Jon Fansmith: And welcome everyone to the July edition of dotEDU Live. Sarah, this is our 116th episode, combined with the podcast. Were you aware of that?
Sarah Spreitzer: I wasn’t, but we’re getting close to the same numbers of Congresses, so that makes me feel good.
Jon Fansmith: By the end of the year, we’ll have surpassed Congresses, so that’s a real landmark for us, right?
For those of you just joining us for your first dotEDU Live, I am Jon Fansmith. I am the senior vice president for Government Relations and National Engagement here at ACE, and I am joined by my amazing colleague, Sarah Spreitzer. Sarah, you want to introduce yourself?
Sarah Spreitzer: Thanks, Jon. I am Sarah Spreitzer, the vice president and chief of staff for Government Relations here at ACE.
Jon Fansmith: And as we do this, we want to start by thanking all of you. A really strong response, actually, to the survey we put out asking for your thoughts and feedback on this...podcast, webinar, I’m not even sure how we term it there, Sarah, but we got a really, really set of strong responses. Many of them very, very positive. Sarah, you were very popular in the responses.
Sarah Spreitzer: I was called out several times, and I know that I only responded around 20 times, so I feel pretty good that at least some of those weren’t just me.
Jon Fansmith: I think my favorite response though was I believe former podcast co-host Jon Turk submitted several survey responses, and I know we’re breaking the anonymity. I don’t know this for a fact, but my guess is he was the one calling for more Jon Turk back on the podcast.
Sarah Spreitzer: Yes, yes. He’s going to have to go and listen to our back catalog of podcast. But Jon, we have a lot to talk about this week.
Jon Fansmith: We do.
Sarah Spreitzer: I was going to use this time mostly to complain about traffic and NATO being in town, but we are actually going to chat about a markup that happened earlier this week in the House Ways and Means Committee. We’re going to talk about appropriations, I think, first because the House actually just finished up marking up all 12 of their appropriations bills. We are going to talk about what’s going on with FAFSA because Congress is also trying to address that before they get out of town. And then we also had the Supreme Court’s decision on Chevron, which we teased, I think, in our last podcast when Mushtaq was on here. But it’s funny because no one in DC is actually talking about those things. They’re all talking about the presidential election. So should we start with, do you have any thoughts about the upcoming presidential election, Jon?
Jon Fansmith: It’s such a loaded question, right, Sarah? And I’d be curious to hear your thoughts too, honestly. I think everyone, and this is where all of the discussions have been recently, has come off of the first debate, and President Biden’s admittedly poor showing in that debate. And I think certainly people have different viewpoints about the importance of the debate, the significance of the debate, what constitutes winning a debate. But what’s unquestionably clear is the narrative coming out of that debate, when it’s focused around whether the president is fit not just to serve another term but even to finish out the election, that’s a bad series of news cycles for the president.
And frankly, how many times a day do you see an update that this member of the House or this major donor or this other person has called on the president to step aside and either turn it over to the vice president or some other as yet unidentified candidate to step in and lead the ticket? It doesn’t really matter, in some ways, ultimately what the decision is; those are losing news cycles. And certainly the polling that we’re beginning to see in the field coming out of the debate, especially in the swing states, indicates meaningful declines in support for President Biden.
This was always an election that was going to be measured on the margins in a handful of states. And if you’re seeing the swings there, it’s certainly an unqualified success for former President Trump as he stands head-to-head with President Biden.
Sarah Spreitzer: And you have an administration that has always been really active, but they especially wanted to get a lot of things done before the election, and I think that this is kind of taking up all of the space right now. And we’re approaching the August recess when everybody in DC leaves town. I keep thinking how if Biden leaves the ticket and also who former President Trump is going to pick as a running mate, how that might impact Congress when they come back because this could involve sitting senators, sitting members of the House. And then obviously we talk a lot about messaging bills, especially in the leadup to the election. They’re going to be hyperfocused on, whoever those people are, supporting their messages.
Jon Fansmith: It’s an interesting point, especially because you’re beginning to see some of these narratives emerge about what the impact of a stronger Trump performance in November means downballot. The conventional wisdom going into the debate was that Democrats looked likely to retake the House and Republicans, especially based on the landscape they’re facing, looked very likely to retake the Senate and then the presidency would be a toss-up, and you’d be looking at some form of divided government in the next Congress.
