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The Education Exception

February 2, 2010

WASHINGTON -- It's nice being seen as essential.

As President Obama and his aides unveiled the administration's fiscal 2011 budget with lots of talk about reining in discretionary spending, they largely exempted programs important to higher education from the budget restraint they urged.

Not every higher education-related program would fare well under the budget blueprint; the administration would hold funding for many student aid programs other than Pell Grants at their 2010 levels and eliminate a handful of others; end the Department of Labor's Career Pathways Innovation Fund (a $125 million grant program for community colleges); and slice the budget of the National Endowment for the Humanities.

But by and large, most programs that serve colleges and students would fare well under the administration's budget for the year that begins in October, with the White House proposing another massive infusion of funds into the Pell Grant Program (covering a million additional students and ensuring a permanent and growing flow of money into it), recommending significant increases for several key scientific research agencies (see related article) for job creation purposes, and even proposing a 31 percent increase in financial support for the AmeriCorps national service program.

"At a time when most government spending is being frozen, President Obama is investing in education -- a clear reflection of the president's deep commitment to education," Education Secretary Arne Duncan said in a telephone news conference Monday. "The president has set a goal that America once again will lead the world in college completion by the end of the decade, and to do that, we need to improve the education at every level. This budget puts us on a path to success and meeting that goal. We have to educate our way to a better economy."

Higher education leaders generally expressed their appreciation for the president's recognition -- through his proposed distribution of money -- of the centrality of a college education for Americans. "Improving access to college for our young people is essential to preparing our workforce for 21st century challenges, and the Pell Grant remains our best tool for aiding students from low-income families," Robert M. Berdahl, president of the Association of American Universities, said in a prepared statement Monday.

If many college leaders were something this side of ebullient, it may be because so many of the administration's priorities depend on passage of the Student Aid and Fiscal Responsibility Act, which would dramatically reshape the student loan programs (ending all lending from the lender-based guaranteed loan program) and shift the savings to support a wide range of new and expanded education programs. The legislation passed the House of Representatives last fall, and while most prognosticators still believe it will become law eventually, serious questions remain about whether the measure will produce enough savings to finance the enormous range of programs the administration is expecting it to pay for.

The Education Department is counting on the savings from the student loan restructuring to finance its Pell Grant expansion, its $10.6 billion community college initiative, a $3.5 billion College Access and Completion Fund, hundreds of millions of dollars for historically black and other minority-serving colleges and various other higher education priorities. But department officials are also banking on it covering a series of new programs to support early childhood education. (The Education Department's budget blueprint describes a total of $95 billion in new spending over 10 years designed to flow from the SAFRA legislation.)

The administration's ambitions could be impaired if Congressional or administration accountants in the coming weeks drastically change their estimates of either the amount the loan legislation would save or the price tag of some of the budget items.

Administration officials played down that possibility in their statements Monday, focusing on what they characterized as President Obama's historic commitment to expanding educational opportunity.

Under the budget blueprint, the maximum Pell Grant for low-income students would rise to $5,710 from the current $5,550, and perhaps even more importantly, in the eyes of many student aid experts, the administration would begin financing the bedrock financial aid program as a federal entitlement program, where it would be protected from the annual ups and downs of the Congressional appropriations process. Under the administration's proposal, which in many ways mirrors what it urged last year, the maximum Pell Grant would be indexed to the Consumer Price Index, rising each year by the increase in the annual inflation rate plus one percentage point. The proposal would also significantly expand repayment options for student loan borrowers.

Most other student aid programs would remain in 2011 at their currently funded levels under the Obama plan, which would dramatically reshape the Perkins Loan Program and phase out the Academic Competitiveness Grant and National Science and Mathematics Access to Retain Talent Grant Programs. (A table with full details on education and other programs appears below.) The Education Department would shift tens of millions of dollars for teacher education that now flow through the Higher Education Act into a revamped K-12 leadership program under Elementary and Secondary Education Act, which is up for renewal this year.

Mixed Bag for Two-Year Colleges

Community colleges could be a major beneficiary of the administration's budget for 2011 and beyond, if the American Graduation Initiative, its $10.6 billion plan to strengthen two-year institutions with a mix of new funds and greater accountability, becomes a reality. But the institutions would also lose out in a few key ways if the administration's 2011 budget plan takes effect as is.

The Education Department proposes eliminating the Tech Prep Program, which has until now maintained a separate stream of funding within the Carl D. Perkins Career and Technical Education Act program. And the Department of Labor's budget calls for ending the Career Pathways Innovation Fund, which the Bush administration created in 2005 to focus on expanding career paths through community colleges. Labor Department budget documents (reinforced by an online chat held by department officials, including Jane Oates, who oversees the department's training programs) said they believed the graduation initiative would obviate the need for the pathways program.

"The AGI would provide significant resources for competitive grants to community colleges that could support career pathways and other innovative training and education programs. The Department of Labor would work with the Department of Education to administer these grants, continuing to support career pathway programs at community colleges that help individuals of varying skill levels enter and pursue rewarding careers in high-demand and emerging industries," the department's documents stated. The Labor Department also proposes creating a new innovation fund (with about 5 percent of existing funds from national and state training programs) aimed at spreading best practices -- including, conceivably, those at two-year institutions.

Dip Proposed for Humanities and Arts

Both the National Endowment for the Humanities and the National Endowment for the Arts would see their funds cut in 2011 under the Obama administration's budget. The annual appropriation for the humanities endowment would dip to $161.3 million from $167.5 million in 2010, with equivalent cuts in most of its programs, except for challenge grants. The arts endowment would see an equivalent drop. The National Historical Publications and Records Commission, which is part of the National Archives and Records Administration and seeks to preserve the country's documentary heritage, would see its budget cut to $10 million from $13 million.

