Hearings on reauthorization of the Higher Education Act of 1965 focus on Title III or institutional aid. Title III is the largest nonstudent assistance program and was established to strengthen the academic quality of developing colleges by financing special projects and programs at individual colleges and by increasing the use of consortia and cooperative arrangements. Although black colleges have been the primary beneficiaries of Title III, many small colleges have also benefited. Program goals were to improve an institution's academic quality, management, or fiscal stability. A bill to revise and modify Title III, H.R. 2907, seeks to eliminate confusion about institutional eligibility and provide direct assistance to minority institutions and traditional colleges and universities serving large numbers of low-income minority students. The bill also introduces two new concepts to the Higher Education Act that establish set-asides for historically black colleges and universities and for national-origin-based higher education institutions (i.e., Hispanic, Native American, and Pacific-Basin institutions). The bill would preserve the 30 percent set-aside of funds for junior and community colleges and would authorize the first 5 years of a 10-year program of aid to historically black institutions. The text of the bill is included, along with prepared statement and testimony of witnesses. (SW)