Now, there’s a lot of questions about essentially what is the downballot impact of President Biden on Democrats’ chances, and you’ve seen polling that goes both ways. Some of the polling indicates that there’s a clear divide among voters in terms of how they see President Biden specifically versus how they see sort of generic Democrats or Democrats within their state. But the reverse is also true. It’s a historical truism that the lead on the ticket tends to have an impact on voter turnout, voter enthusiasm, all sorts of things that if you are a Democratic member, and this is I think what you’re seeing with, as of today, nine or 10 Democratic members of the House who have called on the president to resign. The fear is in some ways as much about losing the ability to regain control in the House and maintain at least some measure of control in the Congress as it is about losing the presidency at this point.
So there’s a lot of possible implications, all of which got thrown up in the air and are being recalculated as we speak. Again, not really a lot of clarity other than very, very bad cycle for President Biden, very, very good cycle for former President Trump.
Sarah Spreitzer: Yeah. Well, thinking about elections and how that’s impacting Congress, I think the first thing we wanted to talk about was appropriations. And the House obviously marked up a bunch of bills this week, but they also tried to move their first appropriations bills earlier today on the floor. So it was the legislative branch. That’s not typically a bill that you see things that are concerning or that are very partisan, but it actually got voted down. And so I don’t think that that’s a good sign for the Hou... I mean, the House is finished, they’re marked up all of their bills, but I think members are too nervous to take votes on those appropriations bills on the floor. What do you think?
Jon Fansmith: You’re right, and some of this is the House Republicans have set themselves up for a very tough cycle in terms of floor votes. They understandably are trying to balance two very difficult considerations. One is that as a party, and particularly among their voters, cutting government spending is a priority. And so they, in the House at least, have advanced appropriations bills across all 12 bills where there’s a $9 billion increase for the departments of Defense and Homeland Security, and a $67 billion cut across all the non-defense spending. So big cuts to what we saw last year. And of course that is something that many of those members on the Republican side have campaigned on. This is consistent with what they have said.
The problem in an election year obviously is that lots of voters tend to like the idea of reducing government spending. Lots of voters also dislike when they see programs that they see as impacting their lives being cut. So when you put forward... This is always the difficulty of it. It’s easy to say we want to cut spending. It’s a whole lot harder to articulate where those cuts come from in ways that don’t begin to raise concerns.
And so I think something like the legislative branch bill going down on the floor is pretty telling. This is not, as you said, an especially controversial bill. It’s not a big money bill either. This is a really small portion of federal spending, and it’s one that’s... The reason it was the first one up for a floor vote was, I think, a general assumption there would at least be party-line support here, and to see the number of Republicans, I think 10 Republicans voted in opposition, when the margins are as small as they are, three or four vote margin overall in the House, that’s a warning sign, because this is an uncontroversial one.
If you start talking about things like Labor-H, which we’re going to talk about in a second, which are much more controversial, the stakes are much bigger, the funding is much bigger. The implications for members in an election year of having to go back and say, “Look, I proposed an $11 billion cut to the Department of Education. I proposed a 25 percent cut to Title I, K-12 funding. I proposed slashing Federal Work-Study and SEOG in half.” These are all things that you may agree with the policy on, you may want to vote in support of it, but you may not want to go back to your constituents a few months in advance of an election saying, “Yeah, I’m the guy who voted yea for slashing school funding, by the way. Nice to hear your kids go to school here, right?” It’s a tough sell in an election year.
Sarah Spreitzer: So you mentioned that Work-Study and SEOG, what is that? State Educational Opportunity Grants?
Jon Fansmith: Supplemental Educational Opportunity Grants.
Sarah Spreitzer: Sorry, Supplemental Education Opportunity Grants. Okay. You said that they were cut by 50 percent in the House bill, but last year, didn’t they propose zero-funding both of those programs? Is this them demonstrating that, okay, we admit that there’s some use for these programs, we have to make hard decisions? Is that a win that they were only cut by 50 percent?
Jon Fansmith: I think it’s pretty telling that the conversation we’re having is only proposing to cut the funding in half. Is it a win? No, it’s not a win, obviously. I think last year, and we saw it really early on when the president’s budget proposed level-funding those programs, that we knew they would be vulnerable as a result, and we continue to see that. Yes, it’s absolutely better to only be proposed to be cut by 50 percent than to be totally eliminated.
I think there’s probably some recognition there that that was the kind of thing that actually got a lot of voters to say, “Look, this is too much, too far. This is not the sort of thing we want to see,” which is a credit, honestly, to the people who are watching this, people across our campuses who did reach out to their members and say, “This is grant aid, directly to students. It doesn’t need to be repaid. This is not where we should be cutting spending.” So I think, in many ways, it reflects the strength of the community; it reflects a better understanding of the importance of these programs. But again, they’re being targeted in ways that other areas aren’t, and so I think we have a lot of concerns.
