September 2018 | Lewis-Burke Associates LLC

​A VIEW FROM WASHINGTON

Efforts like the College Transparency Act, which would overturn the current student-unit record ban and create a secure, privacy-protected postsecondary data system, have strong bipartisan support.  This potential system would include reporting on student outcomes including enrollment, retention, completion, and post-collegiate outcomes (including earnings) across colleges and majors.  While the higher education community by and large supports efforts to reduce regulatory burden and compliance costs, some have cited concerns over privacy and an overemphasis of outcome measures. 

A continued critique of higher education has been the charge that students are ill-prepared for the workforce.  A recent presidential Executive Order states, “For too long, our country’s education and job training programs have prepared Americans for the economy of the past.”  Several actions by the Administration and Congress have recognized the importance of higher education to workforce development.  A recent Department of Labor grant opportunity to expand apprenticeships is specifically targeted to institutions of higher education.  As new opportunities emerge and continued attention to a “skills gap” remains, institutions should consider how to articulate the connection between their education mission and workforce development.

Sources and Additional Information:

• A fuller exposition on these and other federal challenges can be found in Lewis-Burke’s Update to Federal Challenges to Research and Higher Education which can be found at http://www.lewis-burke.com/sites/default/files/2018_higher_education_federal_challenges_-_12_jan_18.pdf.

Senate Passes Education Funding Package
On August 23, the Senate passed its third fiscal year (FY) 2019 government funding package, H.R. 6157, by a vote of 85-7.  The bill would fund the Department of Education (ED), as well as the Departments of Labor, Health and Human Services, and Defense, providing a total of $857 billion.  Under this bill, ED would receive approximately $74.9 billion in FY 2019.  During floor consideration, the Senate considered over 60 amendments to the bill, but avoided any “poison pill riders”—amendments that are unpopular with one party and render the bill unlikely to pass. 

Several senators objected to a $100 increase to the maximum Pell Grant award for the 2019-2020 school year included in the bill, which would bring the maximum award to $6,195.  An amendment to strip the increase was defeated.  Several education-focused amendments to the bill were adopted with bipartisan support, including new policy language to allow ED to reimburse institutions of higher education for the cost of servicing Federal Perkins Loans and language directing ED to report on the coordination of K-12 STEM programs across agencies.  An amendment was also agreed to, which would provide $10 million for a pilot grant program to test partnerships between institutions of higher education and local education entities to train counselors, social workers, and other mental health professionals.
 
The Senate has passed nine of its 12 funding bills, which is a rare accomplishment.  While the House has already passed its version of the Department of Defense FY 2019 funding bill, it is unlikely they will pass a funding bill for the Departments of Labor, Health and Human Services, and Education before the end of the fiscal year on September 30.  Congress will likely vote to temporarily extend funding for most federal programs at current levels until after the November election. 
 
Sources and Additional Information:

• The text of the bill can be found at https://www.congress.gov/bill/115th-congress/house-bill/6157/text/eas.
• Lewis-Burke’s more detailed analysis of the education funding bill is available at http://www.lewis-burke.com/sites/default/files/senate_lhhsed_fy2019_appropriations.pdf.

On August 8, a federal judge in Texas heard a case brought by several states suing to end the Deferred Action for Childhood Arrivals (DACA) program.  Led by the Texas Attorney General, several states assert in the lawsuit that the Obama Administration “unilaterally conferred lawful presence and work authorization on otherwise unlawfully present aliens, and then the executive used that lawful-presence ‘dispensation’ to unilaterally confer United States citizenship.”  Despite many predictions that the suit would be successful in ending the DACA program, the federal judge overseeing the case declined a request to terminate the program in a surprising August 31 decision, citing that the states waited too long to file their case.  The judge noted, however, that the program is likely to be declared illegal.  If an appeal is filed, the case would next go to the U.S. Court of Appeals for the Fifth Circuit.  Absent action by Congress and the Administration, it is likely litigation will make its way to the Supreme Court, potentially in the spring of 2019.  Questions about DACA may come up during the ongoing confirmation hearings for Supreme Court nominee Brett Kavanaugh.
 
