News Headline

usatoday.com — A group of college financial aid experts is calling for a comprehensive overhaul of the federal student aid system, including simplifying the application process and helping low-income parents save for their children's education. In a newly released report, the group also recommends expanding and strengthening a federal student loan repayment plan that is based on the student's income after graduation, and encouraging colleges and states to ensure that students succeed once they enroll. The proposals were presented by a Rethinking Student Aid study group, made up of about a dozen higher education policy experts; it was created two years ago with support from several education-related foundations and the College Board, a nonprofit group.

hosted.ap.org — Federal authority to protect student borrowers from getting squeezed by the current credit crunch would be extended a year under legislation passed by the House. The measure, approved 368-4, continues the secretary of education's power to purchase loans from lenders in the federal guaranteed loan program when lenders are unable to meet demand. The current authority expires in July. The bill, which now goes to the Senate, prolongs provisions of legislation enacted into law last May aimed at ensuring that problems in the credit markets don't prevent students from getting college loans. That act also increased limits on how much borrowers can receive in federally subsidized student loans, decreasing student reliance on more expensive private loans. It allows parents to defer loan payments until their children leave school.

usatoday.com — Several colleges and universities in Texas, Ohio, Maryland and New York are freezing 2008-2009 tuitions at last year's levels in an effort to make college more affordable for the nation's middle class. In the 13-campus Texas Tech system, chancellor Kent Hance says the decision to keep in-state undergrad tuition at $4,310 stems in part from a five-year decline in students with annual family incomes of between $40,000 and $80,000. But in some systems where there are tuition freezes for in-state undergrads, other costs — like room and board charges, and out of state tuition — are still increasing.

iht.com — With mortgage foreclosures throwing hundreds of families out of their homes each month, dismayed school officials say they are feeling the upheaval: record numbers of students turning up for classes this fall are homeless or poor enough to qualify for free meals. As 50 million children return to classes across the nation, crippling increases in the price of fuel and food, coupled with the economic downturn, have left schools from California to Florida to Maine cutting costs. Some are trimming bus service, others are restricting travel, and a few are shortening the school week. And as many districts are forced to cut back, the number of poor and homeless students is rising.

usatoday.com — In the midst of one of the toughest back-to-school buying seasons in years, grandparents in many families are pitching in to get kids clothed. Three of the top five cities where folks are projected to spend the most per person in 2008 on children's apparel also rank among the top five cities for residents over age 65, according to new data crunched by Pitney Bowes MapInfo, a specialist in demographic research. With prices for food, gasoline and home heating up, parents are more willing to let grandparents help with clothing costs, says Dan Butler, vice president of retail operations at the National Retail Federation.

time.com — The U.S. Army, eager to fill its ranks amid wars in Iraq and Afghanistan, formally opened its first prep school for dropouts. The soldiers work in small classrooms outfitted with simple desks, chairs, and dry-erase boards. In-desk computers are used for test-taking. Grouped three to four to a class, the students hunch over special GED preparation books, working on basic math, social studies and reading selections. Recruits must score in the top half of the Army's aptitude test to qualify for the prep school and get two tries at a General Educational Development certificate. If they still can't pass, the Army will release them from their contract, Sanderson said.

usatoday.com — In recent months, several large lenders have stopped providing private student loans, stranding families that were counting on private loans to cover some of their costs. Education Finance Partners, the fourth-largest private lender, recently announced on its website that it had ceased operations. Borrowers who had been approved for loans from the company have been forced to look elsewhere for money. Though some lenders are still offering private student loans, "The list is shrinking," says Kevin Walker, chief executive of SimpleTuition, a website that allows borrowers to compare loan rates. Last year, he says, SimpleTuition featured 77 lenders on its website; now, it has only 16.

nytimes.com — Prices on some school lunch lines are going up this fall as school officials, like many others, struggle to pay higher prices and delivery fees for staples like bread, milk, fresh fruit and vegetables. The price increases, generally about 25 cents a meal, come as school districts across the country try to eke more out of already tight budgets, with some switching to four-day schedules to reduce utility and busing costs, and others asking more of their students to walk to school or limiting out-of-town games for athletic teams. But for many parents, nothing hits the pockets quite like lunch prices.

money.cnn.com — Sallie Mae, the nation's largest student lender, spent $640,000 lobbying in the second quarter for government help to shore up the troubled student loan market and on legislation related to other issues affecting the industry, according to a recent disclosure report. The company lobbied on access to capital for student lenders and a variety of legislation touching on student lending, education spending and banking. Congress sets the interest rates borrowers pay and the subsidy levels lenders receive under the federal student loan program. Lawmakers last year cut about $20 billion in federal subsidies to lenders to pay for increases in student aid. That cut into lenders' profits, as did the credit crunch, making it expensive to raise the capital they need to offer student loans.

usatoday.com — The troubled economy may be prompting more families to turn to federal school nutrition programs that aid poor children, a survey suggests. For the first time since 2004, a majority of cafeteria operators say the number of children getting free or reduced-price lunches has risen. In the annual survey, out today from the School Nutrition Association, 51.4 percent of food service directors say they saw an increase in the past school year.