.Y.

“If it raises confidence and credibility in the eyes of regulators and traditional educators,” Ebersole said, “it’s worth it.”

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As Lawmakers Consider G.I. Bill Expansion, Colleges Reach Out to Veterans

Student Loan Girl — Thu, 19 Jun 2008 01:33:00 GMT

In spite of the financial assistance offered by the current G.I. Bill, military veterans face a series of daunting challenges when it comes to getting their college degree, including administrative hurdles and navigating the often complicated maze of veteran support services, according to an article in The Chronicle of Higher Education (“As Congress Prepares to Expand GI Bill, Colleges Reach Out to Veterans,” June 9, 2008).

Though 71 percent of veterans use some portion of their G.I. Bill benefits, according to the U.S. Department of Veterans Affairs, only 6 percent of veterans exhaust the higher education benefits they’re entitled to.

In an attempt to help rectify this problem, Congress is considering ways to expand the current G.I. Bill to enhance veteran benefits and remove some of the existing barriers in place for veterans’ trying to obtaining a higher education.

At the same time, educators are looking at other ways to reach out to vets and to make their campuses more friendly to those who have participated in the Iraq and Afghanistan conflicts. A recent conference in Washington, D.C. sponsored by the American Council on Education, addressed colleges' ideas regarding how to better meet the needs of their veteran students:

Extend scholarships to disabled veterans (University of Idaho)
Award academic credit for military training (Minnesota State Colleges & Universities)
Offer courses in Iraq and Afghanistan (University of Maryland University College)
Hold free entrepreneurial boot camps for aspiring business owners (Syracuse University)

College and university administrators say they have a lot to gain academically and financially from offering increased support services that help attract veteran students and maintain higher veteran student enrollment numbers. If Congress passes the revised G.I. Bill, which covers the cost of attending the most expensive public college in a veteran’s state, the veteran population would have the potential to generate even more tuition dollars for the nation’s colleges.

And as Stephen Weber, president of San Diego State University, told the Chronicle, veteran students typically have better grades, lower drop-out rates than civilians, and bring “a maturity and discipline to their studies that traditional students sometimes lack.”

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Proposed Bill Combines House, Senate Versions of the Higher Education Act

Student Loan Girl — Wed, 14 May 2008 23:51:00 GMT

Congressional aides hope to finalize a renewal of the Higher Education Act by Memorial Day that merges different versions of the proposed bill passed separately by the House of Representatives and the Senate last year, according to an article in The Chronicle of Higher Education (“Compromise Higher-Education Bill Takes Shape in Congress,” May 14, 2008).

Although the draft of the measure that is circulating Washington does not include provisions on graduate education, new programs, or private student loans — three of the bill’s 11 sections — the measure is already nearly 700 pages.

The issues that the two houses appear to have reached a compromise on include college cost watch lists, accreditation, and campus piracy:

Negotiators hope to give consumers more accurate and useful information about higher education costs by bolstering current watch lists. These lists, established by the House bill, already identify the most and least expensive colleges and those with the highest percentage of tuition increases. But under the compromise bill, institutions with the highest and lowest “net price” would also be listed.

The current 15 members of the National Advisory Committee on Institutional Quality and Integrity, which advises the Department of Education on accreditation, would be replaced with 18 new members, six each appointed by the secretary of education, the Senate, and the House.

Colleges would be required to develop plans to detect and prevent illegal downloading of music and videos on college campuses and to offer alternatives to such illegal downloading.

Issues that are still being negotiated include whether states should be punished for cutting their higher education budgets, whether textbook publishers and colleges should be required to disclose more information about the costs of the books, and whether colleges should be required to notify students and employees within 30 minutes of a campus emergency.

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Expanded Tuition Benefits for Veterans Gaining Momentum in Congress

Student Loan Girl — Thu, 08 May 2008 00:41:00 GMT

When the original G.I. Bill became law in the 1940s, it covered the full cost of tuition, housing, and living expenses for military veterans.

Today’s G.I. Bill benefits have not kept up with the rising costs of college. Veterans currently receive the equivalent of about 60 to 70 percent of the cost of the average four-year public institution, less room and board, writes Kelly Field of The Chronicle of Higher Education (“Efforts to Expand G.I. Bill Gain Ground in Congress,” April 30, 2008).

However, support is growing in Congress for a bill that would greatly expand tuition benefits for veterans of the Iraq and Afghanistan wars.

According to Field, several key legislators have expressed the opinion that today’s military members should receive the same benefits that the original bill provided for World War II veterans. These advocates are pushing to attach a tuition-benefits bill (S 22) to a pending piece of war-spending legislation that Congress is expected to address soon.

The bill would enable veterans who have served since September 11, 2001, to receive financial aid that covers the full cost of attending the most-expensive four-year public college or university in their state, as well as a monthly stipend for housing costs.

For those veterans who choose to attend more expensive private schools, the bill would match any school-based aid provided above the cost of the most expensive public college in the state. And, the legislation would allow veterans to access their education benefits for up to 15 years after leaving the military, instead of the current 10.

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Credit Unions Offer Themselves as Partial Solution to Looming Student Loan Crisis

Student Loan Girl — Sat, 12 Apr 2008 10:19:00 GMT

In the last six months alone, since legislators eliminated over $21 billion in subsidies to student loan lenders in the Federal Family Education Loan Program, at least 44 FFELP lenders have stopped originating federal student loans.

This exodus of lenders from the federal student loan program, combined with the current credit and liquidity crunch resulting from an epidemic of defaulted mortgages, may leave many college students scrambling for money for school this fall.

In an effort to help avoid a student loan crisis before it starts, a group of credit unions serving students in California, Texas, and Wisconsin is lobbying for federal subsidies that would allow credit unions to provide significantly more loan capital for students.

