GRAMM-RUDMAN CASTS SHADOW OVER NCHELP CONVENTION - Vol.13 No.217

Sep 28, 2026

Coverage of the National Council of Higher Education Loans Program (NCHELP) convention highlights how the Gramm-Rudman-Hollings balanced budget amendment could substantially reduce federal student aid. Experts describe uncertainty about the amendment’s implementation and its likely impact on Guaranteed Student Loan (GSL) provisions, including lender incentives and loan origination fees. Additional reporting addresses demographic shifts that may require changes to aid programs and NCAA proposed eligibility revisions for incoming student athletes.

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GRAMM-RUDMAN CASTS SHADOW OVER NCHELP CONVENTION

Automatic Budget Reconciliation

DEMOGRAPHIC SHIFTS COULD NECESSITATE CHANGES IN AID PROGRAMS

NCAA PROPOSES CHANGES IN ELIGIBILITY REQUIREMENTS FOR STUDENT ATHLETES

Vol。13,No。217 Wednesday,November 6,1985 # GRAMM-RUDMAN CASTS SHADOW OVER NCHELP CONVENTION NEW ORLEANS --Although the thunderheads of Hurricane Juan have left theLouisiana Delta,one large cloud continues to hang over the National Council ofHigher Education Loans Program(NCHELP)convention being held here.That cloudis named Gramm-Rudman. The Gramm-Rudman-Hollings balanced budget amendment,attached to the Senatedebt ceiling measure several weeks ago,could dramatically cut into all federalstudent aid programs,according to several experts speaking here Monday.Unfortunately,nobody really knows exactly what tie measure would do. "There is a great deal of confusion about it,"said Betsy Brand,education aideto Sen.Dan.Quayle,R-Ind."I see Gramm-Rudman as something of a symbolic vote。Unfortunately,no one understands how toimplement it without hurting the programs." The Senate last month pushed through Gramm-Rudmanas a remedy to the federal deficit problem。Under the amendment,introduced by Sens.Phil Gramm,R-Texas,Warren Rudman,R-N.H.,and Ernest Hollings,D-S.C.,the Senate must cut the federal discretionary bud-get $36 billion per year,wiping out the deficit by 1991. A House-Senate conference on the measure broke down last week--the House hasnot agreed to Gramm-Rudman--and Senate debate continued yesterday and Monday ona solution(HED,Nov.5)·Congress missed a midnight deadline Friday and has anew deadline of 2 p.m.today to act on the debt ceiling. # Automatic Budget ReconciliationBrand said Gramm-Rudman would act as aautomatic annual budget reconciliation for the Guaranteed Student Loan(GSL)program,which means GSL laws might have to be changed on an annual basis. William Clohan,counsel to the Consumer Bankers Association,said Gramm-Rudmanis so powerful that it could make reauthorization of the Higher Education Act--now pending in Congress--irrelevant."There is very little discretionary fund-ing in the federal budget,"said Clohan,who was education undersecretary underformer Education Secretary Terrel Bell. Several policy implications are already apparent for the GSL program,Clohansaid.The special allowance to lenders would be decreased,thus reducing theincentives for banks to get involved in the program。 In addition,the 5 percent loan origination fees,which the House Postsecondary(more) # GRAMM-RUDMAN CASTS SHADOW OVER NCHELP CONVENTION(Cont.) Education Subcommittee is trying to phase out through reauthorization,would beincreased,Clohan said. NCHELP President Joe McCormick said Gramm-Rudman has advanced as far as it hasbecause"not enough attention is paid to the programs it affects." McCormick said the higher education community,and NCHELP in particular,wouldhave to rally the support of congressional friends of student aid to counteractthe affects of the deficit-cutting amendment. "In spite of all the_doom and gloom…I think for the most part we will sur-vive our government,"McCormick said. Clohan,however,said the atmosphere on Capitol Hill could get worse before itgets better."Last week was one of the zooiest weeks I've ever seen inWashington,D.C.,and I have a feeling it will get even zooier,"Clohan said."Rome is burning."--Bill Reinhard # DEMOGRAPHIC SHIFTS COULD NECESSITATE CHANGES IN AID PROGRAMS NEW ORLEANS --While the thoughts of many National Council of Higher EducationLoan Programs(NCHELP)members were on congresslonal decisions to be made inthe next few weeks,one of the nation's foremost education researchers said itwasn't too early to start thinking about the year 2,000. Harold Hodgkinson,senior fellow with the Institute of Educational Leadership,said Monday that demographic changes facing the college population of thefuture could spell the need for changes in the Guaranteed Student Loan(GSL)program。 While not billing hiself as an expert in the GSL program,Hodgkinson said asuccessful program must serve its public.Technical and legislative factorsare now being studied in detail

FAQs

How does Gramm-Rudman affect federal student aid at the NCHELP convention?

Experts say the Gramm-Rudman-Hollings amendment could dramatically cut into federal student aid programs, though the exact effects are unclear.

What changes could occur for the Guaranteed Student Loan (GSL) program?

Reported implications include decreased special allowances to lenders, reducing incentives for participation, and potential adjustments to loan origination fees.

Why might student aid programs need adjustments in the future?

Demographic changes—such as differing birthrates and shifts in the labor market toward service jobs—may require aid programs to be targeted or redesigned.

Sep 28, 2026

Uploaded by Taylor Morgan