[House Hearing, 113 Congress]
[From the U.S. Government Printing Office]






                     KEEPING COLLEGE WITHIN REACH:
                   IMPROVING ACCESS AND AFFORDABILITY
                    THROUGH INNOVATIVE PARTNERSHIPS

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON HIGHER EDUCATION
                         AND WORKFORCE TRAINING

                         COMMITTEE ON EDUCATION
                           AND THE WORKFORCE

                     U.S. House of Representatives

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

           HEARING HELD IN WASHINGTON, DC, SEPTEMBER 18, 2013

                               __________

                           Serial No. 113-32

                               __________

  Printed for the use of the Committee on Education and the Workforce





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                COMMITTEE ON EDUCATION AND THE WORKFORCE

                    JOHN KLINE, Minnesota, Chairman

Thomas E. Petri, Wisconsin           George Miller, California,
Howard P. ``Buck'' McKeon,             Senior Democratic Member
    California                       Robert E. Andrews, New Jersey
Joe Wilson, South Carolina           Robert C. ``Bobby'' Scott, 
Virginia Foxx, North Carolina            Virginia
Tom Price, Georgia                   Ruben Hinojosa, Texas
Kenny Marchant, Texas                Carolyn McCarthy, New York
Duncan Hunter, California            John F. Tierney, Massachusetts
David P. Roe, Tennessee              Rush Holt, New Jersey
Glenn Thompson, Pennsylvania         Susan A. Davis, California
Tim Walberg, Michigan                Raul M. Grijalva, Arizona
Matt Salmon, Arizona                 Timothy H. Bishop, New York
Brett Guthrie, Kentucky              David Loebsack, Iowa
Scott DesJarlais, Tennessee          Joe Courtney, Connecticut
Todd Rokita, Indiana                 Marcia L. Fudge, Ohio
Larry Bucshon, Indiana               Jared Polis, Colorado
Trey Gowdy, South Carolina           Gregorio Kilili Camacho Sablan,
Lou Barletta, Pennsylvania             Northern Mariana Islands
Martha Roby, Alabama                 John A. Yarmuth, Kentucky
Joseph J. Heck, Nevada               Frederica S. Wilson, Florida
Susan W. Brooks, Indiana             Suzanne Bonamici, Oregon
Richard Hudson, North Carolina
Luke Messer, Indiana

                    Juliane Sullivan, Staff Director
                 Jody Calemine, Minority Staff Director
                                 ------                                

        SUBCOMMITTEE ON HIGHER EDUCATION AND WORKFORCE TRAINING

               VIRGINIA FOXX, North Carolina, Chairwoman

Thomas E. Petri, Wisconsin           Ruben Hinojosa, Texas,
Howard P. ``Buck'' McKeon,             Ranking Minority Member
    California                       John F. Tierney, Massachusetts
Glenn Thompson, Pennsylvania         Timothy H. Bishop, New York
Tim Walberg, Michigan                John A. Yarmuth, Kentucky
Matt Salmon, Arizona                 Suzanne Bonamici, Oregon
Brett Guthrie, Kentucky              Carolyn McCarthy, New York
Lou Barletta, Pennsylvania           Rush Holt, New Jersey
Joseph J. Heck, Nevada               Susan A. Davis, California
Susan W. Brooks, Indiana             David Loebsack, Iowa
Richard Hudson, North Carolina
Luke Messer, Indiana




















                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on September 18, 2013...............................     1

Statement of Members:
    Foxx, Hon. Virginia, Chairwoman, Subcommittee on Higher 
      Education and Workforce Training...........................     1
        Prepared statement of....................................     3
    Hinojosa, Hon. Ruben, ranking minority member, Subcommittee 
      on Higher Education and Workforce Training.................     4
        Prepared statement of....................................     6

Statement of Witnesses:
    Baraniuk, Dr. Rich, professor, Rice University, Founder 
      Connexions.................................................    18
        Prepared statement of....................................    20
    Docking, Jeffrey R., Ph.D., president, Adrian College........     8
        Prepared statement of....................................    10
    Isbell, Dr. Charles, Georgia Institute of Technology.........    25
        Prepared statement of....................................    26
    Singer, Paula, chief executive officer, Global Products and 
      Services, Laureate Education, Inc..........................    13
        Prepared statement of....................................    14

Additional Submissions:
    Brooks, Hon. Susan W., a Representative in Congress from the 
      State of Indiana, questions submitted for the record to Dr. 
      Docking....................................................    50
    Mrs. Foxx:
        Miyares, Javier, president, University of Maryland 
          University College, prepared statement of..............    45
        Questions submitted for the record to:
            Dr. Baraniuk.........................................    49
            Dr. Docking..........................................    49
            Dr. Isbell...........................................    52
            Ms. Singer...........................................    54
    Kline, Hon. John, Chairman, Committee on Education and the 
      Workforce, questions submitted for the record to:
        Dr. Docking..............................................    50
        Dr. Isbell...............................................    52
        Ms. Singer...............................................    54
    Response to questions submitted for the record from:
        Dr. Baraniuk.............................................    49
        Dr. Docking..............................................    50
        Dr. Isbell...............................................    52
        Ms. Singer...............................................    54

 
                     KEEPING COLLEGE WITHIN REACH:
                   IMPROVING ACCESS AND AFFORDABILITY
                    THROUGH INNOVATIVE PARTNERSHIPS

                              ----------                              


                     Wednesday, September 18, 2013

                     U.S. House of Representatives

        Subcommittee on Higher Education and Workforce Training

                Committee on Education and the Workforce

                             Washington, DC

                              ----------                              

    The subcommittee met, pursuant to call, at 10:01 a.m., in 
Room 2175, Rayburn House Office Building, Hon. Virginia Foxx 
[chairwoman of the subcommittee] presiding.
    Present: Representatives Foxx, Walberg, Guthrie, Heck, 
Brooks, Messer, Hinojosa, Tierney, Bishop, Bonamici, and Holt.
    Also present: Representatives Kline and Miller.
    Staff present: Katherine Bathgate, Deputy Press Secretary; 
Heather Couri, Deputy Director of Education and Human Services 
Policy; Amy Raaf Jones, Education Policy Counsel and Senior 
Advisor; Brian Melnyk, Professional Staff Member; Krisann 
Pearce, General Counsel; Emily Slack, Legislative Assistant; 
Alex Sollberger, Communications Director; Alissa Strawcutter, 
Deputy Clerk; Aaron Albright, Minority Communications Director 
for Labor; Tylease Alli, Minority Clerk/Intern and Fellow 
Coordinator; Kelly Broughan, Minority Education Policy 
Associate; Jody Calemine, Minority Staff Director; Eamonn 
Collins, Minority Fellow, Education; Jamie Fasteau, Minority 
Director of Education Policy; Scott Groginsky, Minority 
Education Policy Advisor; Eunice Ikene, Minority Staff 
Assistant; Brian Levin, Minority Deputy Press Secretary/New 
Media Coordinator; Megan O'Reilly, Minority General Counsel; 
Rich Williams, Minority Education Policy Advisor; and Michael 
Zola, Minority Deputy Staff Director.
    Chairwoman Foxx. A quorum being present, the subcommittee 
will come to order.
    Good morning, and welcome. Ranking Member Hinojosa will be 
here shortly, but we have permission to continue with the 
hearing and honor people's time who are here.
    I want to take a moment to offer our condolences and 
prayers to all whose lives were shaken by the tragedy earlier 
this week in Washington's Navy Yard. The victims and survivors, 
as well as their families, remain in our thoughts.
    I also want to extend our appreciation to the first 
responders, metro police officers, and our own Capitol Police 
who worked diligently then, as they do now, to keep our capital 
city safe.
    I also want to acknowledge the flooding in Colorado. I know 
that Congressman Polis was not available to be at the Rules 
Committee meeting yesterday. He is on our larger committee, and 
he is there in Colorado. So I want to thank everyone who has 
been involved with helping our fellow Americans as they face 
these various challenges.
    Returning to today's subcommittee business, I would like to 
thank our panel of witnesses for joining us today to discuss 
the ways postsecondary institutions are utilizing innovative 
partnerships to improve higher education access and 
affordability.
    With thousands of colleges, top-ranked research 
universities, and specialized degree programs, America is home 
to the greatest higher education system in the world.
    Our diverse institutions not only cater to the unique needs 
of students from around the globe, but also drive our nation's 
economic competitiveness by preparing graduates for the 21st 
century workforce.
    However, our higher education system is not without its 
challenges. College costs continue to rise at an unprecedented 
rate, compelling institutions to explore more creative ways to 
rein in tuition.
    Changing student demographics heighten the demand for more 
flexible degree programs and course schedules. And evolving 
technologies mean institutions must constantly modernize 
program offerings to ensure graduates have the skills necessary 
to thrive in today's workforce.
    Recognizing these new dynamics, a growing number of 
institutions are forming creative partnerships with private 
sector entities to help reduce costs, strengthen degree 
programs, and enrich coursework to meet the needs of a changing 
student body.
    With the development of Massive Open Online Courses, or 
MOOCs, institutions are exploring exciting new ways to deliver 
high quality education opportunities to students all over the 
world.
    These online platforms are revolutionizing instructional 
delivery, and providing thousands of students access to free 
educational resources at the click of a button.
    Coursera, edX, and Udacity are just a few of the MOOC 
providers helping universities build online learning 
environments where students can access and complete high 
quality courses in their own time.
    Georgia Tech is working to take online education a step 
further, announcing in May plans to work with AT&T and Udacity 
to offer the first fully online master's program for computer 
science. Students will be able to earn their degrees completely 
online and at a fraction of the cost of traditional programs, 
possibly even less than $7,000.
    While some institutions are exploring ways to improve 
higher education access and affordability through partnerships 
with online providers, others are forming partnerships with 
other nearby colleges and universities to offer students in-
demand degree programs at a more affordable price.
    To expand degree options for students without raising 
tuition, administrators at Indiana's Grace College partnered 
with two local institutions to develop a program that allows 
Grace College students to take advantage of the popular nursing 
and engineering programs offered at the other schools.
    Another great example of innovative partnerships can be 
found at Emmanuel College, a small liberal arts school in the 
heart of the Longwood Medical Center in Boston.
    In 2001 the school leased an unused piece of land to 
pharmaceutical giant Merck & Company, forging a partnership 
that launched a wealth of biomedical graduate programs and 
specialized summer internship opportunities for Emmanuel 
students. Enrollment has since tripled, and Emmanuel has 
regained a competitive edge in the higher education system.
    It is creative partnerships like these that will help 
ensure our higher education system remains the best in the 
world. As policymakers, we have a responsibility to ensure such 
innovation can continue.
    By lifting burdensome regulations and simplifying the 
current complex statutory framework, more institutions will 
have the opportunity to innovate and meet the challenging needs 
of our students and economy.
    Earlier this year, we took a step in the right direction by 
approving the Supporting Academic Freedom through Regulatory 
Relief Act, legislation to eliminate three regulations that 
threaten to stifle innovation at postsecondary schools.
    I hope we can work together through the upcoming 
reauthorization of the Higher Education Act to continue these 
efforts to limit federal overreach and preserve flexibility in 
our modern higher education system.
    Once again, I would like to thank our witnesses for joining 
us today. I would now like to recognize my colleague, Mr. Rubin 
Hinojosa, senior Democrat member of the subcommittee for his 
opening remarks.
    [The statement of Chairwoman Foxx follows:]

         Prepared Statement of Hon. Virginia Foxx, Chairwoman,
        Subcommittee on Higher Education and Workforce Training

    Good morning, and welcome. Before we begin, I want to take a moment 
to offer our condolences and prayers to all whose lives were shaken by 
the tragedy earlier this week in Washington's Navy Yard. The victims 
and survivors, as well as their families, will remain in our thoughts. 
I also want to extend our appreciation to the first responders, metro 
police officers, and our own Capitol police who worked diligently then, 
as they do now, to keep our capital city safe. Thank you.
    Returning to today's subcommittee business, I'd like to thank our 
panel of witnesses for joining us today to discuss the ways 
postsecondary institutions are utilizing innovative partnerships to 
improve higher education access and affordability.
    With thousands of colleges, top-ranked research universities, and 
specialized degree programs, America is home to the greatest higher 
education system in the world. Our diverse institutions not only cater 
to the unique needs of students from around the globe, but also drive 
our nation's economic competitiveness by preparing graduates for the 
21st century workforce.
    However, our higher education system is not without its challenges. 
College costs continue to rise at an unprecedented rate, compelling 
institutions to explore more creative ways to rein in tuition. Changing 
student demographics heighten the demand for more flexible degree 
programs and course schedules. And evolving technologies mean 
institutions must constantly modernize program offerings to ensure 
graduates have the skills necessary to thrive in today's workforce.
    Recognizing these new dynamics, a growing number of institutions 
are forming creative partnerships with private sector entities to help 
reduce costs, strengthen degree programs, and enrich coursework to 
better meet the needs of a changing student body.
    With the development of Massive Open Online Courses, or MOOCs, 
institutions are exploring exciting new ways to deliver high quality 
education opportunities to students all over the world. These online 
platforms are revolutionizing instructional delivery, and providing 
thousands of students access to free educational resources at the click 
of a button. Coursera, edX, and Udacity are just a few of the MOOC 
providers helping universities build online learning environments where 
students can access and complete high quality courses in their own 
time.
    Georgia Tech is working to take online education a step further, 
announcing in May plans to work with AT&T and Udacity to offer the 
first fully online master's program for computer science. Students will 
be able to earn their degree completely online and at a fraction of the 
cost of traditional programs, possibly even less than $7,000.
    While some institutions are exploring ways to improve higher 
education access and affordability through partnerships with online 
providers, others are forming partnerships with other nearby colleges 
and universities to offer students in-demand degree programs at a more 
affordable price.
    To expand degree options for students without raising tuition, 
administrators at Indiana's Grace College partnered with two local 
institutions to develop a program that allows Grace College students to 
take advantage of the popular nursing and engineering programs offered 
at the other schools.
    Another great example of innovative partnerships can be found at 
Emmanuel College, a small liberal arts school in the heart of the 
Longwood Medical Center in Boston. In 2001 the school leased an unused 
piece of land to pharmaceutical giant Merck & Company, forging a 
partnership that launched a wealth of biomedical graduate programs and 
specialized summer internship opportunities for Emmanuel students. 
Enrollment has since tripled and Emmanuel has regained a competitive 
edge in the higher education system.
    It is creative partnerships like these that will help ensure our 
higher education system remains the best in the world. As policymakers, 
we have a responsibility to ensure such innovation can continue. By 
lifting burdensome regulations and simplifying the current complex 
statutory framework, more institutions will have the opportunity to 
innovate and meet the changing needs of our students and economy.
    Earlier this year, we took a step in the right direction by 
approving the Supporting Academic Freedom through Regulatory Relief 
Act, legislation to eliminate three regulations that threaten to stifle 
innovation at postsecondary schools. I hope we can work together 
through the upcoming reauthorization of the Higher Education Act to 
continue these efforts to limit federal overreach and preserve 
flexibility in our modern higher education system.
    Once again, I'd like to thank our witnesses for joining us today. I 
would now like to recognize my colleague, Mr. Ruben Hinojosa, the 
senior Democrat member of the subcommittee, for his opening remarks.
                                 ______
                                 
    Mr. Hinojosa. Thank you, Madam Chair.
    Before we begin, I want to express my sympathies to the 
families who lost their loved ones during yesterday's tragic 
shootings in the Navy Yard. My thoughts and prayers are with 
them.
    Today's hearing will explore how our system of higher 
education can improve accessibility and affordability of 
quality higher ed through innovative partnerships.
    I would like to welcome our distinguished panelists. I want 
to say that at this time I also want to recognize our witness 
from my home state of Texas, Rich Baraniuk, a professor at Rice 
University which is one of our best universities in the state 
of Texas. And I want to say that he is a professor at this 
great school who is also a leader in the open education 
movement.
    Welcome to our hearing, Mr. Baraniuk.
    As ranking member of the subcommittee, I strongly support 
innovative partnerships that work to make high quality, higher 
education more affordable and accessible for all students, 
particularly for low income and moderate income students.
    It seems to me that partnerships that serve the best 
interests of students and taxpayers should be expanded and 
supported while partnerships that increase college costs of our 
students and families should be discouraged.
    Today, we will hear about some innovative partnerships that 
show promise and can help address the issue of college 
accessibility and affordability. I am particularly interested 
in learning more about OpenStax College, a free and open 
library of college textbooks which integrates with the venture 
philanthropists and for-profit course material companies to 
reduce college costs by what they estimate, $250 per class.
    In many states, college students spend more on textbooks 
than on tuition. Innovative partnerships like OpenStax College 
can help reduce the high cost of teaching materials and 
eliminate barriers to college access and student access.
    Once built out to scale, the OpenStax initiative is 
projected to save 1.2 million students an amount over $120 
million a year in course materials many are currently funding 
through student loan debt.
    In my view, Congress must incentivize high-quality, low-
cost innovative partnerships that make college more accessible, 
more affordable, and improve retention and student success. 
Congress can also do more to promote college employer 
partnerships.
    In a September 12 op-ed, Secretary of Commerce, Penny 
Pritzker and Secretary of Labor, Thomas Perez highlighted 
successful partnerships between community colleges and 
employers that align skills training programs with workforce 
needs in growing sectors of our economy. As you know, more than 
half of new jobs created in the next 10 years will be middle 
skills jobs requiring more than a high school diploma.
    At the same time, a number of concerns have been raised 
over partnerships that have increased the cost of college while 
providing financial benefits to some institutions.
    A recent ABC news investigation found multimillion dollar 
exclusive financial agreements between the big banks and 
college campuses linking debit cards to student IDs that could 
subject students to numerous hidden charges.
    It is equally disturbing that public universities are 
increasingly outsourcing their student housing to private 
contractors to cut their costs. Rooms at privately-financed 
dormitories can cost students $1,000 more per semester than 
other dorms.
    Finally, while massive open online courses may end up 
providing greater access to higher quality and affordable 
education in the future, they are still largely untested.
    Some colleges have not learned the lessons of the past and 
are pursuing inappropriate partnerships that increase the 
overall costs of college for students and families.
    These innovative attempts to profit off of students are 
inappropriate and should be discouraged.
    Finally, I thank our witnesses for their insights and 
recommendations. The reauthorization of Higher Education Act is 
an opportunity for Congress and our federal government to do 
more to promote innovation and improve accessibility, 
affordability, and student success in higher education.
    And with that, I yield back.
    [The statement of Mr. Hinojosa follows:]

       Prepared Statement of Hon. Ruben Hinojosa, Ranking Member,
        Subcommittee on Higher Education and Workforce Training

