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Ahead of the Curve

The Leading Edge of Legal Ed

Karen Sloan

Apr 16, 2018

Welcome back to Ahead of the Curve. I’m Karen Sloan, legal education editor at Law.com, and I’ll be your host for this weekly look at innovation and notable developments in legal education.

I’m mixing things up a little bit this week. I spent last Thursday and Friday at Florida International University College of Law for the Summit on the Future of Legal Education and Entry Into the Profession, which was organized by professor Scott Norberg, the FIU Law Review, and co-hosted by the Law School Admission Council. So today I’m going to hit some highlights from that event, including legal education’s looming funding crisis, a reimagining of the bar exam, and a crazy idea to remove U.S. News from the law school equation.

Please share your thoughts and feedback with me at ksloan@alm.com or on Twitter: @KarenSloanNLJ.

 

Winter is Coming (For Law School Financing)

I’ve never seen Game of Thrones, but even I knew that when AccessLex Institute President Chris Chapman prefaced his summit remarks with the bloody show’s ominous catchphrase, the news wasn’t going to be good.

Chapman went on to give an overview of a series of proposed changes to the federal student loan system that would have major ramifications for the current law school financing model. Those changes, should they come to fruition, could lead to 20 or 30 law schools closing in the next five years, Chapman predicted. As part of the reauthorization of the Higher Education Act, House Republicans have advanced out of committee a bill that would:

>> Deep-six Public Service Loan Forgiveness, which allows law graduates in public interest jobs to keep their monthly payment manageable and see their federal loans forgiven after 10 years.

>> Get rid of income-based repayment, which lets federal loan borrows to cap their monthly payments at around 10 percent of their income, and see their loans forgiven after 20 or 25 years.

>> Cap federal graduate loans at $28,000 annually, instead of allowing students to borrow the full amount of tuition, living expenses, books and fees as determined by their individual programs.

Each one of these changes would have a significant impact on law schools. Admissions offices market public interest loan forgiveness and income-based repayment as tools to manage the high cost of attending law school. But the capping of federal loans would hit law schools especially hard, given that it’s not uncommon for students to borrow $50,000 or more a year for a J.D.

Now, a few reality checks.
The House Republican’s bill is a starting point. Chapman predicted that the Senate will negotiate less draconian limits on federal loans, perhaps ending up with a $40,000 cap. And we later heard from American Bar Association President Hilarie Bass, who had just returned from a lobbying trip to Washington and indicated that Senate Republicans are supportive of Public Service Loan Forgiveness.

But what would it mean if law students could only borrow $40,000 from the federal government? According to Chapman, it would harken a return to the days when law students had to secure private loans to fund their education. That doesn’t sound so bad on the face of it, except that private lenders have tightened their criteria since 2006—when the federal student loan program expanded and private loans were essentially replaced by federal ones—and now will loan only to low-risk borrows, according Grant Carwile, the managing director of SL Capital Strategies.

Approval rates for private lenders tend to fall between 20 and 30 percent, meaning upwards of 70 percent of students seeking private loans to cover what their federal loans won’t will be denied. Things like FICO scores and academic performance go into the algorithms private lenders use to determine borrower risk, Carwile said. And interest rates will be higher for the lucky few who do get approved from private loans, increasing the overall cost of their degrees.

So what does that mean? In a nutshell, that students of lesser financial means will be shut out of law school, which in turn will exacerbate the legal academy’s existing racial and socioeconomic diversity challenges. And it will reduce the pool of people willing and able to go to law school at all.

➤➤ My thoughts: There was no shortage of bleak news and stats offered up at the summit, but the developments surrounding changes to the student loan regime seemed to be what most rattled deans, admissions officers, professors, and other legal education stakeholders in attendance. It’s not time to hit the panic button yet, but law school leaders would be wise to contemplate a future when the pipeline of federal loan dollars available to their students is smaller, lest they be caught flat-footed by Washington.

 

A Different Kind of Bar Exam

The bar exam didn’t get too much love during the two-day summit at FIU. Various critics faulted the all-important licensing exam as being out of touch with what lawyers do in practice, for rewarding rote memorization at a time when legal statutes are never more than a mouse click away, and for not embracing technology, among other things.

“The current system doesn’t make sense,” said ABA President Hilarie Bass, who said reviewing the bar exam is one of the three focuses of her Commission on the Future of Legal Education, which launched last summer.