And you look at some of the other things we saw in the Labor-H bill and for those, we teed this up, the full committee marked it up, passed those bills yesterday, the Labor-HHS-Education bill. It is significant cuts, double-digit percentage cuts across the board.
Pell funding remains flat, which obviously better than a cut, but when we are trying very hard to get Pell funding up to the level doubling the amount that we think is what’s actually needed to help students afford and access higher education, flat funding doesn’t get you there, obviously, but really flat funding in this budget, not so bad.
Very few increases, very few, frankly, level funding. There’s some additional money for the Title II and Title V programs, which we were happy to see. Those are important programs for important institutions, but relatively small increases, but an increase is still an increase.
You see some of the other things. During the markup yesterday, an amendment was passed that cut funding by 10 percent to the Office of Civil Rights at the Department of Education, which currently has a massive caseload of open cases, mostly related to Title VI investigations following October 7th, allegations of antisemitism, anti-Muslim or anti-Arab discrimination on college campuses. They have a huge caseload going, so to propose reducing their funding overall, if enacted, and, talk about this in a second, not clear any of these bills will be enacted at these levels. But certainly cutting 10 percent of their funding when they’re probably an understaffed department already isn’t going to help for speedy resolution of any of these investigations.
Similarly and kind of concerningly, the Federal Student Aid office at the Department of Education, there was a proposed 34.6 percent cut to their funding. And I think everyone has been very, especially on campuses, has been very frustrated with how that office has administered the implementation of the new FAFSA. It has been an unmitigated disaster and there’s real repercussions from that. That said, I’m not sure anyone thinks that a massive funding cut to that office is going to help with what looks to be maybe not as bad as this year but certainly another challenging financial aid cycle next year.
So these are the kind of decisions, you’re trying to reduce spending, you’re trying to make the cuts fit with what your top lines are, but these choices have real impacts, and I think the kinds of impacts you will see on a campus, but especially you will see if you’re a low-income student. The ability to find out what financial aid you’re eligible for, reductions in the amount of financial aid you’re eligible for. Were these bills to be enacted, they would have a decidedly negative impact on the ability of low-income students to access and afford college.
Sarah Spreitzer: And Jon, there’s a lot of report language in there for various things, various priorities, especially for the Republican Party. When you mentioned the cuts to FSA, there’s language in there on my favorite topic, Section 117, foreign gift reporting, about asking for reports from the Department of Education about how many investigations are ongoing, what they’re doing around compliance for Section 117, and urging the Department of Education to upgrade their searchable database, which is very hard to do with much less funding.
Also in the bill, we watch very closely the funding for the National Institutes of Health, which is the biggest funder of scientific research at our institutions, and that is flat-funded. But the interesting thing is they included language that calls for the reorganization of NIH. And so NIH is currently organized into 27 different institutes. The reorg would create 15 new centers because they think that that will streamline some of the work being done at NIH. It’s unclear whether or not the Senate is going to take that up, but I think that’s something we’re watching really closely.
Jon Fansmith: And speaking of, especially where research funding, Sarah, Labor-H wasn’t the only appropriations bill that got marked up yesterday. Another one we track and I know you track pretty closely, Commerce, Justice, Science, that went through markup yesterday as well. You want to update people on that one?
Sarah Spreitzer: Yeah, so that one includes NASA, NOAA, and the National Science Foundation, and those are all pretty much level-funded. NSF did get a 2 percent increase, but obviously that’s still far below what was authorized for the agency under the CHIPS and Science Act, which passed with bipartisan support a few years ago. So that’s kind of disappointing.
I would also flag that there’s language in the Commerce, Justice, Science House bill that would mandate that the Department of Justice bring back the China Initiative, which of course was something that was ended under the Biden initiative because they believed that it was very much focused on Chinese-born and ethnic Chinese faculty and staff at our institutions. And so that language is included in the CJS bill, but that one is likely not going to see the House floor anytime soon either.
Jon Fansmith: And it’s worth mentioning here too, we are talking about what the House has proposed, and this is the normal pattern over recent years is that the House has marked up their bills and introduced them and marked them up and moved them forward in the process much sooner than the Senate. The Senate is doing some work. I think as of today, either today or yesterday, they announced what their overall spending levels would be and the allocations among the bills.
