Transparency in federal and state financial aid programs is a necessary and fundamental component of a progressive agenda for higher education. This idea of transparency was embedded in the recommendation from the 1993 National Commission on Responsibilities for Financing Postsecondary Education to implement a Student Total Education Package. Based on financial need and the price of attendance at college, STEP would provide the total amount and sources of financial aid available that families could count on to pay for college. That is, student and families would know the amount of grants, loans, and work-study for which they are eligible based on family income and family size.
In a similar vein, the Rethinking Student Aid Study Group recently proposed a simple look-up table for Pell Grant eligibility to allow students and families to know the exact amount of Pell Grant money they can receive if they enroll in college, with the amount of Pell Grant money based on adjusted gross income and family size as reported to the Internal Revenue Service on individual tax returns.
By taking the lead in making financial aid amounts and sources transparent, federal policy could incent public and private postsecondary colleges and universities to add state and institutional grant aid to STEP so that students with different financial need would know what to expect in grants and loans when they enroll in college. The result would be that families would be more knowledgeable about the actual price of college they are expected to pay through work and loans, and thus become smarter consumers in the postsecondary education marketplace. This information could be communicated to working adults so they are more aware of the available workforce education and training resources for which they qualify, as well as the promise of federal grant aid to enroll in a college or university.
Transparency in federal financial aid programs will also benefit traditional-age students: Information can be communicated to students as early as middle school and throughout their secondary education, thus taking the uncertainty of paying for college out of the college-going process.
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