Sources and Additional Information:

• The lawsuit filed by the states can be found at https://www.texasattorneygeneral.gov/files/epress/File-Stamped_Complaint.pdf.

Revised Policies on Unlawful Presence and STEM OPT
On August 16, U.S. Citizenship and Immigration Services (USCIS) issued a revised policy memo on the accrual of unlawful presence policy, under which certain visa holders would begin accrue unlawful presence on August 9, 2018 or the day after a status violation occurs.  Previously, the policy had been that accrual would begin once the government formally found a violation of status had occurred.  The new guidelines state F and M visa holders will not accrue unlawful presence while waiting for visa reinstatement if they applied within five months of falling out of status.  J-1 visa holders will also not accrue unlawful presence if their applications for reinstatement are approved. 
 
On August 23, USCIS announced that it will allow F-1 students participating in optional practical training (OPT) in science, technology, engineering, and math (STEM) fields to work at third-party sites with proof of a “bona fide employment relationship.”  This announcement revises USCIS’ January 2018 announcement that restricted the employment of STEM OPT students anywhere other than the employer’s own place of business.

Sources and Additional Information:

• The revised policy memorandum on unlawful presence released on August 9, 2018 can be found at https://www.uscis.gov/sites/default/files/USCIS/Laws/Memoranda/2018/2018-08-09-PM-602-1060.1-Accrual-of-Unlawful-Presence-and-F-J-and-M-Nonimmigrants.pdf.
• More information on OPT Extension for F-1 students can be found at https://www.uscis.gov/working-united-states/temporary-workers/h-1b-specialty-occupations-and-fashion-models/extension-post-completion-optional-practical-training-opt-and-f-1-status-eligible-students-under-h-1b-cap-gap-regulations.

IRS Issues Call for Comments on Unrelated Business Tax
In mid-August, the Internal Revenue Service (IRS) released a call for comments on the calculation of unrelated business income (UBI) for tax exempt organizations (Notice 2018-67).  The recent enactment of the 2017 tax reform bill made significant changes as to how and what is classified as UBI by colleges and other tax-exempt organizations.  This new notice offers the IRS’s initial views on the calculation of separate UBI trades/businesses, as well as details on UBI calculations for income from partnerships, income from investments, and fringe benefits.  While the Department of the Treasury still intends to propose regulations for UBI calculations, it says that pending those “proposed regulations, and pursuant to additional interim guidance provided in section 6 of this notice, exempt organizations may rely on a reasonable, good-faith interpretation…when determining whether an exempt organization has more than one unrelated trade or business.”

Sources and Additional Information:

• The IRS is accepting public comments on the agency’s proposals through December 3, 2018 and details can be found at https://www.irs.gov/pub/irs-drop/n-18-67.pdf.

“Is college still worth it? To answer this question as posed by our recent symposium: Yes, a college degree remains a valuable investment for many. As in the past, it is associated with significantly higher earnings in the job market. However, the wealth accumulation of today’s graduates looks meaningfully lower than graduates of yesteryear.

 
It’s not entirely clear what’s driving this development, but the much higher price tag attached to a degree seems obvious. These results suggest that pursuing a college degree is a riskier decision for many more prospective students than it was in the past. Consequently, oversimplifying the financial benefits of college by looking solely at the aggregate return obscures an alarming trend in higher education.”

Read more at: https://www.stlouisfed.org/on-the-economy/2018/july/college-boost-why-wealth-returns-degree-falling 

---

SURVEY

In order to ensure we are providing you the most useful and pertinent information, Lewis-Burke is soliciting feedback on our Higher Education Policy Monthly Newsletter.  Please share your thoughts regarding newsletter content here.