Sen. Jim Banks Proposes Bill to Repeal Controversial Education Funding Rule
On Monday, Indiana Republican Sen. Jim Banks introduced legislation aimed at reversing regulations that he claims unfairly target career education institutions and military students.
The proposed Promoting Access and Revenue Integrity Through Institutional Transparency (PARITY) Act seeks to eliminate the requirement from the Higher Education Act stating that at least 10% of funding for private schools must originate from non-federal sources. Initially, this rule only included regular federal student aid, limited to 90%. However, it was revised under the Biden administration to encompass GI Bill funding as well.
This particular regulation does not apply to public or nonprofit educational institutions.
In his statement, Banks argued, “As it stands, the rules provide an advantage to technical and career schools, allowing other universities to operate under different criteria.” He continued, “This is unfair since these programs address essential workforce demands and are crucial for our economy.”
Supporters of the bill, including several military organizations, contend that the existing rules unjustly target vocational and trade schools. Originally, the rules aimed to cap Title IV funds, which are federal direct loans, and permitted schools to count GI Bill recipients toward the 10% non-federal funding requirement. However, an update in 2021 altered this definition, and proponents of the PARITY Act claim it may lead to a reduction in the number of military and veteran students accepted by career schools.
Terry Schilling, the president of the American Principles Project, shared his views with the public, stating, “Democrats have burdened young Americans with student loans by reinforcing elite college systems. This bill offers veterans, parents, and everyone else a chance to access affordable and innovative programs that genuinely enhance student lives, rather than acting as gatekeepers for those stuck in bureaucratic processes.”
Furthermore, the National Defense Committee indicated in a letter that if the rule were applied evenly across all higher education institutions, 80% of public two-year colleges and 40% of public four-year colleges would likely fail to comply.
The 90/10 rule has been in place since 1992 and has seen modifications since then, including proposals for additional measures to ensure that educational institutions are adequately preparing students for employment post-graduation.
The debates surrounding these rules reflect broader concerns about competition and access within higher education, prompting calls for adjustments to foster inclusive environments for all students.
