Following a report by the Government Accountability Office (GAO) that found that a vast majority of prospective college students lack clarity about the cost of their education, U.S. Rep. Young Kim (R-CA) has renewed the call for Congress to address legislation that seeks to fix that.
The GAO analysis found that 91 percent of colleges understate the total cost of their education, while 65 percent leave out important details about aid packages. Further, 31 percent of colleges list loans as grants. The report also notes that Kim’s bill, Understanding the True Cost of College Act, which Kim sponsored, would help remedy this lack of clarity.
Specifically, the bill would improve financial aid transparency by standardizing financial aid offer forms and ensuring the Department of Education works with colleges, consumer groups, students, and school guidance counselors to develop standard definitions for award letters. In addition, it would establish basic minimums of information that must be included on page one of the uniform financial aid offer form, 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, information on calculating the costs of repaying student loans, disclosures related to private loans and parent loans, treatment of scholarships, and the terms and conditions of federal financial aid.
“Today’s GAO report reaffirms what we hear every day from students and families in California and across the nation – too many colleges misrepresent the total cost of programs and financial aid options,” Kim said. “Families deserve the most accurate information regarding the cost of college and available resources. That is why Congress must pass our Understanding the True Cost of College Act as soon as possible to ensure a streamlined, transparent financial aid process that allows families to make the best, informed decision possible to reduce student debt.”
Kim first introduced the bill in 2021 with Rep. Raja Krishnamoorthi (D-IL). A similar version of this bill was introduced in the Senate by Sens. Chuck Grassley (R-IA), Tina Smith (D-MN), and Joni Ernst (R-IA).
“Congress needs to pass the Understanding the True Cost of College Act to ensure students are able to easily compare financial aid offers by creating a uniform, standard offer letter. It’s clear our bill is needed now more than ever,” Grassley said.
It is endorsed by 35 organizations, including the U.S. Chamber of Commerce, NAACP, Partners for College Affordability and Public Trust, National Scholarship Providers Association (NSPA), and the Institute for Higher Education Policy (IHEP), among others.
“Congress must act to increase the transparency and accuracy of these offers for students and families, and our bipartisan bill would fix this widespread problem once and for all,” Smith said. “Our bill, the Understanding the True Cost of College Act, would equip students and their families with the accurate, consistent, and complete information they need to make informed decisions.”
