The Gift Colleges Don't Want

January 24, 2006

It is supposed to be a boon for colleges and students, the one major provision in federal legislation to reduce the budget deficit that makes it easier for higher education to swallow the unpalatable parts of the bill that cut benefits to students. After all, the proposed program would provide $3.75 billion in grant aid for students, a rare injection of new federal funds into higher education at a time of fiscal austerity and budget slashing.

Most higher education officials very much applaud and appreciate the basic idea behind the Academic Competitiveness Grants program, which is aimed at enticing more students from low income families into science, math, engineering and high-demand language fields.

But they overwhelmingly believe that the program is fatally flawed in conception and design, in part because elements of the program were crafted in mere days without any meaningful involvement from experts in the field.

Among the perceived problems in the program, which still awaits final passage, as part of the larger budget measure, when the House of Representatives returns at the end of this month:

  • Requiring recipients to meet a minimum grade-point average to get and keep the awards would fundamentally alter the federal government’s historical approach to need-based financial aid.
  • Restricting access to full-time students would make it available only to a narrow slice of all students from low-income families.
  • Limiting the awards to students who have completed a high school curriculum deemed “rigorous” by the U.S. secretary of education would greatly (and inappropriately, critics say) expand the federal role in high school policy making.

“In concept, it’s a great idea,” says Claude Pressnell, president of the Tennessee Independent Colleges and Universities Association, in the home state of the legislation’s primary sponsor and cheerleader, U.S. Sen. Bill Frist (R-Tenn.), the majority leader. “But by tying it so closely to the Pell Grant Program in name and structure, it has the very serious potential of compromising what is now a very successful program.”

Adds David Baime, vice president for government relations at the American Association of Community Colleges: “The flaws in the competitiveness grants vividly demonstrate the perils of closed door, back room policy making. If this had been public for a day or two, we might have had a chance to help make a program that actually achieved its purposes.”

The Science Gap

The United States without doubt has a problem in science, math and related disciplines, as a slew of recent reports have pointed out: The country’s international standing is slipping in a range of technological indicators, the American education system is producing too few students in high skill fields, and as a result, the economy is perceived as being overly dependent on foreign engineers and scientists. The issue is high on the agenda of the Secretary of Education’s Commission on the Future of Higher Education, and the Association of American Universities plans to release a report this week with some possible prescriptions to the problems.

Senators looking for ways to deal with that problem saw an opportunity in Congress’s every-five-year review of the Higher Education Act, and in the “budget reconciliation” legislation (designed to carve savings out of federal mandatory spending programs) with which the Higher Ed Act renewal became entangled.

Frist and his fellow Tennessee Republican, Sen. Lamar Alexander, both sit on the Senate’s education committee, and in early September, they worked with the panel’s chairman, Michael B. Enzi (R-Wyo.), to incorporate into the panel’s bipartisan Higher Education Act bill a provision to create the Science and Math Access to Retain Talent (SMART) program, designed to provide $1 billion over five years for grants to third- and fourth-year students to study the sciences.

But that sum was dwarfed by the $4.5 billion that Sen. Edward M. Kennedy (D-Mass.) and others worked to include in the bill for another new (and temporary) program, known as the Provisional Grant Assistance Program (or ProGAP), that was designed to supplement Pell Grant aid for needy students. Democrats and Republicans both got things they badly wanted, and there were smiles all around.

College leaders liked the SMART program just fine, but they loved ProGAP. New funds for Pell Grants have been hard to come by in recent years, and the idea of using savings squeezed from the federal student loan programs to help low-income students appealed to many (especially in comparison to a competing plan in the House to use almost all of the savings from the loan programs to reduce the budget deficit).
As the legislative process unfolded, however, the proposal mutated. In mid-October, the Senate Health, Education, Labor and Pensions Committee stitched its Higher Ed Act bill into the budget reconciliation legislation. That freed up another $2.5 billion for the senators to use for new grant funds, which they planned to divide between the PROGap and SMART programs. So far, so good, for both programs.

