NAICU Washington Update

Biden Budget Boosts Pell and Continues to Push for Free Community College

June 04, 2021

President Biden submitted his full FY 2022 budget to Congress before the Memorial Day recess with an historic increase proposed for the Pell Grant program. President Biden is proposing a $1,875 increase in the Pell Grant maximum for FY 2022, bringing the total to $8,370.

By combining the $400 increase from the “skinny budget” and the $,1400 increase from the American Families Plan, both realized in April, and topping it off with an additional $75 from his full budget, President Biden has taken a big step toward doubling the Pell Grant maximum. 

The importance of this investment in the Pell Grant program to the Administration is reinforced by its inclusion as one of the highlights in the “Budget Message of the President,” in the introduction to the FY 2022 Budget of the U. S. Government.  The Administration says the budget “would make college more affordable and tackle equity gaps with increased Pell Grants and investments in institutions serving low-income, first generation students, and students of color.” The Administration has also stated that it considers this year’s budget “a significant down payment on the President’s commitment to doubling the grant.” 

The budget proposes an $11.6 billion increase for the Pell Grant in FY 2022, for a total of $40.672 billion; $25.475 billion is proposed from the discretionary (annual appropriated) side of the budget and $15.197 billion proposed from the mandatory (entitlement) side of the budget. The budget estimates this would help more than 7 million students, including newly eligible DACA students.

The budget also continues President Biden’s call for free community college, as outlined in his American Families Plan.  Free community college would be provided through a federal-state partnership in which the federal government would provide 75% of the funding, and states would provide 25% of the funding to ensure first-time students and workers wanting to reskill have free tuition.  Total funding for this proposal is $14.3 billion. 

Another federal-state partnership proposal included in the budget is $6.2 billion for Completion Grants to help states support “a comprehensive set of completion and retention activities at colleges and universities that serve high numbers of low-income students.” While private, nonprofit colleges may be eligible for the proposal, priority is noted for community colleges.

To promote “Institutional Aid to Improve Affordability,” the budget proposes two years of subsidized tuition for students from families making less than $125,000 at any Historically Black Colleges and Universities, Minority-Serving Institutions and Tribally Controlled Colleges.  This proposal would provide grants to institutions, rather than states, to help cover tuition. 

Additional higher education programs are highlighted and increased in the budget, including the Title III and Title V Strengthening Institutions Programs (including all Historically Black College and University programs, and all Minority-Serving Institutions Programs); TRIO; GEAR UP; and Teacher Quality Partnership Programs. However, the campus-based aid programs – Supplemental Educational Opportunity Grants (SEOG) and Federal Work Study (FWS) – are proposed to be funded at last year’s levels. 
Congress will now take the president’s budget request and run it through the budget and appropriations process. The program increases proposed with discretionary funds will need to be approved through the annual congressional appropriations process while the program increases proposed with mandatory funds will need to be approved through the budget reconciliation process. 

The appropriations process is starting right away, with the House planning to have its bills written in June. The budget reconciliation process is expected to take place in the fall.  As a first step, the budget committees will write a budget resolution to guide the process that will engage the education committees to write the legislation to enact the increases.

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