Revised Higher Education Act seeks to make costs for college more transparent

Better tools to help you find the best college values are coming, but you will have to supply the mental muscle.

A revised version of the Higher Education Act became law Aug. 14. While it will make colleges more accountable for tuition and fee increases, it will do little to lower the cost.

Among an array of changes, the law will streamline financial-aid forms, attack corruption in the student-loan business, and make college costs more transparent.

In theory, the frustrating task of comparing colleges will be easier. The law will create a website that will provide cost estimators and data on tuition prices, graduation rates, and popular majors.

It would be highly desirable to be able to compare similar colleges to determine the best education for the price, which is often the most difficult part of college selection. While universities can't be rated like appliances, there are some considerations that are often overlooked and may not be included in the government data.

Two oft-neglected figures are the rate of fee increases and total cost. Both should be staples of your planning.

Massachusetts, for example, charges almost $15,000 annually for state schools, compared with a national average of about $13,000, according to 1693 Analytics LLC, of Williamsburg, Va.

Equally important is that over the past five years, average bills at Massachusetts schools have climbed about 10 percent, compared with about 7 percent nationally. Washington state schools, which charge about the same as those in Massachusetts, kept their rate of increase at about the US average over the same span.

State colleges in Florida are a comparative bargain, averaging a little more than $10,000 annually for the 2006-2007 academic year. Better yet, over the past five years, they raised their tuition, room, and board only 2.7 percent.

With a college education, reputation has a powerful sway, and we frequently confuse price with quality. In many cases, you will pay dearly for a top-notch education, with tuition, room, and board at private colleges averaging more than $40,000 a year.

Public-service workers gain the most in the new legislation, which offers up to $10,000 in loan forgiveness for students who enter jobs such as public defender, prosecutor, firefighter, military employee, law enforcement officer, educator, nurse, and "others serving in the public interest."

If you're a lower-income household, Pell Grants are being increased to $6,000 next year from $4,800 in 2008-09. They will rise to $8,000 in 2014. Congress also made it easier for low-income families to apply for financial aid through a streamlined, two-page FAFSA-EZ form.

Shopping for college is more than getting a good fit for the student and vetting the "sticker price." It's essential to project what total costs will be, based on the college's rate of fee increases.

You might consider using a certified college-planning specialist.

John F. Wasik is a Bloomberg News columnist. He can be reached at jwasik@bloomberg.net.