Low-Income Students

When Michelle Rhee was chancellor of DCPS, one of her chief accomplishments was negotiating a new contract with the teachers union that included a new teacher evaluation system. The system, called IMPACT, was designed to keep good teachers in the classroom through incentives like merit pay and weed out the bad by giving the district the power to fire teachers who were repeatedly ranked at the bottom.

IMPACT rates teachers on a variety of metrics, from their students' test scores to classroom observations. It has been both controversial and held up by education reformers as a model for how other districts could begin evaluating teachers in a holistic way. In some ways, the methods for observing teachers are similar to those of the Classroom Assessment Scoring System (CLASS), the Danielson Framework for Teaching and other evaluation systems that are catching on in the early childhood world in that it both evaluates teachers and gives them opportunities for feedback and mentoring. 

DC has been using this system since 2009, so two school years have passed since it began. This month, The New Teacher Project released a report that addresses important questions about how the new teacher evaluation system is playing out. In this podcast, Dan Weisberg of The New Teacher Project and Anne Hyslop of the New America Foundation discuss the new report and what it says about the future of the teaching workforce. Maggie Severns hosts.

Click here to listen to the podcast. You can also subscribe to our podcasts in iTunes, and download previous podcasts from our online archive.

Editor's note: This post originally appeared on New America's Education Policy program blog, Early Ed Watch.

A new report from two child advocacy groups, First Focus and Save the Children, gave the United States a grade of C- on children’s issues for last year. The report, America’s Report Card 2012, considered White House, federal agency, state and community efforts on family economic security; early childhood and K-12 education; permanency and stability in welfare programs and for immigrant families; and children’s health and safety. The groups examined federal, state and local efforts in each of these areas, and gave scores according to qualitative analyses.

A new report from two child advocacy groups, First Focus and Save the Children, gave the United States a grade of C- on children’s issues for last year. The report, America’s Report Card 2012, considered White House, federal agency, state and community efforts on family economic security; early childhood and K-12 education; permanency and stability in welfare programs and for immigrant families; and children’s health and safety.

Last week we highlighted President Barack Obama’s higher education hits and misses during his time in office. With the presidential election fast approaching, we thought it would only be fair to take a look at Mitt Romney’s higher education record during his tenure as governor of Massachusetts.

Even though the candidates mentioned very little about higher education during the debates, Governor Romney’s record in Massachusetts provides some insight into how higher education might fare under a Romney presidency:

1. Not afraid to cut higher education: When Romney took office Massachusetts was facing a $600 million budget gap in addition to a potential $3 billion dollar deficit.  Within weeks of taking office, Romney instituted a package of emergency budget measures that cut $12 million from the $1 billion higher education budget. And Romney continued to slash the budget during his years in office—between 2001 (when his predecessor was in office) and 2005, Massachusetts saw a reduction of 33 percent in state spending. While Romney has touted throughout the presidential campaign that Massachusetts has the best public k-12 education system in the nation, under his watch, Massachusetts ranked 49^th in the nation in higher education spending, spending more money on prisons than on higher education.

Given all the roiling debates about how America’s children should be taught, it may come as a surprise to learn that students spend less than 15% of their time in school. While there’s no doubt that school is important, a clutch of recent studies reminds us that parents are even more so.

This week, the Federal Education Budget Project, Ed Money Watch's parent initiative, released a report that shows how the Obama Administration's proposed changes to Income-Based Repayment (a federal student loan repayment plan designed to help struggling borrowers) will offer the biggest increase in benefits to high-debt graduates -- even once their incomes rise to six figures. Director of the Federal Education Budget Project and co-author of the report Jason Delisle sat down with Yahoo! Finance's Aaron Task this week to explain the key points of the paper, and to review how the Administration can fix the program before the pending changes even take effect. The video is embedded below.

The full report, Safety Net or Windfall?: Examining Changes to Income-Based Repayment for Federal Student Loans, is available here, and the calculator we designed and used to test the program is also available to download (for more about the calculator click here). 

This week on Slate, I wrote about a new twist to an experiment many Early Ed Watch readers are likely familiar with: the Stanford Marshmallow experiment, a classic measure of childhood willpower in which kids who managed to sit at a table with a marshmallow in front of them and not eat it for 15 minutes were rewarded with a second marshmallow.

In today’s tough economy, many recent college graduates are looking for ways to shrink their federal student loan payments. Income-Based Repayment (IBR), which allows students to pay a monthly amount based on their earnings, not their federal student loan balances, provides significant relief. However, a new report, Safety Net or Windfall? Examining Changes to Income-Based Repayment for Federal Student Loans, from the Federal Education Budget Project (our sister blog Ed Money Watch's parent initiative) shows that pending changes to IBR are far more generous than previously thought. Borrowers with high student loan balances and high incomes, not low-income borrowers, stand to benefit the most.