Retired University of North Carolina law professor Judith Wegner and Michigan State University law professor Joan Howarth came armed with a pretty radical idea to update the bar exam process, which would create stages of testing and enable people to leave law school at different points for different types of legal careers. Here’s the pitch, in a nutshell:

➤ Give a nationally standardized pre-bar exam after the first year of law school, covering the substantive core 1L subject areas while they are still fresh in the minds of students.

➤ Devote the second year to courses in a specialty area and supervised externship or clinic in that area. Then students would take another exam covering that specific area of law, and would obtain a limited license to practice in that.

➤ Students could opt to stay for their third year of law school to receive a full J.D.

The benefits, according to Howarth and Wegner, are myriad. Substantive law would be tested while the material is still fresh, students who know they want to practice is a single area could lop off a year of law school tuition, the entire curricula would be more practice oriented, and the new limited license attorneys could help cut down on the justice gap.

To be sure, the existing bar exam had its defenders. Judith Gunderson, the president of the National Conference of Bar Examiners, and Diane Bosse, Chair of the New York Bar Examiners, said the exam has been updated over the years with new subjects added and others dropped. And any reimagined bar exam would have to be valid and fair to test takers, while also not heaping on more costs. But they also said that bar leaders are open to ideas of how to improve the exam.

➤➤ The takeaway: We’re nowhere near a fully revamped bar exam. While Gunderson and Bosse welcome new ideas for the bar exam, my sense is that they are thinking of changes that are much more modest in scale than Howarth and Wegner’s proposal. Still, the professors have pitched their idea to Bass’ ABA Commission, and all it would take is one or two court systems around the country to jump on board and pilot a program.


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So Long, U.S. News?

A substantial portion of the FIU summit was devoted to what critics see as the pernicious effects of the U.S. News & World Report ranking. That includes incentivizing law schools to funnel money toward merit scholarships intended to bring in students with high LSAT scores and undergraduate grades at the expense of need-based scholarships, and spending more per student simply because those expenditures are rewarded by U.S. News’ ranking formula.

So why not get U.S. News out of the law school rankings business? That was the idea floated by Law School Transparency Executive Director Kyle McEntee, who proposed that law schools—or a deep pocketed entity devoted to legal education—pony up to buy U.S. News’ law school ranking and shut it down, removing an incentive for schools to make decisions in a way that’s intended to game the rankings.

Here’s McEntee: I think it could be done at a cost that would be less that what law schools spend in a single year. We might have a chance of adjusting those toxic behaviors.”

Freed from the shackles of U.S. News’ focus on LSAT scores and grades, schools would base admissions decisions on a broader array of indicators and would be able to funnel more financial aid to the students who most need it. McEntee acknowledged that nothing would stop another player from launching a similar ranking were U.S. News to get out of the law school ranking game, but no other competitors would hold the same sway in the marketplace as U.S. News, he said.

➤➤The final word: McEntee’s proposal was met with laughter by the summit attendees. And it is a pretty funny, unorthodox idea. But at the same time, it’s hard to see the law school admission pattern changing as long as the U.S. News ranking is around. Few law schools are willing to forego the U.S. News game because they play such a large role in how prospective students make decisions.

 

Here's what else I'm watching:

➜ An American Bar Association committee has recommended axing the requirement that accredited law schools use the LSAT in admissions. Proponents of the change say doing away with the LSAT requirement would enable law schools to experiment with new ways of admitting students and tap into new pools of potential applicants. The next step is for the recommendation to go before the ABA’s Council of the Section of Legal Education.

Golden Gate University School of Law is the latest to get a yellow card from the ABA over its compliance with admissions rules. The San Francisco school has plenty of company these days.

➜ This is cool. Students at Cornell Law School created an online tool that helps undocumented immigrants develop a plan should they get deported. It covers things like how to close out credit cards and making plans for their children.

➜ This just in: Legal educators can’t seem to agree whether the GRE is good or bad for law school admissions.

Some words of advice for prospective law students about choosing a school once they are offered admission at numerous campuses. Hint: Visit campus, negotiate scholarships, and trust your gut.


Thanks for reading Ahead of the Curve.

I'll be back next week with more news and updates on the future of legal education. Until then, keep in touch at ksloan@alm.com.

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