Hearings held before the U.S. House Subcommittee on Postsecondary Education regarding reauthorization of the Higher Education Act and related measures are presented. The detailed legislative recommendations of the Carter Administration concerning the reauthorization are presented, and those features of the administration's bill that represent the most significant departures from current law are examined. Specific areas of focus are recommendations concerning Title III, strengthening developing institutions; institutional eligibility; the administration and management of student financial aid programs; the allocation of student aid funds to students, states, and institutions; and grant aid to students through the Basic Grant and the Supplemental Educational Opportunity Grant programs. The administration is proposing: a packaging framework for student financial aid; a single student aid application form; a single needs-analysis system; a new formula for state-matching in the State Student Incentive Grant Program; and the elimination of the initial year-continuing year distinction in the Supplemental Educational Opportunity Grant Program. The administration is also proposing to modify the Basic Grant maximum award and the reduction schedule, to permit the use of average rather than actual costs of attendance under the Basic Grant program, and to increase the maximum Supplemental Educational Opportunity Grant Award. (SW)