House Committee Passes Student Aid and Fiscal Responsibility Act of 2009

Today, the House Education and Labor Committee led by Chairman George Miller (D-CA) passed H.R. 3221, the “Student Aid and Fiscal Responsibility Act of 2009,” by a 30-17 vote. The bill eliminates the Federal Family Education Loan Program and originates all new federal student loans through the Direct Loan Program starting in 2010. In total, this conversion generates $87 billion in savings. While there were a number of amendments offered and debated, the intent of the bill and the funding levels for Pell Grants, community college modernization and President Obama’s American Graduation Initiative (no significant changes to the community college programs) were left unchanged.

The bill provides significant funding increases in two key areas:

• Investing $40 billion to increase the annual Pell Grant maximum to $5,550 in 2010 and to $6,900 by 2019. Starting in 2010, the maximum will be linked to match rising costs-of-living by indexing it to the Consumer Price Index plus 1 percent; and
• Providing $9.5 billion for President Obama’s American Graduation Initiative, with $2.5 billion in FY2011 for community college infrastructure and $7 billion (over ten years) for competitive grants to community colleges and states. The funding is broken down to three distinct programs:

1. 2.5 billion in FY2011 for grants to community colleges to modernize,
   renovate, and repair their facilities.
2. $6.3 billion over ten years for community college and state competitive
   grants. The first four years are geared towards community colleges and
   states. The remaining six years are targeted towards states. Prior
   to the markup, ACCT worked to include language within the state grant program
   stipulating that no less than 90% of funds to states be allocated to community
   colleges.
3. $700 million for competitive grants for national activities, including
   grants to develop free online training and courses.

Additionally, the funds other programs including:

• Providing $3 billion to bolster college access and completion support programs for students;
• Strengthening the Perkins Loan Program;
• Keeping interest rates low on need-based – or subsidized – federal student loans by making the interest rates on these loans variable beginning in 2012. These interest rates are currently set to jump from 3.4 percent to 6.8 percent in 2012;
• Simplifying the FAFSA form;
• Providing $2.5 billion for Historically Black Colleges and Universities and Minority-Serving Institutions;
• Providing $8 billion for Early Learning Programs; and
• Providing $10 billion to pay down the federal deficit.

With the Committee process complete, the bill has been referred to the House Budget Committee. There is some discussion about bringing the bill to the floor next week. Meanwhile, the Senate is expected to consider its budget reconciliation bill in early September.

To see the letter of support for H.R. 3221 by ACCT and AACC, visit: http://www.acct.org/Final%20HR3221Support%20Letter.pdf

For more information visit: http://edlabor.house.gov/newsroom/2009/07/legislation-to-make-landmark-i.shtml

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House Appropriations Committee Passes Education Funding Bill

Last Friday, the House Appropriations Committee passed its version of the FY2010 Labor, Health and Human Services and Education spending bill at $160.7 billion by voice vote. With Committee passage, the bill now heads to the House floor for consideration. It is expected that the bill will be considered this week or next week. The bill is $5.2 billion over last year’s funding level, but $52 million less than what President Obama requested.

The bill maintains the maximum Pell Grant at $4,860; combined with the mandatory funding of $690 for the Pell Grant program, this equals a $5,550 maximum. Also, the Career and Technical Education programs are level funded at $1.2 billion.

The Committee provides $130 million for the new Career Pathways Innovation Fund (formerly called the Community-Based Job Training Grant program). The allocation for this program is $5 million more than the FY2009 total. It appears that the Departments of Labor and Education will have a role in running this program. The Committee requires that $65 million be used for nursing programs. Additionally, the Committee is providing $50 million to prepare workers for careers in emerging green industries.

The Senate Subcommittee is expected to consider its version of the bill in the next couple of weeks.

For more information, visit: http://appropriations.house.gov/Subcommittees/sub_lhhse.shtml Read more!

House Subcommittee Passes Education Spending Bill

Today, the House Labor, Health and Human Services and Education Appropriations Subcommittee passed its version of the FY2010 spending bill at $160.7 billion. The Subcommittee is providing $5.2 billion over last year’s funding level, but $52 million less than what the President requested. While each programmatic funding level was not disclosed, the Subcommittee did provide funding levels for key programs.