    Thank you, Chairwoman Foxx. Before we begin, I want to express my 
sympathies to the families who lost their loved ones during yesterday's 
tragic shootings in the Navy yard. My thoughts and prayers are with 
them. Today's hearing will explore how our system of higher education 
can improve accessibility and affordability of quality higher education 
through innovative partnerships.
    I would like to welcome our distinguished panel of witnesses. At 
this time, I also want to recognize our witness from my home state of 
Texas, Rick Baraniuk (BARE-uh-nik), a professor at Rice University who 
is also leader in the open education movement. Welcome to our hearing 
Mr. Baraniuk!
    As Ranking member of this subcommittee, I strongly support 
innovative partnerships that work to make high quality higher education 
more affordable and accessible for all students, particularly for low-
income and moderate-income student. It seems to me that partnerships 
that serve the best interests of students and taxpayers should be 
expanded and supported, while partnerships that increase college costs 
to students and families should be discouraged.
    Today, we will hear about some innovative partnerships that show 
promise and can help address the issue of college accessibility and 
affordability. I am particularly interested in learning more about 
OpenStax College, a free and open library of college textbooks, which 
integrates with venture philanthropists and for-profit course material 
companies to reduce college costs by up to $250 per class.
    In many states, college students spend more on textbooks than on 
tuition. Innovative partnerships like OpenStax College can help reduce 
the high cost of teaching materials and eliminate barriers to college 
access and student success. Once built out to scale, the OpenStax 
initiative is projected to save 1.2 million students over $120 million 
a year in course materials many are currently funding through student 
loan debt.
    In my view, Congress must incentivize high quality, low-cost 
innovative partnerships that make college more accessible, more 
affordable, and improve retention and student success.
    Congress can also do more to promote college-employer partnerships. 
In a September 12th op-ed, Secretary of Commerce Penny Pritzker and 
Secretary of Labor Thomas Perez highlighted successful partnerships 
between community colleges and employers that align skills training 
programs with workforce needs in growing sectors of the economy. As you 
know, more than half of new jobs created in the next ten years will be 
``middle-skills'' jobs, requiring more than a high school diploma.
    At the same time, a number of concerns have been raised over 
partnerships that have increased the cost of college while providing 
financial benefits to some institutions. A recent NBC news 
investigation found multi-million dollar exclusive financial agreements 
between big banks and college campuses linking debt cards to student 
IDs that could subject students to numerous hidden charges.
    It is equally disturbing that public universities are increasingly 
outsourcing their student housing to private contractors to cut costs. 
Rooms in privately financed dormitories can cost students $1,000 more 
per semester than other dorms.
    Finally, while Massive Open Online Courses (MOOCs) may end up 
providing greater access to high quality and affordable education in 
the future, they are still largely untested. Some colleges have not 
learned the lessons of the past and are pursuing inappropriate 
partnerships that increase the overall costs of college for students 
and families. These `innovative' attempts to profit off of students are 
inappropriate and should be discouraged.
    In closing, I thank our witnesses for their insights and 
recommendations. The reauthorization of the Higher Education Act (HEA) 
is an opportunity for Congress and the federal government to do more to 
promote innovation and improve accessibility, affordability and student 
success in higher education. Thank you.
                                 ______
                                 
    Chairwoman Foxx. Thank you, Mr. Hinojosa.
    Pursuant to Rule 7-C, all subcommittee members will be 
permitted to submit written statements to be included in the 
permanent hearing record. Without objection, the hearing record 
will remain open for 14 days to allow statements, questions for 
the record, and other extraneous material referenced during the 
hearing to be submitted in the official hearing record.
    It is now my pleasure to introduce our distinguished panel 
of witnesses; however, I will turn to Mr. Walberg to introduce 
our first witness.
    Mr. Walberg. Thank you, Madam Chairwoman.
    It is a privilege to do this introduction. I have really 
looked forward to this hearing today for a number of reasons. 
To hear creativity, hear people thinking outside of the box.
    I am looking forward to the full panel. I think it is a 
wonderful hearing that you have chosen to have to highlight 
what can and is being done in higher education.
    But to introduce my good friend, and I guess would say a 
motivator of me, a person who doesn't know the meaning of no or 
can't, but is willing to push the envelope to the point of even 
getting coaches and professors to work together producing 
academic excellence and increased enrollment.
    Dr. Jeffrey Docking is the 17th president of Adrian 
College. I might add, our colleague, Mike Rogers' alma mater. 
Before coming to the college, he earned a doctorate in social 
ethics from Boston University, a master of divinity degree from 
Garrett Evangelical Theological Seminary, and a bachelor's 
degree from Michigan State University. After providing 
leadership for Pennsylvania's Washington and Jefferson College, 
he became president of Adrian College in July 2005.
    Through his innovative means he transformed the college 
from a struggling institution of 840 students with a budget of 
$28 million and more than doubled the enrollment to nearly 
1,700 and a budget of more than $62 million.
    He raised the academic profile of incoming students in 
nearly every benchmark category and that continues to this very 
day. Dr. Docking is a leader in higher education circles, 
having served as chairman of the ACE Fellows Program board, the 
premier leadership development program in the United States.
    He currently serves as chairman of the executive committee 
for the Association of Independent Colleges and Universities of 
Michigan and the Michigan College Foundation.
    It is a privilege to know his efforts. Even this morning, 
in the Detroit Free Press, an article talked about Adrian 
College providing resources to pay off student loan debt for 
their graduates who are without jobs that meet those needs; 
unique and innovative. He truly exemplifies the statement, 
``build it and they will come.''
    And it is a privilege to introduce him as well as his 
partner in academic excellence and commitment to those goals, 
his wife, Beth.
    Thank you for being here today.
    Chairwoman Foxx. Thank you very much, Mr. Walberg. I will 
continue with the introductions.
    Ms. Paula Singer is the president and CEO of Laureate 
Global Products and Services. In this capacity, she leads the 
company's international online network products and services, 
information technology and U.S. campus-based operations as well 
as several of Laureate's global programs.
    Dr. Rich Baraniuk is the Victor E. Cameron professor of 
electrical and computer engineering at Rice University and 
founder of Connexions, one of the first initiatives to offer 
free open-source textbooks via the web.
    Dr. Charles Lee Isbell serves as a professor and senior 
associate dean with College of Computing at the Georgia 
Institute of Technology. Prior to this role, he spent 4 years 
with AT&T Labs Research.
    Before I recognize you to provide your testimony, let me 
briefly explain our lighting system. You will have 5 minutes to 
present your testimony. When you begin, the light in front of 
you will turn green. When 1 minute is left, the light will turn 
yellow. When your time has expired, the light will turn red.
    At that point, I ask that you wrap up your remarks as best 
as you are able. After you have testified, members will each 
have 5 minutes to ask questions of the panel.
    I now recognize Dr. Jeffrey Docking for 5 minutes.

          STATEMENT OF DR. JEFFREY DOCKING, PRESIDENT,
                         ADRIAN COLLEGE

    Mr. Docking. Chairwoman Foxx, Chairman Kline, Ranking 
Members Hinojosa and Miller, and members of the subcommittee, I 
thank you for the opportunity to appear here today to discuss a 
unique business model that Adrian College created 8 years ago 
to reverse a downward spiral in enrollment, revenues, and 
academic quality of our students.
    This entrepreneurial approach to saving our college 
ultimately gave us the revenues we need to create innovative 
partnerships with businesses and enhanced access to students 
throughout the Midwest.
    Let me explain. In 2005, Adrian College dropped below 900 
students and was saddled with a $1.3 million annual operating 
deficit. Three of our dorms were closed, our deferred 
maintenance bills reached several million dollars, and leaky 
roofs and dandelions were a constant sight on campus.
    The academic quality of our students also suffered. We 
attracted only 1,100 applications in 2005 and rejected only 71 
students. Essentially, it was open enrollment. Many freshmen 
were not prepared academically to attend a private liberal arts 
college, so they either failed out or quit before they 
graduated. Our retention rate was only 59 percent.
    Our problems were compounded by our location in Southeast 
Michigan. Adrian College is located 60 miles southwest of 
Detroit, a city currently undergoing bankruptcy protection, and 
our major local manufacturing base is in automotive parts, a 
very troubled industry during those years.
    The perfect storm descended upon families that wanted to 
send their children to college, especially a private college. 
People openly questioned whether Adrian would survive these 
circumstances, but Adrian did not close, it thrived.
    During the past 8 years, our enrollment doubled to over 
1,700 students and our annual budget increased from $28 million 
to over $64 million. Our retention rate stands at 85 percent 
and our freshman classes grew from 263 in 2005 to 665 last 
fall.
    We built over $60 million in new facilities and started 
five new graduate programs, eight academic institutes--nearly 
doubled our endowment. Each year, we have given raises to our 
employees, hired additional workers, and expanded benefit 
coverage.
    At Adrian, we like to joke that we skipped the Great 
Recession. How have we done this? How, under these 
circumstances, were we able to attract more students and make 
college more affordable to the families in our state?
    We did it through a unique business plan that relies on 
strategic investments, measurable results, and accountability. 
This model, which I can discuss further during the question-
and-answer period, responds to the needs of students in the job 
market in Michigan.
    It requires us to listen closely and respond quickly to the 
voices of our employers and families, and it works very well, 
as you can see from the story I just recited.
    When Adrian started to flourish, we looked for innovative 
partnerships with businesses that could advance the college's 
educational mission while cultivating talent needs for our 
business community.
    Let me list very few here. In recent years, we allocated 
money for students to conduct micro research studies with local 
business leaders. Several students have worked with businesses 
who want to optimize social media and web content marketing to 
expand their operations.
    Other examples include psychology students working with 
local doctors to gain a broader understanding of the placebo 
effect, students conducting research with businesses on 
potential hydrocarbon reserves in our area, and a student 
working with a startup apparel company to build a business 
plan.
    In addition to micro research, we recently finished 
construction on three campus incubators that students can use 
to start businesses in our small town of 23,000 people. These 
incubators will not be limited to our students. If local 
residents want to use our incubators, they are certainly 
willing to do so and we are too at no charge.
    My third example of innovative relationships occurred 2 
months ago when 11 small college presidents in Michigan 
organized a 2-day retreat with major business leaders to 
discuss the talent gap, that gap between the skills business 
leaders say they need when they hire recent graduates and the 
skills these graduates actually bring to their new jobs.
    Forty-five CEOs and high-profile executives from companies 
such as Dow Chemical, the Kellogg Corporation, Amway, and 
Stryker joined the presidents to exchange ideas on this 
important topic.
    Finally, we restructured our entire internship office to 
place students in businesses that openly expressed a desire to 
hire new workers. Students are told that their internship is 
actually a 3-month interview. If the company likes them, they 
will be hired.
    I could provide you with many more examples of how 
innovative partnerships with our local business community have 
helped our region, but in the interest of time, let me say that 
these partnerships give us the resources we need and the 
financial offerings we have to provide greater access to our 
students.
    This emphasis on making education more affordable reached a 
climax at Adrian College late last week when we announced a new 
guarantee to all incoming freshmen. Beginning in the fall of 
2014, all freshmen will be guaranteed a high-paying job of at 
least $37,000 a year or part or all of their student loans will 
be paid for them.
    I thank you for the opportunity to share what we have done 
at Adrian College. I look forward to your questions.
    [The statement of Mr. docking follows:]

      Prepared Statement of Jeffrey R. Docking, Ph.D., President,
                             Adrian College

    I am providing this testimony because I am worried. I am worried 
about the plight of small private liberal arts colleges in America. I 
am afraid many are going to run out of money, reach insolvency, fail 
the federal financial responsibility audit, close their doors, or be 
swallowed up by large state universities as satellite campuses over the 
next several years. If this happens, if small liberal arts colleges 
continue to struggle to the point of insolvency, we will lose one of 
the greatest educational assets this country has. Many of our national 
leaders graduated from private colleges and universities including over 
half of the U.S. House of Representatives. (219 of 435) Private 
colleges offer students a different type of education, an education 
where students can get tremendous amounts of personal attention and 
where faculty are committed to ``teaching first.'' Many students who 
would fall through the cracks of large lecture halls at huge public 
institutions will lose the option to enroll in places where professors 
take attendance in class and will take the time to pull students aside 
after class if they are falling behind in their work. Many students 
need this type of environment in order to graduate. Without this option 
they simply will not earn a college degree.
    Additionally, small communities in which these colleges are located 
will lose the largest economic engine they have to supply the 
prosperity, jobs, and cultural activities to the businesses surrounding 
the college. Many restaurants, bookstores, markets, and small retailers 
rely on college students and their guests to spend money in their 
establishments to stay afloat. The loss of a college not only hurts 
educational options for students, it severely impacts the surrounding 
community. The loss of students and their disposable incomes is 
compounded when the highly educated workforce that is required to teach 
and administer an institution is gone. These individuals and their 
families fill the K-12 buildings in a town as well as buy homes and 
attend cultural events. When a community loses such people, the effects 
that ripple throughout it are hard to calculate.
    My anxiety is not without merit. During the past ten years more 
than 30 institutions shut their doors for the final time, terminated 
their faculty, and told their students to transfer to other schools. 
This list includes:
     Barat College (Lake Forest, IL)
     Beacon University (Columbus, GA)
     Bethany University (Scotts Valley, CA)
     Bradford College (Haverhill, MA)
     Cascade College (Portland, OR)
     Chester College (Chester, NH)
     College of Santa Fe (Santa Fe, NM)
     D-Q University (Davis, CA)
     Dana College (Blair, NE)
     Eastern Christian College (Bel Air, MD)
     Far North Bible College (Anchorage, AK)
     Kelsey-Jenney College (San Diego, CA)
     Lambuth University (Jackson, TN)
     Lon Morris College (Jacksonville, TX)
     Marycrest College (Davenport, IA)
     Marymount College (Tarrytown, NY)
     Mary Holmes College (West Point, MS)
     Mount Senario College (Ladysmith, WI)
     New College of California (San Francisco, CA)
     Notre Dame College (Manchester, NH)
     Pillsbury Baptist Bible College (Owatonna, MN)
     St. John's Seminary College (Camarillo, CA)
     Sheldon Jackson College (Sitka, AK)
     Southeastern University (Washington, D.C.)
     Summit Christian College (Fort Wayne, IN)
     Trinity College (Burlington, VT)
     Vennard College (University Park, IA)
     Wesley College (Florence, MS)
     William Tyndale College (Farmington Hills, MI)
    These colleges had an average life span of 87-plus years. Some had 
been in operation over 150 years. Many seemed resilient and 
impenetrable. Several were established soon after our country was 
founded, and they survived wars, the Great Depression, plagues, and 
natural disasters. It seemed highly unlikely--if not impossible--that 
these wonderful schools would ever go out of business, but they did. 
And I believe that many others will over the next several years unless 
we adopt a new paradigm for attracting students, forge new partnerships 
with businesses and the non-profit community, and reimagine new ways to 
keep college accessible and affordable.
    In 2005 Adrian College faced all of these realities, and we 
developed a revenue-building enrollment model that saved our 
institution. I am providing this testimony, in part, because I think 
that this model can work for other colleges and ultimately serve 
students and their families.
    This is how the Plan Works:
    College administrators must begin by turning to business principles 
that have served business owners well for years. It requires homework 
and answers to some simple questions that are foundational to a viable 
business plan.
    The questions include:
    What size is your college now?
    1. What is your ideal college size?
    2. What is your discount rate?
    3. What is your ideal net tuition revenue?
    4. How much revenue do you need to make from each student to 
realize your revenue goals?
    5. What is your ideal freshman class size?
    6. What is your ideal in-state/out-of-state ratio?
    7. What is your campus capacity?
    Then, each institution must review their historic data:
    1. How many new students can you count on every year with your 
current recruitment efforts?
    2. What is your annual retention rate?
    3. Why do students leave your college early?
    When you formulate the answers to the three questions:
    1. What is your ideal college size?
    2. What is your ideal tuition revenue?
    3. What is your ideal freshman class size?
    Then you have a goal, the number of students you need to bring to 
campus each year to keep your institution fully-funded.
    The next step is to look at the programs your school offers and 
ask:
    1. How many students is each academic major, athletic team, and co-
curricular activity bringing in now?
    2. How many students should each major and activity be attracting?
    3. Who is accountable for recruiting students for each activity?
    After you have a firm grasp of the enrollment potential of current 
activities, then you begin to add programs. And I am going to emphasize 
that each program must have a recruiting goal associated with it, as 
well as a coach or staff member responsible for achieving that goal.
The Business Model to Sustainable Growth
    Once you have listed your financial goals, decided on new programs, 
and assigned an individual to recruit for each activity then you can 
begin to follow six steps that will lead to financial health and 
indicate your success based on your return on investment. This is 
illustrated below:



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



    A good example of how this works can be illustrated through the 
implementation of a marching band on our campus.
    At Adrian College, we have enjoyed a long and storied history of 
excellence in music. Students could earn a Bachelor of Music in 
Performance or a Bachelor of Music in Education. They could also 
graduate with a B.A. in Music, Musical Theatre, or Arts Administration, 
and the program offered a music minor, as well. What Adrian College had 
before we implemented this model was all sorts of ways to get a music 
degree, but we did not have a marching band. We needed to leverage this 
opportunity to build our enrollment. I argued that many high school 
seniors love playing in the marching band--it's their peer group, it's 
a big part of their social lives, and it's an important part of their 
identity. If we offered a quality marching band opportunity, we would 
quickly get 100-plus students on campus who would not be here 
otherwise.
    One recruiting advantage Adrian College uses is a result of our 
size. Most kids active in high school bands are never going to play in 
the marching band at large state universities. Bands at those schools 
are too competitive. But Adrian College has a ``no cut'' policy, so 
every student who wants to play is guaranteed a spot on the ``team.'' A 
student who wants a good education and that experience of playing in 
the band on the field every home game is going to choose Adrian 
College.

                                       MARCHING BAND RETURN ON INVESTMENT
----------------------------------------------------------------------------------------------------------------
 Start-up costs (director's                                No. of students recruited       Annual return on
salary & first year budget)       Ideal roster size                per year            investment (4-year total)
----------------------------------------------------------------------------------------------------------------
              $145,000                           80                           25      $359,600  ($1,438,400)
----------------------------------------------------------------------------------------------------------------

    This simple example can be replicated time and time again with 
other athletic and academic programs. For example, we have experienced 
a major return on investment by starting lacrosse and a student 
symphony. We built a hockey rink on campus and attracted over 200 
hockey players and figure skaters that would not have looked at us 
without an ice arena and these wonderful co-curricular activities. We 
are currently looking at new academic majors in graphic design and 
fashion merchandising to see if the ROI makes sense.
    The point of this business model is to evaluate all new academic 
and athletic programs through the prism of an ROI to determine if it is 
worth the investment. In doing so colleges are forced to listen to 
student needs, respond to the market, and provide educational 
opportunities that people want. Ultimately the business plan will 
provide additional funds to direct to financial aid and scholarships 
that promote access and affordability.
    Once a college or university stabilizes its finances it can begin 
to look for business relationships that can add additional value to the 
College and to the educational experience of all students. I have 
outlined several of these relationships in my oral testimony; I could 
certainly add many more. New business relationships lead to 
partnerships that pull colleges outside their cloistered boundaries. 
They force colleges to pay closer attention to our changing economy and 
the skills employers want in their graduates. They introduce college 
officials to new industries and changes in our economy that require new 
majors and new curriculum in the classroom. The future of education in 
America will be dependent on these partnerships in order to ensure that 
education is relevant and affordable to the future students we welcome 
each fall.
                                 ______
                                 
    Chairwoman Foxx. Thank you.
    I now recognize Ms. Singer for 5 minutes.