Just to sort of as a point of contrast, I mentioned that there’s about a $58 billion overall cut in spending on the House side when you have the 9 billion plus for Defense and Homeland Security and the 67 billion cut for non-defense. On the Senate side, it’s quite different. They’re going to increase overall spending from last year by about $34.5 billion using some emergency spending authority, sort of falls outside of the caps that are currently in place. So you’re looking at nearly $100 billion in difference in overall spending between what the House and the Senate will put forward.
Obviously, the Senate numbers on those programs, we’ve talked about, much more likely to be positive from our perspective than what we’ve seen from the House so far. Again, not clear that the Senate will see their levels either. I think what we’re setting up is what we generally tend to see set up in appropriations, which is some level of agreements on the specific program funding and really a fight over the top lines at the leadership level. Complicated, of course, this year. This always takes a long time. I think, when did we resolve the current caps? In March of this year? March or April?
Sarah Spreitzer: Yeah.
Jon Fansmith: Dragging far into the fiscal year in an election season, this is also pretty much the norm. We will get through the election. We’ll have a lame duck. Depending on the election outcomes, you might see some activity around appropriations during the lame-duck session. I think realistically probably punting into March. February or March of the new year once the new administration is in place.
Important thing to keep in mind. Other things we have on tap coming up in the new year. The debt ceiling, the ever popular debt ceiling, will need to be raised again, which always leads to pretty high-stakes negotiations about federal spending and overall spending. And then we are under two years of budget caps, which will expire too. So they will need to renegotiate what the overall spending levels are without this agreement that has been in place for the last few years. So a lot of things up in the air. A lot of high-stakes issues around government spending that will really be punted into, whether they’re a new administration or the second term of the Biden administration, to be resolved. But again, lots of uncertainty, lots of ambiguity with some pretty important things hanging out there.
Sarah Spreitzer: And if I can make a prediction, I will just say they will kick the can down the road several, several times, right? Because the fiscal year ends in October, and so they’ll do a CR and then they’ll do another CR and then they’ll do an extension for the debt ceiling and they’ll just keep kicking it down the road. So we’ll see. So March, we may have a better viewpoint on what’s going to happen in March, but I don’t know, I’m not hopeful for March.
Jon Fansmith: I would say that is kind of the safe money bet, to expect that Congress will keep kicking the can down the road because that has been the pattern, I don’t know, the last 15 years at this point.
Sarah Spreitzer: Yeah.
Jon Fansmith: Well, outside of approps though, Sarah, some other... I mean, this has been a very busy couple weeks. And just this week, again, we’re talking about bills being marked up by approps. The Ways and Means Committee marked up several pieces of legislation yesterday, including two that are really important to institutions.
Sarah Spreitzer: And Ways and Means is the committee that deals with tax policy. So people may think, well, what does that have to do with higher education? But they are one of the committees that has said that as part of the whole of the House approach to addressing antisemitism on college campuses that they were going to do some things, and these, at least they are messaging some of these bills as addressing that issue.
And so two of the bills that they marked up, H.R. 8914, the University Accountability Act, and then H.R. 8913, the Protecting American Students Act, both deal with our tax-exempt status and endowments. ACE opposes both of those pieces of legislation. We sent a letter up to the House before the markup, which was actually referenced, I believe, during the markup, and we’ll post a link of that letter in the chat.
But the first one, the University Accountability Act, really creates new fines and sanctions for schools that are found in violation of Title VI or that are undergoing Title VI investigations. And obviously the Office of Civil Rights within the US Department of Education, Jon, you were just talking about the fact they are carrying out quite a few investigations on college campuses. This creates yet another fine and additional sanctions for those institutions that are undergoing those investigations. So it doesn’t seem like it would be something that would be very helpful, but I know you helped draft that letter.
Jon Fansmith: And all credit to Steven Bloom, who’s our lead on these issues. I know a lot of the people watching now are familiar with Steven, have worked with him, and he’s been great and the lead on these issues.
Steven will probably correct me, but my take is a little bit, this is just a very unnecessary and redundant piece of legislation and in a way Ways and Means Committee members trying to jump on some of this all of Congress approach to antisemitism. It would add... The mechanism here is that you would have to pay if you are found in violation of Title VI either $100,000 or 5 percent of your administrative expenditures, 5 percent of your salaries and things like that, which for most institutions would be well more than $100,000. It would be a huge financial penalty. It’s not needed. Title VI already has enforcement mechanisms in place, up to and including complete blocking from Title IV eligibility.
