President Obama announced Friday a plan to limit college tuition costs by punishing schools that don't keep prices down. The proposed funding changes were just one part of sweeping plans released by the White House.
"We can't keep subsidizing skyrocketing tuition," he said. "Colleges and universities need to do their part to keep costs down as well ... We are putting colleges on notice—you can't assume you can jack up tuition every single year."
According to the White House, Obama will propose reforms to cut funding for schools that raise tuition and shift money to universities that "do their fair share to keep tuition affordable, provide good value, and serve needy students well."Obama also wants to create a new higher education leg of his "Race to the Top" education competition. The proposed program would split $1 billion among states who are "willing to drive systemic change in their higher education policies and practices, while doing more to contain their tuition."
The president's speech in front of a group of students at the University of Michigan comes on the heels of his State of the Union remarks Tuesday, where he emphasized the importance of making college affordable for families.
"The most daunting challenge can be the cost of college," he said Tuesday. He urged Congress to prevent interest rates on subsidized Stafford student loans from doubling from 3.4 to 6.8 percent, as they're set to do this summer.
In recent years, the federal government has tried to make the cost of college more transparent to students and parents. The Higher Education Opportunity Act of 2008 required all colleges and universities to supply a "net price calculator" to help families estimate the cost of attending each institution. The requirement went into effect in October.
Friday, Obama proposed a "College Scorecard," a publicly available information sheet that would grade colleges based on total cost, graduation rates, and potential earnings.