Proposal to Shore Up Pell Grant Program Advances on Capitol Hill

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After a heated few weeks of debate about who cares more about college students, federal lawmakers have tentatively moved ahead with a plan to shore up the program that helps low-income students pay for higher education.

But the $1 billion added to a supplemental spending bill for fiscal 2002 to offset a shortfall in the Pell Grant program hasn't erased bitter feelings between Republicans and Democrats. And despite bipartisan agreement to allocate the extra money, details must be ironed out between proposals in the House and the Senate.

The $29.4 billion spending bill was expected to come up for a vote on the House floor late last week. The $1 billion included in the measure for Pell Grants could help erase a $1.3 billion shortfall in the program, which this year provides qualifying students with up to $4,000 for college. A faltering economy and an increased number of students seeking postsecondary education created the deficit. This year's budget of $10.3 billion fell short despite a 5.7 percent increase over last year's level. More than 4 million students currently use Pell Grants, according to the Department of Education.

The House bill includes a number of cuts to non-education-related programs to pay for the extra $1 billion. The Senate version, which has not yet made it to the floor, doesn't provide any offsetting spending cuts. Instead, the Senate version would classify the $1 billion as emergency spending, a designation that would not require cuts elsewhere in the budget.

However, the White House would have to approve the emergency designation, said Larry Zaglaniczny, the director of congressional relations for the National Association of Student Financial Aid Administrators, based in Washington."The billion-dollar question is, will the administration do this and, secondly, what are the [House and Senate] conferees going to do in terms of working out this difference in approach?" he said.

Democrats and Republicans last week praised the inclusion of the $1 billion for Pell Grants. Secretary of Education Rod Paige lauded Republican leaders for "ensuring that millions of needy students who depend on Pell Grants ... will not face any decrease."

President Bush's fiscal 2003 budget proposal includes about $10.9 billion for Pell Grants, about $400 million lower than this year's allocation after adding in the extra $1 billion. Even so, the lower amount would be enough to fully fund the program, Education Department officials maintained last week, citing anticipated improvement in the economy, among other factors.

Bruised Feelings

Some Democrats, including Rep. George Miller of California, are still critical of an earlier White House proposal to force students to consolidate college loans under a federally subsidized variable-interest rate, rather than a fixed rate. Though higher education analysts say it would have cost students thousands of dollars, it could have saved the government enough to cover the Pell Grant shortfall. Republicans later dropped that idea.

"The whole experience leaves us concerned about needing to watch carefully what the appropriators and authorizers do with regard to Pell Grants to make sure there really are adequate funds the over the years, " said Daniel Weiss, a spokesman for Rep. Miller, the top Democrat on the House Education and the Workforce Committee.

But Republicans say the Democrats revved up partisan debate. And, Democrats didn't put forward their own education budget, said Dave Schnittger, a spokesman for the GOP majority on the House education panel.

"You have Democrat leaders taking potshots at the president and attempting to distort the record and convince Americans that this president is anti-education," he said. "That doesn't serve anyone."

Vol. 21, Issue 38, Page 23

Published in Print: May 29, 2002, as Proposal to Shore Up Pell Grant Program Advances on Capitol Hill
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