Last September, federal legislation set two lender subsidy rates on federally guaranteed student loans, one rate that applies to for-profit lenders and a second for state-chartered nonprofit agencies, explains Paul Basken of The Chronicle of Higher Education.

When those rates were set, credit unions, which are essentially nonprofit banks, were left out of the picture, neither subject to the for-profit lender rate nor eligible for the nonprofit rate which is guaranteed only to state-chartered lenders.

Now, writes Basken, as more for-profit bank and nonbank lenders abandon the FFEL program each week, the credit unions seek legislation that would make them eligible for the nonprofit subsidy rate (“Credit Unions Will Lobby Congress for Loan-Subsidy Benefits Accorded to Nonprofit Lenders,” April 4, 2008).

A Viable Source for More Student Loans?

Credit unions currently provide less than 1 percent of all FFELP loans, according to Mark Kantrowitz, publisher of FinAid.org, a financial aid website.

However, credit unions could offer significantly more volume at some institutions, Michael K. Kim, vice president for student services at the USC Credit Union, told The Chronicle.

The USC Credit Union provided 30 percent of all federal student loans at the University of Southern California last year, and Kim believes the USC Credit Union could double its student loan lending to $200 million to provide financing for any students unable to find another lender.

Although Kim thinks the credit union might find a way to double its student loans even without the nonprofit subsidy, the nonprofit rate would help.

One of the key selling points in the credit unions’ lobbying efforts, Basken writes, may be the fact that credit unions have a ready pool of capital — their customer deposits — from which to lend. In contrast, nonbank lenders, who don’t hold funding capital, must find external funding sources for their student loans and thus have been more vulnerable to the liquidity crisis that’s followed the fallout in mortgage lending.

Joining Kim’s Southern California credit-union group in lobbying Congress next week for the nonprofit subsidy rate are the UW Credit Union, serving universities in Wisconsin, and the University Federal Credit Union, which serves more than 100 colleges and employers in central Texas.

More, but Still Not Enough

An advisor from Senator Edward Kennedy’s office recently expressed support for the credit unions’ request that their proposal for inclusion in the nonprofit subsidy rate be added to the legislation for reauthorization of the Higher Education Act currently before Congress.

Kantrowitz believes that the credit unions’ subsidy proposal is reasonable since they’re nonprofit entities whose earnings don’t benefit outside investors.

On the other hand, he says, the additional loan volume credit unions could provide for the federally backed student loan program will likely not be enough to staunch the tide of students that may potentially be unable to find lenders this fall.

Kantrowitz further points out that among the 100 largest lenders in the federal student loan program, only three are credit unions.

“If credit unions can double their volume, that’s a 5-percent solution,” Kantrowitz says. “It could be part of the solution, but not even close to the entire solution.”

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Congress Joins States and Colleges in Efforts to Reduce Soaring Textbook Costs

Student Loan Girl — Mon, 03 Mar 2008 07:09:00 GMT

With the average college student now shelling out between $900 and $1,000 each year for textbooks and supplies, according to the College Board’s latest Trends in College Pricing report, schools, states, and now Congress are getting involved in the crusade to control the spiraling costs of college textbooks.

Propelled by studies that show the prices of textbooks are rising faster than the rate of inflation, the House of Representatives included provisions in the recently approved College Opportunity and Affordability Act that are specifically targeted at making textbook costs more manageable, reports Elia Powers of Inside Higher Ed (“Different Tacks on Textbook Choice,” Feb. 19, 2008).

The House bill (H.R. 4137), which passed the House on February 7 and renews the Higher Education Act, would have colleges provide advance information in their course schedules about required books to give students time to plan for expenses and comparison-shop for the most cost-effective options.

Also approved by the House was an amendment (H.AMDT.951) proposed by Rep. Tim Ryan of Ohio that would create a pilot competitive grant program to assist a select number of colleges in setting up textbook rental programs.

States Enacting Their Own Textbook Legislation

H.R. 4137 would also require textbook publishers to provide more information about pricing and changes from previous editions, which follows bills already passed by some state legislatures, writes Powers.

Last April, for example, Washington state House Bill 2300 was signed into law, requiring textbook publishers to disclose retail prices and a history of revisions from edition to edition when presenting any materials to faculty.

In June, Oregon passed its similar Senate Bill 365 into law. In addition to charging publishers with providing retail prices and a list of all previous versions of a text to potential adopters, the Oregon measure requires publishers of textbook “bundles” (textbooks packaged with an accompanying CD-ROM or study guide, for instance) to make each component of the bundle available to students separately and to disclose the retail price of each piece.

In California, Assembly Bill 1548, known as the College Textbook Transparency Act, likewise calls for publishers to provide a list of revisions made to new editions, as well as for college bookstores to release the wholesale prices of textbooks. The California bill was signed by Gov. Arnold Schwarzenegger in October and goes into effect in 2010.

Changes at the College Level

In response to the increasingly vocal concerns of students, families, and legislators, not all schools are waiting on Congress or state officials to adopt changes to textbook pricing and marketing practices. Some schools, writes Powers, have already instituted book rental, buyback, or other programs in a move to extend textbook affordability.

At Rio Salado College in Arizona, for example, a partnership with Pearson Custom Publishing allows professors to “build” custom textbooks, drawing material from multiple sources. Administrators believe this program could save students up to 50 percent on reading materials.

The University of Virginia, in addition to expanding its textbook rental and guaranteed buyback programs, is increasing its selection of e-books, which can save students as much as 30 percent over print versions of new editions. And a growing number of U.Va. professors are choosing to purchase older editions of books in cases where the new material isn’t a necessity, a move the university says cuts an average of 75 percent off new book prices.

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