Higher Education Opportunity Act (HEOA) 

The Higher Education Opportunity Act (HEOA)
The Higher Education Opportunity Act (PL 110-315) is the 2008 reauthorization of the Higher Education Act (HEA), which became law on August 14, 2008. Several of NACAC's recommendations were addressed by this legislation. For a summary of the HEOA, check out the Dear Colleague Letter issued by the U.S. Department of Education.

Definitions

The Higher Education Opportunity Act (HEOA) adds a new definition of the term "diploma mill" to indicate that such an entity is one that 1) offers, for a fee, degrees, diplomas, or certificates that may be used to represent to the general public that the individual possessing such a degree, diploma, or certificate has completed a program of postsecondary education or training; 2) requires the completion of little or no education or coursework to obtain the credential; and 3) lacks accreditation by an accrediting agency or association that is recognized by the Secretary or a Federal agency, State government, or other organization or association that recognizes accrediting agencies or associations.

In addition, the HEOA requires the Secretary of Education maintain information and resources available on their website to inform students and families on how to avoid diploma mills.  Also, the Secretary is required to continue a Federal multi-agency effort to prevent, identify, and prosecute diploma mills and disseminate to the public information about diploma mills, and resources to identify them.

Dual Enrollment

The HEOA allows eligible institutions - institutions of higher education, proprietary institutions, and postsecondary vocational institutions - to dually enroll secondary students as regular students at the institution. 

Improved Information Concerning the Federal Student Financial Aid Website

NACAC Summary: Federal Government Provides Online Resources for Financial Aid Counseling Under HEOA

Enhanced Student Financial Aid Information

The HEOA includes several provisions that require the Department of Education to develop and promote information regarding college planning, pricing, and financial aid for students and families.  These resources will be housed in the Federal student financial aid website.  The HEOA requires that the website and student resources be widely publicized via a major media campaign and be prominently displayed on the homepage of the Department's website.

Also included in the Department's student resources will be a newly created Armed Forces information website to be developed in partnership with the Department of Defense, the Department of Veterans Affairs, or a State.  The website will allow students and families to search for information regarding Federal and State student financial assistance available to members of the Armed Forces and information pertaining to readmission requirements and other student services for which members of the Armed Forces may be eligible.   

The HEOA also requires the Secretary to provide, on the Department's Federal student financial aid website, information on non-departmental student financial assistance programs.  These programs are defined as any grant, loan, scholarship, fellowship, or any other form of financial aid for students that is operated, sponsored, or supported by the Federal department or agency other than the Department of Education. 

No User Fees for Department's Financial Aid Websites

The Department of Education is prohibited from charging user fees to individuals to access information about higher education programs or student financial assistance on any of the Department's websites.   

Transparency in College Tuition for Consumers

The HEOA adds a variety of requirements about college pricing, including:

The Department of Education released in July 2011 online tools with information on college costs:

• College Affordability and Transparency Center with information about tuition and net prices at postsecondary institutions. The site highlights institutions with high and low tuition and fees as well as high and low net prices (the price of attendance minus grant and scholarship aid). It also shows institutions where tuition and fees and net prices are increasing at the highest rates.
• State Spending Charts with summary information on changes in state appropriations for postsecondary education, state aid for students, and tuition and fees.
• 90/10 Information with a list of for-profit (proprietary) postsecondary institutions that receive more than 90 percent of their revenues from Title IV Federal Student Aid.

The Secretary is required to make available a set of lists describing the affordability of postsecondary institutions according to their institution type.  The lists will identify the five percent of institutions that have the highest tuition/fee and net price, the largest increase in tuition/fee and net price, and the ten percent of institutions with the the lowest tuition/fee and net price for the academic year for which data are available for each institutions type.  Each institution included in the lists of highest tuition/fee and net price institutions must report to the Secretary identifying areas of greatest cost and explaining any steps taken to reduce costs at their respective institutions. 

The HEOA requires the Secretary to issue an annual report describing the percentage change in State spending per full-time student at all State public institutions; the percentage change in tuition and fees per full-time student at all public institutions in the State; percentage change in total need-based and merit-based aid given to all full-time students attending public State institutions for the five most recent academic years.  This report will be posted on the College Navigator website.

Included in the HEOA is a provision that requires the creation a Net Price Calculator to help consumers estimate the approximate net price of attending an institution.  The "net price" of attending an institution is defined as the actual price charged to full-time students receiving student aid minus the average need-based and merit-based aid from the institutions cost of attendance. 

All postsecondary institutions receiving Title IV program funds are required to post the Net Price Calculator to their website within two years of its availability. 

