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11 Percent Hike in Education Funding Nears Final Approval in the Congress

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By Mark Pitsch

Washington--The Congress last week neared final approval of a $182.2-billion labor and social-services spending bill for fiscal 1991 that includes a $2.7-billion increase for education programs over last year.

The 11 percent increase for education, to a total of $27.4 billion, would have been $487 million larger if conferees had not imposed a 2.41 percent cut on all discretionary programs in reconciling differences between the House and Senate bills.

Most education programs still received healthy increases over last year--for example, Chapter 1 funding was boosted by $860 million and the Pell Grant program received $566 million more than last year.

But others, such as the Chapter 2 school-improvement program and college work-study, did not. Funding for Chapter 2 fell $35 million, to $484 million, while the work-study program dropped by $71 million, to $595 million.

Meanwhile, the Congress and Mr. Bush late last week were on the verge of signing off on a final deficit-reduction accord after weeks of debate. The House and the Senate were scheduled to vote on the bill's tax-increase compromise and send it to the President by Oct. 27.

Coupled with legislated changes in entitlement programs, including those slicing $1.8 billion from the Stafford Student Loan program, the budget package would trim $40.1 billion from the fiscal 1991 deficit and $500 billion over five years.

Even with those savings, the government still is projected to have a total deficit of more than $250 billion this year.

House and Senate conferees is4sued their report on the labor, health and human services, and education spending bill Oct. 20.

Educators See Mixed Success

The House had allocated education programs $26.1 billion. That total did not include funding, however, for certain special- and vocational-education programs whose authorizations had not yet been renewed by the Congress. The Senate provided $27.7 billion, which included funds for the unauthorized programs.

Conferees originally agreed on a $183.5-billion bill, including a $3.2-billion increase in education funding. But the total exceeded the amount allocated to the programs under the overall Congressional budget resolution by $1.3 billion, forcing the across-the-board cut.

The final version approved by conferees gave boosts over last year of $275 million to unemployment insurance and employment services, and $220 million to emergency aids care. The latter increase was included at the insistence of senators who represent states with large urban areas.

The House Oct. 22 approved the conference report on a 335-to-74 vote. The Senate approved the bill on an 82-to-15 vote Oct. 25, but added several amendments, including one that would provide $2 million for a panel to monitor national education goals. (See related story, this page.)

The House was expected to consider the altered bill late last week.

Members of the education community looked at the conference agreement "with two sets of eyes," according to Edward R. Kealy, director of federal programs for the National School Boards Association and vice president of the Committee for Education Funding.

"From one point of view, you say, 'From the bottom line, this is an excellent increase,"' he said. On the other hand, "We have a little disappointment in looking at it from another point of view, knowing we had a larger increase."

Chapter 1 programs for the disadvantaged remained the primary beneficiaries of the funding increase. Such programs will receive $6.2 billion, $610 million more than President Bush's request. The final amount is virtually the same as the figure included in the House bill, but $152 million less than that in the Senate bill.

The report also provides for raising the maximum annual Pell Grant from $2,300 to $2,400.

Conferees included language in the report that would allow the Education Department to transfer $100 million from Chapter 1 to the President's proposed Merit Schools program if the pending omnibus bill of which it is a part is approved.

Impact Aid, Drug-Free Schools

Other highlights of the conference report are:

  • Impact aid will receive $781 million, a $48-million increase over last year and $119 million more than Mr. Bush's request. The amount is $19 million less than that approved earlier by the House and Senate.
  • The drug-free-schools program will receive $607 million--$68 million more than last year, $14 million more than the President's request, and $13 million more than the House approved. The amount is $39 million less than that approved by the Senate, however.
  • $1.9 million will go toward the National Writing Project, a program proposed by Senator Ward Cochran, Republican of Mississippi, to improve students' writing skills. Neither President Bush nor the House called for such funding.
  • $198 million will be allocated for bilingual education, up $9 million over fiscal 1990. But that figure is $8 million less than the President asked for and $7 million less than the House approved. The Senate originally approved $197 million.
  • Handicapped-education programs will get $2.47 billion, a $410-million increase over last year and $330 million more than Mr. Bush's request. The amount is $280 million less than the House approved, even though the House bill did not include more than $200 million in unauthorized programs. It is $214 million more than the Senate approved.
  • Student financial assistance jumped from $6.08 billion to $6.71 billion. That is $360 million more than the President asked for, but $67 million less than the House approved and $164 million less than the Senate recommended.

Itemized Deductions Curbed

The budget-reconciliation package reportedly would raise taxes by more than $140 billion over the next five years, targeting upper- and upper-middle-income taxpayers.

Although details were not final late last week, a number of the tax provisions would affect education. They include:

  • The ceiling on wages taxed at 1.45 percent for Medicare would be raised from $51,300 to more than $100,000, and a plan that would force states to include all employees in the payroll-tax program was being considered.
  • Itemized deductions would be reduced by 3 percent on adjusted gross incomes that exceed $100,000.

Lobbyists said the change could have an indirect impact on education funding. Schools that rely on charitable contributions fear a drop in donations, while school districts, which are predominantly funded by state and local taxes, warn that taxpayers may ask for tax relief at those levels.

  • Gasoline taxes would rise from 9 cents to 14 cents.

In a related development, the Congress last week gave final approval to an Interior Department appropriations bill that includes $619.3 million for Indian education.

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