Berdahl, the AAU president, questioned the logic of cutting the cultural endowments' budgets, given how little would be saved by doing so.

"We hope that Congress will be able to restore the proposed cut in funding for the National Endowment for the Humanities," he said. "The relatively small amount of money this saves, $6 million, contributes little to the effort to maintain an overall spending freeze, but it has a significant impact on the endowment’s ability to support humanities research and education."

The president's budget becomes a starting point for discussions in Congress, where the reaction from lawmakers -- despite the president's renewed call for bipartisanship in his State of the Union speech and the days since -- was predictably divided, with Rep. George Miller (D-Calif.) praising the president and Rep. John Kline (R-Minn.) -- well, not so much.

Obama Administration's Key 2011 Funding Requests Related to Higher Education

EDUCATION DEPARTMENT 2009 Appropriation 2010 Estimate 2011 Request
Financial Aid      
Pell Grants (discretionary) $17,288,000 $17,495,000 $0
Pell Grants (mandatory) 2,090,000 3,030,000 0
Pell Grants (Recovery Act) 0 6,463,059 34,878,000
Pell Grants (Total) $19,378,000 $26,988,059 34,878,000
Supplemental Educational Opportunity Grants 757,465 757,465 757,465
Work Study 980,492 980,492 980,492
Perkins Loan cancellations 67,164 0 0
College Access and Completion Fund (proposed) n/a n/a 63,852
Leveraging Educational Assistance Partnerships 63,852 63,852 0
Academic Competitiveness /SMART Grants 73,000 1,336,000 (36,000)
Iraq/Afghanistan Service Grants 0 232 240
TEACH Grants 0 23,008 12,711
Institutional aid 84,000
Strengthening Institutions 80,000 84,000 88,200
Strengthening Tribally Controlled Colleges and Universities      
--Discretionary 23,158 30,169 31,677
--Mandatory 30,000 -- --
Strengthening Alaska Native/Native Hawaiian Institutions  
--Discretionary Funds 11,579 15,084 15,838
--Mandatory Funds 15,000 --
--
Strengthening Historically Black Colleges and Universities    
--Discretionary Funds 238,095 266,586 279,915
--Mandatory Funds 85,000 -- --
Strengthening Historically Black Graduate Institutions 58,500 61,425 64,496
Master's Degree Programs at HBCUs and Predominantly Black Institutions 11,500 11,500 11,500
Strengthening Predominantly Black Institutions
--Discretionary Funds 0 10,801 11,341
--Mandatory Funds 15,000 -- --
Minority Science and Engineering Improvement 8,577 9,503 9,503
Developing Hispanic Serving Institutions  
--Discretionary Funds 93,256 117,429 123,300
--Mandatory Funds (Hispanic STEM and articulation programs) 100,000 --
--
Promoting Postbaccalaureate opportunities for Hispanic Americans      
--Discretionary 0 10,500 10,500
--Mandatory funds 11,500 11,500 11,500
Strengthening Asian American and Pacific Islander-serving Institutions 2,500 3,600 3,780
--Discretionary 2,500 3,600 3,780
--Mandatory 5,000 --
--
Strengthening Native American-serving Nontribal Institutions  
--Discretionary 0 3,600 3,780
--Mandatory 5,000 -- --
Tribally controlled Voc-Tech Institutions 7,773 8,162 8,162
Gallaudet U. 124,000 123,000 118,000
National Technical Institute for the Deaf 64,212 68,437 64,677
Howard U. 234,977 234,977 234,977
International education/foreign language 118,881 125,881 125,881
Fund for Improvement of Postsecondary Education 133,667 159,403 64,036
Demonstration Projects to Ensure Access for Students With Disabilities 6,755 6,755 6,755
Vocational and adult education    
Carl D. Perkins Act State Grants 1,160,911 1,160,911 1,264,000
Tech Prep 102,923 102,923 0
Adult Education 567,468 639,567 653,661
Student assistance  
TRIO programs 905,089 910,089 910,089
Gear Up 313,212 323,212 323,212
College Access Challenge Grant Program 66,000 0 0
Special programs for migrant students 34,168 36,668 36,668
Child Care Access Program 16,034 16,034 16,034
Graduate education
Byrd Scholarships 40,642 42,000 0
Javits Fellowships 9,687 9,687 9,687
Graduate Assistance in Areas of National Need 31,030 31,030 31,030
Thurgood Marshall Legal Educational Opportunity Program 3,000 3,000 3,000
Other offices
Research and statistics 617,175 659,006 738,756
Statewide Data Systems (Recovery Act) 250,000 0 0
Office for Civil Rights 96,826 103,024 105,700
Inspector general 54,539 60,053 65,238
LABOR DEPARTMENT      
Adult Employment and Training 861,540 861,540 861,540
Innovation Fund     45,344
Dislocated Workers Training 1,341,891 1,435,500 1,413,000
Innovation Fund     63,307
Career Pathways Innovation Fund 125,000 125,000 0
OTHER AGENCIES      
AmeriCorps state and national grants 267,000 372,000 488,000
Institute of Museum and Library Services 275,000 282,000 266,000
National Endowment for the Humanities 155,000 167,500 161,315
National Endowment for the Arts 155,000 167,500 161,315
National Historical Publications and Records Commission 9,000 13,000 10,000
State Department Academic Exchanges (Fulbright, etc.) 323,000 359,000 357,000

 

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