Stopgap Spending Bills Worry Education Advocates

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Low spending levels included in temporary spending bills passed last week by the House and Senate in an effort to avert a government shutdown could hurt education programs in the long run, advocates fear.

And while lawmakers agreed last week to limit cuts in student-loan programs, their agreement would significantly curtail the direct-lending program.

The so-called continuing resolutions would give Congress and the White House until Dec. 1 to complete 11 outstanding appropriations bills, replacing a six-week stopgap plan that expired Nov. 13. Failure to enact a new plan by that deadline would trigger a government shutdown, a possibility that loomed large late last week as President Clinton threatened to veto either version of the resolution.

The House passed its bill 230-197. The Senate version was approved 50-46. GOP leaders hoped to reconcile differences between the bills by the end of last week.

Both bills would set temporary funding levels equal to the lowest amount allocated in 1996 spending bills passed by the House, the Senate's version of those bills, or fiscal 1995 appropriations.

That means that education spending under the new plan would be set, albeit briefly and with little immediate impact, by the lean House spending bill for the departments of Labor, Health and Human Services, and Education, which would lower federal education spending by $3.5 billion, or 15 percent.

However, spending on programs targeted for elimination, including dozens in education, would be set at 60 percent of the fiscal 1995 level under the plan.

The pending Senate education-spending bill would provide more money, but its passage has been stalled by disputes over issues such as abortion.

"This won't have any real impact on our programs because most of our money goes out later in the year," said Sally H. Christensen, the director of the Department of Education's budget service.

The problem, school lobbyists say, lies in what could happen after Dec. 1.

"We're concerned about the potential precedent," said John B. Forkenbrock, the president of the Committee for Education Funding, an Washington-based umbrella lobbying group. "We're worried that the lower numbers could be set in concrete if there is a longer continuing resolution after December 1."

President Clinton said he would veto the bills because of the low spending levels and because he opposes legislative riders that have been added, including one that would curb lobbying by nonprofit groups that receive federal grants.

Direct-Loan Cap

The 1996 budget fight also played out on other fronts last week.

Republicans negotiating differences between House and Senate budget-reconciliation bills, which make legislative changes that cut entitlement spending, settled on $4.9 billion in savings from student-loan programs over seven years.

That is about the amount called for in the Senate bill; the House bill included $10.8 billion in student-loan cuts. Almost all the savings are to be realized by cutting subsidies to private lenders.

Still, some $1.4 billion in savings would come from capping the direct-lending program, under which the government makes loans to students through their institutions, at 10 percent of total loan volume. Currently, direct loans make up more than 35 percent of federally backed student loans.

House Republicans also agreed to drop their proposal to cut subsidies of loan interest that accrues during the six-month grace period after a borrower's graduation.

"I think there was wide agreement that none of the savings would come from students and parents," said Mike Horak, the press secretary for Sen. Nancy Landon Kassebaum, R-Kan., the chairwoman of the Senate Labor and Human Resources Committee.

Lawmakers hope to finish work on a final reconciliation bill--which will include a wide array of provisions affecting such programs as school meals and Medicaid--by Nov. 17.

Vol. 15, Issue 11

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