Adding this, I think most people are familiar, we’ve seen a few of these in the last couple of weeks announced. Most of the ways these investigations are completed are through resolution agreements between OCR and the institution, where the institution looks honestly at what happened on the campus. They work with OCR. They find agreement on ways that institutions can change their policies to prevent future problems. Sometimes there’s some disagreement over exactly how much blame should be assessed and what the right approach is, but it’s a collaborative process. It gets to a better outcome.
When you start putting things like this, automatic fines, in place for finding a violation, what you do is you really disincentivize institutions from working with the department in a collaborative way. If the financial penalties become so severe, pursuing it outside of a negotiated process with OCR makes a whole lot more sense because wouldn’t you rather take your chances in court if this is the kind of impact of what you’re going to see? It’s just bad legislation from so many different perspectives, and it’s not doing anything really to help students or the climate on campuses in any way. So a very, very blunt and mistargeted tool that’s much more likely to cause harm were it to be enacted than it is to help.
Sarah Spreitzer: And then the second bill that they marked up, the Protecting American Students Act, was really looking at the existing endowment tax, which is focused on private institutions with large endowments, and basically removing international students from the calculation of taking your endowment and figuring out per student how much it would be available per student. And that’s so problematic because it could encourage institutions to not admit international students. It’s unclear what it’s accomplishing beyond just expanding the number of institutions that would fall under the endowment tax.
I know there were a lot of members at yesterday’s markup that spoke up about the importance of international students and international partnerships and that we should be doing more to welcome them rather than discouraging institutions from accepting those students. So I think that was very helpful. But yeah, that bill was confusing to me also. It was unclear what it was going to accomplish.
Jon Fansmith: I mean, it’s one thing to say we simply want to expand the pool of endowment tax institutions, and clearly I think that’s the driving purpose of this legislation. The messaging, as you point out, is really hard to quite get because it seems very much targeted at trying to disincentivize institutions from having international students, which, again, I think whether you’re talking about the benefits to your campus of different perspectives or building relationships overseas or soft diplomacy or frankly financial implications for campuses, there’s really lots of great reasons to have international students. We should be encouraging more partnerships, send Americans abroad and bring international students to the US. If you want to expand the endowment tax, at least be more direct about it, I think is probably a fair thing. But again, I’m sure Steven may have some thoughts about how I’m framing this.
I will say, obviously we have concerns. We sent up our objections to both bills. I saw Tom Vu in the chat asked, what should institutions be doing? And I think this is a really good place for institutions to talk to their delegations for both of these bills. I think there’s a sort of a one-sentence summary that seems like these are simple and/or meant to help problems that campus leaders do take seriously, but it doesn’t take a lot of unpacking to see just how damaging, how they’ll actually probably make it much harder to actually deal with issues of antisemitic behavior on campuses or to manage the finances of an institution to be welcoming places for international students.
So having institutional voices, letting members of Congress know what the actual unintended negative consequences of this legislation being enacted would be, hugely helpful. I mean, they’re hearing it from us, but hearing it from campuses in their district, it’s a whole different level of impact. And so certainly I would encourage you to reach out if you have those relationships. Or if you’re looking to make them, this is a great place to start.
Sarah Spreitzer: So Jon, while Steven was working on the letter to Ways and Means and talking to Ways and Means staff, you were working on the FAFSA Deadline Act, which was introduced, I believe, this week or last week. What is that piece of legislation about?
Jon Fansmith: Yeah, there’s a bill that was introduced in the House, the FAFSA Deadline Act, last week. As of Monday, Senator Cassidy, the ranking member on the Health, Education, Labor and Pensions Committee, introduced the companion bill in the Senate. The House moved pretty quickly to a markup date, a markup of a number of pieces of legislation on Tuesday. On Tuesday? Wednesday. Losing track of the days, Sarah. Wednesday-
Sarah Spreitzer: It’s Thursday.
Jon Fansmith: Yes, thank you. Yesterday they had a markup, and we sent a letter on behalf of a number of associations Tuesday afternoon in support of this one. The FAFSA Deadline Act does something pretty simple. What it would do is change the statutory requirement on the Department of Education to have the FAFSA form available to students from January 1st, which is the current statutory obligation, to October 1st.
People may be thinking, isn’t it already October 1st? Because that’s what it’s been over the last few years, barring the current year and all the problems with that. But that was always a voluntary effort of the Department of Education. It was never actually required in law. In fact, January 1st has always been the requirement in law, which is why the department was still in compliance with the law when they didn’t get the form out until December 30th this year.
