Approps Cont'd.

Continuing on the Obama Administration approp recommendations, here's the non-S&T programs of note. Again, analysis provided by the able folks at the APLU.

Department of Education (ED)--A cornerstone of the Obama Administration higher education policy is its proposal to turn the Pell Grant Program into an entitlement program from its current status as a discretionary line item. The documents released today reaffirm this proposal and calls for the maximum award to be set at $5,550 for the 2010-2011 academic year. In addition to turning the program into an entitlement, the budget calls for the maximum to increase yearly at the same rate as the consumer price index (CPI) plus one percentage point.

The documents released today also reconfirm the Administration’s desire to end the Federal Family Education Loan Program (FFELP). The Administration proposes to originate all new federal student loans after July 1, 2010, through the Direct Loan (DL) program. In order to ensure that the Department has the capability to handle the new loan volume, the budget calls for the Department’s student aid administration budget to increase by $27 million to $870 million in FY2010.

While the Pell and student loan proposals have received the most attention from the community and the press, the Administration has proposed a set of changes to the current Perkins Loan Program. While the Administration has called for the size of the program to be increased to $6 billion, until today, many of the details about the Administration’s proposal were less clear.

The Department is proposing changes to the delivery mechanism of the program, moving away from the institution-based “revolving funds” model and to the same system that institutions currently use for Pell Grants and Direct Loans. The Perkins loans would be serviced by private companies that currently service the direct loans and FFEL loans acquired by the Department.

The distribution formula would be altered as well. It appears that the new proposal could include a number of new conditions that institutions must meet. The appendix states that the Administration “intends for this new formula to encourage colleges to control costs and offer need-based aid to prevent excessive indebtedness. It may also reward schools that enroll and graduate students from low- and middle-income families.” Furthermore, institutions would have the ability to determine student eligibility and the borrowers would continue to receive an interest of five percent, while the in-school subsidy would be eliminated. Institutions would be required to calculate and return to the federal government the federal share of the current revolving funds.

The budget also calls for a new mandatory five-year, $2.5-billion college access and completion fund. Funds would go primarily to states to improve graduation rates among high need students. States would be given the flexibility to fund and support programs.

With respect to other student aid programs, the Administration proposes to fund the Supplemental Education Opportunity Grant (SEOG) program at $757 million in FY2010, slightly below the current level. The budget also calls for the work-study program to be funded at $981 million, compared to the $1.18 billion in FY2009. The program, however, received $200 million in the American Recovery and Reinvestment Act (ARRA) earlier this year.

The complete set of the ED budget documents is available at the following URL: http://www.ed.gov/about/overview/budget/budget10/index.html?src=rt.

National Endowment for the Humanities (NEH)--The Obama budget seeks $171.3 million for the NEH, which represents an increase of $16.3 million over the FY2009 appropriated levels. This sum includes $10 million to run the National Capital Arts and Cultural Affairs, currently administered by U. S. Commission of Fine Arts.

Additional information about the NEH budget request is available at the following URL: http://www.neh.gov/news/archive/20090507.html.