Federal Relations

July 28, 2011

Senate Holds Hearing on Department of Ed FY12 Budget

The Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies held a hearing yesterday on the Department of Education’s FY12 budget. Secretary Duncan was the witness.

In his opening remarks, Duncan expressed concern that America has gone from being a world leader in education to now being “middle of the pack”.  He also emphasized that demand on the Pell program has increased from 6 million to 9 million students in 2 years and that the Department is focused on closing the Pell shortfall – currently $11 billion – through increased efficiencies and more resources. The Pell program accounts for a third of the Department’s total $77 billion FY12 request. The Secretary cites the increasing number of lower income families and more families without jobs as the reason for the increased demand for the grants. Earlier this week, both Reid’s and Boehner’s debt ceiling deals contained an elimination of the in-school interest subsidy for graduate students, with the money saved by doing this going back into the Pell program to help shore up the shortfall for the next two years. Although this will have a negative effect on students, out of the many rumored changes to Pell that have been floating around during the past few weeks and the negotiation process, this is the best possible outcome for the university community. Pell and changes to the program will continue to be an issue as we head towards Fall and finishing up the FY12 process.

The Committee also brought up the concern that 89% of first-generation college students do not complete their degree. The Secretary stated that this was one of the Department’s FY12 priorities, and they are trying to solve this problem in three ways: 1) Fighting to maintain access to Pell. 2) Investing in community colleges and partnerships with the private sector to leverage funding. 3)  Investing in programs such as i3 and the proposed “First in the World Competition”. The First in the World Competition would provide “venture capital” to encourage innovation approaches to improving college completion (particularly low-income and minority students), research support to build the evidence of effectiveness needed to identify successful strategies, and resources to scale up and disseminate strategies we already know are successful.

The Labor-HHS-Ed Appropriations bills have not yet been drafted in the House or the Senate and we don’t expect to see them until after the August recess.