- Sen. Marco Rubio is calling for reform in college pricing transparency after a Government Accountability Office report estimated that 91 percent of colleges are misleading students about the cost of attendance in financial aid letters
- According to the report, colleges underestimated or did not include the net price of attending the school in their offers to students
- The report further found that half of the universities omitted key costs like housing, meals, books, and other supplies in their aid letters or factored loans
- In recent years, Rubio has introduced a series of bill proposals that aimed to reform the federal direct student loan system and require students to be provided with more information regarding education finances
After a Government Accountability Office (GAO) report estimated that 91 percent of colleges are misleading students about the cost of attendance in financial aid letters, Florida Senator Marco Rubio is calling for changes to increase transparency and help students contain costs.
According to the report, colleges underestimated or did not include the net price of attending the school in their offers to students. Findings also indicate that approximately half of all audited universities omitted key costs like housing, meals, books, and other supplies in their aid letters or factored loans.
In recent years, Rubio has introduced several pieces of legislation including a failed 2021 bill that would reform the federal direct student loan system by eliminating interest and replacing it with a one-time, non-compounding origination fee.
Rubio also helped propose the ‘Student Right to Know Before You Go Act’ legislation in 2019 that would provide critical information to help students, families, policymakers, and taxpayers to better understand the costs and outcomes associated with higher education.
“Colleges and universities are increasingly disconnected from the real world and costs continue to skyrocket,” said Rubio. “Young people are especially vulnerable because they’ve been told college is the only pathway to success in America. Misleading students and families on the cost of attendance is wrong, and if it was done intentionally people should be held accountable.”
The GAO states in its report that most colleges are not following best practices for providing clear and standardized information in financial aid offers, concluding that 92 percent of examined colleges do not include and understate the net price within offers in an attempt to entice more students to attend.
In the report, an estimated 41 percent of colleges do not include a net price, which it claims may leave students guessing how much they will need to pay over the time of their attendance.
Further, an estimated half of all colleges understate factors in loans that must be repaid, making a college appear far less costly than it actually is.
“GAO is recommending that Congress consider legislation requiring colleges to provide students financial aid offers that follow best practices for providing clear and standard information,” the GAO states.
The group states that the best practices for colleges to provide clear information include itemizing direct and indirect costs, providing a total cost of attendance that includes key costs, accurately estimating the net price, and labeling types of aid being offered.
Additionally, the office recommends labeling the source of offered aid, separating gift aid, loans, and work-study listings, the end of referring to a financial aid offers — which may be a loan — as an “award,” and including actionable next steps.
“Research has raised questions about how much college financial aid offers vary in providing critical cost and financial aid information to students,” a letter to Dr. Virginia Foxx, Republican Leader of the Committee on Education and Labor states. “However, the extent to which colleges are providing students with clear and standard information in financial aid offers has been previously unknown due to the lack of nationally representative information. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.”