Phase IV COVID-19 Bill Recommendations
April 27, 2020
By Michael Dannenberg
Leading education policy wonks offered and discussed their recommendations for a Phase IV COVID-19 bill in a Twitter chat (#CARES4Ed) led by Education Reform Now a couple of weeks ago. Online participants included influential voices at the Alliance for Excellent Education, Bellwether Education Partners, Center for American Progress (CAP), The Education Trust, Higher Learning Advocates, New America, The Century Foundation, Third Way, and The Institute for College Access and Success (TICAS).
Highlighted below are three key areas of consensus, and within them, conflicting opinions as to what is needed in a Phase IV COVID-19 bill for education. Along the way, we shout out interesting new ideas raised by participants.
State & Local Government General Aid
While the Phase III Coronavirus Aid, Relief, and Economic Security Act (CARES) Act addressed short-term education needs by providing a little over $30 billion to public school districts, charter schools, institutions of higher education, and “education-related service organizations” for COVID-19 response needs, our #CARES4Ed Twitter chat participants agreed the included aid is woefully insufficient and oblivious to the free fall in overall state and local budget revenue—approximately one-third of which goes to K-16 education—for the coming state fiscal year.
Accordingly, #CARES4Ed Twitter chat participants agreed that a Phase IV bill should:
- Go big. Numbers bandied about included a minimum of $100 billion for K-12 education and a separate dedicated stream of general aid for higher education. Mind you this was two weeks ago. Since then, the National Education Association (NEA) and American Federation of Teachers (AFT) have called for $175 billion. **New Idea Alert** In different ways, Bellwether’s Chad Aldeman and TICAS suggested taking the present and future size of general aid decisions out of Congress’ hands. Aldeman tweeted he would “rather see a #CARES4Ed bill that automatically adjusted [size] based on economic indicators in, say, the first half of 2020.” And TICAS called putting counter-cyclical federal funding for education in general on auto-pilot so we don’t go through this every recession. Both ideas are smart.
- Target aid. There was widespread agreement that Phase IV education aid should be directed to and within states to public school districts, public charter schools, and public institutions of higher education based on economic need as reflected in student and community poverty levels, or in the case of higher education, Pell Grant student enrollment. The Alliance for Excellent Education’s Anne Hyslop highlighted that the CARES Act legislation allows school districts to direct Phase III funds to schools without regard to area poverty or financial need. CAP and others have noted that the CARES Act provides some $1 billion to for-profit colleges, as well as aid to super-wealthy, non-profit institutions of higher education (e.g., Notre Dame, UPenn, Columbia). That’s not good.
- Guard against bad state behavior. Multiple DC-based policy wonk participants called for a “strong maintenance of effort” to be included in a Phase IV bill. **New Idea Alert** We’d go further and suggest that a Phase IV bill include upfront, clear, and escalating consequences for violators of maintenance of effort. Going forward, federal education formula funds should be “double targeted” to high poverty school districts and needy colleges in states that are not acting in the best interest of students. If after a major infusion of federal funds, Louisiana isn’t going to hold steady its education funding levels, then federal education funds should be hyper-targeted within state away from wealthy Ascension Parish and sent to high poverty New Orleans instead.
Most interesting though is that while almost all #CARES4Ed Twitter chat participants fit into the COVID-19 response context continued calls for their favored pre-coronavirus policy proposals, such as a robust federal-state partnership for college affordability and completion, Bellwether’s Sara Mead opined that the political context has shifted since Rahm Emmanuel told us to “never waste a crisis.” Sara tweeted, the Obama Recovery Act “included a lot of policies designed to not just prop up education to backfill state budgets, but also to drive policy change. The track record of those is mixed and [there is] less appetite to do something similar today.” We’re not happy about it, but we think she’s right. We’re still for policy change and improvement. We just think it’s harder.
Student Loan Relief
The enacted Phase III CARES law includes a series of student loan relief provisions—a moratorium on federal Direct Loan and U.S. Department of Education-owned Federal Family Education (FFEL) loan payments through Sept. 30, 2020, protection against interest accrual on those loans, a prohibition on involuntary federal student loan payment collection activity, and an assurance that each CARES Act moratorium month is deemed a month in repayment for the purpose of existing federal student loan forgiveness programs.
