The Education Exception

It’s nice being seen as essential.

As President Obama and his aides unveiled the administration’s fiscal 2011 budget with lots of talk about reining in discretionary spending, they largely exempted programs important to higher education from the budget restraint they urged.

Not every higher education-related program would fare well under the budget blueprint; the administration would hold funding for many student aid programs other than Pell Grants at their 2010 levels and eliminate a handful of others; end the Department of Labor’s Career Pathways Innovation Fund (a $125 million grant program for community colleges); and slice the budget of the National Endowment for the Humanities.

But by and large, most programs that serve colleges and students would fare well under the administration’s budget for the year that begins in October, with the White House proposing another massive infusion of funds into the Pell Grant Program (covering a million additional students and ensuring a permanent and growing flow of money into it), recommending significant increases for several key scientific research agencies (see related article) for job creation purposes, and even proposing a 31 percent increase in financial support for the AmeriCorps national service program.

"At a time when most government spending is being frozen, President Obama is investing in education — a clear reflection of the president’s deep commitment to education," Education Secretary Arne Duncan said in a telephone news conference Monday. "The president has set a goal that America once again will lead the world in college completion by the end of the decade, and to do that, we need to improve the education at every level. This budget puts us on a path to success and meeting that goal. We have to educate our way to a better economy."

Higher education leaders generally expressed their appreciation for the president’s recognition — through his proposed distribution of money — of the centrality of a college education for Americans. "Improving access to college for our young people is essential to preparing our workforce for 21st century challenges, and the Pell Grant remains our best tool for aiding students from low-income families," Robert M. Berdahl, president of the Association of American Universities, said in a prepared statement Monday.

If many college leaders were something this side of ebullient, it may be because so many of the administration’s priorities depend on passage of the Student Aid and Fiscal Responsibility Act, which would dramatically reshape the student loan programs (ending all lending from the lender-based guaranteed loan program) and shift the savings to support a wide range of new and expanded education programs. The legislation passed the House of Representatives last fall, and while most prognosticators still believe it will become law eventually, serious questions remain about whether the measure will produce enough savings to finance the enormous range of programs the administration is expecting it to pay for.

The Education Department is counting on the savings from the student loan restructuring to finance its Pell Grant expansion, its $10.6 billion community college initiative, a $3.5 billion College Access and Completion Fund, hundreds of millions of dollars for historically black and other minority-serving colleges and various other higher education priorities. But department officials are also banking on it covering a series of new programs to support early childhood education. (The Education Department’s budget blueprint describes a total of $95 billion in new spending over 10 years designed to flow from the SAFRA legislation.)

The administration’s ambitions could be impaired if Congressional or administration accountants in the coming weeks drastically change their estimates of either the amount the loan legislation would save or the price tag of some of the budget items.

Administration officials played down that possibility in their statements Monday, focusing on what they characterized as President Obama’s historic commitment to expanding educational opportunity. Under the budget blueprint, the maximum Pell Grant for low-income students would rise to $5,710 from the current $5,550, and perhaps even more importantly, in the eyes of many student aid experts, the administration would begin financing the bedrock financial aid program as a federal entitlement program, where it would be protected from the annual ups and downs of the Congressional appropriations process.

Under the administration’s proposal, which in many ways mirrors what it urged last year, the maximum Pell Grant would be indexed to the Consumer Price Index, rising each year by the increase in the annual inflation rate plus one percentage point.

Most other student aid programs would remain in 2011 at their currently funded levels under the Obama plan, which would dramatically reshape the Perkins Loan Program and phase out the Academic Competitiveness Grant and National Science and Mathematics Access to Retain Talent Grant Programs. (A table with full details on education and other programs appears below.) The Education Department would shift tens of millions of dollars for teacher education that now flow through the Higher Education Act into a revamped K-12 leadership program under Elementary and Secondary Education Act, which is up for renewal this year.

Mixed Bag for Two-Year Colleges
Community colleges could be a major beneficiary of the administration’s budget for 2011 and beyond, if the American Graduation Initiative, its $10.6 billion plan to strengthen two-year institutions with a mix of new funds and greater accountability, becomes a reality. But the institutions would also lose out in a few key ways if the administration’s 2011 budget plan takes effect as is.

The Education Department proposes eliminating the Tech Prep Program, which has until now maintained a separate stream of funding within the Carl D. Perkins Career and Technical Education Act program. And the Department of Labor’s budget calls for ending the Career Pathways Innovation Fund, which the Bush administration created in 2005 to focus on expanding career paths through community colleges. Labor Department budget documents (reinforced by an online chat held by department officials, including Jane Oates, who oversees the department’s training programs) said they believed the graduation initiative would obviate the need for the pathways program.

"The AGI would provide significant resources for competitive grants to community colleges that could support career pathways and other innovative training and education programs. The Department of Labor would work with the Department of Education to administer these grants, continuing to support career pathway programs at community colleges that help individuals of varying skill levels enter and pursue rewarding careers in high-demand and emerging industries," the department’s documents stated. The Labor Department also proposes creating a new innovation fund (with about 5 percent of existing funds from national and state training programs) aimed at spreading best practices — including, conceivably, those at two-year institutions.

Dip Proposed for Humanities and Arts
Both the National Endowment for the Humanities and the National Endowment for the Arts would see their funds cut in 2011 under the Obama administration’s budget. The annual appropriation for the humanities endowment would dip to $161.3 million from $167.5 million in 2010, with equivalent cuts in most of its programs, except for challenge grants. The arts endowment would see an equivalent drop. The National Historical Publications and Records Commission, which is part of the National Archives and Records Administration and seeks to preserve the country’s documentary heritage, would see its budget cut to $10 million from $13 million.

Berdahl, the AAU president, questioned the logic of cutting the cultural endowments’ budgets, given how little would be saved by doing so.

"We hope that Congress will be able to restore the proposed cut in funding for the National Endowment for the Humanities," he said. "The relatively small amount of money this saves, $6 million, contributes little to the effort to maintain an overall spending freeze, but it has a significant impact on the endowment’s ability to support humanities research and education."

The president’s budget becomes a starting point for discussions in Congress, where the reaction from lawmakers — despite the president’s renewed call for bipartisanship in his State of the Union speech and the days since — was predictably divided, with Rep. George Miller (D-Calif.) praising the president and Rep. John Kline (R-Minn.) — well, not so much.

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