At a hearing titled “No More Surprises: Reforming College Pricing for Students and Families,” Chairman Burgess Owens (R-UT) of the Subcommittee on Higher Education and Workforce Development addressed concerns about the lack of transparency in college pricing. Owens highlighted that families often face confusion when determining the true cost of higher education, as advertised prices from colleges frequently differ from what students ultimately pay.
“Good morning, and welcome to today’s hearing of the Subcommittee on Higher Education and Workforce Development. I want to thank our witnesses for joining us to shine a light on how students and families navigate one of the most important, and most confusing, financial decisions they will ever face: choosing and paying for college.
“The process of determining the true cost of college is clouded in mystery. Colleges and universities routinely advertise prices that bear little resemblance to what families ultimately pay. Too often, aid packages are filled with unclear or deceptive figures.
“This is not how major financial decisions are made in other parts of our economy. When you buy a home, federal law requires clear disclosures so you know exactly what you will owe. When you purchase a car, consumer protections guard against deceptive pricing. Yet when it comes to a college degree, an investment that can rival or exceed the cost of a home, students are left in the dark.
“The consequences of this lack of transparency are serious. Studies show that unexpected costs are a leading reason students drop out. Families who believe they are making a sound investment are blindsided by hidden expenses. Many borrowers are left in debt without a degree or credential. Taxpayers also suffer. When students borrow too much, they risk default, leaving taxpayers to foot the bill.
“We also know that institutional practices such as tuition discounting and aid displacement make the system even more opaque. Colleges use sophisticated algorithms to decide who gets a ‘discount,’ often based not on merit or need, but on how likely a student is to enroll. One student may pay tens of thousands more than a classmate with similar qualifications, simply because of the way the student’s FAFSA was processed. That is not fair to students and families.
“The good news is that solutions are within reach. This Committee has previously advanced bipartisan proposals to bring sunlight to college pricing. Republicans have proposed legislation that would establish standardized financial aid offers to ensure students and families can accurately compare college costs. We have also proposed improvements to make net price calculators more accurate, accessible, and user-friendly. And we are exploring the concept of maximum price guarantees so that families know from day one the most they will ever have to pay for a degree.
“These reforms are rooted in a simple idea: students and families deserve honesty and transparency. They should have access to the information they need to budget, plan, and make the college choice that is best for them without a lawyer or an accountant.
“Today, we will hear from experts, including a leading economist and a seasoned college administrator. Their testimony will help us recognize where transparency is working, where it is not, and what Congress can do to ensure that no student or family faces sticker shock after it is too late.
“I look forward to a strong discussion and to working with my colleagues to make college pricing transparent—eliminating the guesswork, empowering students, enhancing accountability, and safeguarding taxpayers.”
The hearing included testimony from various experts aimed at identifying effective strategies for improving clarity around tuition costs.