The HEOA requires the creation of a searchable database of all Title IV participating postsecondary institutions to be included in College Navigator website.  Each institution's profile must contain consumer information (tuition and fees, average percentage change in tuition and net-price, average dollar change in tuition and net price) that must be annually updated for the three most recent academic years.  The Department must work with students, families, institutions and other experts to improve the usefulness of this tool. 

In addition to the Net Price Calculator, the Multi-year Tuition Calculator will be made available on the College Navigator website to assist students and families estimate the amount of tuition and fees in future years at a particular institution.  The estimate is not final and subject to change.

The HEOA authorizes the National Center for Education Statistics (NCES) to survey a representative group of Federal student aid recipients to better understand their characteristics, amount of aid they received, and impact of issues such as debut burden, text book prices, and cost of attendance.  The survey is to be administered at least every four years. 

Self-certification Form for Private Education Loans

The HEOA requires the development of the self-certification form for private education loans to be made available to loan applicants.  The self-certification form will encourage applicants to seek alternate forms of student aid and inform applicants of loan amounts before agreeing to private education loans. 

Need Analysis

For students living in housing located on a military base or housing for which they receive a basic allowance Title 37 of the U.S.C. - Pay and Allowances of the Uniformed Services, the room and board allowance shall include an allowance based on the expenses reasonably incurred for board only.

Discretion of Student Financial Aid Administrators

The HEOA grants financial aid administrators the authority to offer unsubsidized Stafford loans under the Direct Loan program to dependent students, without requiring the student's parents to file a FAFSA, if the financial aid administrator determines that the parent has ended financial support to the student and refuses to file a FAFSA.

Total Income

The HEOA permits the use of data from the second preceding tax year to carry out simplification efforts.  Also, veteran's education benefits received by an individual are exempt from the calculation of total income.

Excluded from untaxed income and benefits is the value of on-base military housing or the value of basic allowance for housing received by the parents, in the case of a dependent student, or by the student or the student's spouse, in the case of an independent student.

The HEOA clarifies the definition of an independent student to include: a student who is an orphan, in foster care, or a ward of the court, or had such status anytime from the time when the individual was 13 years of age or older; an individual who was emancipated before attaining the age of majority.

Any income earned from work under a cooperative education program offered by an institution of higher education is excluded from the determination of estimated family contribution (EFC).  Also, Veterans' education benefits are excluded from the definition of estimated financial assistance.

Improvements to the FAFSA and Processes

Paper and Electronic FAFSA applications

In addition to requiring the Department to issue paper and electronic versions of the FAFSA, the HEOA includes provisions to create simplified versions of the FAFSA for students who qualify under the simplified needs test (SNT) or the automatic zero expected family contribution (EFC).  In regards to the Renewal FAFSA, the HEOA encourages institutions to continue to streamline the reapplication process and authorizes the Department to reduce the number of data elements required of applicants. 

Charges to Students and Parents Prohibited

The HEOA prohibits the Department or any public or private entity charge a fee for the collections, processing, or delivery of financial aid through the use of a FAFSA.

Personal Identification Numbers

The Department is to continue to provide PIN numbers to applicants to use a signature for the purpose of completing a FAFSA and any other purpose in Title IV programs.  No other person or entity may use an applicant's PIN to submit a FAFS on behalf of the applicant.

The HEOA requires the Department to work with the student financial assistance community to reduce the number of data elements on the FAFSA by 50 percent.  Collection of all data elements must comply with the Privacy Act of 1974.

State Data Elements on the FAFSA

In consultation with States, the Department must include questions that meet State requirements for need-based State aid.  The Department must make an effort to not require applicants to complete any questions that are not required by the applicants State.  The HEOA also requires the Department to work with States to encourage the use of the EZ FAFSA and simplified electronic FAFSA for students qualifying for SNT and automatic zero EFC.  The Department will conduct an annual review of data elements that States require to award need-based State aid and determine whether each state will allow applicants to submit an EZ FAFSA or simplified electronic FAFSA for students who qualify for SNT or automatic zero EFC.

The Department will enable students to file a FAFSA as early as practicable prior to January 1 of the first calendar year of the award year.  The Department will also continue to allow students to submit FAFSAs in years prior to enrollment to obtain an estimate of their EFC as well as to learn more about Federal student financial aid.

FAFSA Preparers

The HEOA added new provisions to allow for applicants to use a preparer to complete a FAFSA application, however, the preparer must include their name, organization and social security number at the time the FAFSA is submitted.  Also, prior to charging applicants for their services, a preparer must clearly inform the applicant that the FAFSA is free to file without the use of a preparer. 

To determine effects of implementing an early application system to allow dependent students to apply for financial aid using information from two years prior to enrollment, the Department will establish a demonstration program.  The program will measure the effects of an early application process to deliver financial aid estimates to high school juniors on students' college plans.

