Washington, DC – U.S. Senator Ben Cardin and Barbara A. Mikulski (Both D-MD) today joined with colleagues to say that families and students should have a more accurate picture of exactly how much college will cost them before deciding which school to attend under bipartisan legislation introduced today. Led by Senator Al Franken (D-MN), Senators Tom Harkin (D-IA), Chuck Grassley (R-IA), Richard Blumenthal (D-CT), Chuck Schumer (D-NY), Tim Johnson (D-SD), Ron Wyden (D-OR) also sponsored the bill.
“Students today have enough obstacles keeping them from a quality education, deciphering the paperwork shouldn’t be one of them. We need to make it easier to understand the options for financial aid and exactly what the full cost will be,” said Senator Cardin. “I am proud to be a cosponsor of legislation that requires uniform, consumer-tested financial aid award letters with standard definitions. This will go a long way toward helping students fully understand their funding options and commitments.”
“I believe in America’s opportunity ladder, and higher education is an important rung on that ladder,” said Senator Mikulski. “This legislation will help families who are stressed and stretched to make an informed financial decision by requiring all colleges to provide basic information on the costs of enrolling at the school of their choice. Higher education is part of the American dream – it shouldn’t be a financial nightmare.”
The bill, “Understanding the True Cost of College Act,” introduced Thursday, would create a universal financial aid award letter so that students can easily compare financial-aid packages between schools. It would clarify what financial aid families will receive from a school and create standard terms for the aid offered so that students can accurately compare offers from different schools. Right now, schools do not use standard definitions or names for different types of aid, so students and families often report having difficulty figuring out the differences between grant aid—which does not need to be repaid—and student loans, which do need to be repaid.
The “Understanding the True Cost of College Act” would:
- Require institutions of higher education to use a uniform financial aid award letter.
- Call on the Department of Education to work with colleges, consumer groups, students, and school guidance counselors to develop standard definitions of various financial aid terms for use in the uniform financial aid award letters.
- Establish basic minimums of information that must be included in the uniform financial aid award letters, such as: cost of attendance; grant aid; the net amount a student is responsible for paying after subtracting grant aid; work study assistance; eligible amounts of federal student loans; expected federal loan monthly repayment amounts; and disclosures including disclosures related to private loans, treatment of scholarships, and the terms and conditions of federal financial aid.
- Require the Department of Education to establish a process to consumer test the uniform financial aid award letter and use the results from the consumer testing in the final development of the uniform financial aid award letter.
Nationally, the bill is supported by the American Federation of Teachers-AFL-CIO, the National Consumers League, Campus Progress Action, the Institute for College Access and Success, Education Trust, and the National College Access Network.