Behind the scenes, though, conservative Republicans in both the Senate and the House were objecting to the ProGAP program, which they viewed as creating another “entitlement” program that could drain the federal budget. Although both ProGAP and SMART were designed to “sunset” after five years, members of the Republican Study Group feared that the program would be hard to eliminate, and that billions more would pour out of the federal treasury. In addition, House Republican leaders wanted the budget reconciliation measure to cut more money generally, intensifying the budget pressure.
So in December, after the Senate had passed its budget reconcilation bill creating SMART and ProGAP, and the House had approved its legislation containing neither, members of the House and Senate gathered behind closed doors to work out a compromise version. With Republican Congressional leaders (who were skeptical of the ProGAP program, and pushing hard for budget savings) and White House officials involved in the discussions, but Kennedy and other Democrats (who had advocated for ProGAP) shut out of the talks, the compromise version of the budget measure emerged, on the fly and just hours before the House passed it early one morning, with a radically restructured version of the grant program.
First, the legislation set aside $3.75 billion over all for the two-part "Academic Competitiveness" program, as it was now called. The “SMART” portion of the program remained roughly similar: Juniors and seniors in college who major in science, math and engineering fields or in foreign languages deemed critical to national security, could receive grants of up to $4,000 in those years, if they maintained a 3.0 grade point average in college.
But in lieu of ProGAP, which would have been widely available to otherwise eligible Pell Grant recipients, the newly conceived "Academic Competitiveness Grants" for first- and second-year college students would be available only to Pell-eligible students who attend college full time, who are American citizens, and who have completed a high school curriculum recognized by the U.S. education secretary as “rigorous.” Grants would be $750 in the first year and $1,300 in the second; to keep the grant for a second year, a recipient would need to maintain a 3.0 GPA.
“These grants will help sustain America’s global legacy as a land of innovation, imagination, and initiative,” Frist said of the revamped program, adding that the funds “will incentivize more students to major in these time-intensive studies and help America produce the workforce it needs to compete in today’s global economy.” The statement from Frist (who is widely believed to fancy a run for the presidency) referred to the SMART grants as the program “I created,” but credited Rep. John Boehner (R-Ohio), chairman of the House Education and the Workforce Committee, and President Bush for the Academic Competitiveness grants.
Indeed, the provision in that measure about the "rigorous" curriculum bore a strong resemblance to the Bush administration's proposed State Scholars program, which the president included in his 2006 budget plan. The House's Higher Education Act legislation contained a provision, modeled on the White House proposal, that would have given additional Pell Grant funds to students who have participated in State Scholars, a privately run program aimed at encouraging high school students to take more rigorous courses.
College officials objected to the hastily reconceived Academic Competitiveness program on multiple fronts. Most fundamentally, they are troubled by the idea of, for the first time, making receipt of federal need-based aid contingent on a student's academic performance or any other merit-based measure. (Previous attempts to do this -- like President Clinton's initial effort to attach a GPA requirement to his Hope Scholarship tax credit, as well as the State Scholars program -- have been rebuffed over the years.)
"The primary philosophy of the Pell program is making higher education more affordable for low- and moderate-income students, and it works extremely well," says Pressnell of the Tennessee private-college group. "If you need to do something more narrowly focused on math or science, or want to have a blend of merit and need, fine, but let's not confuse our need-based structure. We should be careful as we address certain weaknesses that we don't in the process weaken our current strengths."
The new grants further exclude significant numbers of low-income students -- especially at community colleges and urban four-year institutions -- by requiring recipients to attend college full time. Baime of the community college association calls the exclusive focus on full time students "offensive," and Edward M. Elmendorf, senior vice president for government relations at the American Association of State Colleges and Universities, says that the program's design "turns it into more of a merit-based program aimed at the people who are already destined" to go to college than one aimed at "truly bringing people who are have-nots into scientific and other fields in a way that's meaningful." (Baime calls it "a final kick in the shins" that the program would also exclude non-U.S. citizens.)
Adds Senator Kennedy: "The small student aid program in the bill will help only a fraction of those needing assistance and abandons the federal commitment to prioritize the neediest students."
Supporters of the new program, including House and Senate staff members, acknowledge that the program’s reach is somewhat limited in scope, but say they aim to solve a pressing problem in a targeted, cost effective way.
“It’s a question of how you use the certain amount of money that was available to to dedicate toward education spending in the most efficient way to really make a difference,” said one Congressional aide. “These are hard decisions to make, but in the end, we felt very strongly that we should be targeting these dollars, not just spreading them so thin that they’re not helping anybody.”
Critics like Kennedy say the Academic Competitiveness Grants program will also exclude many would-be recipients by requiring them to have undertaken a curriculum "established by a state or local educational agency and recognized by the secretary" of education.
That provision not only concerns liberal lawmakers and college officials worried about students in second-rate schools who don't have access to high-quality curriculums, but it also troubles advocates for home-schooled and private school students, who worry about those students’ exclusion from the program, but also conservative groups that tend to be troubled by signs of creeping federal intervention into local affairs.

The budget reconciliation legislation that contains the Academic Competitiveness program still needs to be approved by the House of Representatives to become law, and while college officials hold out some faint hopethat the overall legislation will be defeated, few political observers see that as likely.

Shaping the exact details of the program, then, will fall to Education Department staff members, who have said that they will seek advice with state and college officials.

But given where the process stands, it's probably too late to do anything really significant to change the underlying flaws in the program, which might have been avoided if lawmakers hadn't done their work so secretly in the final days of the legislative session, several lobbyists say.

As Baime of the community college association put it: "It's just hard to imagine this would have come out this way if it had just had a little bit of sunlight on it."

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