NAICU Washington Update

House Spending Bill Includes Historic Increases for Student Aid

May 02, 2019

The FY 2020 spending bill recently released by the House Appropriations Subcommittee on Labor-HHS-Education, which funds the student aid programs, made funding critical student aid programs a priority.  Included in the package are significant increases to the student aid programs, including all the funding requests recommended by the Student Aid Alliance, a coalition of nearly 90 organizations and institutions co-chaired by NAICU and the American Council on Education.

The bill:
  • Increases the Pell Grant Maximum by $150 to $6,345
  • Increases the Supplemental Educational Opportunity Grant (SEOG) by $188 million to $1 billion
  • Increases Federal Work Study by $304 million to $1.4 billion
  • Increases TRIO by $100 million to $1.1 billion
  • Increases GEAR UP by $35 million to $395 million
While the spending package includes substantial increases for the fundamental programs that help low-income students get into college, stay in, and graduate, it is likely these spending levels will be the high water mark for student aid this year. There is a long road ahead before enactment, as the House bill is only the first step in the multi-step appropriations process.

During the subcommittee markup, members on both sides of the aisle were supportive of student aid funding levels. Democrats, who called this a “blockbuster” bill, were effusive about their ability to not only prevent cuts in funding for any programs but provide substantial increases, in stark contrast to the President’s budget proposal. Republicans praised the inclusion of funding increases for their priorities, but cautioned against the big increases not surviving the process.

There is no question that the political atmosphere will play a key role in how the spending bills are managed.  Appropriators are starting their work without an agreement on increased statutory budget caps for FY 2020 and FY 2021, so technically, if the bills being written now were enacted, they would be subject to sequestration cuts.

Generally, there is bipartisan, bicameral leadership agreement that the spending caps must be increased, but by how much is still developing.  House Democrats, feeling emboldened by their new majority, are raising the stakes by proposing significant spending increases across all agencies.  Senate Republicans are likely to propose, possibly with Democratic support, more moderate increased spending levels, in contrast to the President’s draconian cuts below sequestration levels. Rank and file members on both sides of the aisle will argue against each other on the merits of increases versus cuts until leadership can agree on a middle ground. 

Next Steps
The House Committee on Appropriations will consider the education spending bill on May 8, then it will likely be held to be combined with the Defense spending bill for a floor vote, as it was last year.  Democrats are hoping this tactic, to garner majority bipartisan support for the biggest defense and nondefense spending bills, will work for them this year, as it did for the Republican majority last year.

The Senate will write its version of student aid funding in June, which will most likely be a bipartisan bill, with funding levels expected to be slightly below the House levels. The Senate is also expected to combine Labor-HHS-Education with Defense for efficient passage in that chamber.

Congressional leadership will then have until September 30 to craft a bipartisan budget deal that includes increased spending caps, and an increase in the debt ceiling.  These combined will avoid a government shutdown, and the nation defaulting on publicly held debt.  The wild card in how the process plays out is President Trump’s reaction to such a deal and how much is allocated for increased funding for border security. Congressional leaders are expected to negotiate these pieces of a deal over the course of the summer.

MORE News from NAICU