We had sent a letter at the end of May, May 24th, I believe, and I think our amazing producers can probably post a link to that in the chat as well, where we had a number of legislative fixes we wanted to see to address problems around both the FAFSA implementation and then underlying problems in FAFSA that we’ve been talking about for a while. One of them was just this, move the deadline up.
So we were encouraged to see a pretty rapid response from policymakers in both chambers, and this was one that I think... You don’t see a lot of bipartisan action, but I think the final vote on this in the House Education and Workforce Committee yesterday was 34 to 6 or something along those lines. It was overwhelmingly bipartisan.
I think the other thing you see here, and I know we had a question about whether the FAFSA will actually be available on October 1st. Part of the reason there’s so much bipartisan interest in setting a new statutory date, so much of the reason there’s an emphasis on this is just that people do not think the department will hit that October 1st deadline. There is widespread concern in Washington about whether they will be able to get full functionality for the FAFSA up and running on October 1st.
The secretary, I think, has been very measured in his comments, has emphasized that that is their goal, that it’s their plan, they will exhaust all efforts to do that. What he hasn’t said unquestioningly is that they will do that. And you hear the same sort of rumblings that they may not be able to hit that mark. As a result, you’re beginning to see more legislative interest in doing things to compel the department to.
Now, that said, setting a deadline doesn’t necessarily mean the department will be able to do it. A lot of the concerns about what they’re going to be able to do really come down to capacity and their ability to implement it. They are reorganizing Federal Student Aid office. They are hiring people, and notably a couple of folks from the College Board who worked on the online SAT, to come in and work exclusively on FAFSA and getting the new FAFSA simplification process up and running as efficiently as possible. So they’re putting efforts in. They’re putting a lot of resources behind it. That said, it’s big and complicated and the early returns, obviously not very good. There is real reason for concern, and you’re seeing that across the aisle in Congress now.
Sarah Spreitzer: So Jon, if this piece of legislation passed, would it be put in place for this year? Then would the department be statutorily required to put out the FAFSA on October 1st of 2024?
Jon Fansmith: Well, presuming it is enacted into law, and I think very likely the Biden administration would veto this were it to pass the Senate. I think there’s a chance it would pass the Senate if it gets advanced to a vote. Still actually less clear that Majority Leader Schumer would bring that up if he knew the administration was opposed to seeing it. But if it were to go forward, I expect the Biden administration to veto it, assuming it was passed into law, yes, it would.
There was an amendment yesterday during the markup from Representative Good of Virginia that added some additional requirements around this. Essentially as of September 1st, the department would have to notify Congress whether they would meet the October 1st deadline, and if they said that they would not or didn’t respond, then the secretary would be required to make an appearance before the education committees to explain the status and what is happening.
So there are some mechanisms they built into this, were it to be enacted, that would be pretty rigorous on the department and require a lot of direct oversight by Congress of the department’s actions here. But again, I think the likelihood that we will see this in effect as of October 1st is probably pretty small.
Sarah Spreitzer: Jon, you’ve been really busy with writing, and you also wrote an op-ed recently. Such the author. I guess turning from Congress to the Supreme Court, which has also been incredibly active, is active the word for it this year?
Jon Fansmith: Oh, yeah, very active.
Sarah Spreitzer: A lot of very impactful decisions. We saw this Chevron decision come out. I just like saying the word “Chevron.” I think it’s really great.
Jon Fansmith: Rolls off the tongue.
Sarah Spreitzer: And we had a lot of questions about this Supreme Court decision, but since you wrote the op-ed, do you want to talk about what the decision was, what the court was deciding, and then we can into the possible impacts?
Jon Fansmith: And it’s a complicated topic, and I won’t pretend to be a constitutional law scholar, so I’ll give the rundown. and I would recommend not just because I wrote it and I thought it was pretty good, but the op-ed in Inside Higher Ed that I wrote is really taken from the perspective of people in our field, people, government relations folks, higher education policy people, and what this might mean when you’re looking forward. So I think it probably gives a more complete summary than I’ll be able to here.
But if you have not been tracking this, when we talk about the Chevron precedent or Chevron deference, this goes back to a case from 1984 where essentially in a case around environmental regulations, the Supreme Court said, look, when a law comes out of Congress and it has gray areas in it, ambiguities that aren’t clear what exactly the agency is supposed to do to interpret that law, then courts should look at what the agency determines they want to do and give them deference. Essentially say, look, these are the experts, these are the people responsible for implementing the law. It’s reasonable to say that whatever conclusion they came to as the law’s meaning is what the court should lean towards.