  STATEMENT OF PAULA R. SINGER, PRESIDENT AND CHIEF EXECUTIVE 
         OFFICER, LAUREATE GLOBAL PRODUCTS AND SERVICES

    Ms. Singer. Good morning. I am Paula Singer, and I 
appreciate the opportunity to speak today on behalf of Laureate 
Education. We are a network of 72 institutions located in 30 
countries serving almost 800,000 students.
    Each of our institutions is unique in its mission and holds 
the highest accreditation available within its country. 
Laureate's institutions and our partner institutions share a 
common commitment to making quality higher education accessible 
and affordable.
    With today's increasingly complex and demanding educational 
environment, an increasing number of traditional institutions 
could face financial challenges and decline in relevance.
    Innovative partnerships and collaborations provide three 
benefits; efficiency and cost savings for both an institution 
and its students, access to capital, and speed to market.
    In regards to cost, building new support services, a new 
program development platform, or online infrastructure is a 
major undertaking. At many institutions, the faculty or 
administration has little or no prior experience in these 
areas.
    Starting from scratch can be inefficient, costly to the 
student, and risky to the institution's reputation. 
Partnerships can help eliminate these risks.
    Second, we cannot overstate the importance right now of 
private capital when governments are increasingly limited in 
the resources that they can provide. Partnerships can help fill 
these gaps.
    Finally, speed is increasingly essential; speed to market 
with the latest educational technology, access to data, and the 
ability to use that data in a more efficient manner with 
demonstrated outcomes for our students.
    In this evolving higher education environment, no 
institution should be standing still, and all of us -
institutions, governments, accreditors, and the providers of 
capital--should be working together to turn these types of 
opportunities into reality for students.
    Alignment of the missions between the collaborating parties 
is critical to realizing these three benefits. Some examples: 
internationally, over a decade ago, Laureate provided the 
University of Liverpool the ability to be an innovator in 
international online education. Today, thousands of students 
from 180 countries have access to a UK accredited education 
formerly unavailable to them.
    Laureate's recent initiative with top-ranked Monash 
University in South Africa will advance our joint mission to 
provide access to a greater number of underserved students in 
sub-Saharan Africa.
    In the U.S., Laureate worked with Johns Hopkins University 
and Teach for America to deliver an online master's degree in 
education. This program allowed Hopkins to quickly reach TFA 
instructors around the country without the need to divert its 
own capital, successfully realizing an important goal for all 
three parties.
    In Santa Fe, New Mexico, the state and local governments 
initiated a partnership with Laureate to provide the resources 
necessary to keep the oldest chartered college in the state 
open and to ensure options for its students.
    How regulators adapt and respond to these types of 
innovative models will determine whether or not other 
institutions are able to meet the rapidly changing needs of 
their students and remain competitive.
    We believe one of the most important partnerships in the 
U.S. is the regulatory triad, which we support. Successful 
partnerships are built with a good dose of trust and 
transparency, and the role of each triad member needs to be 
clarified and strengthened to allow for both.
    Each third of the triad should rely more heavily on the 
review and evaluation done by the other two-thirds. With 
reauthorization now due, we are hopeful that the Congress will 
examine ways to encourage these types of innovations, but only 
while ensuring institutional integrity and accountability to 
students.
    We need to encourage innovation through regulation. 
Uncertain, inconsistent, and inequitable regulation slows 
innovation down right when we need speed. Instead, we strongly 
support a regulatory structure based on demonstrated outcomes 
applicable to all institutions.
    Regulators in other countries face similar challenges in 
higher education, and we are watching them adapt. The U.S. 
needs to adapt too. This is critically important to the 
competitiveness and success of our students and our country.
    Thank you very much.
    [The statement of Ms. Singer follows:]

      Prepared Statement of Paula Singer, Chief Executive Officer,
         Global Products and Services, Laureate Education, Inc.

    Chairwoman Foxx, Ranking Member Hinojosa, and subcommittee members, 
on behalf of Laureate Education (Laureate), I appreciate the invitation 
to appear before the subcommittee on the important topic of ``Keeping 
College Within Reach: Improving Access and Affordability through 
Innovative Partnerships.'' I am Paula Singer, Chief Executive Officer 
of Laureate's Division on Global Products and Services. I have served 
in a number of senior leadership roles since joining Laureate and its 
predecessor company, Sylvan, in 1993. The Global Products and Services 
division, which I lead, includes Laureate's portfolio of international 
online institutions and offerings, including our flagship U.S. 
institution Walden University and those provided through partnerships. 
I also oversee all campus-based institutions in our international 
network that educate in the fields of hospitality, art, architecture, 
and design. Finally, my division also includes all U.S. partnership 
initiatives and our network products and services group, which offers 
higher education best practices to institutions throughout our network.
    I would like to provide the subcommittee with more information 
about Laureate and its global presence in higher education. The 
Laureate International Universities network includes 72 institutions 
located in 30 countries, serving almost 800,000 students, approximately 
600,000 of whom live in one of the 8 Latin American countries in which 
we are located. Each of our institutions is unique in its offerings and 
missions, and holds the highest accreditation available within their 
country.
    Although we operate under a corporate structure, we are a network 
of institutions that act in essence as partners with a common 
commitment to making quality higher education accessible and affordable 
in the regions, countries, and localities in which each institution is 
located. Laureate provides institutions in our network, as well as the 
institutions with which we ``partner,'' with resources and best 
practices to provide students the desired level of support services, 
program offerings, and modern modalities of teaching.
    Laureate, previously operating as Sylvan, began its work in higher 
education in 1997 with acquisition of a company called Canter 
Associates. With Canter, we focused on the professional development and 
higher education of teachers in the classroom through agreements with 
more than 30 institutions of higher education around the U.S. Our 
additions of Universidad de Europea (UE) in Spain and Walden University 
extended our commitment in this area. Since then, we have become the 
largest global network of institutions providing access to a quality 
higher education to the rising middle class around the world. We 
continue our commitment to individuals who most need access, whether it 
is through fully owned institutions, or through strategic alliances 
with the types of institutions and organizations, like those I describe 
below.
    Given this experience, I am particularly appreciative of the 
opportunity to speak about the impact of innovation on access and 
affordability on institutions and their students, and the importance of 
a regulatory structure that understands this connection. It is a topic 
of immense importance to the future of higher education in the U.S. and 
around the world. I will focus in particular on the use of 
constructive, careful and effective partnerships and other 
collaborative efforts\1\ with those institutions that seek or need 
private capital, and/or services and resources in order to expand their 
access and academic offerings to students. In our case, this also 
includes the ability to provide institutions a global footprint--i.e., 
we provide institutions and their students access to other campuses 
throughout the globe, without the cost and effort of building their own 
facilities. Paramount to the success of these endeavors is the 
fostering of an individual institution's existing mission and quality.
---------------------------------------------------------------------------
    \1\ The use of the terms partnership or partner is not meant to 
focus solely on the legal construct of a relationship. Instead, this 
testimony is intended to recognize the importance of the full continuum 
of possible relationships--from articulation agreements and other 
contractual arrangements to different forms of partnerships and 
affiliations.
---------------------------------------------------------------------------
What Do These Strategic Alliances Provide an Institution?
    In today's global education marketplace, without the ability to 
innovate quickly, we believe an increasing number of traditional 
institutions could face financial challenges and a decline in 
relevance. Innovation occurs in many ways. Collaborative projects, like 
partnerships, are just one example. They can be helpful by providing 
efficiency and cost savings for both an institution and its students, 
access to capital, and speed to market. I will briefly speak on each of 
these.
    First, regarding cost. Responding to the changing demographic and 
needs of students can be expensive, particularly if the institution has 
no prior experience in offering a certain service, program, or modality 
for teaching. Building new support services, a new program development 
platform, or online infrastructure is a major undertaking, and at many 
institutions, the faculty or administration has little or no prior 
experience in these areas. Reinventing the wheel or starting from 
scratch can be inefficient, costly, and risky to the institution's 
reputation. One way institutions can solve these problems is by turning 
to others with the expertise and demonstrated best practices to assist 
the institution.
    Ultimately, this also results in cost-savings to the student who 
otherwise might have these costs passed down to them in higher tuition.
    Second, we cannot overstate the importance right now of private 
capital in education. States and the federal government are 
increasingly limited in the resources they can provide, and again, we 
certainly want to protect the students from further increases in 
tuition. Private capital from sources with deep understanding and 
experience in higher education can be critically important to all types 
of institutions--from the small community college to private nonprofit 
college or large state system.
    Finally, speed is increasingly essential: I am talking about speed 
to market with the latest in educational technology, access to data, 
and ability to educate in a more efficient manner with demonstrated 
outcomes for our students, including the growing segment of working 
professionals. Adapting quickly will be critically important to the 
success of all institutions and to satisfying the needs of our students 
and our country's economic demands. Speed in innovation is also 
important to maintaining our institutions' ability to compete in a 
global marketplace where institutions and students in other countries 
are increasingly able to leap-frog over our own. With the knowledge and 
best practices that an institution's ``partner'' provides, the 
institution can accelerate what would otherwise be a lengthy build-out 
process.
    In this evolving higher education environment, no institution 
should be standing still and all of us--all types of institutions, 
government, accrediting agencies, and the providers of private 
capital--should be working together--in partnership or otherwise--to 
turn these types of opportunities into reality for students. We need to 
be able to move as quickly and efficiently as possible, while at the 
same time being careful that we don't jeopardize the student's academic 
experience.
Laureate's Experience with Partnerships and Collaborative Relationships
    With 72 institutions in 30 countries, Laureate's network of 
institutions operates on a global scale, and Laureate has also had the 
additional opportunity to work directly with many institutions outside 
its network, regulators, governments, organizations, and foundations 
around the globe. Over 15 years or so, we have learned that 
partnerships and other endeavors like them are much more than just an 
infusion of new capital. When entering into a partnership or some other 
contractual relationship, it is essential that each partner fully 
understands, supports, and respects the mission under which the 
institution serves its students and the vision and purpose of the 
arrangement. In our experience, the partners or parties we choose to 
support are those that want to take the good education they already 
provide and leverage it--often either through the introduction of 
online education or new global locations or experiences or the 
provision of new services or program offerings to their students.
    These collaborative projects often include multiple types of 
entities. This conversation should not be just about vendor-institution 
relationships nor should the conversation be about one-to-one 
relationships between two institutions. In many cases, local 
government, foundations, or other sources of private capital are 
important participants to a strategic alliance and to the successful 
innovation of an institution. In each of our strategic alliances, our 
goals and those of the institutions or organizations with whom we 
engage are perfectly aligned in mission.
    Let me provide some examples.
Arrangements Between Laureate and Other Institutions
            University of Liverpool
    For over a decade, Laureate has had an innovative and impactful 
partnership with the UK's University of Liverpool. Liverpool is a 
highly selective member of the UK's elite Russell Group of research-led 
universities. It is ranked in the top 1% of world universities, 
according to the QS World University Rankings for 2013.
    Laureate is Liverpool's partner in delivering a suite of online 
master's and doctoral degree programs. There are now approximately 
10,000 students from more than 180 countries studying in these 
programs. Liverpool retains full control of academic and admission 
standards and for their student outcomes.
    In addition, this partnership led to the creation of a third 
institution in China, Xi'an Jiaotong Liverpool University (XJTLU), 
founded in 2006. XJTLU is the result of a joint venture between four 
entities: University of Liverpool, Laureate, a top-ranked public 
university, and a regional private sector company in China. It was the 
first institution of its type to be licensed by the PRC Government. It 
has in excess of 7,500 students today and continues to grow rapidly. It 
is widely acknowledged as the most successful Sino-Foreign provider in 
China today.
            Monash University
    Laureate's most recent initiative with Monash South Africa (MSA) 
represents our entry into sub-Saharan Africa and an opportunity to 
provide greater access to students in that region. MSA is already a 
leading institution in Johannesburg with 4,000 students. It is operated 
by Monash University, one of Australia's top universities and is also 
ranked in the top one percent of the world's universities by the 2012--
13 Times Higher Education World University Rankings.
Collaboration between Laureate, Other Institutions, and Other Third 
        Parties
    At Laureate, we have found that including other non-educational 
third parties in our partnerships also provides an opportunity to align 
social missions and goals.
            Laureate and the International Finance Corporation
    Laureate and the International Finance Corporation (IFC), which is 
part of the World Bank, have partnered for a number of years to provide 
capital to universities in Latin America. This year, the IFC made an 
additional investment in Laureate in order for us to work together to 
expand access to quality higher education in Sub-Saharan Africa. This 
relationship provides the IFC an educational organization with which to 
work and provides us additional capital so that both organizations, 
together, can meet the same goals.
            Laureate, Johns Hopkins, and Teach for America
    In the U.S., Laureate began a three-way partnership this past fall 
with The John Hopkins University and Teach for America (TFA) to deliver 
an innovative online master's in education degree program. Under the 
partnership, Teach for America teachers enroll in a customized Hopkins 
degree program, where the curriculum is based on Teach for America 
principles and pedagogy. Previously, Johns Hopkins offered just a 
traditional ground-based master's program for TFA teachers who were 
based in Baltimore, but the online delivery format provided by Laureate 
allows Hopkins to reach TFA instructors around the country. This 
program is ideally suited for TFA teachers who were excellent 
undergraduate students and now want a master's degree from a top-ranked 
institution but may lack access to one in the rural or urban school 
district in which they teach.
Public-Private Initiatives Between Laureate and Government
            Morocco and Saudi Arabia
    Our projects in Morocco and Saudi Arabia demonstrate how private 
sector higher education organizations can work together with 
government, financing bodies, and industrial groups to create new 
education models and meet employment demands within country.
    The Universite Internationale de Casablanca (UIC) is the result of 
a joint effort between Laureate, the Moroccan government, and the 
Societe Maroc Emirats Arabes Unis de Developpement (SOMED). It is the 
first private university in Morocco and in Casablanca and serves a 
region that has a large demand for highly skilled workers. A new state-
of-the-art campus is being built there that will be able to accommodate 
more than 12,000 students. We expect students enrolled at UIC to 
benefit from being part of our network, and likewise, expect it will 
provide opportunities to some of our already-existing students to study 
abroad in Morocco.
    In Saudi Arabia, we currently have a number of institutions created 
through partnership with the government there, industrial groups, and 
employers. One example is The Higher Institute for Water and Power 
Technologies (HIWPT), founded in 2011, as a public-private initiative 
launched by the government of Saudi Arabia to meet the increasing 
demand for Saudi nationals in the power and water industry.
    Laureate operates the institution through a joint venture with 
Obeikan Research and Development, one of the largest industrial groups 
in Saudi Arabia.
            New Mexico: Santa Fe University of Art & Design
    We have entered into arrangements with government in the United 
States as well. The roots of Santa Fe University of Art & Design 
(SFUAD) grow directly from New Mexico's oldest chartered college, St.
    Michael's College, which was founded in 1859 and granted a charter 
for higher education in 1874. In the 2000s, SFUAD (formerly the College 
of Santa Fe) was struggling to remain viable. In September 2009, the 
college's doors remained opened thanks to a private-public partnership 
between Laureate Education, the state of New Mexico, and the City of 
Santa Fe. This partnership was initiated by the state and local 
government officials who saw the need to maintain higher education 
options in their state and were not afraid to be innovative in their 
approach.
The Importance of Partnership Between the U.S. Regulatory Triad and 
        with Institutions
    How regulators adapt and respond to existing and new forms of 
innovation in higher education will determine whether institutions are 
able to meet the rapidly changing needs of students in the U.S. and to 
remain competitive worldwide. With reauthorization of the Higher 
Education Act now due, we are hopeful that Congress will examine ways 
to allow for more innovation whether through collaborative 
relationships or otherwise, while continuing to maintain the diversity 
in our higher education system and to ensure a good return on 
investment for students.
    Of course, one of the most important partnerships in the U.S. 
higher education system is the regulatory triad between accreditors and 
the federal and state governments. I know that this committee has 
discussed the triad in other hearings and that it is the subject of a 
Senate HEA reauthorization hearing tomorrow. Successful partnerships 
are built with a good dose of trust and transparency and the regulatory 
construct is a partnership that needs to be clarified and strengthened 
to allow for both. The triad should be strengthened to remove 
unnecessary duplication and instead, each third of the triad should 
rely more heavily on the review and evaluation done by the other two-
thirds.
    The role of accreditors is critical to the success of any 
partnership or other contractual arrangement in which an institution 
enters. The accreditors' current focus on protecting institutional 
mission and quality is not only appropriate--it is necessary. With our 
own institutions and with our partner institutions, we have found our 
goals and interest in continuous improvement and demonstrated results 
to be consistent with those of our accreditors. Any changes to the 
accreditation during HEA reauthorization need to ensure accreditors 
have the right tools to understand and approve appropriate private 
investment and to allow accreditors to distinguish proposals by 
existing and established institutions or models.
    In their new book, Frederick Hess and Michael Horn speak of the 
relationship between regulation and the ability private enterprise has 
to bring innovative power to education. They write that in the 
regulatory environment ``transparency, appropriate regulation, sensible 
policy, and good information on results and performance are * * * all 
crucial elements to a healthy marketplace.'' They continue by noting 
that policy-makers review private enterprise mostly in terms of good 
versus evil.
    I believe the existing federal regulatory framework that regulates 
in part on tax status will become increasingly arbitrary, irrelevant 
and difficult to apply as the student marketplace demands the types of 
innovation and partnerships described above. We strongly support the 
growing interest of federal policy-makers and others to create a 
regulatory structure that is based on outcomes and demonstrations of 
academic quality and financial responsibility across all of higher 
education. We believe this model would be much more conducive to 
innovation than our current construct.
    In addition, during reauthorization, Congress should consider how 
to adapt the manner by which regulators examine and interpret an 
institution's financial capacity and responsibility in order not to 
impede new innovative models, like partnerships. There should be 
regulatory provisions that allow and encourage regulators to recognize 
demonstrated and existing experience and quality in the marketplace, 
such that they may better distinguish institutions during eligibility 
and other decision-making. As higher education becomes even more 
complex, ``one-size-fits all'' regulatory practices and decision-making 
will not work.
    We agree with concerns raised regarding the Department's use of the 
current financial composite score formula and that this area needs some 
restructuring, while, of course, continuing to prioritize the 
protection of federal funds and students. The current construct has 
unintended consequences in some situations because the regulations 
largely rely on institutional structure as a gauge, rather than on 
outcomes. I know that during the new gainful employment proceedings, 
the Department will continue to consider new program approval 
processes. While we understand and share the department's interest in 
preventing the introduction of poor performing or unnecessary programs, 
we believe that the Department needs to weigh that concern carefully 
against the possibility that layering on new, duplicative regulation 
may result in the stunting of the innovation and growth that we're 
seeking to promote at this hearing today.
    Regulators in other countries face similar changes in higher 
education, and we are watching them adapt. It would be unfortunate if 
other countries continue to adapt in education at a more rapid pace 
than the U.S. It is essential that all of our regulators in the triad 
have the right tools, level of understanding, and ability to adapt and 
accept new innovative models as they arise. This is critically 
important to the competitiveness and success of the students we all 
serve.
Conclusion
    I would like to thank the Chairwoman, the Ranking Member, and the 
subcommittee for giving me the opportunity to testify. I look forward 
to continuing to work with both Congress and the Administration on 
higher education reform.
                                 ______
                                 
    Chairwoman Foxx. Thank you very much.
    Dr. Baraniuk, I now recognize you for 5 minutes.

