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Advocacy Group Calls for Cutting Federal Aid to College 'Dropout Factories'

Momentum is growing to provide high school students with more information about colleges, including their value and graduation rates, before making a decision about where to enroll. The Education Trust would like to make their choices easier by identifying and withholding federal funding for poor-performing colleges.

The Washington-based research and advocacy group has introduced a plan to hold four-year colleges accountable based on rates for college access, graduation, and student-loan repayment. The report, Tough Love, Bottom-Line Quality Standards for College was released June 18. It notes that 600,000 undergraduates attend these schools each year with the support of $15 billion in federal student aid.

"Students who are receiving federal financial aid to get a college education should, at the very least, be guaranteed that their school meets minimum performance standards," said Michael Dannenberg, the group's director of higher education and education finance policy and a co-author of the report, in a press release. "And taxpayers providing generous financial aid and tax benefits to elite institutions, ranging from Yale to the University of Virginia, should be guaranteed that these institutions are working to correct socioeconomic inequities, rather than calcify them."
The Education Trust, which advocates on behalf of low-income and minority students, recommends sanctions to four-year schools where their Pell Grant-eligible, full-time freshmen enrollment is less than 17 percent, they have six-year graduation rates below 15 percent, and one-third of students who leave these schools default on their student loans.

For first-time, full-time students attending a "college dropout factory" that meets this criteria, their chances of leaving school with no degree are nearly six times higher than their chances of graduating, and half won't make it to their sophomore year, the report says. Once a student drops out, he is four times more likely to default on his loan, according to the Education Trust.

The Education Trust proposes providing technical assistance, funding, and time to failing schools before they would face consequences.

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