It doesn’t mean the courts had to accept it uniformly, but what it did was it essentially provided a precedent that said, look, administrative agencies probably know this better than the courts do. Might in many cases know it better than the Congress would. So in terms of determining the fairness of this or the implications, what the law means, rely on them.
This Supreme Court in particular has been very skeptical of that ruling. They struck down an element of it a few years back in a case called West Virginia v. EPA where they said agency regulations that are so big and impactful that they must exceed what Congress ever could have anticipated should be struck down. And then what we saw in the case recently, the June 28th ruling of the Supreme Court in a case called Loper Bright Enterprises v. Raimondo, which was about fishing regulations, they essentially said, Chevron is dead. In fact, I think in one of the concurring opinions, I believe it was Justice Alito said, “this puts the gravestone on Chevron.”
Essentially, Justice Roberts’ opinion said courts are the arbiters of what a law means and there should be no deference to agencies. Agencies have no particular expertise, courts do in determining what a law means.
This is all kind of legal semantics. I think it may seem a little dry. The implications are massive, and what it means is now so many areas where Congress for decades has written ambiguous laws and left it to the agencies to sort it out, which changes administration to administration. Certainly how the Trump administration views Title IX is very different than how the Biden administration views Title IX. But in both cases, what those agencies, Department of Education under Trump or Department of Education under Biden, put forward had the effective rule of law.
Now it’s pretty safe to say that any regulation where there is not clear and explicit statutory requirements in place will be subject to challenge. And you can say, that’s fair, that’s always been the case. Title IX has been subject to legal challenges multiple times over the last decade. Guidance and regulations that the department have been challenged.
So does this change anything? It really does. It undercuts the strength of the agency’s argument here when there is so much ambiguity, and what’s more, given the way that our judicial system right now, even in the federal courts is so varied, right? The kind of decision you are likely to see in the Fifth Circuit versus the kind of decision you are likely to see in the Ninth Circuit look very, very different, even when presented with the same set of facts.
For colleges and universities, it just really leads to a lot of chaos. You will not be able to feel with great confidence that a federal regulation once enacted will apply equally to you as it will to your neighbor in a different state based on what the different courts will find. We’re already seeing this in Title IX, and Title IX is sort of the perfect example of this.
We’ve had three cases right now that have enjoined and barred from implementation the Biden administration’s Title IX regulations across 14 different states. There’s three more lawsuits that are looking at 12 additional states. You could ultimately have a situation, looks like what we’re headed to, where in 26 states in this country, institutions have to follow Title... or 26 states in this country where institutions are not required to file the Biden administration’s Title IX regs but instead the Trump administration’s Title IX regs. And in 24 states where you have to follow the Biden administration’s Title IX regs and not the Trump administration’s Title IX regs.
And bless you if you have physical locations in more than states that cross those different state territories. It is just chaos. Everything is now up for grabs in a way that makes the institutional ability to understand what they need to do, what compliance looks like, it just throws it wide open.
Sarah Spreitzer: Well, I was going to say, Jon, has the Supreme Court noticed that Congress can’t actually act on anything? So in a lot of the issues I cover on immigration, things have been done through regulatory action because Congress has been unable or unwilling to pass immigration legislation, and there are issues that have to be addressed. And so I definitely, I do not think that this is good news for the Deferred Action for Childhood Arrivals, the DACA program, which was created under executive action.
I worry about other things that have been done under executive action where they’ve said we can waive visa interviews for countries that are under the Visa Waiver Program because we consider that to be part of our authority. I mean, we’re just going to see so many things tested in the courts.
And what was the case that was the day after the Supreme Court issued the decision? Was that on the overtime rules?
Jon Fansmith: Yeah, that’s the perfect example to cite because the Supreme Court’s ruling came out on a Friday. The following Monday in Texas, a district court judge ruled that the Department of Labor’s overtime rules, and he specifically cited the Supreme Court’s ruling from three days before, said that blocked implementation of that rule for public sector employers. And so public institutions in Texas, for instance, do not have to follow the July 1st deadline for the overtime rule.
Now, it only applies within Texas, it only applies to employers in the public sector, so it is not a universal injunction. The judge was actually asked to issue a national injunction and deferred, said he didn’t believe he had the authority to do that. But that in some ways speaks to what we’re talking about. Now, if you are a Texas public institution, you are operating under a different set of rules than your peers in Oklahoma.