           STATEMENT OF DR. RICH BARANIUK, PROFESSOR,
              RICE UNIVERSITY, FOUNDER CONNEXIONS

    Mr. Baraniuk. Thank you, Chairwoman Foxx, Ranking Member 
Hinojosa, and members of the committee. I appreciate the 
opportunity to be here today to speak with you about a new 
approach we are developing at Rice University to lower the 
costs of textbooks for college students.
    As you know, the high and rapidly rising cost of textbooks 
is a significant barrier to enrollment, persistence, and 
success for millions of post-secondary students.
    Since 1978, textbook costs have risen more than three times 
the average increase of all goods and services in the consumer 
price index. Indeed, the $300 textbook is near at hand and at 
some locales, California community colleges for example, the 
average cost of textbooks now exceeds the cost of tuition.
    No wonder that a recent survey found that 70 percent of 
college students forgo buying texts even though 78 percent of 
those students believe that they will perform worse in their 
course because of it.
    Recently, new alternatives have arisen to address this 
crisis of access. One example is massive open online courses or 
MOOCs that we are going to hear about this morning. Today, I am 
going to speak about another approach, one that is already 
saving U.S. college students millions of dollars.
    OpenStax College is a new nonprofit publisher based at Rice 
University that is harnessing 14 years of experience and 
expertise in open education to develop a library of 25 free, 
high-quality textbooks for the highest impact college courses. 
By high-impact, we mean those courses that combined high 
enrollment with high textbooks costs.
    OpenStax College textbooks are professionally authored and 
are of the same quality as those from traditional publishers. 
Our books are available for free 100 percent of the time in all 
of the standard digital formats including web, PDF, and e-book 
formats. The books are also available for very low cost in 
print for those who prefer a hard copy.
    OpenStax College published its first five books starting in 
June 2012, College Physics, Introduction to Sociology, Anatomy 
and Physiology, and two biology textbooks. Six more texts will 
publish in the next 18 months.
    We have been pleasantly surprised with the reaction from 
students, educators, and administrators. In just over 1 year, 
325 institutions nationwide have adopted our texts. This 
represents 50,000 students who are saving money at community 
colleges, 4-year colleges, and research universities. Examples 
include the University of Texas, Pan American and North 
Carolina A&T University, both who have adopted our physics 
textbook.
    In addition to formal adoptions our texts have been 
downloaded more than 250,000 times and have been used on the 
web by over 2 million unique learners.
    We estimate that using our texts over the past year 
students have saved in excess of $4.6 million which already 
exceeds the cost of developing the first five titles.
    In order to add value and sustain our free books, OpenStax 
College has fostered an ecosystem of for-profit and nonprofit 
partners who drive adoption and provide a way to return a 
revenue stream to sustain our nonprofit long-term. Current 
partners include John Wiley & Sons, Sapling Learning, 
WebAssign, and the University of Michigan among others.
    OpenStax College is also exploring partners with MOOC 
providers to reduce barriers to student learning in such 
settings. One example is the Coursera Introductory Biology MOOC 
that UC Irvine is recommending our biology text.
    The cost of authoring, marketing, and maintaining the 
OpenStax College text has been underwritten by Rice University 
and several philanthropic foundations including the Hewlett, 
Gates, Arnold, Twenty Million Minds, Maxfield, Kazanjian, and 
Lowenstein Foundations.
    We employ a unique venture philanthropic funding model 
where we pay back the investment of our foundation partners in 
student savings. With free open textbooks, the return on 
investment can be dramatic.
    Assuming we reach a very conservative 10 percent market 
share with our 25-book library, we estimate that we will save 
1.2 million students over $120 million every year. Over a 
decade, that is $1.2 billion in student savings, which is about 
50 times the initial investment in developing the textbooks.
    In closing, one could say that the textbook was the answer 
to the educational challenges of the 19th century but it is the 
bottleneck of the 21st century. New models for learning 
materials like OpenStax College not only have the capability to 
yield massive student savings but also provide a clear path 
toward the revolutionary advance in the nation's and the 
world's standard of education at all levels.
    Thank you very much for your time today, and I am happy to 
answer any questions that you might have.
    [The statement of Mr. Baraniuk follows:]

          Prepared Statement of Dr. Rich Baraniuk, Professor,
                  Rice University, Founder Connexions

Summary
    In 1911, Andrew Carnegie joined a movement to make knowledge more 
accessible by institutionalizing the free public library as a resource 
for lifelong learning for millions of people. One hundred years later, 
technological advances have fueled a new disruption, with ramifications 
now not only for access and efficiency, but also for efficacy. Since 
1999, Rice University has offered free educational resources via 
Connexions, a powerful e-textbook authoring and distribution platform. 
Within the next two years, Rice's OpenStax College will complete a 
library of 25 free, high-quality, on-line textbooks for the highest 
impact college courses. All of the books will be available for free in 
Connexions and on the OpenStax College website. At scale, OpenStax 
College will save an estimated 1.2 million students approximately $120 
million each year.
The access crisis
    We tend to believe that all students have the opportunity to earn a 
college degree through hard work in high school and college. But 
because of record-high financial barriers, hard work is often not 
enough.
    The high--and rapidly rising--cost of traditional textbooks is a 
significant barrier to enrollment, persistence and success for millions 
of post-secondary students (see Figure 1). According to the GAO, first-
time, full-time college students spent an average of $886 at two-year 
public colleges on books and supplies in 2003-2004, the equivalent of 
72% of their tuition and fees. In some locales (California community 
colleges, for example), the cost of textbooks now exceeds the cost of 
tuition. No wonder a recent survey [R] found that 70% of college 
students forgo buying texts, even though 78% of those students believe 
they will perform worse in the course. The survey also found that 24% 
of students take fewer credit hours due to the cost of textbooks. 
Considering that 29% of community college students have an income under 
$20,000, textbook costs can be a significant barrier to enrollment, 
persistence, and performance.



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Openstax College
    Since 1999, Rice University has been developing new ways and means 
of addressing the access crisis, starting with the Connexions open 
education platform (cnx.org, more information below). OpenStax College 
(see openstaxcollege.org) is harnessing this experience and expertise 
to build a library of twenty-five free, high-quality textbooks for the 
highest impact college courses (that combine high enrollments with high 
textbook costs); see Table 1. In contrast to current textbook prices 
that in some subjects are approaching $300, this library of titles will 
be available for free to all students 100% of the time.



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    OpenStax College textbooks are professionally authored and of the 
same quality as a traditional publisher's textbook. Packaging high-
quality, turn-key educational content in a form familiar to faculty is 
critical to its widespread adoption. In OpenStax College, both the 
textbooks and the accompanying ancillaries (solutions manual, image 
libraries, lecture slides, test bank) are available in widely accepted 
digital formats, including free webview, PDF, and e-book formats and 
low-cost print.
    OpenStax College published its first five open textbooks starting 
in June 2012 (see Figure 2). These texts, featuring professionally 
developed, peer-reviewed content under the guidance of prestigious 
editorial boards, have been met with positive media reaction [M]. As of 
September 2013, adoptions have increased to over 335 institutions 
representing 50,000 students at community colleges, four-year colleges, 
and research universities. In addition to formal adoptions, the texts 
have been downloaded from the OpenStax College website more than 
250,000 times and used on the web by over 2 million unique learners. 
Together, formal and informal adoptions have already saved students in 
excess of $4.6 million, which exceeds the cost of developing the texts. 
Six more textbooks will publish over the next 18 months (see Figure 2).



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    OpenStax College has fostered an ecosystem of for-profit and non-
profit partners (companies providing computer-based homework sets, for 
example) that both help drive adoption and provide a way to return 
revenue to sustain the initiative long term. Current partners include 
Apple, John Wiley and Sons, Sapling Learning, WebAssign, Expert TA, 
Veritas Tutors, SimBio and the University of Michigan.
    OpenStax College is exploring partnerships with Massively Open 
Online Course (MOOC) providers such as edX and Coursera to reduce 
barriers to student learning in online settings. One example is the 
Coursera Introductory Biology MOOC from UC Irvine [I]. (Beware that the 
term ``open'' in MOOC denotes ``open enrollment'' and not necessarily 
that the learning resources are open licensed or even free. Indeed, 
some MOOCs require or suggest that students purchase an expensive 
traditional textbook as part of the course.)
    The cost of authoring, marketing, and maintaining the OpenStax 
College textbooks has been underwritten by Rice University and by 
grants from philanthropic foundations, including the William and Flora 
Hewlett Foundation, the Bill and Melinda Gates Foundation, the Laura 
and John Arnold Foundation, the Twenty Millions Minds Foundation, the 
Maxfield Foundation, the Calvin Kazanjian Foundation, the Leon 
Lowenstein Foundation. In return for the foundations' venture 
philanthropic investment, OpenStax College aims to make returns in 
terms of student savings. The return on investment can be dramatic. 
With even modest market penetration, free, high-quality textbooks can 
produce benefits many times the value of an equivalent sum invested in 
scholarships. A one-time investment to create a textbook produces 
student savings year after year; a scholarship must be funded annually. 
More specifically, assuming just a 10% market share, the 25-title 
OpenStax College library will save 1.2 million students over $120 
million every year.
The open road ahead
    We live in an increasingly connected world, yet our educational 
systems cling to the disconnected past. Moving forward, OpenStax 
College will enable not only student savings but also new mechanisms to 
democratize education by interconnecting ideas, learners, and 
instructors in new kinds of constructs that replace traditional 
textbooks, courses, and certifications. More generally, the open 
education movement has real potential to realize the dream of providing 
not only universal access to all of world's knowledge but also all the 
tools required to acquire it. The result will be a revolutionary 
advance in the nation's and world's standard of education at all 
levels. And the ``perfect storm'' resulting from the combination of the 
global financial downturn and powerful new communication and 
information technologies means the future will likely arrive much 
sooner than we think. Clearly the education world is in for a 
turbulent, yet fruitful next decade.
                appendix: open textbooks and connexions
    The textbook was the answer to the educational challenges of the 
19th century, but it is the bottleneck of the 21st century. The 
textbook of today remains static, linear in organization, time-
consuming to develop, soon out-of-date, and expensive. Moreover, a 
textbook provides only ``off the rack'' learning that doesn't cater to 
the background, interests, and goals of individual students. 
Communication and information technologies give us a golden opportunity 
to reinvent the textbook.
    Open Educational Resources (OER) include text, images, audio, 
video, interactive simulations, problems and answers, and games that 
are free to use and re-use in new ways by anyone around the world. The 
key elements of OER are:
     open copyright licenses like the Creative Commons licenses 
(creativecommons.org) that turn educational materials into living 
objects that can be continuously developed, remixed, and maintained by 
a worldwide community of authors and editors; and
     information technologies like the Internet and Web, which 
enable easy digital content re-organization and virtually free content 
distribution.
    The OER approach to textbooks provides several key opportunities, 
including:
     bringing people back into the educational equation. Those 
who have been ``shut out'' of the traditional publishing world, like 
talented K-12 teachers, community college instructors, and scientists 
and engineers in industry can add tremendous diversity and depth to the 
educational experience.
     reducing the high cost of teaching materials. In many US 
states, college students now spend more on textbooks than tuition.
     reducing the time lag between producing learning materials 
and getting them into students' hands. Many books are already out-of-
date by the time they are printed. This is particularly problematic in 
fast-moving areas of engineering, science, and medicine.
     enabling re-use, re-contextualization, and customization 
such as translation and localization of course materials into myriad 
different languages and cultures. This is critical if we are to reach 
the entire world's population, where clearly ``one size does not fit 
all'' for education.
    Several OER projects are already attracting millions of users per 
month. Some, like MIT OpenCourseWare (ocw.mit.edu) are top-down-
organized institutional repositories that showcase their institutions' 
curricula. Others, like Wikipedia (wikipedia.org), are grassroots 
organized and encourage contributions from all comers.
    In 1999, Rice University founded Connexions (cnx.org) with three 
primary goals: to convey the interconnected nature of knowledge across 
disciplines, courses, and curricula; to move away from a solitary 
authoring, publishing, and learning process to one based on connecting 
people into open, global learning communities that share knowledge; and 
to support personalized learning (more on this below). Over the last 
fourteen years, Connexions has grown into one of the largest and most 
used OER platforms; each month millions of users access over 22000 
educational ``building blocks'' and 1300 e-textbooks (September 2013). 
In addition to web and e-book outputs, a sophisticated print-on-demand 
system enables the production of inexpensive paper books for those who 
prefer or need them at a fraction of the cost of conventional publisher 
books. Contributions come from authors worldwide in over 40 languages, 
including Spanish, Chinese, Vietnamese, and Afrikaans. Siyaula 
(cnx.org/lenses/siyavula) is developing a complete K-12 curriculum for 
South Africa. Vietnam is using Connexions as a faculty development tool 
(voer.edu.vn). Professional societies like the IEEE are advancing their 
global educational outreach and inreach through content development and 
peer review (ieeecnx.org).
                               references
[B] R. G. Baraniuk, ``Opening education,'' The Bridge, National Academy 
        of Engineering, Vol. 43, No. 2, 2013. Available online at 
        http://www.nae.edu/Publications/Bridge/81221/81237.aspx
[I] A. Williams and D. O'Dowd, ``Introductory Biology: DNA to 
        Organisms,'' UC Irvine course on Coursera.
Available online at https://www.coursera.org/course/introbiology
[M] OpenStax College New Coverage. Available online at http://
        openstaxcollege.org/news
[P] M. J. Perry, ``The college textbook bubble and how the `open 
        educational resources' movement is going up against the 
        textbook cartel,'' Carpe Diem Blog, American Enterprise 
        Institute. 24 December 2012.
[R] M. Redden, ``7 in 10 students have skipped buying a textbook 
        because of its cost, survey finds,'' Chronicle of Higher 
        Education, 23 August 2011. Available online at http://
        chronicle.com/article/7-in-10-Students-Have-Skipped/128785
                                 ______
                                 
    Chairwoman Foxx. Thank you very much.
    Dr. Isbell, you are recognized for 5 minutes.

STATEMENT OF DR. CHARLES LEE ISBELL, JR., PROFESSOR AND SENIOR 
  ASSOCIATE DEAN, COLLEGE OF COMPUTING, GEORGIA INSTITUTE OF 
                           TECHNOLOGY

    Mr. Isbell. Madam Chair, Ranking Member, distinguished 
members of the subcommittee and of this panel, thank you for 
the opportunity to appear here today.
    As requested by the subcommittee, my testimony today will 
explain the origin and intent of Georgia Tech's new online 
Master of Science in Computer Science degree. I would like to 
convey why we have chosen this particular path and to place the 
degree in the context of the wider landscape of higher 
education.
    Georgia Tech has a decades-long tradition of delivering 
high-value educational opportunities to students at all points 
of the demographic spectrum.
    For many years, Georgia Tech's professional education unit 
has led our efforts to reach out to nontraditional students 
through distance learning and other specialized programs.
    Two years ago we created the Center for 21st-Century 
Universities to serve as a living laboratory for new 
pedagogical practices, particularly those focused on 
technology.
    It is in that context that earlier this spring Georgia Tech 
made its boldest move to date in online education with the 
announcement of a Master's of Science in Computer Science 
delivered through the new MOOC-based platform, or OMSCS.
    Offered in collaboration with Udacity and AT&T, the OMSCS 
is the first attempt by any accredited university to deliver a 
full degree program completely through the massive online 
format and at an estimated cost of less than $7,000 for the 
entire degree for most students.
    The question I get asked often is why are we doing this. 
Put simply, we are doing it because we can and because we 
should. So why should we? Rising student costs for higher 
education threaten enrollments at a growing number of 
institutions.
    Structural shifts in the economy have simultaneously 
created a sizable population of un-or underemployed workers in 
need of affordable education and training. At the same time, 
there has been a growing demand for a larger technological 
workforce. Part of our mission at Georgia Tech is to create 
such a workforce.
    So how is it that we can manage to do this? Fundamentally, 
technology has made feasible and affordable the delivery of 
elite quality education, not only through the proliferation and 
penetration of broadband internet, but through affordable and 
portable recording technology, through collaboration tools that 
allow teams of experts necessary to create and support these 
courses to work across large distances, and through online 
social networking that allows students themselves to self-
organize.
    The facts together allow us to lower overhead and to take 
advantage of scales to offer not only a higher-quality degree, 
but an affordable one.
    Even with this new technology, the OMSCS would not be 
happening right now without the critical support and 
collaboration of Georgia Tech's partners in Udacity and AT&T. 
AT&T's technical workforce represents a key constituency for 
this degree, and AT&T has provided critical startup funding 
with an unrestricted gift to Georgia Tech.
    Udacity meanwhile brings more than a mature delivery 
platform. Its approach to course development and leadership in 
massive online education made it the right fit at the right 
time to help support our MOOC-based degree.
    Our top concern is, and will always remain, degree program 
quality. If we cannot offer a Master's in Computer Science 
whose rigor is as good as that of Georgia Tech's on-campus 
program, we simply will not continue to offer the degree.
    To that end, we will start relatively small to test the 
additional infrastructure that the OMSCS requires and then ramp 
up as we understand how to scale while maintaining the quality 
that our students deserve.
    Ultimately, we hope that this approach will allow us to 
reach a much broader set of students, particularly 
nontraditional ones who are unable to invest the time to attend 
the 2-to 3-year program on campus.
    Eventually, we hope to support multiple credentialing paths 
offering professional certificates and other course credit so 
the students have a range of options that fit their needs.
    Those are the goals that we have set for ourselves. 
Accomplishing these goals requires a tremendous level of 
coordination among dozens of professionals in Atlanta and Palo 
Alto, where Udacity is based.
    It requires a public university located in the southeast 
finding ways to work smoothly with a private company on the 
West Coast negotiating time zones, state and federal 
regulations, accreditation considerations, faculty and staff 
schedules, production capacities, and any number of other 
activities with everyone pointed in the same direction for a 
program launch in January of 2014.
    In conclusion, let me add that Georgia Tech does not 
believe that MOOCs are a silver bullet for all the challenges 
that face higher education. We are in a period of innovation, 
it is true. We are also in a period of examination.
    We envision a future where MOOCs and other yet-to-be-found 
innovations will complement traditional education at all levels 
from high school to college to graduate school and beyond.
    Such a world will offer a much richer and more practical 
menu of educational choices for people of all ages, which we 
believe will result in a better educated and more productive 
society.
    On behalf of the Georgia Institute of Technology, I thank 
you very much for your time and attention today, and I look 
forward to our discussion and to working with you to help 
achieve our common educational goals.
    Thank you, Madam Chair.
    [The statement of Mr. Isbell follows:]

    Prepared Statement of Dr. Charles Isbell, Georgia Institute of 
                               Technology