Almost all our Twitter chat participants agreed a Phase IV bill should:
- Cover all federal student loans. Some 10 million borrowers with federal Perkins loans and older FFEL loans not owned by the U.S. Department of Education are not covered under the Phase III CARES Act moratorium provision. Whether an oversight or intentional, that should be fixed in a Phase IV bill.
- Extend the moratorium period. Education Trust specifically called for an extension of the involuntary collection prohibition until at least January 2021. We would like to see the same for all federal and private student loan payments with no interest accruing.
- Provide private student loan borrowers with relief. Almost all participants called for an extension of the payment moratorium to private student loans. **Old, New Idea Alert** During the last recession, Senator Sherrod Brown and Rep. Marcia Fudge introduced “debt swap” legislation that would allow private student loan borrowers to refinance a portion of their education debt into the federal student loan system and thereby access various forgiveness and other consumer benefits.
There is an ongoing divide among education advocates on student loan debt cancelation. Third Way, for example, has called for a credit directed at either debt forgiveness for low-income borrowers or “upskilling” (i.e., additional education and training) of low-income individuals. In contrast, during our Twitter chat, Education Trust called for $20,000 in across-the-board student loan debt cancelation in a Phase IV bill for borrowers of any income.
Notable is that that CAP seemed to suggest student debt cancelation specifically for people of color. It’s not as if a general student loan debt cancellation policy can specifically exclude people of color. That means CAP is suggesting there should be a special student loan debt cancelation for people of color irrespective of generally applied criteria, such as income levels or school of attendance. That’s significant.
The Black-White student loan default data is deeply disturbing. Nearly one in two Black student loan borrowers default. Nearly one in four Black bachelor degree holders default on a student loan—almost four times the rate of White bachelor degree holders. Education Trust’s Andrew Nichols and Tiffany Jones have highlighted that even high-income Black student loan borrowers default at a rate seven times higher than their White peers. We have offered a series of explanations for racial disparities in student loan repayment rates. But it’s hard to see the U.S. Supreme Court upholding CAP’s suggestion that there be targeted student loan relief specifically for racial minorities.
Finally, all #CARES4Ed Twitter chat participants agreed with Education Trust that COVID-19 is “caus[ing] current equity gaps to widen significantly.” The digital divide is making a bad situation worse for many students. Too many K-16 students lack access to necessary hardware or connectivity to the internet, making it near impossible to make the shift to remote learning.
All recognize on-line education quality assurance is a major challenge with equity implications. In fact, there are those who believe that absent adult supervision and guidance to ensure some minimum quality interaction equity in on-line education may be out of reach. The Alliance for Excellent Education’s Anne Hyslop was even more pessimistic. “If I had to choose between using [Phase IV funds] to ramp up online learning at scale in K-12 schools or on strategies to help kids catch up once schools reopen, I’d choose option #2. I am too skeptical of quality of online instruction in any [school district] that wasn’t already bought in.”
On the other hand, there are those who argue that quality on-line resources can promote equity. **New Idea Alert** Former Obama administration official Hal Plotkin, for example, recommends that a Phase IV bill have clear language that requires all intellectual property produced with federal funds be released as Open Educational Resources (OER) so everyone can use and build on those resources. Hal submits “we could redirect savings from increased OER use—billions of dollars—to Pell [Grants] at no additional net cost to taxpayers. More cash for students—less for proprietary education publishers who seek to lock up knowledge behind time-expiring passwords.” The U.S. Department of Labor’s TAACCCT program includes template regulatory language.
Either way, during and post-COVID-19, on-line education is here to stay. Last week, James Murphy and I recommended a Phase IV bill include specific minimum standards for quality on-line education. To us, a series of PowerPoint slides and e-bulletin board does not a college course make.
Hopefully, we get a Phase IV COVID-19 law that supports public education PK-16 and sets aside partisan politics. This is a time for good government and making use of relatively new communication vehicles, including, yes, Twitter, to influence policymakers. We might as well accept it and lean in.
For more details on our Twitter chat, go to #CARES4Ed.
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August 16, 2018
June 27, 2018