Congress Acts to Overhaul College Loan Regulations

Congress overwhelmingly approved an overhaul of the nation’s higher education law on July 31, adding dozens of provisions and programs to help families with soaring college costs.

The bill is an effort to keep college costs down through greater transparency — and perhaps shaming — without imposing price controls. It requires colleges and universities to report more information about their costs and prices, to be released by the Education Department in user-friendly lists; those with the largest percentage tuition increases will have to tell the department why they were needed and what they will do to keep costs down.

The measure passed in the House by 380 to 49 and in the Senate by 83 to 8.

The measure also simplifies federal financial-aid forms, and, for the first time, makes Pell grants for low-income students available year-round, not just during the academic year. It also requires colleges to disclose all relationships with student lenders and bans all gifts and revenue-sharing agreements between institutions and lenders offering federal and private loans.

Although President Bush is widely expected to sign the legislation, the White House made no promises last week.

“We will review the legislation to see how it addressed administration concerns during the conference process,” said Scott Stanzel, a White House spokesman.

Representative George Miller, Democrat of California and chairman of the House education committee, said the bill would “create a higher-education system that is more consumer-friendly, fairer and easier to navigate.”

Education groups found good and bad in the sprawling 1,100-page legislation.

Terry Hartle of the American Council on Education said he applauded provisions making it easier for low-income students to pay for a college education, but worried about the cost of complying with all the new regulations “dealing with textbooks, tuition and fees, cost of attendance, alumni activities, foreign gift reporting, fire safety, graduation rates, drug violations, vaccines and peer-to-peer file sharing.”

Coming five years after the last major education overhaul expired, the legislation was a source of substantial relief to many lawmakers.

“We have had over 13 different extensions of this bill,” said Senator Barbara A. Mikulski, Democrat of Maryland, who has recently steered the bill in the absence of Senator Edward M. Kennedy, Democrat of Massachusetts and chief author of the bill. “I feel like we have been on third base for six and a half years.”

House and Senate negotiators agreed on the final outlines of the bill July 30, getting around the last sticking point — how to deal with states that reduce their spending on higher education — with a symbolic compromise under which states that do so could not compete for money from a new grant program that may never be given money.

College affordability has been a high priority for the current Congress, which in other legislation over the past year cut interest rates on student loans and raised the size of Pell grants. Many lawmakers have been frustrated that every increase in federal financial aid is quickly swallowed up by increases in tuition.

Congress has also been concerned that the form filled out by families seeking help with tuition, the Free Application for Federal Student Aid, known as the Fafsa, was a daunting obstacle for many. “Though it was only a seven-page form, you had to hire a financial services outfit to do it,” Ms. Mikulski said.

The new law calls for a two-page Fafsa-EZ form.

With textbook costs averaging about $900 a year and many students forced to pay hundreds of dollars for a required book “bundled” with a DVD or workbook, the new law would require publishers to provide full pricing information and sell unbundled versions of every textbook.