Congress created IBR in 2007 to make it easier for college graduates to make their student loan payments even in their first years out of school when they are earning lower incomes. If a student’s monthly payment under standard repayment exceeds 15 percent of his monthly discretionary income, he is eligible for the program. The borrower’s monthly payments increase as his salary increases until they reach a cap at the level he would have paid under standard repayment. After that borrower makes 25 years of payments in IBR, the Department of Education forgives any remaining loan balance.

But in 2010, at President Obama’s request, Congress made the program even more generous. The new IBR will base monthly payments on 10 percent of discretionary income, instead of 15, and loan forgiveness will be provided after only 20 years. That change was set to take effect in 2014 until the Department of Education, as part of the president’s “We Can’t Wait” initiative to circumvent legislative gridlock, sped up the availability of the new IBR by creating a version of it through regulations – “Pay As You Earn” (PAYE). PAYE will take effect by the end of the year.

But little is known about the real effects of this new IBR system. To fill in this knowledge gap, FEBP Director Jason Delisle and Program Associate Alex Holt designed and built a calculator that estimates the monthly payments a borrower will make under the original IBR, the pending version of IBR, and other repayment plans like standard 10-year and consolidation. It accounts for a borrower’s loan balance, interest rate, income, and family size over the entire repayment period. It also calculates the total payments over the life of the loan, and the amount of loan forgiveness he will receive.

In today’s tough economy, many recent college graduates are looking for ways to shrink their federal student loan payments. Income-Based Repayment (IBR), which allows students to pay a monthly amount based on their earnings, not their federal student loan balances, provides significant relief. However, a new report, Safety Net or Windfall? Examining Changes to Income-Based Repayment for Federal Student Loans, from the Federal Education Budget Project (Ed Money Watch's parent initiative) shows that pending changes to IBR are far more generous than previously thought. Borrowers with high student loan balances and high incomes, not low-income borrowers, stand to benefit the most.

Congress created IBR in 2007 to make it easier for college graduates to make their student loan payments even in their first years out of school when they are earning lower incomes. If a student’s monthly payment under standard repayment exceeds 15 percent of his monthly discretionary income, he is eligible for the program. The borrower’s monthly payments increase as his salary increases until they reach a cap at the level he would have paid under standard repayment. After that borrower makes 25 years of payments in IBR, the Department of Education forgives any remaining loan balance.

But in 2010, at President Obama’s request, Congress made the program even more generous. The new IBR will base monthly payments on 10 percent of discretionary income, instead of 15, and loan forgiveness will be provided after only 20 years. That change was set to take effect in 2014 until the Department of Education, as part of the president’s “We Can’t Wait” initiative to circumvent legislative gridlock, sped up the availability of the new IBR by creating a version of it through regulations – “Pay As You Earn” (PAYE). PAYE will take effect by the end of the year.

But little is known about the real effects of this new IBR system. To fill in this knowledge gap, FEBP Director Jason Delisle and Program Associate Alex Holt designed and built a calculator that estimates the monthly payments a borrower will make under the original IBR, the pending version of IBR, and other repayment plans like standard 10-year and consolidation. It accounts for a borrower’s loan balance, interest rate, income, and family size over the entire repayment period. It also calculates the total payments over the life of the loan, and the amount of loan forgiveness he will receive.

The calculator revealed some surprising results. PAYE (the plan that is virtually identical to the 2014 10 percent, 20-year IBR) doesn’t necessarily target the greatest benefits to struggling borrowers. Because low-income borrowers have so little discretionary income above the poverty exemption applied annually, the new IBR only lowers their monthly payments by as little as $5 and at most $20 compared to the original IBR.

Instead, borrowers with high federal student loan balances at graduation – think law students or graduate students, since undergraduates face annual and aggregate limits on the amount they can borrow – reap the most benefit. When their incomes are low, they are able to pay manageable amounts. But as their incomes rise, their monthly payments are capped at the standard repayment amount, meaning they actually derive more benefit from IBR as they become wealthier. Plus, these borrowers often qualify for loan forgiveness after only 20 years; according to the calculator, borrowers above certain debt levels may not even pay down the interest they owe over 20 years, let alone the principal. This is a much greater benefit than is offered through the consolidation repayment plan, in which borrowers with debt totaling more than $40,000 repay their loans in full over 25 or even 30 years. And since IBR allows graduate school borrowers to take out such high loan balances with few concerns, schools have no reason to lower tuition – in fact, they have an enticement to raise it.

The report’s authors offer recommendations for changes to the PAYE/new IBR plans based on these findings. The IBR changes haven’t taken effect yet, which means there’s still time to restructure the program so it targets benefits to those who need them most. In an era of limited resources, we can’t afford to provide payouts to the rich while leaving struggling students languishing in debt.

To read the paper, click here. To try your hand at the IBR calculator, click here.

In his 2010 State of the Union address, President Obama urged Congress to change the federal student loan program’s existing Income-Based Repayment (IBR) plan, which caps borrowers’ payments at 15 percent of their incomes and forgives any remaining debt after 25 years of payments. He argued that high college tuition was an untenable burden for the middle class, and that by reducing payments to 10 percent of a borrower’s income and providing loan forgiveness after 20 years of payments, lawmakers could provide borrowers with relief.