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H.R. 4508 (115th): PROSPER Act

Would the GOP’s higher education reform bill make things easier or harder for borrowers and those with high student loans?


The main federal law governing higher education and financial aid is 1965’s Higher Education Act, through which about 75 percent of federal higher education financial aid flows.

The law is reauthorized with some updates every few years, the most recent time being in 2008. Some members of Congress intended to pass another update once more during the current Congress.

However, most Republicans want a more comprehensive overhaul with more major reforms.

What the bill does

The PROSPER Act [H.R. 4508] is that overhaul. Among the bill’s provisionsare:

  • Instead of dozens of different federal student loan options, there would only be one type of loan and one type of grant: the to-be-created Federal ONE loan and the existing Pell Grant.
  • Lifetime student loans would be maximized at $60,250 for undergraduates and $150,000 for graduate students.
  • However, these loans would be allowed to accrue interest while the student is still attending school — something that can’t be done under current Stafford loans.
  • Eliminates the Public Service Loan Forgiveness program, under which one’s loans are significantly reduced if they work for the government or a nonprofit organization.
  • Simplifies and streamlines the Free Application for Federal Student Aid (FASFA) forms.
  • Gives an extra $300 Pell Grant for an increased academic workload.

The bill’s full name is the Promoting Real Opportunity, Success, and Prosperity through Education Reform Act.

It was introduced by Rep. Virginia Foxx (R-NC5), Chair of the House Education and the Workforce Committee.

What supporters say

Supporters argue the bill contains long overdue changes that make the higher education system in America more effective and responsive.

“With six million unfilled jobs and over a trillion dollars in student debt, simply reauthorizing the Higher Education Act will help no one,” Rep. Foxx said in a press release. “A hard truth that students, families, and institutions must face is that the promise of a postsecondary education is broken.”

“We need a higher education system that is designed to meet the needs of today’s students and has the flexibility to innovate for tomorrow’s workforce opportunities,” Foxx continued. “The PROSPER Act is higher education’s long overdue reform.”

What opponents say

Opponents counter that the bill will actually slash spending for those who most need it, while redirecting taxpayer money towards for-profit and religious institutions.

The bill “makes financing a college education harder for low- and middle-income students, dramatically reducing available grant aid and making student loans more expensive,” House Democrats led by the committee’s top Democrat Rep. Bobby Scott (D-VA3) wrote [PDF page 1,139 in that link]. “The Congressional Budget Office (CBO) estimates that H.R. 4508 will reduce direct spending in the Pell Grant and Student Loan programs by $14.6 billion over ten years.”

“While the bill makes college less affordable, it makes federal student aid more generous for for-profit institutions, at the expense of taxpayers and students,” the argument continues. “H.R. 4508 eliminates necessary guardrails and dilutes consumer protections that safeguard students and taxpayers. [It] expands and creates loopholes that will allow ineligible providers access to federal student aid without adequate oversight to ensure quality, and in some cases, even without compliance with any federal law.”

Odds of passage

The bill passed the House Education and the Workforce Committee in February, on a party-line vote of 23 to 17. It next goes to the full House.

The bill was originally introduced last December and attracted 21 cosponsors, all Republicans.

Last updated Aug 3, 2018. View all GovTrack summaries.

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress, and was published on Dec 1, 2017.

Promoting Real Opportunity, Success, and Prosperity through Education Reform Act or the PROSPER Act

This bill amends the Higher Education Act of 1965 to revise the governance of federal financial aid provided to students pursuing a postsecondary education and institutions of higher education (IHEs), including by:

removing restrictions on providing aid to for-profit institutions, correspondence courses, and certificate programs; modifying the eligibility requirements for IHEs and students to participate in federal student aid programs; revising accountability measures for IHEs, such as adding new measures for minority-serving institutions; requiring IHEs to implement programs to prevent the use of illicit drugs and the abuse of alcohol by students and employees; prohibiting aid to IHEs that deny religious student organizations the rights, benefits, or privileges that are afforded to other organizations; limiting the Department of Education's authority to issue regulations; revising requirements concerning sexual assault on campuses; authorizing an industry-led apprenticeship grant program; reauthorizing through FY2024 and revising specified programs, including the Federal Pell Grant program, the Federal Work-Study programs, and an aid program for students whose families are seasonal farm workers; revising requirements governing the Federal TRIO programs for students from disadvantaged backgrounds; repealing specified grant programs (e.g., the Federal Supplemental Educational Opportunity Grant program) and loan forgiveness programs (e.g., Public Service Loan Forgiveness) for new borrowers; replacing the existing student loan programs (i.e., the Federal Direct Loan program and the Federal Family Education Loan program) with a single loan program (i.e., ONE loan program); revising student loan limits for undergraduate students and establishing loan limits for graduate students; and replacing existing student loan repayment plans with an income-based repayment plan.