07.28.15

Congress Passes Bill Allowing Universities to Collaborate on Financial Aid Best Practices

. . . Middlebury College Is One Of 23 U.S. Colleges Using The Collaborative Authority

WASHINGTON (TUESDAY, July 28, 2015) -- The U.S. House of Representatives Monday night passed bipartisan legislation introduced by Judiciary Committee Chairman Chuck Grassley (R-Iowa), Ranking Member Patrick Leahy (D-Vt.) and Senator Mike Lee (R-Utah) to extend an expiring antitrust exemption that allows certain colleges and universities to continue to collaborate on issues of need-based financial aid.  The legislation unanimously passed in the Senate on July 14 and cleared the House of Representatives by a vote of 378-0.  This legislation will now be sent to the President for his signature.

Leahy said:  “Allowing participating universities to focus their resources on ensuring the most qualified students can attend some of the best schools in the nation, regardless of family income, is important.  With Congress’s swift action to pass the Need-Based Educational Aid Act, participating universities can continue collaborating on need-based financial aid that ultimately benefits students.  I am glad we were able to pass this important legislation ahead of a critical deadline.”    

Grassley said:  “Every college student, regardless of financial situation, wants a shot at the best education, and schools looking to attract the best and the brightest want to ensure that financial aid goes to those who need it most. Our bill allows colleges and universities to continue working together, free from the threat of antitrust litigation, to ensure that students in need of financial aid are treated fairly and consistently. Expanding opportunities for bright, hardworking students in need of financial assistance is a worthy cause, and I applaud my colleagues in the House for passing our bill.”

Middlebury College of Vermont is one of 23 universities and colleges in the country that are permitted to collaborate on the formula they use to determine a family’s ability to pay for college.  The Need-Based Educational Aid Act of 2015 extends the Section 568 antitrust exemption, which was set to expire in September, and allows Middlebury and other participating colleges and universities to continue to collaborate and admit students regardless of the student’s financial ability.  The antitrust exemption permits higher education institutions to agree to award aid only on the basis of financial need and use a common application for aid.  By allowing financial aid professionals to work together in these ways, the exemption helps ensure that the colleges and universities covered by this section of the law admit students without regard to ability to pay.  It also prevents needless litigation over the development of principles for determining financial need.  This exemption was first enacted in 1994, and has been reauthorized by Congress three times without opposition, most recently in 2008.  A 2006 Government Accountability Office report found that the activities permitted by the exemption have not resulted in harm to competition.

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