    Madam Chair, Ranking Member Hinojosa, and distinguished members of 
this panel, my name is Dr. Charles Isbell and I am the Senior Associate 
Dean for the College of Computing at Georgia Tech. Thank you for the 
opportunity to appear before this Subcommittee to discuss how Georgia 
Tech is improving access and affordability through innovative 
partnerships.
    As requested by the Subcommittee, my testimony today will:
    1. Describe Georgia Tech's experience and impact in the use of 
technology to advance the quality of higher education
    2. Explain the origin, intent, structure and implementation of 
Georgia Tech's new Online Master of Science in Computer Science (OMS 
CS) degree
    3. Contextualize the OMS CS degree within the broader landscape of 
higher education innovation and technological disruption
    Madam Chair, as you and your fellow Subcommittee members well know, 
the combination of rising cost pressures in higher education and 
exciting new technologies is sparking some thrilling examples of 
innovation in this sector. Structural shifts in the economy--such as an 
increased emphasis on nontraditional students and lifelong learning 
paths--have brought to the forefront the need to adapt our educational 
system to new norms.
    You might have read this past Sunday in the Washington Post that 
the ``traditional'' student now comprises only about a third of current 
college enrollments. The rest are a mix of older students, working 
students, students with families to support, students without formal 
high school degrees, and others whose educational needs historically 
have been under-addressed.
    Georgia Tech has a decades-long tradition of delivering high-value 
educational opportunities to students at all points of the demographic 
spectrum. Last year Georgia Tech Professional Education enrolled more 
than 30,000 students across a curriculum that includes everything from 
K-12 outreach programs to online and professional master's degrees, 
including a new program to help transition veterans into the workforce. 
Professional Education delivers individual courses on everything from 
high school calculus to foreign languages, civil engineering to signal 
processing, web development to Six Sigma--and many more subjects in 
between. In 2012, Professional Education's reach extended to 82 sites 
in 67 cities, spanning 23 states and seven countries.
    Professional Education partners with NASA to operate the agency's 
Electronic Professional Development Network (ePDN), offering both NASA-
specific certificate programs and free online professional development 
programs for K-12 teachers in several STEM fields. Nearly 1,500 
students took advantage of ePDN opportunities in fiscal 2012.
    It is in that spirit that over the past two years, Georgia Tech has 
invested significantly in the promise of ``massive-online'' education. 
In 2011 we created the Center for 21st Century Universities, or C21U, 
led by one of country's foremost thought leaders in higher ed 
innovation (and former dean of our College of Computing), Rich DeMillo. 
C21U's role is to serve as living laboratory for new pedagogical 
practices, particularly those related to technology.
    The center spearheaded Georgia Tech's early and highly successful 
entry into the world of massive open online courses (MOOCs) through our 
2012 partnership with online education provider Coursera. As part of 
the second cohort of elite universities working with Coursera, Georgia 
Tech is responsible for some 20 course offerings that together have 
drawn more than 450,000 students in just 14 months. One of 77 
institutions working with Coursera, Georgia Tech accounts for more than 
10 percent of the company's overall enrollment.
    With funding provided by the Gates Foundation, Georgia Tech has 
produced three Coursera courses that push the boundaries of the format, 
bringing MOOCs into the liberal arts and lab sciences. These courses--
First-Year English Composition, Introductory Physics (with lab) and 
Introduction to Psychology as a Science--have attracted some 48,000 
enrollments. And one of Coursera's most popular courses is taught by a 
Georgia Tech Computing professor, Tucker Balch. More than 100,000 
students have enrolled in Professor Balch's Computational Investing 
course over three offerings, the most recent of which began three weeks 
ago.
    Earlier this spring, Georgia Tech made its boldest move to date in 
online education with the announcement of an online Master of Science 
in Computer Science delivered through a MOOC-based platform (OMS CS), 
offered in collaboration with Udacity and AT&T. First conceived in Fall 
2012 by Georgia Tech College of Computing Dean Zvi Galil and Udacity 
founder Sebastian Thrun, OMS CS is the first attempt by any accredited 
university in the world to deliver a full degree program completely 
through the massive-online format--and at an estimated cost of less 
than $7,000 for most students. Announced in May, OMS CS is set to 
launch in January 2014 with its first cohort of fully qualified, 
degree-seeking graduate students.
    While OMS CS represents an opportunity to dramatically expand 
access, through both cost and delivery method, to an elite-quality 
education for students around the world, it also comes at no small risk 
to Georgia Tech. For every believer in the potential of massive-online 
education, there is an equally confident skeptic who maintains that 
this format could undermine the foundation of higher education and 
cheapen its value to students. OMS CS was supported by three-quarters 
of College of Computing faculty and approved at every level of the 
University System of Georgia; however, we acknowledge there are 
skeptics even on our own campus. Finally, given the level of media 
coverage OMS CS has received in just four months, failure would occur 
on a large, brightly lit stage.
    So why are we doing this? Put simply, we are doing it because we 
can and because we should.
    Why should we? Rising student costs for higher education threaten 
enrollments at a growing number of institutions. Structural shifts in 
the economy have simultaneously created a sizable population of un- or 
underemployed workers in need of affordable education and training 
together with a strong demand for a larger technological workforce.
    According to the Bureau of Labor Statistics, the unemployment rate 
for technology professionals nationwide stands at about three and a 
half percent--roughly half the overall rate. Over the past decade, 
employment in the IT sector has increased by 37 percent, and during the 
recent recession, the Bureau estimates that the technology industry 
lost only 1 percent of its workforce.
    These factors present an opportunity to apply Georgia Tech's 
official motto: Progress and Service. OMS CS addresses both parts of 
this motto. As the first in the world to try this approach, Georgia 
Tech intends to put real force behind the advancement of higher 
education through technology. And the program's ultra-low cost, 
combined with its availability to students anywhere in the world 
through the Internet, promises to expand the global population of 
trained computing professionals.
    How can we? Technology has made feasible and affordable the 
delivery of elite-quality education, not only through the proliferation 
and penetration of the broadband internet, but through affordable and 
portable recording technology; through collaboration tools that allow 
the teams of experts necessary to create these courses to work across 
large distances; and through online social-networking that allows 
students themselves facility to self-organize across distance.
    In the Institute's view, a Master's degree in computer science also 
represents a natural first pilot in massive-online degrees. The 
Master's degree is often a professional degree that emphasizes learning 
through rigorous and structured coursework, as opposed to the rigorous 
but highly unstructured research experiences of the doctoral student. 
Master's students are often older and have the maturity and discipline 
to self-motivate, traits that are critical to student success in a MOOC 
environment. Finally, computing as a field is amenable to the MOOC 
format, as much of its related coursework can be evaluated using 
objective, large-scale processes.
    Of course, OMS CS would not be happening right now without the 
critical support and collaboration of Georgia Tech's partners in 
Udacity and AT&T. An unrestricted $2 million gift from AT&T provided 
critical startup funding, and the company continues to play a central 
role in the program's development. A senior AT&T human resources 
executive chairs the OMS CS advisory board, and AT&T will propose 
course projects for OMS CS students--subject to the approval of Georgia 
Tech faculty--and strengthen its own workforce with OMS CS graduates. 
By supporting this program both financially and through its continued 
participation, AT&T has strongly demonstrated a forward-thinking 
commitment to improving education through innovation.
    Udacity, meanwhile, is much more than a delivery vehicle for OMS 
CS. Its approach to course development and leadership in massive-online 
education made it the right fit to help support our MOOC-based degree. 
Founder Sebastian Thrun taught one of the world's first MOOCs, in 
artificial intelligence, as a Professor of Computer Science at Stanford 
University. At Udacity he has created a focused, highly interactive 
approach to MOOC education, with course segments that continually 
reinforce learning through micro-quizzes and other exercises built into 
the course content itself. These innovations have led to significantly 
higher retention and academic performance rates when compared to other 
MOOC offerings.
    In spite of the anticipated quality of OMS CS courses, both Georgia 
Tech and Udacity acknowledge that the program will not succeed without 
achieving a scale far beyond that of a traditional program. Udacity-
style MOOC development is resource-intensive in terms of both dollars 
and personnel time, and OMS CS course content will be supplemented by a 
human infrastructure much larger than those supporting campus classes.
    Program price is both the engine and outcome of necessary scale. 
The expected price of $6,600--which is actually higher than many 
students will pay, because overall cost depends on the time students 
take to complete the degree--is critical to attracting sufficient 
numbers of students to cover the high initial fixed costs, and 
sustainable program scale also will enable OMS CS to remain at an 
attractively low price to students.
    We have identified a critical educational need in society, found 
two brave and committed collaborators, and sketched out a compelling 
vision for how OMS CS will function at full scale. So how do we get 
started? At Georgia Tech, the College of Computing and Professional 
Education are taking the lead in marshaling forces from across campus 
to build the infrastructure necessary to support a program like this. 
We are working with dedicated colleagues, who are devoting significant 
time to OMS on top of their existing responsibilities, in units such as 
admissions, financial aid, the bursar's office, information technology, 
identity management, accounting and finance, communications, 
assessment, compliance and many others.
    As for the curriculum, a half-dozen faculty from the College of 
Computing are working with Udacity developers and instructional 
designers to create the first OMS CS courses for January's launch. We 
anticipate offering five courses at launch:
     Advanced Operating Systems
     Computer Networking
     Software Development
     Machine Learning
     Artificial Intelligence for Robotics
    We anticipate that approximately 100 students will be admitted into 
each course, though our enrollment plans are made difficult by the fact 
that we cannot fully anticipate the number of qualified students who 
will apply. This program has no comparable offering in the educational 
marketplace against which to gauge demand. As stated previously, our 
estimates for long-term demand are driven not just by current CS 
enrollments around the world, but by our belief that a low-cost, 
accessible degree will significantly expand the global pool of 
prospective students.
    Assuming demand scales as anticipated, we will start small to test 
the additional infrastructure OMS CS requires, then ramp up gradually 
over a three-year implementation period. This implementation will 
involve not only the full Master of Science degree program but also 
additional credentialing options that will accommodate a range of 
student preferences. Not every student wants or needs a full-fledged 
graduate degree--offering professional certificates and transferable 
credit for individual courses gives students a range of options while 
distributing the financial risk across multiple program tracks.
    As we venture into this brave new world of massive-online 
education, our top concern is and will remain degree program quality. 
If we cannot offer a Master's in computer science whose rigor equals 
that of Georgia Tech's on-campus program, we will not continue to offer 
the degree. Further, our metrics for quality will not simply apply to 
course content--students must receive adequate support for success. 
They must be provided application, registration and payment procedures 
that function smoothly and enable them to focus their attention on 
academics. They must have access to trained, knowledgeable staff and 
teaching assistants who can help them navigate both the intricacies of 
computer science and the technology being used to teach it.
    Those are the goals we have set for ourselves. Accomplishing those 
goals requires a tremendous level of coordination among dozens of 
professionals in Atlanta and Palo Alto, Calif., where Udacity is based. 
It requires a public university on the East Coast finding ways to work 
smoothly with a private company on the West Coast, negotiating time 
zones, state and federal regulations, accreditation considerations, 
faculty and staff schedules, production capacities and innumerable 
other activities--everyone pointed in the same direction, toward 
program launch on Jan. 15, 2014.
    As I mentioned earlier, Georgia Tech believes there are very 
specific reasons why a Master's degree in computer science will succeed 
in the massive-online format, and we further believe that this mode of 
delivery will have an important role in a diverse, technologically 
enhanced future for higher education.
    Having said that, we do not believe that MOOCs are a ``silver 
bullet'' for the challenges that face higher education. Georgia Tech 
built its international reputation on the acreage of its physical 
campuses in Atlanta and around the world, and we do not believe online 
degrees can easily replace the residential experience. We envision a 
future where MOOCs and other, yet-to-be-found innovations will 
complement traditional education at all levels, enabling high school 
graduates to enter college better prepared, college students to 
maximize the value of the time they spend on campus, and career 
professionals to continually update their skills and qualifications 
with high-quality, accessible content. Such a world will offer a much 
richer and more practical menu of educational choices for people of all 
ages, which we believe will result in a better trained and more 
productive society.
    In conclusion, let me add that one of MOOCs' most important 
contributions to education is that they have engendered necessary 
conversations among all the constituencies of higher education. What 
does it mean to teach? What are the critical components of learning? 
How can we leverage technology to bring quality, effective education to 
the greatest number of people possible?
    We have been exploring these questions at Georgia Tech for a long 
time. And I for one feel privileged to be part of one our most daring 
efforts yet in search of answers. On behalf of the Georgia Institute of 
Technology, I thank you very much for your time and attention today, 
and I look forward to working with you to help achieve our common 
educational goals in service of this great nation.
    Thank you, Madam Chair. This concludes my testimony.
                            online resources
Georgia Institute of Technology: www.gatech.edu
Georgia Tech College of Computing: www.cc.gatech.edu
Georgia Tech Professional Education: www.pe.gatech.edu
Udacity: www.udacity.com
AT&T Dynamic Solutions for Education: http://www.corp.att.com/edu/
Online Master of Science in Computer Science: www.omscs.gatech.edu
Charles Isbell: Georgia Institute of Technology
Sept. 18, 2013, hearing: ``Keeping College Within Reach: Improving 
        Access and Affordability Through Innovative Partnerships''
Charles Isbell: Georgia Institute of Technology
Sept. 18, 2013, hearing: ``Keeping College Within Reach: Improving 
        Access and Affordability Through Innovative Partnerships''
                                 ______
                                 
