In Focus: Federal Postsecondary Policy
Jul 22, 2010 | Permalink »
House Subcommittee Approves FY 2011 Education Funding to Assist Low-Income Students
By Marcie W.M. Foster and Amy Ellen Duke-Benfield
The U.S. House Appropriations Subcommittee on Labor, Health and Human Services and Education recently approved a bill that is consistent with the President’s FY 2011 budget request for key education programs that can help low-income adults access and complete postsecondary education.
Although this bill is only the first step in the federal appropriations process, it sends an important message that the nation needs targeted education and training investments so more low-income students and workers can access education and training to help them gain skills needed in our recovering economy.
Most notably, the bill increased funding for Pell Grants, which more than eight million low-income students rely on each year for tuition-related expenses, by almost $5.7 billion. This increase would cover the looming funding shortfall and is necessary to ensure students continue to receive aid.
Unverified reports indicate that other student aid programs did not fare as well. Gear Up, TRIO, Federal Work-Study, and the Supplemental Educational Opportunity Grants received flat funding or modest increases, and the bill eliminated the Leveraging Educational Assistance Partnerships (LEAP) Grants program.
The subcommittee approved $1.9 billion for career and adult education, equal to the President’s budget request. According to reports, President Obama’s request for funding for the adult education portion of these funds was also matched at $612 million, which reflects a decrease of $16 million from the previous fiscal year. While this decrease is unfortunate, it’s important to note that last year’s appropriations included a one-time increase to correct for several years of federal accounting errors that prevented states from receiving the total funding that they were entitled to under the budget.
Recent findings show that, due to insufficient funding, the number of individuals on adult education waiting lists has doubled since 2008, and the problem is expected to continue until Congress increases appropriations for adult education. A recent report from the National Council of State Directors of Adult Education (NCSDAE) found that just $160 million in additional appropriations would allow states to serve those currently on waiting lists.
The Senate is expected to markup the bill before the August recess.
Mar 30, 2010 | Permalink »
Key Education Reforms Included in Health Care Reconciliation Bill
The Health Care and Education Reconciliation Act of 2010 (HCERA), a companion piece to the health care reform bill, includes provisions that would provide greater access to postsecondary education. President Obama signed the measure March 30.
HCERA saves money and provides resources for programs that increase access to postsecondary education by eliminating the Federal Family Education Loan (FFEL) program. Currently, the FFEL program guarantees and subsidizes federal Stafford loans for students and PLUS loans for parents issued by private student lending companies. The reconciliation act does away with these subsidies and, instead, allows the federal government to issue these loans through the Direct Loan program. This provision is estimated to save $61 billion over 10 years.
This saving allows the reconciliation act to expand access to postsecondary education by:
- Increasing Pell Grants. The reconciliation act invests $36 billion in the Pell Grant program. It increases individual Pell Grant awards each year based on the Consumer Price Index beginning at $5,550 in 2013-2014 and maxing out at $5,975 four years later. The act also includes an investment of $13.5 billion to fund a Pell Grant shortfall, which makes the total HCERA investment in Pell $36 billion.
- Increasing funding for the College Access Challenge Grant Program (CACGP). The reconciliation act provides $150 million per year from 2010 to 2014 to CACGP, a program established under the Higher Education Opportunity Act in 2008 that distributes grants to states to increase access for students who are underrepresented in postsecondary education. The federal government provides two-thirds of the grant, and states provide the remaining one-third.
- Establishing funding for community college and career training grant programs. The reconciliation act appropriates $500 million each year over four years ($2 billion total) for a discretionary grant program within Trade Adjustment Assistance. Each state is to receive no less than $2.5 million each year to offer or improve an educational or career training program for workers who are eligible for services under Trade Adjustment Assistance, a program that provides aid to workers who have lost jobs due to increased imports.
- Providing grants to institutions that predominantly serve minorities. The legislation provides $255 million to minority-serving institutions annually through 2019. Of that, $100 million is allocated to Hispanic-serving institutions, $100 million is allocated to historically black colleges and universities and predominantly black institutions, and $55 million is allocated to other minority serving institutions, including tribal colleges and institutions that serve Alaska Natives, Native Hawaiians, Asian-Americans, Native Pacific Islanders, and nontribal Native Americans.
- Increasing assistance to borrowers through income-based repayment. Starting in July 2014, student borrowers eligible for income-based repayment of federally subsidized loans will pay only 10 percent of discretionary income instead of the current 15 percent, and their loans will be forgiven after 20 years, instead of the current 25 years.
HCERA includes a number of provisions that were originally part of the Student Aid and Financial Responsibility Act (SAFRA) that the House passed last fall. Unfortunately, it omits key elements of SAFRA. The original legislation would have invested more resources in education by establishing a grant program for early care and education, renovating public school facilities, and funding the American Graduation Initiative, a proposal that sought to increase the number of community college graduates by 5 million. Between September and March, however, SAFRA's revenue estimate dropped from $87 billion to $61 billion. In addition, congressional leaders allocated $10 billion to reduce the budget deficit and another $9 billion to help the combined legislation meet the budget reconciliation requirement of a net reduction in federal spending.
Feb 04, 2010 | Permalink »
President Proposes Investments in Postsecondary Aid and Innovation
While the President's FY 2011 budget calls for an overall freeze on discretionary non-defense spending, the budget would substantially increase support for students in postsecondary education.
Most notably, the budget proposes to raise the maximum Pell grant from $5,550 in 2010 to $5,710 in 2011 and move it to the mandatory side of the budget. Spending on the Pell Grant program would rise from $26.9 billion to $34.9 billion. Under the President's proposal, the maximum Pell grant would increase each year by the rate of inflation plus 1%, reaching an estimated $6,900 in 2019. This is the second year in which the President has proposed transforming Pell into a mandatory program to shield it from the uncertainties of the discretionary budgeting process. In addition, the budget request would ease the terms of loan repayment for low-income individuals in the Income-Based Repayment program.
The budget is consistent with the proposed Student Aid and Fiscal Responsibility Act (SAFRA), which has passed the House of Representatives and is awaiting a vote in the Senate. The President's budget proposal allocates $10.6 billion over ten years for SAFRA's American Graduation Initiative, which would fund competitive grants for innovation at community colleges. The proposal also allocates $3.5 billion over five years for the College Access and Completion Fund, which aims to increase the graduation rates of low-income students.
Not all programs are to receive increases, however. The budget would provide flat funding for TRIO, Gear Up, Federal Work-Study and Supplemental Educational Opportunity Grants, and would eliminate the Leveraging Educational Assistance Partnerships (LEAP) Grants program
CLASP supports SAFRA, and has worked with House and Senate leaders to strengthen the bill's effectiveness. See CLASP's letter to House Education and Labor Committee Chairman George Miller.