Washington, DC – This week, U.S. Representatives Young Kim (CA-40), Raja Krishnamoorthi (IL-08) and Josh Gottheimer (NJ-05) introduced the Understanding the True Cost of College Act (H.R. 1198) to streamline and improve transparency of the financial aid process so students and families can better navigate decisions regarding the cost of college. Senators Chuck Grassley (R-IA) and Tina Smith (D-MN) introduced companion legislation in the Senate.
According to a December 2022 Government Accountability Office (GAO) report:
- 91 percent of colleges understate the total cost of college;
- 65 percent leave out important details about aid packages; and,
- 31 percent list loans as grants.
The Understanding the True Cost of College Act would improve financial aid transparency by:
- Standardizing financial aid offer forms and ensures the Department of Education works with colleges, consumer groups, students, and school guidance counselors to develop standard definitions for award letters; and;
- Establishing basic minimums of information that must be included on page one of the uniform financial aid offer form.
“A great way to reduce student debt is ensuring students do not take on unnecessary debt in the first place. That requires transparency and the most accurate information regarding educational opportunities and their cost,” said Kim. “After putting myself through school and raising four kids, I have seen firsthand as a student and as a parent how confusing the financial aid process can be. The Understanding the True Cost of College Act aims to make the cost of college available and easier to understand so families and students can make an informed decision and reduce the chance for student debt. I’ll keep fighting to make life affordable and for future generations to succeed and achieve their dream.”
“It is imperative that students and their families are equipped with clear, consistent information regarding the cost of college when considering their options. Yet, the current financial aid process makes it incredibly difficult to accurately assess and compare these costs. Our legislation will help ensure transparency as students and families make such an important life and financial decision,” said Krishnamoorthi.
“With college tuition and student loan debt skyrocketing in recent years, we must take steps to make college more affordable for everyone. As a country, we must increase transparency and accountability into the college system, take into account all the costs, and ensure it’s easier to pay back and renegotiate your student loans,” saidGottheimer. “I’m proud to help introduce the bipartisan Understanding the True Cost of College Act to help families make the best, most informed decisions they can when it comes to paying for college.”
“I often hear from Iowa families who are frustrated and confused by the complex student loan borrowing process. So much of the student debt conversation focuses on repaying debt. We ought to fix the process on the front-end before students get in over their head. The federal government should be offering commonsense resources to better prepare borrowers,” Grassley said. “The Understanding the True Cost of College Act would provide additional clarity to the student loan process so that America’s next generation of leaders can pursue higher education opportunities without breaking the bank.”
“We applaud Sens. Grassley, Smith, and Reps. Kim, Krishnamoorthi for leading the Understanding the True Cost of College Act. Paying for college is one of the biggest financial decisions facing many American families. Yet, too many colleges are still providing families with unclear and misleading information about their costs. This bill would make common-sense reforms to ensure that colleges provide students with clear, transparent, and comparable information about college costs and the financial aid options available to cover them,” said Michele Shepard, Senior Director of College Affordability, The Institute for College Access & Success (TICAS).
“The Independent Educational Consultants Association (IECA) supports standardizing financial aid offers to better equip families in understanding the true cost of college enrollment. Understanding the True Cost of College Act introduced by Young Kim (CA-40) requires standard terminology and offer formats to assist colleges and universities, students and their families, secondary school and postsecondary counselors to make informed decisions about the real cost of college and reverse the trend of taking on staggering student debt. IECA maintains that financial aid transparency is a step toward greater access and opportunity for all students. We believe it is time to require standardization. IECA endorses this effort led by Representative Young Kim and urges Congress to pass this legislation, approving the True Cost of College Act,” saidIbrahim Firat, President, Independent Educational Consultants Association (IECA); Mark Sklarow, CEO, IECA; and Jeana Kawamura, Government Relations Chair, IECA.
Reps. Kim and Krishnamoorthi also introduced the Understanding the True Cost of College Act in the 117th Congress.
Read the bill HERE.