    Chairwoman Foxx. Thank you, Dr. Isbell.
    Thanks to all of you for your very informative testimony. I 
will be inviting each member of the subcommittee to ask 
questions of you and I am going to begin with myself, and we 
will have 5 minutes. The clock will be working in the same way, 
so I would ask that you pay attention to that.
    Ms. Singer, how does the regulatory structure in the United 
States slowdown implementation of innovative partnerships? How 
is that a detriment to schools trying to implement these types 
of arrangements in a rapidly-evolving higher education 
landscape? And in your written testimony, you allude to the 
fact that our competition from other countries is a real 
problem.
    So if you would talk a little bit more about that in 
answering the question, I would appreciate it.
    Ms. Singer. Certainly. I would say that our experience has 
been not that regulation is really prohibiting a partnership, 
it is just not helping it.
    What is happening with these kinds of partnerships that we 
are involved with is that they are very complex and I have to 
tell you, sometimes I feel very sorry for both the department 
and accreditors and state officials who are trying to 
understand them.
    They are complex. They want to do the right thing by the 
student, and so what is really happening is we kind of get 
slowed down. There isn't the knowledge of how to handle some of 
these.
    I think we are at a stage where, while people really want 
to help and do the innovation, there is not enough education 
about them. So I think an openness to this, perhaps even some 
staff that might know a little bit more about complicated 
partnerships or at least resources to do that.
    I would also encourage demonstration projects. I know that 
when we were first starting online, the demonstration projects 
were excellent in terms of us really experimenting in finding 
out how online could be helpful in a way that was responsible.
    So I think while there is not big barriers, there is just 
not the encouragement of it and the complexity is what is 
slowing us down. Demonstration projects would help a bit too.
    Worldwide, we are seeing lots of different innovation that 
is happening, and I think part of the advantage that some other 
countries have over us about things is that they are not set in 
a particular way.
    Yes, we have the best higher education system in the world 
and it is still valued that way, but they are fast coming on 
board, watching what we do, and leapfrogging because they are 
not wedded to certain bureaucratic ways of doing things or 
certain investments that they have made. Those are the things 
we have observed.
    Chairwoman Foxx. Thank you very much.
    Dr. Isbell, what did you have to do to get programmatic 
approval from your accreditor? Is there anything you have to do 
differently compared to a traditional program at Georgia Tech 
to comply with federal law or regulations, and did this impede 
the college mission?
    Mr. Isbell. At this point, the answer is we haven't had to 
do much very different. The biggest problem that we have had in 
working with our accreditor is the ambiguity in the rules.
    We had a very long, hour-long conversation with people from 
SACS, which is the accreditor for the southeastern region of 
the United States, to work with us on what exactly it is that 
we meant by this degree and whether we were actually going to 
be able to go forward with it without having a full visit.
    Georgia Tech is up for reaffirmation of its accreditation 
in the next year, and they promised to come and to look very 
carefully at what we are doing.
    I think the good news is that everyone is on the same page 
and that we are all trying to do the right thing together. They 
want to do what is best for the students. We want to do what is 
best for the students.
    The difficulty arises in the complexity of our 
relationships and that it isn't very clear what it means in 
today's society for someone to own a platform or for someone to 
own the curriculum in the education.
    Chairwoman Foxx. Thank you both very much.
    Dr. Docking, we have just about a minute, but if you could 
very quickly explain how you restructured your administrative 
offices and what businesses you have entered into agreements 
with, and what types of jobs are students getting as a result, 
and are those jobs reflective of the local economy.
    Mr. Docking. Yes, Chairwoman Foxx. Essentially, what we did 
administratively was we layered a business model on top of a 
higher education institution by asking two very simple 
questions--how much does it cost to run this institution and 
how many students do we need to have at this institution to 
make it work?
    That number came back at 1,400 students. So we then put 
several strategic investments in place in which we knew how 
much each investment was going to bring in in terms of 
students. So even something like a student symphony--if you 
have a recruiter who has responsibilities for the symphony, you 
can then hold them accountable.
    The relationships that we have gotten in with have to 
support our local community in Southeast Michigan because most 
of our kids are from Michigan--about 80 percent. They would 
like to stay in Michigan, and so they need to be ready for the 
Michigan workforce.
    Chairwoman Foxx. Thank you very much. My time has expired.
    Mr. Hinojosa, I recognize you for 5 minutes.
    Mr. Hinojosa. Thank you.
    I want to commend each one of you because I hear lots of 
panelists at congressional hearings that we have had and each 
and every one of you have really stimulated my mind as to how 
exciting it would be to have you just spend 1 month with each 
member of this education committee so that we could learn from 
you and be able to kick forward these new ideas that you all 
are presenting.
    I would like to start my first question to someone from my 
State of Texas, Rich Baraniuk.
    Can you elaborate on the number of ways in which the open 
educational resources approach to textbooks can benefit 
students and reduce college costs?
    Mr. Baraniuk. I think that--thank you very much for the 
question. There are a number of ways that open educational 
resources are benefiting students right now.
    The first is the fact that the resources are free, which 
means that some of the most at-risk students in America have 
access to resources in order to study, to be able to advance 
their learning outcomes, to be able to actually work on their 
homework at night or at their job when they are taking classes. 
So the first is access.
    The second really critical item behind open educational 
resources is the fact that they can be customized to the local 
context of the individual institution.
    So a faculty member can customize so that his or her class 
has the perfect textbook, if you will, that reaches their 
students, their context, their background, so that they can 
optimize their learning outcomes.
    So this combination of free access and also openness that 
allows the materials to be customized by faculty is a very 
powerful combination.
    Mr. Hinojosa. Let me put a face on this question. I had an 
intern this summer by the name of Maria. She comes from my 
congressional district from a family of four children and she 
is at Rice University getting a masters and doctoral degree at 
the same time. Can she use your textbooks and be able to get 
all the credits that Rice will give so that she can get her 
degrees?
    Mr. Baraniuk. So that the key thing is that we are--
OpenStax College is a publishing initiative and so we aim to 
lower the cost on the learning material side of the equation.
    Of course the total cost of the student attending college 
includes other costs like tuition, fees, et cetera, but there 
is ample evidence that in many locales the cost of the 
textbooks is a very significant percentage of the total cost. 
So we aim to reduce that part down to zero.
    Mr. Hinojosa. Thank you.
    Ms. Singer, I read your material, and it is really exciting 
to be able to say that you are serving 800,000 students. Tell 
me. How do graduation rates for online programs developed 
jointly by Laureate and universities typically compare to the 
universities' traditional on-campus programs?
    Ms. Singer. Our retention rates compare very favorably. We 
started very carefully when we went into online, and we worked 
mostly at the graduate level. We don't think that online is a 
panacea and we don't think online should be used for every 
student.
    So we work very much at--36 percent of our students who are 
at the doctoral level, and online is just fabulous for them in 
terms of their research. So we have very, very competitive 
retention rates and very strong cohort default rates. So I feel 
that the programs do both the quality end of it----
    Mr. Hinojosa. Your answer is music to my ears because we 
are trying to increase the numbers of Latinos and Latinas doing 
masters and doctoral programs, and looking at your material, it 
seems to me that it would really work with us.
    So tell me. Can we use some of the federal monies that are 
available like Pell Grants and other scholarships for these 
Latinos and Latinas to take advantage of what you just said?
    Ms. Singer. Yes, absolutely. For the undergraduate programs 
that we offer and actually--one of our institutions is National 
Hispanic University in San Jose, California, and of course, we 
have such a strong connection with Latin America----
    Mr. Hinojosa. Why not the masters and doctoral programs?
    Ms. Singer. Because they are focused on the undergraduate 
programs. They have access to all of the loans.
    Mr. Hinojosa. Do you plan to add the masters and doctoral 
programs?
    Ms. Singer. I think if we are targeting--I mean, that is a 
big concern as a nation, being sure we reach this fast-growing 
population. I think we should make those kinds of things 
available.
    Mr. Hinojosa. Thank you.
    Chairwoman Foxx. Thank you.
    Dr. Heck, you are recognized for 5 minutes.
    Mr. Heck. Thank you, Madam Chair.
    And thank you all for being here and for the presentations 
this morning.
    Dr. Docking, it is kind of amazing, the renaissance I 
guess, that Adrian went through from 2005 to 2013, and a lot of 
the strategic investments that were made to make that happen. 
Can you tell me, what was the trajectory of the tuition and 
fees at the college during that time period?
    Mr. Docking. We have raised tuition and fees around 4 or 5 
percent. However, I should also add that our financial aid has 
gone up on an even higher trajectory. So we have put in more in 
financial aid than we have charged students.
    Mr. Heck. And I was interested in the meeting that was had 
by the CEOs and the small college presidents to identify the 
talent gap. I think that is something that is critical. A lot 
that this committee has looked at is making sure that we are 
investing resources to prepare future students for the jobs 
that will be as opposed to the jobs that were.
    What did you do, or what did that group of college 
presidents do with that information once they identified the 
talent gap?
    Mr. Docking. Well, what the CEOs--let me start with what 
they said they needed. What they said they needed were problem 
solvers, people that are critical thinkers, people that can 
work in teams. And the thing that really distinguishes our type 
of institution from so many others is our size, which makes us 
very nimble.
    So we took that back. Our academic affairs vice presidents 
looked at it, have already worked with professors to work it 
into the curriculum and to do the types of things that we need 
to do to prepare students for what these CEOs said they wanted.
    Mr. Heck. And so, did that go back and change the actual 
curriculums or was it in some of the delivery models? What was 
done----
    Mr. Docking. Well, both. Both the curriculum and the 
delivery model. Again, you can do things so quickly in a school 
with 1,700 students that it really only takes a couple of 
meetings and those changes can be made.
    And so yes, all of that was done. How we deliver it, even 
the types of experiential education opportunities the kids get. 
We are very, very big on sending kids off-campus and giving 
them an opportunity to do rather than simply just learn in the 
classroom.
    Mr. Heck. Thank you.
    Ms. Singer, in your written testimony you expressed some 
concern that with a regulatory framework that somewhat is based 
in part on tax status, and also you reference the regulatory 
triad and the speed to market. How do you link those things 
together?
    I know it is very important, as was discussed by Dr. 
Docking, about being able to react to changes in the academic 
environment, to be able to have a speed to market. How does the 
regulatory framework, specifically perhaps the framework 
relating the part related to tax status or the regulatory 
triad, impede or facilitate your ability to have speed to 
market?
    Ms. Singer. Yes, thanks for the question.
    I think when we look at the triad, the facilitation can 
happen if--I am talking about trust and transparency. It is 
interesting. That is what is good about partnerships to begin 
with. That is what you have to have.
    And so I think what happens for us is that sometimes there 
is ambiguity. Ambiguity in the regulation is probably more of 
an issue. Uncertainty, more of an issue because then you 
hesitate.
    Should we be doing this? Is it okay? Is it not okay? It is 
complicated. Are we going to be able to move? And then that 
hesitation stops us from moving forward in a way that might 
find new innovative ideas and implement right away on that.
    And I think your comment about tax status, you know, being 
in my position in my company, there is a lot of conversation 
about tax status. Honestly, I have been an educator all my 
life. I have only been in education. I am a reading specialist, 
a Montessori teacher.
    When I look at what I really think the criteria should be 
is that I think the tax status is not the right criteria. The 
right criteria is: are we getting quality outcomes for our 
students? Are they measurable? Can you really show that? And 
are we being good stewards of the taxpayers' dollars?
    I think those are the things that ought to be the marks 
that we use and we ought to use them across all universities 
and not have advantages and disadvantages from one or the 
other. All students, no matter where they go to school, need to 
have the same kind of quality assurance.
    Mr. Heck. Thank you. And lastly again, Ms. Singer, I am 
aware that Laureate has a potential pending partnership with 
the Thunderbird School of Global Management, a state that 
borders mine. Can you tell us about the need for that 
partnership and how you expect it to benefit students?
    Ms. Singer. Yes, that partnership, while we intend to have 
that partnership go through, I must tell you that it has not 
passed all of the accreditation approvals yet, but I think it 
is an interesting story.
    Just very quickly a beautiful, fabulous school, great 
faculty in the MBA world, international, did well for a long 
time. The environment has changed.
    There are many wonderful international business schools all 
over the United States. Lots of competition even from around 
the world. They didn't change that model quickly enough, found 
themselves struggling a bit financially, and not able, more 
importantly, to push forward their mission.
    They did an RFP process, I think, which is very 
interesting. The board went out and said, we need to change, we 
need to get help. They had quite a lot of activity around that.
    We were chosen because of the strategic and financial 
support that we could give, but the strategic piece was most 
important. Our international footprint allows them to fulfill 
their mission very quickly.
    Mr. Heck. Great, thank you.
    Thank you, Madam Chair. I yield back.
    Chairwoman Foxx. Thank you.
    Mr. Holt, you are recognized for 5 minutes.
    Mr. Holt. Thank you, Madam Chair.
    I thank the witnesses. Very interesting. We see quite 
obviously enormous changes taking place, and they will have to 
because it seems the current system is not sustainable. But I 
have to ask whether the proposals that you make or the examples 
you give are sustainable either.
    Let me start with you, Mr. Baraniuk. I certainly see 
advantages to this. What is your goal for market penetration? 
It looks like what you describe, saving a million students $100 
million a year, that is taking $100 million out of the 
publishing business, I suppose.
    What is the long-term prospect for this if this becomes 
dominant in providing textbooks?
    Mr. Baraniuk. That is an excellent question. So to answer 
the first part of the question, our goal is to first of all 
underpromise and overperform, so we have a very conservative 
goal of trying to achieve 10 percent market penetration in each 
of the 25 subject areas that our books are targeting. As I 
mentioned in my remarks, this will save about 1.2 million 
students approximately $120 million per year.
    As far as sustaining our particular initiative, we feel 
that if we can achieve this kind of market penetration then the 
ecosystem of partners that we are building will be able to 
create a sustaining revenue stream that will come back to the 
projects so that we can keep the books up to date, relevant, 
correct and give them a life that can last many, many decades. 
So that is the sustainability question.
    I think the larger issue you bring up is where is the 
publishing industry going, and I think that this is a very 
interesting and deep question. I think that many of the players 
in the publishing industry are moving from a content-based type 
model to a technology type model.
    And I think that initiatives like OpenStax College, because 
we are open source, because we are willing to partner with 
publishers and technology companies, there is a role for them 
to play in this new world.
    Mr. Holt. Okay, thank you.
    Dr. Isbell, now Georgia Tech has this one computer science 
graduate program. Are there others following soon? I read in 
the Chronicle of Higher Education that the university's 
curriculum committee said that they have received no written 
proposal for any new graduate degree, I think including this 
one. Is that right?
    Mr. Isbell. That is not correct. What happened----
    Mr. Holt. That is not correct?
    Mr. Isbell. It is not correct.
    Mr. Holt. So where does the University plan to go?
    Mr. Isbell. So two parts to this. One is the University 
is--first, in terms of governance, the degree program went 
through all of the normal processes through the faculty--there 
was a faculty vote where 75 percent voted for it inside of our 
college. We presented it to the institute committee and we took 
it up to our Board of Regents and it went through without a 
problem.
    The institute is watching very closely as are we all. This 
is a pilot. We plan to move forward very quickly over the next 
year or two and to scale it up as much as feasible given our 
quality goals, and I believe that once we have done that, we 
will expect to see other at least masters level programs follow 
suit.
    Mr. Holt. So is this a small perturbation on the system--to 
use an engineering term--that isn't going to make a big dent in 
college, in university costs in the long run or, if it is going 
to make a big dent in university costs in the long run, how is 
it sustained?
    Mr. Isbell. The answer to both of those are the same. The 
answer is scale. A lot of the costs that we deal with, both in 
this program and in general at a university, are fixed costs. 
So depending upon how you sign those costs, building one of 
these courses on a MOOC platform costs anywhere between 
$200,000 and $300,000.
    That is a lot of money if you are talking about 40 
students. But it is not a lot of money if you are able to reuse 
the material again and again and serve thousands upon thousands 
of students.
    So at our current projections for our costs, if we can keep 
2,000 or 3,000 students, maybe 4,000 students in the program 
overall, we will more than break even.
    That is how we are going to make the sustainability. It all 
boils down to scale so that as you bring in more people, it 
overcomes the large fixed costs, the initial investment that 
you have to make in the program.
    Mr. Holt. Well, I thank the witnesses. Very interesting, I 
think, attractive prospects.
    Chairwoman Foxx. Thank you, Mr. Holt.
    Mr. Bishop, you are recognized for 5 minutes.
    Mr. Bishop. Thank you very much, Madam Chair.
    And I want to thank the panel. This has been really a very 
interesting and helpful discussion. I thank you very much.
    Dr. Isbell, let me just start with you. I just want to be 
clear on something. We hear a lot about how the regional 
accrediting process is often an inhibiting force in terms of 
program development and program innovation.
    And if I understood you correctly, the program that you 
have described is the first master's degree program in the 
country that will be offered exclusively on a MOOC platform. Is 
that correct?
    Mr. Isbell. That is correct.
    Mr. Bishop. And you were able to in effect, gain the 
concurrence of your accreditor by virtue of an hour-long 
conversation and then I would assume some other conversations. 
Is that right?
    Mr. Isbell. That is correct.
    Mr. Bishop. So it is fair to assume that the accreditor was 
cooperative and helpful as opposed to inhibiting?
    Mr. Isbell. Absolutely.
    Mr. Bishop. Okay. Thank you. And congratulations to you. 
Really. It is very impressive.
    I want to go to Dr. Docking. I used to work at an 
institution similar to one--we had perhaps more dandelions than 
you had, more leaky roofs, but I am deeply impressed with what 
you were able to do, and I have a lot of questions about how 
you were able to do it. But when you met with the CEOs, you and 
the other 11 college presidents, did you discuss at all the 
possibilities or the promise of cooperative education?
    I know you have an internship program which differs 
somewhat from cooperative education. One of the things I have 
been talking about and thinking about for a long, long time, is 
the utility of cooperative education both in terms of preparing 
students for meaningful careers, helping businesses basically 
try on employees so they can determine whether they have what 
they need, and also the affordability aspect of earning while a 
student is enrolled as an undergraduate.
    Is that a model that you think might work for you or that 
might work for some of your sister colleges?
    Mr. Docking. I think it is a model that can work with us on 
some level. We have been around since 1859, so people are 
pretty steeped in tradition at these small private liberal arts 
colleges, but the whole idea of cooperating with the business 
community is key for us, and I will just give you a couple of 
good examples.
    We have something called externships where we tell the kids 
during their first year in school, you don't want to study for 
4 years and then get out of here and realize I don't like what 
I am doing. I have an accounting degree and I don't like being 
an accountant.
    So we tell them, go away with an accountant for a day, see 
what they do. If you want 2 days, we will let you off from 
class, but at least experience it and see if you have a passion 
for this. That has worked very well by helping students 
understand very early on this is what I want to do.
    Obviously, the internship model that I described in which 
we say we really want to find internship sites with companies 
that say, ``We want to hire.'' So it can turn into a 3 month or 
1 semester interview rather than an hour in a CEO's office.
    In terms of broader cooperative educational efforts, as I 
mentioned earlier, we have a lot of experiential learning 
opportunities in which our professors get out into the business 
community and work with folks, but they do that on a very 
class-individual basis and we haven't mandated it across the 
college.
    Mr. Bishop. You made several references to the strategic 
investments that you made to begin the turnaround. Where did 
you get the seed money for those strategic investments? Was it 
internal reallocation of resources? Were you able to get a lead 
gift? How did you pull that off?
    Mr. Docking. Yes, I needed $30 million in 2005. I went and 
raised $15 million, and I borrowed $15 million from the banks.
    Mr. Bishop. Okay. Next question. Your tuition has gone up, 
your financial aid expenditures have gone up as well. What is 
your student discount rate?
    Mr. Docking. 52 percent.
    Mr. Bishop. And that is across all 4 years or just for 
freshman?
    Mr. Docking. It is across all 4 years.
    Mr. Bishop. Okay, but you have been able to make that work 
in terms of the volume that you have developed as a result of 
that discount rate?
    Mr. Docking. That is correct. We have been able to make it 
work.
    Mr. Bishop. Okay. But I take from that that you have a 
population that is very dependent on student aid.
    Mr. Docking. We do; 98 percent of our students need 
financial aid.
    Mr. Bishop. Have you been able to assess what impact 
ongoing sequestration will have on your campus-based programs 
and on Pell?
    Mr. Docking. I have not been able to assess that. At these 
small schools, we don't have a big staff to do that, and so we 
had not looked at that closely, but that would be a problem.
    Obviously, we are very appreciative of the support that you 
all have given to student aid programs to our types of schools. 
That is key to us to continue to provide greater education.
    Mr. Bishop. Real quick, I am about to run out of time.
    If campus-based goes down or Pell goes down, does that mean 
that your discount rate goes up or your enrollment goes down or 
some combination thereof?
    Mr. Docking. It would be devastating. Our discount rate 
would go up some but we would certainly lose a lot of students.
    Mr. Bishop. Okay. Thank you very much and congratulations.
    Mr. Docking. Thank you.
    Chairwoman Foxx. Thank you.
    Mr. Walberg, you are recognized for 5 minutes.
    Mr. Walberg. Thank you, Madam Chairman.
    Mr. Isbell, interesting program; exciting to think about 
the potential. Could this model that you are working in now in 
the sciences--could it work with liberal arts, humanities to 
make it be cost-effective as well as the quality that would be 
there?
    Mr. Isbell. Sir, I will defer to my liberal arts colleagues 
for an answer for that, but we believe that for a lot of the 
sort of courses that are out there, the answer is probably yes.
    There are people who are exploring options like this mostly 
at the undergraduate level, and at the master's level we have 
been targeting with this or the sorts of courses that are well-
understood and can manage where we can disseminate information 
to thousands of people at once.
    We do have people who work on more liberal arts sort of 
courses even in the College of Computing, and they are 
currently exploring ways to take all of this work.
    Publishing is actually a big issue here. What does it mean 
to provide readings to people possibly all over the world 
without violating copyright? There are a lot of technical 
details that have to be worked out, but in principle, it is 
possible.
    Mr. Walberg. The present pricing structure that you have, 
could you go in a little more detail on that? To hear that a 
master's total cost is $7000 for the student, you have the 
basic cost worked out. Go into a little more detail of how your 
pricing structure operates.
    Mr. Isbell. We did something very simple. We sat down--it 
was a very difficult exercise, but it was fairly 
straightforward--we sat down and we tried to capture all of the 
costs. It turns out the bulk of the costs again are fixed 
costs.
    What does it mean to produce one of these courses? We 
worked out how much it would cost us in order to do this. If we 
assumed that we had a steady-state in the low thousands, how 
would we be able to break even, and then we priced it 
accordingly.
    We started out with the goal of try to do something under 
$10,000, expecting that we might be able to get as low as 
$4,000, and we ended up roughly where we are at about $6,600. 
So we tried to account for all of our costs, put a little bit 
of a buffer in there, and then priced accordingly.
    Mr. Walberg. Great, thank you.
    Dr. Docking, how real is the threat to small liberal arts 
colleges of closing, and what is the key facilitator of the 
closing?
    Mr. Docking. Yes, I think I just read recently that 70 to 
75 percent of small liberal arts colleges either have flat or 
falling revenues right now.
    I did a study recently at the college that showed about 30 
colleges that closed over the last 10 years, small liberal arts 
colleges, and it would really be devastating I think to the 
landscape of higher education in America if these were not 
available as an option to young people. It is a very real 
concern.
    Mr. Walberg. I had the opportunity to watch the turnaround 
take place and innovation that went on there, risks that were 
taken, roadblocks that were in the way. Talk a little bit more 
about the first steps in taking that simple strategy of what 
does it cost to run the program, how do we get to the 
enrollment to achieve that.
    Mr. Docking. Yes, well, as I mentioned earlier, efficiency 
at these small liberal arts colleges is absolutely key. I only 
have 93 professors, a small staff, and it is an environment in 
which you have to pay attention to every single penny.
    So when we knew we had to get to 1,400 students, we said, 
well, how many are we going to get just by being here on the 
map? And it only came up to about 600. So we knew we had a lot 
of growth.
    And we put people in charge of specific programs much like 
a salesperson with a sales quota and they needed to meet that 
number and if they couldn't meet that number, then it wasn't 
going to work out at the college.
    What we learned about it was that people like that 
accountability. Whether it is a hockey coach looking to fill a 
hockey team or someone filling numbers for a marching band or 
even thinking about doing it in something like health care 
management in which we started a new major in health care 
management because our area needs this but we have----
    Mr. Walberg. Was it just numbers? Were there other factors 
that you mandated in that process?
    Mr. Docking. Were there numbers for other faculty did you 
say?
    Mr. Walberg. Well no, was it just numbers like a hockey 
coach? He needed to find more players.
    Mr. Docking. No, obviously there were academic standards 
that the young people had to meet, and they had to be good 
students, but he needed to bring in numbers of good quality 
kids that could do the academic work and play hockey.
    Mr. Walberg. Federal barriers in the process? What federal 
barriers would you list quickly here in the final seconds?
    Mr. Docking. Well, the financial responsibility standards 
is the one that is the most difficult for us right now. I don't 
know if it is a one-size-fits-all view, but it really takes a 
lot of time and does not reflect the economic strength of an 
institution. That is the problem right now. It really should be 
looked at.
    Mr. Walberg. So as we move ahead with reauthorization, 
financial standards account----
    Mr. Docking. 100 percent. Of 160 schools like Adrian last 
year, about that did not pass and it is crazy. These are good 
strong schools. They have been around longer than most of the 
banks.
    Mr. Walberg. Thank you.
    I yield back.
    Chairwoman Foxx. Thank you.
    Ms. Bonamici, you are recognized for 5 minutes.
    Ms. Bonamici. Thank you very much, Madam Chairwoman.
    This has been a fascinating discussion. I have really 
appreciated it, and I want to follow up for a moment if I may, 
Dr. Docking, on your comment about the talent gap in bringing 
together colleges and business leaders.
    We have had a lot of success in that area in the district I 
represent. Portland Community College, for example, has a 
renewable energy system program where students can learn to be 
renewable energy technicians.
    And interestingly, at Chemeketa Community College we have a 
viticulture program where students can study the wine business, 
vineyard management, and winemaking, which is a big part of the 
economy there. So those partnerships have been very successful.
    I want to follow up on your internship program that you 
mentioned. Our goal and purpose of this hearing today is 
talking about improving access and affordability through 
innovative partnerships.
    Access is an issue with internships that often raises 
equity issues because low income students often have to take a 
paid job, can't take an internship, which is often times 
unpaid.
    So how do you address those challenges of low income 
students? And I want to mention that I am working on the 
Opportunities for Success Act to try to deal with that equity 
issue and make unpaid internships more available for low income 
students. So paid internships or how do you address that issue?
    Mr. Docking. Sure. First of all, let me say that over 900 
of our students are on Pell. So we are a very working-class 
college, almost 10 percent students of color. So it is very 
important that they make money in their internships. So we 
almost look exclusively at paid internships.
    The second thing that I wanted to mention that was pointed 
out, this talent gap program that we went to, is that the 
business leaders that were there said the two things that they 
find most helpful in students is A, that they have an 
internship so that they know what they are getting into and B, 
that they do a sort of senior project in which everything comes 
together in a capstone and the kids can synthesize all of the 
information they received over 4 years.
    I found the business community to be very, very open to 
both sharing those ideas, and then once they get to know us, 
working with our kids to give them paid internships. It is 
something that they are very, very happy to participate in.
    Ms. Bonamici. Thank you so much, and obviously it helps 
them a lot when they graduate to have that experience.
    So I want to talk about the MOOCs. So, like many people 
across the country, I'm really interested in the potential of 
these massive online courses, but to me, the jury is still out. 
I am still a little wary about their widespread adoption before 
we really talk about the consequences, positive and negative.
    So what I've found is that out there, in the real world, in 
the business world, and in society that qualities like the 
ability to work as a team member, communication, relationship 
building skills, those are all developed throughout a student's 
time in school. Growing in these areas continues of course in 
post-secondary education and they are very important to success 
in the world.
    So though MOOCs have potential, especially with older 
nontraditional students, and I know, Dr. Isbell, you mentioned 
that. Can we talk a little bit about whether they neglect this 
in-person development and those skills that students need to 
really go on and be successful?
    I think we will start with Dr. Isbell. What are your 
thoughts on that because that type of teamwork, communication 
and relationship building doesn't happen with online learning? 
Or maybe you think it does.
    Mr. Isbell. So this is one of the reasons why we started 
with a master's degree, so that we were mainly focused on 
people who were already professionals, who were already in an 
environment where they had built a lot of those skills.
    So our expectation--you will have to ask me in a couple 
years how it worked out--but our expectation is that many of 
these people will be from places like AT&T, places like GE, 
where they actually have a cohort locally where they can work 
on projects together as they continue their education. So we 
think at that level, it is going to be a big win.
    At the lower level, at undergraduate, it is very unclear 
how we would be able to leverage that sort of thing alone. Our 
current belief is that at least at Georgia Tech we are going to 
try to use things like MOOCs to complement the undergraduate 
education. Certainly not to replace it.
    Ms. Bonamici. Thank you.
    Anyone else care to comment?
    Ms. Singer. If I might, I think the MOOCs--you have to--one 
thing about MOOCs is that right now, a little different than 
what you are doing, is that they are mostly about courses and 
what I understand that you are working on are degree programs 
and a degree is much more than the sum of its parts as you are 
indicating.
    So I think really careful design of a degree program 
whether at the undergraduate level or at the graduate level, 
starting with the employer outcomes that are necessary, and 
really what happens with online and with MOOCs is that you can 
actually just design the scaffolding and the way that you want 
those students to go through to assure success.
    But the other thing about an online environment is you have 
to build the support structure around it. We talked about 
retention rates and so forth. It is about the support 
structure. It is about the conductivity that happens, but I 
will disagree about one thing.
    The collaboration that can happen online particularly 
around the world--and it is not just online--I think sometimes 
we have a misnomer there, even MOOCs, it is more than that. It 
is about using educational technology to connect people. That 
is how business is working now. We are working across countries 
and across borders.
    Ms. Bonamici. Exactly. Well, thank you so much. My time has 
expired.
    I yield back. Thank you, Madam Chairwoman.
    Chairwoman Foxx. Thank you.
    Mr. Tierney, you are recognized for 5 minutes.
    Mr. Tierney. Thank you very much.
    Mr. Baraniuk, I am curious to talk a little bit about the 
savings that can be there for students with regard to textbooks 
being online, for those resource materials.
    How are we going to expand that out from where you are now, 
25, and get to a larger number? What barriers are there to 
doing that, and what policy implications might there be for us 
in trying to make that happen?
    Mr. Baraniuk. Thank you very much for the question. Very 
interesting.
    So our plan is to start with an initial library as I 
mentioned of 25 textbooks. The reason why we selected these 25 
books is because they capture a very large percentage of the 
total college enrollment across community college, 4-year 
college, and even elite universities.
    So we believe that by focusing initially on those 25 
courses, we will be able to make the most impact and also be 
able to save the most students the most money.
    That said, if the project is a success and we have good 
reason to think that it will be, we are very interested in 
looking at expanding into other domains and also expanding our 
collaborations both with other ecosystem providers like 
publishers, like computer-based homework providers, MOOC 
providers, et cetera.
    I think that because the choice of the textbook in a class 
is primarily the choice of a faculty member or a college 
textbook committee, we feel that there are not necessarily many 
barriers in the way to having our books be adopted on a wide 
scale.
    All that said, I think that the key issue that we face 
today or the key barrier that we face is just getting the word 
out about the project.
    We find that when students--or when faculty, rather, find 
out about the project, they are usually ecstatic because they 
know that their students are at risk, and they would like to do 
anything they can in order to see that they can get access to 
high-quality educational materials.
    Mr. Tierney. Thank you.
    I want to talk a little bit--I am not sure who to direct 
this question to, so I open it to anybody, about the online 
potential for nontraditional students.
    We have a number of institutions in Massachusetts that 
really have a lot of nontraditional students who need to be 
able to afford to go to school. They need to be able to have 
the flexibility time-wise around the rest of their life, 
whether it is family or work or both of those, and they really 
need to have some credentialing because they stop in and out. 
They don't want to wait until they finish a 4-year completion 
program or even a two.
    Sometimes you like to know that when you reach a certain 
level of accomplishment, there will be something there that you 
can take tangibly with you and it encourages you to come back 
and build on that.
    How do we see online courses addressing those factors?
    Ms. Singer. I can take a first stab at that.
    I think nontraditional students and that is a wide range of 
people. So it could be first time--it sounds to me like first-
generation students coming in perhaps or the working 
professional, the working adult.
    I think one of the comments that you made is they need to 
be able to get the credential and then go back to work and come 
back.
    One of the things that is important about online, I think, 
is that it makes it more accessible because you can keep a job 
going if the degree has been created correctly so that you can 
actually keep your job, do your work at a pace that is 
appropriate for you.
    But, I think the other thing that you are insinuating here 
that is important is that there is a way to design programs for 
students that they can get a certificate or be certified in a 
certain area, up their skill set, go back to work, come back, 
finish that degree.
    So I do think the way we think about designing programs and 
being sure that courses can lead to certificates and can lead 
to those degree programs and then making them accessible in the 
home is very important. You have to put the right services 
around it.
    Mr. Tierney. I was just going to say that. Their 
indications are that this population in particular has some 
experience in the online course but find that they need more 
support----
    Ms. Singer. They need much more support----
    Mr. Tierney [continuing]. Individuals that they can 
contact----
    Ms. Singer. And that is why it is not always less 
expensive.
    Mr. Tierney. That was my next point is how does that affect 
the price----
    Ms. Singer. The course design--I will just say to you, 
content is a commodity. Content is a commodity. So what is it 
that the institution of higher education is giving to it 
students? It is taking them from where they are, understanding 
what skills they need, giving them the support, the bridge 
support that they need around it so that they can be 
successful----
    Mr. Tierney. So in the end, it may be more expensive to 
address that population with online----
    Ms. Singer. It could be if you have a group that really 
needs--you have got to be able to--it may be a little bit more 
expensive, but the value won't be there for the student if you 
allow them to enroll in a self-paced--and online is not all 
self-paced--I would tell you that those students need to be in 
a class, online class with a professor who knows how to work 
with students who might be struggling and the support structure 
needs to be in there. You will have a savings on the content 
end of it.
    Mr. Tierney. Thank you.
    Chairwoman Foxx. Thank you very much.
    I want to thank the witnesses for their comments. This has 
been a very, very useful hearing today, and I want to thank you 
for taking your time to testify before the subcommittee today.
    Mr. Hinojosa, do you have any closing remarks?
    Mr. Hinojosa. Yes, thank you.
    I would like to thank our expert panelists for joining us 
today and for sharing their invaluable experience and 
expertise, and I have to say that from my perspective, this is 
one of the best congressional hearings that I have participated 
in, and we thank each and every one of you.
    In fact, when this is over, I am going to come down there, 
and shake your hand. [Laughter.]
    Ms. Singer. Thank you.
    Mr. Hinojosa. As we move forward, on the HEA 
reauthorization, I look forward to working with you and all of 
our higher ed stakeholders to encourage innovative partnerships 
that really promote affordability and accessibility and college 
graduation success.
    With that, I yield back.
    Chairwoman Foxx. Thank you very much.
    And again, I want to thank all of you for coming.
    I always have a lot more questions than we have time to ask 
so these hearings could go a lot longer, but what I would like 
to say to you is we will be submitting some questions to you.
    And the overriding question that I would like to ask you to 
respond to, in writing when you get an opportunity and the 
staff will handle this much more formally, is we are going to 
be dealing with the reauthorization of the Higher Education Act 
and I would like to hear from you what policy changes you would 
suggest to make public-private partnerships easier and more 
effective.
    I think that is obviously at the heart of what we are 
hoping to get at by a hearing like this is how can we make them 
more effective.
    I have mentioned before at these hearings that I have been 
around in higher education for a long time. I have heard some 
of the comments that have been either spoken or alluded to 
today for a long time and we sometimes--I sometimes feel we 
aren't getting much closer to them.
    The issue of outcomes versus inputs. I have always felt 
that that should be where we should be looking. We haven't been 
able to move higher education very far in that direction in my 
opinion, but with the technology that we have and the ability 
to use that technology, it seems to me we should be moving much 
closer.
    I think that we have all heard the old cliche that trying 
to change higher education is like trying to turn a battleship. 
It takes a long time to do it. Fortunately again, we have been 
delivered of a lot of opportunities, particularly through 
technology and with the interest of the private sector.
    I believe higher education has been failing in many cases 
to produce the skills in people that the private sector needs, 
and so I am very happy to see the private sector pushing higher 
education to do more to meet the needs of the workplace, and 
that is obviously what higher education is for.
    I say we should emphasize the fact that 4-year degrees, 
online degrees, whatever they are, they are focused on helping 
people get jobs.
    I think there has not been enough recognition sometimes of 
that by the higher education community, which has in the past I 
think been pretty insulated and looking to itself for what it 
likes to do and not necessarily what needs to be done for the 
broader society, although there are wonderful exemptions to 
that.
    So I thank you all again for being here today, for helping 
stimulate some very good conversations and new ways of thinking 
because that is important for us on this subcommittee and the 
larger committee too.
    There being no further business, the subcommittee stands 
adjourned.
    [An additional submission of Chairwoman Foxx follows:]

