Repaying More Aid When Students Drop Out

The Kentucky Community and Technical College System invests serious resources into student supports during the first four weeks of a semester — the period in which at-risk students are most likely to drop out.

Jay Box, the system’s president, said its 16 colleges make student retention a top focus throughout the semester. Yet because of student withdrawals during a recent fall semester, the system still had to return about $2.6 million in student aid to the federal government.

Under a GOP proposal in the U.S. House of Representatives, however, the system projects its bill would hit $8.1 million for that semester alone.

“It’s really not a good deal for us,” Box said.

That proposal, part of House legislation to reauthorize the Higher Education Act, would apply to all colleges and universities. But it would hit open-access institutions like community colleges particularly hard.

Republican authors of the PROSPER Act, as the bill is dubbed, described the overhaul of aid repayments as a risk-sharing measure that would compel colleges to produce better outcomes. Critics of the GOP approach said the proposal identifies a real problem while offering a solution that’s even more troublesome.

Federal law requires colleges to pay back a portion of aid students receive if they drop out before a term is completed. Under the system, which is called Return to Title IV, the amount colleges must pay back is prorated and depends on when students drop out or withdraw. When a student has attended 60 percent of the term, the college does not have to return any aid.

 

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