The Department will continue to work toward reducing the number of items on the FAFSA collaborating with the IRS to transfer information from applicant's tax returns to prepoplulate the electronic version of the FAFSA with student and parent taxpayer data.  A group of government officials and higher education representatives will examine methods of shortening the FAFSA and identify changes to the need-analysis formula.  The Department is required to report regularly to Congress on the progress of the FAFSA simplification efforts.

Addressing the Digital Divide

The savings accrued by moving more applicants to electronic FAFSAs will be used to improve access to the electronic FAFSA for applicants qualifying for SNT and automatic zero EFC.

Professional Judgment Disclosure

The HEOA requires that a disclosure be placed on a students' SAR stating that a student may qualify for an adjustment to the cost of attendance or the other values of data required to calculate the EFC under a financial aid administrator's authority to use professional judgment.

Included in the HEOA are provisions that instruct the Department to reduce the use of the paper FAFSA and increase on the use of the electronic FAFSA.  A summary of these efforts will be reported to Congress annually. 

Consumer Information

Information and Dissemination Activities

The HEOA instructs institutions to present current and prospective students up-to-date information on academic programs, financial aid policies, student demographics, job placement, completion and graduation rates, and retention rates. 

Exit Counseling

Institutions of higher education are required to provide exit counseling for borrowers receiving loans through the Direct Loan and Perkins Loan programs prior to the completion of the borrower's departure from the institution.  The exit counseling should inform borrowers on the general terms of agreement, repayment schedules, debt management strategies, and consequences of default on a loan.

Departmental Publication of Descriptions of Assistance Programs

The Department is required to publicize the availability and location of publications that describe student financial aid assistance programs.  Currently available information will be updated to include descriptions of the different payment options for student loans administered through the Direct Loan program.

Disclosures Required with Respect to Athletically Related Student Aid

Student athletes who leave school to serve in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Government, will be excluded from the calculation of completion and graduation rates for student athletes.

Disclosure of Campus Security Policy and Campus Crime Statistics Annual Security Report.

Institutions of higher education are required to inform students of campus security policies including policies pertaining to hate crimes and emergency response and evacuation procedures.

U.S. Department of Education Reporting

The Department is required to report annually to Congress on the compliance and monitoring of the security report requirements in regards to campus safety and emergencies.

Whistleblower Protection and Anti-Retaliation

Institutions of higher education are not permitted to take retaliatory action against anyone with respect to the implementation of the Jeanne Clery Disclosure of Campus Security Policy and Campus Crime Statistics Act.

Transfer of Credit

All Title IV participating institutions of higher education are required to publicly disclose current transfer credit policies.  The policies should describe the minimum criteria an institutions uses to determine the transfer of credit from another institution of higher education. 

Disclosure of Fire Safety Standards and Measures

HEOA provisions require institutions of higher education to publish an annual fire safety report that includes fire safety practices and statistics of all fire incidents during the previous year.  Each Title IV must also submit a copy of the fire safety statistics to the Department on an annual basis.  The Department will make the fire statistics public and work alongside nationally recognized fire organizations and institutions of higher education to develop a protocol for institutions of higher education to review the status of their fire safety systems.

Missing Person Procedures

Each eligible Title IV institution must establish a missing student notification policy for students who reside in on-campus housing that includes notification procedures for students that go missing for more than 24 hours.

Notice to Students Concerning Penalties for Drug Violations

Institutions of higher education are required to provide enrolled students with a written notice with information on the penalties associated with drug-related offenses.  A separate notice should also issued notifying students of loss of eligibility for any student financial aid as a result of drug-related offenses.

Entrance Counseling for Borrowers

The content of the entrance counseling that institutions must provide to first time borrowers in the Direct Loan program has expanded to ensure that the borrower receives detailed information on the terms and conditions of the loan.

Disclosures of Reimbursements for Service on Advisory Boards

Institutions must report to the Department any reasonable expenses paid to employees who are employed in the financial aid office, or whose responsibilities involve student loans or other financial aid of the institution.   

Federal Pell Grant Program

The HEOA increases the maximum Pell Grant for each academic year.  Starting with a maximum amount of $6,000 during the 2009-2010 award year, the maximum Pell Grant amount will increase $400 a year until the 2014-2015 award year.

The minimum Pell Grant has been set to 10 percent of the maximum award appropriated each year. 

The HEOA includes amendments that allows students to receive up to two consecutive Pell Grant awards in a single award year if enrolled in at least half-time for more than one academic year and in a degree-granting program.

The HEOA  increases the allocation formula allowance for books and supplies from $450 to $600 

Federal Work Study Program

Definition of Community Service

The definition of community service has been expanded to include the field of emergency preparedness and response.

Allowance for Books and Supplies

The allocation formula amount for books and supplies has been increased from $450 to $600.