            Prepared Statement of Javier Miyares, President,
               University of Maryland University College

    I would like to thank Chairwoman Foxx and Ranking Member Hinojosa 
for inviting University of Maryland University College (UMUC) to submit 
testimony for the record of this important hearing on innovative 
partnerships in higher education.
    Let me begin with a brief description of UMUC, its history and its 
current direction.
    UMUC is a public university and is part of the University System of 
Maryland. With over 97,000 students stateside and internationally, it 
is the nation's largest public institution of higher education.
    UMUC has a long and proud history of creative approaches to 
challenges in higher education. In fact, UMUC was created in 1947 to 
fulfill the educational needs of the people considered our first non-
traditional students--the GIs returning from World War II. They were 
older, had jobs and families and did not seek the traditional college 
experience.
    UMUC brought higher education to them--where they lived and 
worked--across Maryland and in the process became a trailblazer in 
distance education.
    In 1949, UMUC was the first to answer the call from the Pentagon to 
send faculty overseas to teach active duty military personnel in Europe 
and Asia. The university has continued to serve the military and their 
families to this day. Over half our current students, about 55 
thousand, represent active duty military, veterans, and their 
dependents.
    UMUC also was one of the earliest adopters of the Internet as a 
course delivery platform, offering its first online course in 1994. 
Since that time the university has continued to innovate with course 
and curriculum design. Today, 85 percent of the courses UMUC offers are 
online and the remainder is delivered in a hybrid--or blended--format.
    UMUC is focused on the goals of high quality, affordable education, 
addressing the needs of non-traditional students, harnessing 
technology, emphasizing prior learning and competency-based learning 
and shortening the time to graduation.
    To help achieve these goals, the university has sought innovative, 
strategic partnerships.
UMUC's Innovative Partnerships
    UMUC has entered into several types of partnerships to facilitate 
learning and reduce the time to a degree. These partnerships fall into 
three categories:
    1. Partnering with companies and organizations that provide 
services such as learner analytics or specific training courses
    2. Partnering with other higher education institutions
    3. Partnering with companies that hire--or could hire--our 
graduates to consult on curriculum development and specific skills 
necessary for employees.
Learner Analytics Help Avoid Negative Outcomes and Promote Success
    UMUC has partnered with Civitas Learning, a Texas-based company 
that builds predictive models of student behavior. As a result, UMUC 
can now reliably predict certain student outcomes allowing the 
university to take proactive steps to improve student performance and 
retention.
    With 85 percent accuracy these models allow UMUC to predict, on the 
first day of an online class, who is likely to succeed and who might 
struggle. With these data, faculty and support staff can design 
interventions to help students overcome difficulties.
    Data analysis indicates that students who sign up for an online 
class the day before it begins are much more likely to struggle and 
withdraw or fail than students who register four or more days ahead of 
the first day of class. To decrease the withdrawal and failure rate, 
UMUC now closes registration four days prior to the first day of class. 
Results indicate an increase of over 2% in successful course completion 
rates. This can result in hundreds of more successful students.
    Civitas Learning and UMUC also determined that familiarity with the 
syllabus is a predictor of success. Students who access a course 
syllabus early and often are more likely to succeed in a class than 
those who do not.
Within Three Years, UMUC Will No Longer Require Hard Copy Text Books, 
        Providing Significant Savings for Students
    By partnering with several organizations, including non-profit 
Merlot.org, (Multimedia Educational Resources for Learning and Online 
Teaching), UMUC, through use of Open Education Resources, will move 
away from hardcopy textbooks, while eliminating the cost of other 
course materials. Digital resources, learning activities, and content 
will ultimately be available for students 24/7 online. By fall of 2014, 
50% of course materials will be available online. UMUC plans to 
eliminate all costs for course materials in undergraduate programs by 
fall 2015, and in graduate programs by fall 2016.
Professional Development Classes Foster Ongoing Personal Advancement
    Because UMUC seeks to serve the learning needs of all adult 
students, the university offers a wide variety of non-credit/
professional development classes. The university partners with the firm 
EXTOL which has developed and structured courses that are particularly 
successful for adult learners. While these are non-credit courses, they 
can provide helpful professional credentials for participating 
students.
Partnering With Other Higher Education Institutions Expands Academic 
        Reach
    Through contracts with the Department of Defense, UMUC provides a 
range of degree programs to active duty military personnel in Europe. 
The DoD recently sought graduate and undergraduate degrees in social 
work. UMUC responded by partnering with Salisbury State University in 
Maryland to offer social work degrees to its overseas students.
Partnering with Community Colleges Saves Students Time and Money
    UMUC has partnerships with 93 community colleges nationwide and is 
the only university that has partnered with all sixteen community 
colleges in Maryland. These partnerships ensure that students who have 
earned credits from 351 selected programs from any of the identified 
schools can automatically transfer those credits to UMUC. Too often, 
students take classes they assume will count toward their degree only 
to find that other schools will not accept those credits. By entering 
into these academic alliances, UMUC takes the guess work out of 
transferring. Students know before they take classes whether they will, 
in fact, transfer to UMUC.
    UMUC's transfer agreements also promote associate degree 
completion, which has been shown to be an important milestone 
achievement in a student's education. With programmatic transfer 
agreements, pathways to completion are the focus at both the community 
college and UMUC.
UMUC Corporate Learning Solutions--Partnering with Businesses to 
        Develop Workforce Ready Graduates and Retain Highly Skilled 
        Employees
    Through its Corporate Learning Solutions Department, UMUC partners 
with companies, associations, government agencies and local 
organizations to accomplish key goals:
    a. Provide currently offered programs to employees in more direct 
and supported ways, and
    b. When appropriate, develop certificate programs, programs to 
strengthen professionalism, tactical skills and leadership capabilities 
in line with the organization's specific strategic objectives. UMUC 
works with organizations to customize curricula to specific needs, so 
employees master the skills and competencies necessary for advancement 
and to become more highly productive. Two examples are outlined below:
            Booz Allen Hamilton
    The university has established a successful partnership with Booz 
Allen Hamilton, one of the nation's leading providers of cybersecurity 
talent and expertise. With the rapid rise in demand for skilled 
cybersecurity employees, UMUC partnered with Booz Allen to develop 
curricula and programs for three UMUC Graduate Certificates:
    1. Foundations of Cybersecurity,
    2. Cybersecurity Policy,
    3. Cybersecurity Technology.
    To date, more than 500 Booz Allen employees have taken courses. The 
goal is to help Booz Allen build a talented, ``Best in Industry,'' 
cyber workforce.
    Because the State of Maryland is considered the epicenter of 
cybersecurity activity, UMUC designated a senior academic administrator 
to serve as liaison to the cyber industry. This ensures that UMUC is 
offering cutting edge programs to an expanding workforce.
            Baltimore Police Department
    UMUC partnered with the Baltimore Police Department to develop a 
customized Leadership Program. By consulting with the department and 
understanding its unique challenges and constraints, UMUC designed a 
curriculum that fits the needs of both individuals and the department. 
Police Commissioner Frederick Bealefeld sought an education program 
that would also instill the desire to learn in his department. UMUC is 
proud of this partnership and the role it has played in making the 
Baltimore Police Department more effective.
    For more information on these partnerships, visit, http://
www.umuc.edu/corporate/index.cfm
    In conclusion, I would like to compliment the subcommittee on the 
interest it has taken in exploring innovative strategies being pursued 
by universities like UMUC. If the higher education community as a whole 
is to meet the workforce demands of the 21st century, it must embrace 
change. UMUC is proud of its history of proactive efforts to embrace as 
well as harness new technology to meet evolving workforce needs.
            Thank you.
                                 Javier Miyares, President,
                         University of Maryland University College,
           3501 University Boulevard East, Adelphi, Maryland 20783.

                              www.umuc.edu

 corporate learning solutions--education alliance partners partial list
 American Council on the Teaching of Foreign Languages (ACTFL)
 American Chemical Society (ACS)
 AmerisourceBergen
 Armed Forces Communications & Electronics Association (AFCEA)
 Analytical Services & Materials (AS&M)
 Applied Integrated Technologies (AIT)
 ARINC
 ASM Research
 Association of United States Army (AUSA)
 AT&T
 Baltimore Police Department
 Boeing
 Booz Allen Hamilton
 CACI
 Calvert County Sheriff's Office
 CGI
 Connections Academy
 DC Office of Unified Communications
 DC Water
 Federal Labor Relations Authority (FLRA)
 Foundation for Advanced Education in the Sciences (FAES)
 G4S
 GEICO
 Global Network Services (GNS)
 Health & Human Services (HHS)
 InfraGard
 Jacobs Technology
 Jiffy Lube
 K12
 L-3 STRATIS
 Lockheed Martin
 Lunarline
 Luxottica
 ManTech
 MedStar Health
 National Center for Missing and Exploited Children (NCMEC)
 National Technical Honor Society (NTHS)
 NJVC
 Northrop Grumman
 Ongoing Operations
 Open System Sciences (OSS)
 Patricio Enterprises
 Precise Systems
 Prince William Chamber of Commerce
 Raytheon
 Ross Technologies (RTGX)
 SAIC
 Smithsonian Institution
 Social Security Administration
 StraighterLine
 TASC
 TerpSys
 TISTA
 UMBC Training Centers
 URS
 US Pharmacopeial Convention (USP)
 Washington Suburban Sanitary Commission (WSSC)
 Walgreens
 Yellow Ribbon Fund
                                 ______
                                 
    [Questions submitted for the record and their responses 
follow:]

                                             U.S. Congress,
                                  Washington, DC, October 29, 2013.
Dr. Richard G. Baraniuk, Victor E. Cameron Professor,
Electrical and Computer Engineering, Department of Electrical and 
        Computer Engineering, Rice University, MS-380, 6100 Main 
        Street, Houston, TX 77005.
    Dear Dr. Baraniuk: Thank you for testifying before the Subcommittee 
on Higher Education and Workforce Training at the hearing entitled, 
``Keeping College Within Reach: Improving Access and Affordability 
through Innovative Partnerships,'' on Wednesday, September 18, 2013. I 
appreciate your participation.
    I have enclosed an additional question for inclusion in the final 
hearing record. Please provide a written response no later than 
November 15, 2013. Responses should be sent to Brian Melnyk or Emily 
Slack of the committee staff who can be contacted at (202) 225-6558.
    Thank you again for your important contribution to the work of the 
committee.
            Sincerely,
                                 Virginia Foxx, Chairwoman,
           Subcommittee on Higher Education and Workforce Training.
                    chairwoman virginia foxx (r-nc)
    What policy changes would you recommend in the upcoming 
reauthorization of the Higher Education Act to make public/private 
partnerships easier and more effective?
                                 ______
                                 

      Dr. Baraniuk's Response to Question Submitted for the Record

    What policy changed would you recommend in the upcoming 
reauthorization of the Higher Education Act to make public/private 
partnerships easier and more effective?