It’s a different set of rules, and we are likely to see that... Certainly you think about things like gainful employment, financial value transparency regulations, where the statutory authority for the department’s regulations is pretty thin, honestly, and it’s something where there has been a lot of legal challenge already, very likely to see more legal challenge in areas. Really across the board, almost everything where there is disagreement with how the agency has proceeded is up for grabs.
And it’s worth noting, it’s often interpreted right now as a rebuke to the Biden administration, and we’ve seen Senator Cassidy on the HELP committee send a letter to the Department of Education talking about redoing their loan forgiveness policies and their Title IX policies in light of the decision. But this is in many ways much bigger than politics. It’s about the balance between the executive branch and the judicial branch. It has been a huge shift of power to the judicial branch. The judiciary is now first and foremost in a lot of policy matters following this ruling. And if there’s a Trump administration next, they will be facing the same challenges with the regulations they want to implement. It is a vast and far-ranging decision by the courts.
Sarah Spreitzer: So one of the questions we had, Jon, was how this would impact negotiated rulemaking. And I think based on what you’re saying, I mean, negotiated rulemaking is in the Higher Education Act, right? The Department of Education is one of the agencies, like the EPA, that is charged with carrying out negotiated rulemaking. But if something is not in the statute, like gainful employment, and it’s kind of a stretch, then perhaps that is going to be tested in the courts.
Jon Fansmith: And I love this question because I think it’s an interesting thing. We sort of mock the... Not mock, that’s probably a too strong a word. But there’s a lot of commentary around the negotiated rulemaking process of the Department of Education, in part because the default has tended to be recently that the department stacks the deck in a way that doesn’t lead to consensus so that they have the freedom to write the regulations that they prefer to write.
Given what’s happened with Chevron, negotiated rulemaking, the importance of it grows significantly. If you have ambiguity in the statute, but you have a process that says they’ve gotten to consensus with an understanding, where an agency can point to an informed panel of stakeholders with deliberative discussion and resources and information, drawing a conclusion as to what that means, the likelihood of that regulation withstanding litigation is a lot stronger in my mind. It should be a lot stronger. It at least shows some process other than just agency interpretation. It adds some weight to that because it’s not just the agency’s interpretation; it’s stakeholders from the outside brought together to reach an opinion.
It also, frankly, then makes the lack of consensus as a tool for the department to implement policy a lot weaker. If they don’t have consensus, it seems to me much more likely that somebody challenging the rule would say, “Look, they put this forward. They asked people who knew about it, and they couldn’t agree, and yet this is the rule they wrote.” I do think it is going to lead to a whole new rethinking of how you approach negotiated rulemaking and the importance of negotiated rulemaking in a way that is really different than what we’ve seen in the last couple decades.
Sarah Spreitzer: So what I’m taking from this conversation is that you’re thinking about going to night school to get your JD so that you can learn all about administrative law now. But I think we’re actually right at time. So do we want to tell folks about how this is our last podcast for the season before we take a break?
Jon Fansmith: I mean, I think you just did, right?
Sarah Spreitzer: Well, I don’t know when we’re coming back. I assume September?
Jon Fansmith: We are coming back in September, right?
Sarah Spreitzer: Okay. September.
Jon Fansmith: We’re like Congress; we leave for August.
Sarah Spreitzer: Okay, got it, got it. Does that mean I can just leave the office and not look back?
Jon Fansmith: No, no way is what that means. But for those of you who might want to tune in in August, don’t. We won’t be here, but we’ll miss you. And we’re going to have a bunch of things, especially when we start coming back, we’re going to be much closer to the elections. We’re going to have been through the convention cycles.
Sarah Spreitzer: Oh man.
Jon Fansmith: It’s going to be a lot to do. And I think we’ve talked about this for years now, higher ed is a growing and growing and growing central part of national political debate. Both parties are featuring higher education in a lot of ways.
We didn’t have time to get to a great question about the Heritage Foundation’s 2025 project and what that means for higher ed. There is a story in Inside Higher Ed this morning about that. If you haven’t read it, I suggest you do. So much to talk about; so much going on. We’ll definitely have a lot of things to talk about when we come back after the break.
Sarah Spreitzer: We’re going to have a lot to talk about when we get back, even though we will be basically in lame duck.
Jon Fansmith: Well, I think you’re right, and I want to thank everyone as always for joining us, for the questions you submit. Certainly, if you are missing us over the August recess, we have old podcast episodes, old dotEDU Lives available on our website. Feel free to check them out, and we will look forward to catching up with all of you come September. So thanks again. We’ll talk to you soon.
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