The bill maintains the maximum Pell Grant at $4,860; combined with the mandatory funding of $690 for the Pell Grant program, this equals a $5,550 maximum. Also, the Career and Adult Education funding is slated at $2 billion, or $72 million over FY2009. It is unclear how these funds are distributed amongst the various programs.

The Subcommittee provided $135 million for the new Career Pathways Innovation Fund (formerly called the Community-Based Job Training Grant program). The allocation for this program is $10 million more than the FY2009 total. It appears that the Departments of Labor and Education will have a role in running this program. Additionally, the Subcommittee is providing $50 million to prepare workers for careers in emerging green industries.

The next step will be for the House Appropriations Committee to consider the bill next week, with the full House considering the bill later this month. The Senate Subcommittee is expected to consider its version of the bill in the next couple of weeks.

For more information, visit: http://appropriations.house.gov/Subcommittees/sub_lhhse.shtml Read more!

Changes to the House Education and Labor Committee

June 10, 2009 — Yesterday, the House Republican Steering Committee selected Rep. Howard “Buck” McKeon (R-CA) as the ranking member of the House Armed Services Committee. Rep. McKeon takes the spot of Rep. John McHugh who resigned last week because of his nomination to serve as Army Secretary.

Rep. McKeon had served as the ranking member of the Education and Labor Committee and chaired the committee during the 109th Congress. Rep. McKeon will continue to serve as the ranking member until a replacement is announced.

According to reports, a number of Republican members have indicated an interest in the ranking member post including Reps. Tom Petri (R-WI), Michael Castle (R-DE), Joe Wilson (R-SC) and Rep. John Kline (R-MN). The Steering Committee is expected to make a decision in the next week or so.

The Education and Labor Committee will have the major task of dealing with the budget reconciliation, which allows for moving of the Pell Grant program to a mandatory program and merging of the Direct Lending program and Federal Family Education Loan program into a single program. Additionally, the committee will have to consider the reauthorization of the Workforce Investment Act and the No Child Left Behind Act (Elementary and Secondary Education Act). Read more!

House Committee Holds Hearing on Increasing Student Aid Through Loan Reform

Thursday, May 21, 2009 — Today, the House Education and Labor Committee held a hearing to examine a proposal outlined by President Obama in his FY 2010 budget request, which would increase funding for the Pell Grant program by almost $94 billion over ten years and make Pell an entitlement program (mandatory). The President’s plan would be paid for by ending the subsidies the federal government currently pays to lenders in the Federal Family Education Loan program, which is the federally guaranteed student loan program, and re-directing those savings back into Pell. In turn, the move would originate all new loans starting in the academic year 2010-2011 under the Direct Loan program.

ACCT supports the Obama Administration’s effort to make the Pell Grant program into an entitlement program (mandatory). The proposal would also allow for Pell Grant maximum increases each year based upon the Consumer Price Index (CPI) plus one percent. Another component of this proposal would be the creation of a program focused on student access and success. This new program would be funded at $500 million or $2.5 billion over five years. The key committee witness was Robert Shireman, Deputy Undersecretary at the U.S. Department of Education, who is leading the Department’s effort on Pell.

Click here for a webcast of today’s hearing.

ACCT encourages community college leaders to contact your members of Congress in support of reforming college aid to allow for stable Pell Grant program.

Contacting your legislators is easy at ACCT’s Policy Center.
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Secretary Arne Duncan Testifies Before House Committee

Today, U.S. Secretary of Education Arne Duncan testified before the House Education and Labor Committee to outline President Barack Obama's education agenda and the FY2010 budget request.

While the bulk of Secretary Duncan's comments covered K-12 education, he noted three key changes in the higher education area: First, the Pell Grant program would be shifted to a mandatory, appropriated entitlement. Second, the elimination of the Federal Family Education Loan program and the move into a large direct lending program. Third, the Perkins loan program will increase from $1 billion to $6 billion. This change will also increase the participation rates for students and colleges.

The Committee will hold a hearing tomorrow to discuss the Administration's proposal for FFEL and direct lending.

In other testimony, Secretary Duncan noted that the Department is focused on ensuring that states are utilizing stimulus stabilization funds properly and on education.

Click here for Secretary Duncan's testimony.

Click here to view the hearing.
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