Grants for FWS Program

Institutions are permitted to use FWS funds to compensate students employed in projects that teach civics in school and increases civic participation.  Also, institutions are to give priority employing students participating in project that educate the public about evacuation, emergency response, and injury prevention strategies.

Flexible Use of Funds

Federal Work Study funds may be used to may payments to students affected by a major disaster for a period of up to one year in which the student was prevented from fulfilling their work study obligations.  A student would be considered a disaster-affected student if the student received a FWS award during the year the disaster struck, earned wages the year prior to the disaster, was prevented from fulfilling their FWS duties, was unable to be reassigned to another work-study job.

Job Location and Development Program

The HEOA increases the funds for the Job Location and Development Program from $50,000 to $75,000.

Additional Funds for Off-Campus Community Service

The HEOA creates a new Off-Campus Community Service Grant Program for institutions to supplement off-campus community service projects.  The Department will prioritize institutions that seek the grant to fund off-campus programs addressing early childhood activities and preparation for emergencies and natural disasters.

Work Colleges

The term "work-learning" has been replaced with "work-learning-service."

In HEOA, the term "work colleges" is defined as an institution with a commitment to community service, has operated a work-learning-service program for at least two years, requires students to participate in a work-learning-service program for at least 5 hours each week or 80 hours during each period of enrollment.  Such institutions should provide students an opportunity to apply their education to the uplift of the community as a whole. 

LEAP/Grants for Access and Persistence Program (GAP)

The HEOA authorizes $200,000,000 for the LEAP and GAP programs.  GAP will replace the Special Leveraging Educational Assistance Partnership (SLEAP) as part of the LEAP program in order to expand college access and persistence by enabling States to provide need-based aid for eligible students, to provide early notification to students regarding their eligibility for aid, and to encourage participation in early intervention programs.   

Direct Loan Program

Definition of "Public Service Job" for Direct Loan Public Service Loan Forgiveness

specify that a job in government excludes time served as a member of the U.S. Congress

• specify that a job in public health includes nurses and full-time professionals engaged in health care practitioner occupations
• clarify that in public interest law services, legal services may be provided on "behalf of" low-income communities rather than "in" low-income communities
• list childhood education as a separate category from public education
• specify that full-time faculty teaching in "high needs areas" includes high needs subject areas or areas of shortage, including nurse faculty, foreign language faculty, and part-time faculty at community colleges

Under HEOA, after completing each school, academic, or calendar year after August 14, 2008, school counselors in high-need schools are eligible for forgiveness of a maximum of $2,000 in loan forgiveness that will continue up to five years for a maximum of $10,000 in total. Since authorization of this program, Congress has not appropriated any funding; NACAC continues to advocate for appropriations.

TRIO and GEAR UP Programs

The HEOA has extended the length of TRIO awards from four to five years.  The Department is also authorized to provide a one time limited extension to extend the lengths of awards to synchronize the start dates in the programs.  In addition, institution may now host more than one TRIO program on different campuses if different populations are served by each grantee.  Also, added to the populations that can be served by TRIO programs are foster care and homeless youth.  The HEOA requires applicants to provide serves to these youth.  The Department will submit an annual report to Congress on the progress of all TRIO programs including an evaluation of the Upward Bound program to begin June 30, 2010.

Grants for GEAR UP programs are authorized to last six years unless an additional year of funding is requested to provide services to eligible students through their first year of postsecondary education.  In regards to partnerships with local education agencies, the HEOA includes amendments that permit, not require, a minimum of two community organizations or other entities from entering partnerships.

The HEOA requires that State grantees reserve 50 to 75 percent of funds for scholarships.  In addition, each State grantee must establish a scholarship reserve fund for eligible students upon enrollment in an institution of higher education. 

Private Student Loan Improvement

The Board of Governors of the Federal Reserve system is charged with developing regulations to implement certain parts of the Truth in Lending Act (TILA).  The changes made to TILA by the HEOA will be effective upon enactment except for those subject to rulemaking which become effective upon the date the regulations become effective or on February 10, 2010.

TILA - Preventing Unfair and Deceptive Private Educational Lending Practices and Eliminating Conflicts of Interest

The HEOA prohibits private educational lenders from providing any gifts to institutions of higher education in exchange for advantage or consideration of any private education loan activity or revenue sharing.  Furthermore, any person employed in a financial aid office and serves on an advisory board cannot receive anything of value from lenders.

TILA - Civil Liability

Under HEOA, a private lender has no civil liability for failure to comply with the private loan disclosure requirements.

TILA - Private Education Loan Disclosure and Limitations

The HEOA requires that private educational lenders provide applicants disclosures during the application for a student loan, when the loan is approved, and at the time of consummation of the loan.  Prior to receiving private student loans, the borrower must certify that he or she is aware that they may qualify for Federal student aid.