Federal Relations

By Cynthia Littlefield, Vice President for Federal Relations, AJCU

FY18 Budget is Not a Higher Education Budget

Traditionally, a President’s first budget provides a snapshot of the Administration’s priorities (or lack thereof). The first “skinny budget” released by President Trump barely supports Federal student aid programs for deserving students and establishes an uncertain future for higher education in years to come. AJCU was so taken aback by the FY18 budget, that we were compelled to release a Statement of Concern. To access this statement online, please click here.

The Administration proposed a $3.9 billion reduction from a $10.6 billion Pell grant surplus; Pell grants have long been considered a foundational Federal student aid program. This rescission from the Pell grant surplus will be used for other programs yet to be announced. We hope that a portion of the Pell grant surplus could still be used to reinstitute a year-round Pell grant program that would allow students to obtain an annual Pell grant (this would be particularly helpful for students taking summer classes in an effort to graduate from college on time).

Severe eliminations and cuts were also suggested for campus-based aid programs. The Federal Supplemental Educational Opportunity Grant program (SEOG) is a campus-based aid program that gives Federal funding to campus financial aid officers for distribution to deserving students. This highly successful grant program targets the neediest of students whose annual family incomes are $19,000 or less. SEOG has also been helpful to students whose Pell grant funding is insufficient, or whose families have had such serious complications as job loss or medical challenges for one or two parents, divorce, etc.

At AJCU institutions, the SEOG program totals $21 million and provides assistance to approximately 13,000 students. The Administration‘s FY18 budget proposed total elimination of this program. Congress should consider this proposal as they prepare for reauthorization of the Higher Education Act (HEA) as Congress has the authority to debate the continuation of the program and should emphasize the value it brings to so many students across the United States. Over one million students could lose this funding, many of whom will either have to take out more loans or drop out of college.

The Administration has proposed substantial cuts to the popular and bi-partisan Federal Work Study (FWS) program, although no specific amount was listed in the budget. FWS is a campus-based aid program that provides students an opportunity to work their way through college, often in academic areas that are career-oriented. On an average year, up to 18,000 students at AJCU institutions receive funding through FWS (the program totals $31 million at AJCU institutions every year).

Since this is the first year of the Trump Administration, the final proposed budget was delayed and the "skinny budget" was proposed as an outline. The final budget for FY18 will be released at some time in May.

Another hurdle in the consideration process is the Continuing Resolution (CR), which is set to expire on April 28th but could be extended until the end of FY17, September 30th (or some time before then). An omnibus bill could also emerge to resolve the FY17 CR (so far, this has not been pushed).

AJCU will continue to work on preserving Pell grants and campus-based aid programs with the hope of working with the Administration and Congress to continue to provide access to education for our nation’s students.