Yesterday, President Obama released his FY14 budget request — nearly two months later than required by law. Much of the delay was blamed on the sequester and the prolonged FY13 appropriations process that resulted in a year-long continuing resolution (CR). In a typical year, the President’s Budget Request (PBR) kicks off the annual appropriations season, but with the delays, Congress has moved forward with their own budget proposals. This leaves us with three very different budget proposals with which to base the annual appropriations process. In other words, the process is once again sure to be a mess come later this fall. Our April Federal Update reviews the PBR and highlights those agencies and programs that we care about the most. You can also access the PBR and all the supporting documents at: http://www.whitehouse.gov/omb/budget.
Category: Student Aid
President Proposes Linking Federal Aid to Performance
Yesterday, President Obama released “The President’s Plan for a Strong Middle Class and a Strong America” as a follow up to his State of the Union address on Tuesday. While the President focused on a few higher education messages during his speech, mainly his College Scorecard, his nine-page document released yesterday laid out a plan to seek major changes in the accountability system for higher education by calling for benchmarks for affordability and student outcomes as criteria for receiving federal student financial aid. If realized, regional and national accreditors would become the primary gatekeepers for access to those dollars, which would be based on performance and results. It is not yet clear how the President will achieve his goal of tying federal aid to performance as it is not well defined in his post-SOTU document. We will be following this closely.
UW Rates Exceptionally Well on Obama’s College Scorecard
During his State of the Union address last night, President Obama announced a new College Scorecard that would help students and parents make better decisions about which college to attend. The College Scorecard allows you to enter the name of a college of interest or select factors that are important in any college search. You can find scorecards for colleges based on factors such as programs or majors offered, location, and enrollment size.
According to the administration’s College Scorecard, the University of Washington, including UW-Tacoma and UW-Bothell, all “score” exceptionally well compared to other post-secondary institutions in Washington state. This validates what we have been saying for a long time: the UW offers great value and a great education for Washington state residents!
2013 Higher Ed Agenda
Inside Higher Ed published a good article in today’s edition that details the higher education issues facing the next Congress. Budget issues will continue to be the most pressing issue confronting lawmakers when they convene the 113th Congress in January. Additionally, Congress will need to deal with looming student loan interest rate increases (July 2013), a shortfall in the Pell Grant Program beginning in 2014, and reauthorization of the Higher Education Act (HEA). This article sets the stage for our advocacy efforts in 2013.
Sequester Details
Schedule: Both the House and Senate are out until Wednesday in observance of the Jewish holiday of Rosh Hashanah. When they return, the Senate will take action on the 6-month continuing resolution. Both chambers are expected to recess at the end of the week and not return until after the November elections.
OMB Sequester Report: In the report released last Friday, the Office of Management and Budget (OMB) warns the sequester would be “deeply destructive” to national security, domestic investments, and core government functions. The report outlines some $109 billion in automatic reductions – or sequester – triggered by last year’s debt limit agreement. The automatic cuts would reduce spending over the next decade across more than 1,200 federal accounts starting January 2, 2013, trimming defense by $54.67 billion, domestic discretionary spending by $38 billion, Medicare by $11 billion, and other mandatory spending programs by about $5 billion. The 394-page report estimated the reductions would reduce discretionary defense spending by 9.4 percent and domestic discretionary spending by 8.2 percent. The estimates are calculated based on the level of federal spending in FY2012. Spending in FY2013 is almost sure to be higher since the proposed six-month continuing resolution (CR) increases spending slightly for the fiscal year that begins October 1st.
Sequester and Higher Education: If Congress fails to head off the $109 billion in overall cuts for 2013 before January 2nd – part of $1.2 trillion in required cuts over the next decade through the sequester – most aspects of federal spending relating to higher education would face reductions of either 8.2 percent (for discretionary programs) or 7.6 percent (for mandatory programs), including appropriations to the National Institutes of Health (NIH) and the National Science Foundation (NSF). NIH, for example, would lose more than $2.5 billion from its more than $30 billion appropriation, a cut of 8.2 percent. The report does not specify how the NIH and other agencies would carry out the reductions internally. In addition to cuts in programs, the law would raise the 1-percent origination fee for unsubsidized Stafford student loans by 7.6 percent, to about 1.1 percent of a total loan. PLUS-loan and unsubsidized-loan fees would rise slightly, from about 4 percent to about 4.3 percent of a total loan. Pell Grants would not be affected by the sequester in the first year.