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“This bill would open the door to a new, more student-friendly option to finance a college education. Purdue, with a long record of highly employable graduates, is a natural fit for Income Share Agreements and we would move quickly to add this new choice to our financial aid menu." - Purdue University President Mitch Daniels
“A college degree is one of the best investments a student can make. Unfortunately, many students are burdened with record levels of debt because of it, often forcing them to delay other important investments in their future, like saving for retirement or purchasing a home. Income share agreements are an innovative, alternative way to finance an education. Our bill provides the necessary legal certainty for students to take advantage of this option, while at the same time giving students the consumer protections they deserve.” - Original Bipartisan Bill Sponsor, Congressman Jared Polis (D-CO)
The Experts on ISAs:
According to Andrew P. Kelly, Director of the American Enterprise Institute’s Center on Higher Education Reform, the ISA process “gives students strong signals about which programs and fields are most likely to help them be successful. It would also help stem tuition inflation and improve the efficiency of the higher education system by rewarding high-quality, low-cost programs.”
Brookings Institution expert in higher education economics, Beth Akers, writes that ISAs deserve attention because they “offer improvements over traditional loans in terms of shielding students from risk and providing information about quality, two widely held objectives among advocates and policy makers.”
New America senior research and program manager, Betsy Prueter,discusses the benefits ISAs can provide over the Federal Student loan repayment programs: Overall, ISAs may be a better option than Income Based Repayment (IBR) as IBR… does not take into account a student’s future income prospects. Additionally, ISAs may encourage institutions to price programs based on labor market return (i.e., disciplines that tend to lead students into lower paying occupations may reduce tuition accordingly).
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