    Considerable funding has been allocated to the creation of open 
education resources (OER). However, efforts to grow the burgeoning 
ecosystem of OER, increase awareness of OER options, and increase local 
adaption of OER are not as mature. To address these needs and increase 
OER use, I recommend a two phased approach.
    First, I recommend creating incentives for non-profit and for-
profit developers to create resources and training programs that both 
facilitate learning and drive-down costs. These incentives should be 
available to programs that increase development and use of adaptive 
learning/technologies, create interactive learning objects, or 
facilitate training and deployment in classrooms. Such monetary 
incentives would help for-profits manage financial risks and allow non-
profits to enhance offerings at greatly reduced cost.
    Second, institutions and faculty should be encouraged (either 
monetarily or programmatically) to support local adoption and 
adaptations. Funds used to adapt OER provide much greater impact 
leverage than those used to build redundant content from scratch. 
However, institutional and faculty investments are required to make 
systemic changes that increase adoption. Some institutions recognize 
this hurdle and have responded with models that could be replicated 
across the country. For example, Tacoma Community College in Washington 
State has an OER group that works with faculty to increase awareness of 
OER and provide them adaptation grants. The University of Oklahoma's 
Center of Teaching Excellence promotes the use of OER and provides 
faculty with resources to locally adapt materials.
    I believe that the next step in OER adoption will be the maturation 
of the OER marketplace. Incentivizing developers to train and 
institutions to adapt OER will help drive demand for additional high-
quality OER and give Congress an opportunity to lower costs and 
barriers to education for students across the country.
                                 ______
                                 
                                             U.S. Congress,
                                  Washington, DC, October 29, 2013.
Dr. Jeffrey R. Docking, President,
Adrian College, 2131 Heatherwood Drive, Adrian, MI 49221.
    Dear Dr. Docking: Thank you for testifying before the Subcommittee 
on Higher Education and Workforce Training at the hearing entitled, 
``Keeping College Within Reach: Improving Access and Affordability 
through Innovative Partnerships,'' on Wednesday, September 18, 2013. I 
appreciate your participation.
    Enclosed are additional questions submitted by members of the 
subcommittee after the hearing. Please provide written responses no 
later than November 15, 2013 for inclusion in the final hearing record. 
Responses should be sent to Brian Melnyk or Emily Slack of the 
committee staff who can be contacted at (202) 225-6558.
    Thank you again for your important contribution to the work of the 
committee.
            Sincerely,
                                 Virginia Foxx, Chairwoman,
           Subcommittee on Higher Education and Workforce Training.
                       chairman john kline (r-mn)
    Dr. Docking, what did Adrian College learn from participating in 
the talent gap retreat you discussed in your testimony? What new 
initiatives or partnerships did you implement as a result of the multi-
college retreat?
                    chairwoman virginia foxx (r-nc)
    What policy changes would you recommend in the upcoming 
reauthorization of the Higher Education Act to make public/private 
partnerships easier and more effective?
                   representative susan brooks (r-in)
    You spoke about the Adrian College internship program and 
pa1tnerships that exist with businesses.
    1. Could you please explain in detail how this program works?
    2. Are students required to intern?
    3. If so, how many semesters?
    4. Are the intern programs credit earning?
    5. If they are not credit earning, do students get paid?
                                 ______
                                 

      Dr. Docking's Response to Questions Submitted for the Record

                       chairman john kline (r-mn)
    Q: Dr. Docking, what did Adrian College learn from practicing in 
the talent group retreat you discussed in your testimony? What new 
initiatives or partnerships did you implement as a result of the multi-
college retreat?

    A: Roundtable discussions with Michigan Colleges Foundation (MCF) 
member campus presidents and leaders from signature Michigan 
corporations and organizations explored the topic of talent 
development, engagement and retention in Michigan. The format was 
designed to understand the employer data related to ``skill gap'' in 
new graduate career readiness and develop best practice solutions to 
address them.
    Outcomes from the event include the strengthening of industry-
campus relationships at MCF institutions, a greater understanding of 
what employers believe college graduates need to know and be able to 
do, and new approaches to improving career readiness. The specific 
strategies that resulted from conversations between the suppliers and 
consumers of young talent are currently being utilized to further MCF's 
work connecting students to internships, project work, and career 
opportunities, as well as millennial retention initiatives. Special 
emphasis was placed on the leadership role of smaller, independent 
colleges and universities in preparing students for career success.
    The ideas generated to address perceived talent gaps and the 
underlying issues were classified based on the concept of alignment. 
The participants identified strategies to help better align college 
learning and experiences with the social, work, and personal skills 
graduates need for career and life success after graduation. Three 
categories were created:
    1. Alignment of Educator and Employer Expectations (Includes 
efforts to more closely align curriculum with workforce demands, and 
initiatives to provide greater interaction between employer and college 
faculty for awareness building)
    2. Alignment of Student Programming (Includes development of 
practical off-campus experiences to apply learning, increased industry 
exposure on campus, and enhanced student understanding of professional 
career skills and expectations)
    3. Alignment of MCF Role and Resources (Includes MCF facilitated 
connections and project work related to career readiness and 
articulation of quality factors that differentiate MCF graduates in 
career performance)
    An advisory committee was established to help facilitate the 
implementation of pilot projects, support MCF's follow-up activities, 
direct future roundtable topics and evaluate the outcomes.
                    chairwoman virginia foxx (r-nc)
    Q: What policy changes would you recommend in the upcoming 
reauthorization of the Higher Education Act to make public-private 
partnerships easier and more effective?

    A: Often, seed money for innovation can be the most challenging 
money to identify. For a small college that is thin on administrative 
staff, identifying all of the available resources is a prohibitive time 
expense.
    It would be great if one of the responsibilities of the Department 
of Education, perhaps through FIPSE (The Fund for the Improvement of 
Postsecondary Education), was to serve as a type of clearinghouse for 
various federal programs. For example, I know the Department of 
Agriculture has some low-interest loans available for rural community 
development. Making these loans known to small colleges in rural 
communities might be an impetus for regional development. In many rural 
towns, colleges are the major economic resource in the community, and 
the largest employer.
                   representative susan brooks (r-in)
    Q: You spoke about the Adrian College internship program and 
partnership that exist with businesses.
    1. Explain how the program works?

    The Institute for Career Planning coordinates the Adrian College 
Internship Program. The goal of the internship program is to provide 
all students with the opportunities to test their career interests and 
develop job-related skills through college-approved work experiences. 
Faculty sponsors guide students as they link theoretical knowledge with 
the practical learning gained in part-time or full-time internships.
    Any Adrian student in good standing (minimum 2.00 cumulative GPA) 
is eligible for participation in the internship program following 
completion of 12 credit hours at Adrian College, provided the student 
is acceptable to the employer, obtains the approval of his/her advisor 
and secures a faculty sponsor for the internship.
    Adrian College offers two types of internships. Exploratory 
internships, designated as course number 199 on the student's 
transcript, are part-time experiences open to second-semester freshman, 
sophomores, and upper class students with a credit limit of three hours 
per semester. Exploratory internships are designed to acquaint students 
with work in a particular setting, to bring them in contact with 
professionals in the field and, in more instances, to give them the 
opportunity to assume limited responsibilities in the career area being 
explored. Professional internships, designated as course number 399 on 
the student's transcript, are experiences for juniors and seniors in 
which they may utilize and enhance entry-level career skills.
    Career Planning maintains a list of approved internship sites, 
though any student, faculty or staff member at the College may propose 
such a site. All proposed sites must be approved by the Internship 
Committee prior to a student beginning the internship. Students may 
pick up an internship packet at Career Planning or access it online and 
discuss the program with a Career Planning staff member.
Role of Internship Committee
    This committee establishes procedures governing the internship 
program, reviews proposed sites, monitors the quality of the program 
and hears requests for variances from normal policy.
Role of Career Planning
    The Institute is the central coordinating facility for all 
internships conducted through the College. In cooperation with the 
faculty Internship Committee, the Career Planning staff establishes, 
administers and publicizes procedures governing the program. Any 
questions regarding the internship program should be directed to this 
Institute.
Role of the Faculty Sponsor
    The faculty sponsor is responsible for designing an academic 
component for the internship experience. This academic component should 
be above and beyond the normal work responsibilities the student 
assumes at the site, and will be outlined and agreed upon by the 
faculty sponsor and the intern prior to the start of the internship. 
The faculty sponsor insures compliance with established procedures, 
monitors student performance during the internship, maintains contact 
with the on-site supervisor, assesses student progress and grades the 
experience.

    2. Are students required to intern?

    Some majors do require an internship within the department or as an 
optional course.
    Required programs are:
     SCJ--Sociology and Criminal Justice (minimum of 2 credits)
     ESPE--Exercise Science: Health Management & Pre-
Professional (3 credits)
     ART--Art Management (6 credits)
     PSCI--Political Science (1 credit hour)
     BAD--Business Administration, Sports Management (3 credit 
hours)

    3. If so, how many semesters?

    Students earn from one to six semester hours of credit during a 
single semester of an internship; the number of credit hours available 
for internships is designated by the Internship Committee. Students may 
complete internships as they wish, with a maximum of 15 hours of 
internship credit applying toward the baccalaureate degree, depending 
on approval by program of study.

    4. Are the intern programs credit earning?

    Yes, students can earn departmental credit for the internship (if 
not a department requirement, can earn departmental credit if approved 
by department chair). Students may also earn elective credits.

    5. If they are not credit earning, do students get paid?

    A student may receive salary or wages for internship services, 
depending on the employer's policy.
                                 ______
                                 
                                             U.S. Congress,
                                  Washington, DC, October 29, 2013.
Dr. Charles Lee Isbell, Jr., Professor and Senior Associate Dean,
College of Computing Georgia Institute of Technology, 190 Imperial Way, 
        Fayetteville, GA 30214.
    Dear Dr. Isbell: Thank you for testifying before the Subcommittee 
on Higher Education and Workforce Training at the hearing entitled, 
``Keeping College Within Reach: Improving Access and Affordability 
through Innovative Partnerships,'' on Wednesday, September 18, 2013. I 
appreciate your participation.
    Enclosed are additional questions submitted by members of the 
subcommittee after the hearing. Please provide written responses no 
later than November 15, 2013 for inclusion in the final hearing record. 
Responses should be sent to Brian Melnyk or Emily Slack of the 
committee staff who can be contacted at (202) 225-6558.
    Thank you again for your important contribution to the work of the 
committee.
            Sincerely,
                                 Virginia Foxx, Chairwoman,
           Subcommittee on Higher Education and Workforce Training.
                       chairman john kline (r-mn)
    Dr. Isbell, how did Georgia Tech develop the coursework and 
curriculum for its new master's program? Is the program as rigorous as 
your on-campus master's degree programs?
                    chairwoman virginia foxx (r-nc)
    What policy changes would you recommend in the upcoming 
reauthorization of the Higher Education Act to make public/private 
partnerships easier and more effective?
                                 ______
                                 

      Dr. Isbell's Response to Questions Submitted for the Record

    Congresswoman Foxx: Thank you very much for your follow-up inquiry 
regarding my testimony to the Subcommittee on Sept. 18.
    In response to your question--``What policy changes would you 
recommend in the upcoming reauthorization of the Higher Education Act 
to make public/private partnerships easier and more effective?''--the 
upcoming reauthorization should encourage the creation of regional and 
state agreements surrounding state authorization, such as the one being 
created through the State Authorization Network (SAN) (see: http://
wcet.wiche.edu/advance/state-authorization-network). This would create 
partnerships between institutions of higher education and state 
authorizing bodies to allow for online and MOOC providers to offer 
services across states and regions. The creation of the SAN would also 
represent a huge step towards reducing cost, complexity, and 
duplication of effort for institutions of higher education.
    In response to Chairman Kline's question--``How did Georgia Tech 
develop the coursework and curriculum for its new master's program, and 
is the program as rigorous as your on-campus master's degree 
programs?''--the answers are that the curriculum is (somewhat) a work 
in progress but it is the College of Computing's position that our 
online Masters of Science in Computer Science (OMS CS) will be every 
bit as rigorous as our traditional programs or we will cease to offer 
the OMS degree. Please allow me to elaborate.
    As you can certainly imagine, we've had an established curriculum 
for the on-campus MS CS degree for several decades, and it is our 
intent to transfer as much of this curriculum as possible to the OMS CS 
program, given certain limitations. The most conspicuous limitation is 
the lack of significant personal contact between OMS students and their 
instructors. This creates an inherent barrier to certain types of 
courses, particularly those in such areas of computing as human-
computer interaction and learning sciences, which draw heavily on 
knowledge from the liberal arts. Courses in these areas tend to rely on 
a greater amount of group discussion to help students both learn new 
concepts and apply what they're learning to novel problems.
    However we do not concede that this barrier is insurmountable. 
Online students are ingenious in devising ways to create virtual 
communities to support their studies, and indeed a small industry is 
springing up around this very issue. Further, given the recent 
technological advances that have made OMS possible in the first place, 
we believe it's highly possible if not probable that the near future 
will see additional innovation to facilitate small-group discussion in 
a massive-online setting. Will this mean that all computing courses 
will then be amenable to the MOOC format? Not necessarily, but the 
large majority should be.
    As we've been working to launch OMS CS for the past several months, 
we've learned that perhaps the most significant barrier to creating a 
full curriculum for OMS CS is nothing revolutionary at all: logistics. 
We are a public university on the East Coast partnering with a private 
company on the West Coast to create course materials that are extremely 
resource-intensive, and the central ``talent'' behind these courses--
namely, Georgia Tech faculty--have very busy schedules. Creating a 
Udacity MOOC has been compared to producing a short film, and as 
someone who is in the middle of producing one myself, I can attest that 
this is true. It takes a tremendous amount of logistical support to 
plan the courses (whose arrangement is completely different from their 
on-campus counterparts), write the material, film the instruction, 
create quizzes and course work, review the filming, etc.--and this is 
completely separate from the technical work to support Udacity's model 
of in-course testing and student engagement.
    In short, it is a major commitment to produce a MOOC, and it will 
take time for the OMS curriculum to add enough course material to catch 
up to the on-campus version. On campus, we have 15 specializations for 
MS students; we are initially offering eight specializations for OMS 
students. Traditional MS CS students have a catalogue of some 90 
courses (including electives) from which to choose; OMS students will 
start with five choices. All this to say that, in the end, time is the 
most significant barrier to Georgia Tech's ability to offer a 100% 
online curriculum that rivals its on-campus equivalent.
    Which leads me to your question regarding rigor. Georgia Tech has 
stated publicly and repeatedly that quality is our No. 1 goal. If we 
cannot offer an online MS in computer science with the same rigor as 
our on-campus degree, we will cease to offer OMS CS, period. This 
covers not only difficulty of the coursework but also admissions 
standards, student honor code enforcement, integrity of testing and 
grading, and all other factors that contribute to a degree's rigor. In 
fact, at least regarding admissions standards, we feel the criteria are 
more rigorous for OMS students than for on-campus students, given that 
the former need to achieve B's or better in their first two OMS courses 
to remain enrolled. It is true that on-campus students must supply an 
adequate GRE score to be admitted, however we feel the ``two B's'' 
requirement for OMS students trumps the GRE in terms of difficulty.
    I hope this additional testimony adequately addresses your 
questions. If you or any other members of the Subcommittee would like 
additional information or clarification regarding the OMS CS program, 
please do not hesitate to contact me or any other official at Georgia 
Tech.
                                 ______
                                 
                                             U.S. Congress,
                                  Washington, DC, October 29, 2013.
Ms. Paula R. Singer, President & CEO,
Laureate Global Products and Services 650 South Exeter Street, 
        Baltimore, Maryland 21202.
    Dear Ms. Singer: Thank you for testifying before the Subcommittee 
on Higher Education and Workforce Training at the hearing entitled, 
``Keeping College Within Reach: Improving Access and Affordability 
through Innovative Partnerships, `` on Wednesday, September 18, 2013. I 
appreciate your participation.
    Enclosed are additional questions submitted by members of the 
subcommittee after the hearing. Please provide written responses no 
later than November 15, 2013 for inclusion in the final hearing record. 
Responses should be sent to Brian Melnyk or Emily Slack of the 
committee staff who can be contacted at (202) 225-6558.
    Thank you again for your important contribution to the work of the 
committee.
            Sincerely,
                                 Virginia Foxx, Chairwoman,
           Subcommittee on Higher Education and Workforce Training.
                       chairman john kline (r-mn)
    Ms. Singer, what are some key reasons institutions look to partner 
with a company like Laureate? What is holding institutions back from 
expanding their academic offerings and what can Laureate provide to 
these colleges and universities to help them overcome these obstacles?
                    chairwoman virginia foxx (r-nc)
    What policy changes would you recommend in the upcoming 
reauthorization of the Higher Education Act to make public/private 
partnerships easier and more effective?
                                 ______
                                 

      Ms. Singer's Response to Questions Submitted for the Record

    Dear Chairwoman Foxx: I appreciate your letter of October 29, 2013 
requesting additional information on the subject of innovation and 
partnerships in higher education. I am pleased to provide the following 
responses. Please let me know if you or the Committee needs any 
additional information. We look forward to working with you during the 
Higher Education Act reauthorization process.
                   question from chairman john kline
    What are some key reasons institutions look to partner with a 
company like Laureate? What is holding institutions back from expanding 
their academic offerings and what can Laureate provide these colleges 
and universities to help them overcome these obstacles?

    Higher education is advancing very quickly at the same time demand 
for access grows and pressure to ensure timely completion increase. 
While this confluence provides opportunities to many institutions and 
their students, it also presents many institutions with a challenge. We 
believe the most significant hurdles are the cost to innovate, the lack 
of capital and human resources to do so, and the need for speed to 
innovate quickly in order to remain relevant in the student 
marketplace. Additionally, for more traditional institutions, adapting 
to more innovative modalities, methodologies or offerings requires the 
input and approval of tenured faculty, which can sometimes be difficult 
and cause delays. Companies like Laureate provide the ability to 
successfully meet many of these challenges. With our experience and 
resources, our institution partners are provided content, technology, 
student support services, and a system of accountability with access to 
outcomes data and results. Institutions, therefore, can implement 
innovation more quickly at a much lower price, without having to 
reinvent the wheel themselves. Many institutions are interested in 
Laureate in particular because of its long history of partnerships in 
higher education and its successful track record of operating its own 
institutions on ground, online and around the world.
    As addressed in more detail below, current statutory and regulatory 
provisions in the Higher Education Act, as well as certain standard 
processes, also present hurdles and delay to innovation and 
partnerships.
               question from congresswoman virginia foxx
    What policy changes would you recommend in the upcoming 
reauthorization of the Higher Education Act to make public/private 
partnerships easier and more effective?

    First, as innovation continues, we believe the relevancy of tax 
status will become even more arbitrary and irrelevant in the regulation 
of higher education institutions. In order to meet the increased demand 
for access while maintaining quality and focusing on the employability 
of all students, all institutions, regardless of tax status, will need 
the benefit of increased private capital. With declining federal and 
state budgets, even public institutions will be unable to rely on 
government funding.
    Similarly, we hope that in reauthorization, attention will be paid 
to the current regulations by which the Department examines and 
interprets an institution's financial capacity and responsibilities. 
Those rules create significant unintended consequences where 
institutions with demonstrated academic quality and return on 
investment for their students and the federal government are unfairly 
restricted in their ability to innovate or add new offerings. For 
example, the manner by which new program approval regulations are 
applied to certain institutions--and not others--is not fully 
transparent or consistent. The program approval regulations are also 
applied without any required timeframes by which the Department must 
make a determination. These restrictions definitely delay innovative 
new offerings. In this age of innovative models, including 
partnerships, regulators need better tools, understanding and 
flexibility to distinguish between institutions or models and to 
effectively apply regulations. With a focus on the right data, 
definitions and outcomes in HEA reauthorization, we believe the 
Department would be better able to promote innovation and 
accountability, while also ensuring financial responsibility to Title 
IV funds.
    Finally, we support the current regulatory triad created by the 
Higher Education Act, but believe it needs strengthening during the 
next reauthorization. There is no doubt that with more innovative 
models in the marketplace, higher education is becoming more diverse 
and complex, making essential the need for more clarity in the role of 
each regulatory body and increased trust regarding those 
responsibilities. There have been several proposals and commentary 
written recently about accreditation. As I said during the hearing and 
in my testimony, we believe the assessment of academic quality and 
improvement in higher education should remain with accreditors. This 
evaluation is very important to ensuring that an innovative partnership 
and other types of innovation maintain or improve the quality of 
offerings to students and do not negatively impact an institution's 
quality. Review of academic outcomes and inputs, like instruction and 
student support services, are critically important. It is essential 
that the Higher Education Act provides accreditors with direction and 
guidance on the types of assessment and evaluation needed, while also 
ensuring they have the ability and mandate to demonstrate flexibility 
and timely efficiency in independent decision-making.
    My colleagues and I at Laureate look forward to being a resource to 
you and the Committee during the reauthorization process and I 
appreciate the invitation to testify.
                                 ______
                                 
    [Whereupon, at 11:25 a.m., the subcommittee was adjourned.]