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Grassley comments on Need-Based Educational Aid Act

College Financial Aid -- FAFSAFrom Press Release

 

Leading members of the Senate and House Judiciary Committees introduced legislation Tuesday to extend an antitrust exemption that allows certain colleges and universities to collaborate on issues of need-based financial aid.

The Need-Based Educational Aid Act of 2015 allows colleges and universities that admit students on a need-blind basis to collaborate on the formula they use to determine how much families can pay for college. This exemption was first enacted in 1994, and has been reauthorized by Congress three times without opposition, most recently in 2008. In addition to collaborating on a common formula for calculating ability to pay for college, higher education institutions are permitted to agree to award aid only on the basis of financial need and use a common application for aid.

The current exemption expires in September. The bipartisan, bicameral legislation introduced today by Senate Judiciary Committee Chairman Chuck Grassley (R-IA), Ranking Member Patrick Leahy (D-VT), Congressman Lamar Smith (R-TX), and Congressman Hank Johnson (D-GA), who both serve on the House Judiciary Committee, extends the exemption another seven years. The bill also removes a previously permitted activity that no school has ever used.

“By explicitly permitting these specific antitrust activities, Congress prevents needless and costly litigation.  It’s an important provision that helps ensure that the colleges and universities covered by this section of the law admit students without regard to ability to pay,” Grassley said.  “Allowing the use of these common principles helps make available need-based aid to low and middle income families and increases access to higher education, without causing harm to competition.”