College & Workforce Readiness

Senate Spending Plan Takes Aim At Pell Grant Shortfall

March 17, 2004 3 min read

The Senate last week approved a Republican budget blueprint for next year that appears to match President Bush’s top education priorities, but goes a step further by proposing to eliminate a shortfall in the Pell Grant program estimated at nearly $4 billion.

The $2.4 trillion budget plan passed on a nearly party-line vote, 51-45, in the wee hours of March 12.

The document assumes $1 billion more in spending for the two largest K-12 programs, Title I and special education state grants, as requested by the president for fiscal 2005. As introduced, the Senate bill also met his $800 million increase for Pell Grants on the discretionary side of the budget, and would raise the stakes with a one-time infusion of some $3.7 billion in mandatory spending to shore up the program.

“Mandatory” spending is not subject to the annual appropriations process, but the one-time Pell Grant measure would require separate authorizing legislation to take effect.

But the Senate passed a Republican- sponsored amendment that would provide an extra $1.9 billion for Pell Grants to raise the maximum award from $4,050 to $4,500. Because the increase would require an across-the-board cut to noneducation programs, critics argue that the hike is unlikely to happen.

Only two months after President Bush signed a final budget package for fiscal 2004—almost four months late—lawmakers are beginning the process of putting together spending plans for the next fiscal year, which begins Oct. 1.

“Education has always been, and will continue to be, the key to our country’s economic future, and the blueprint assumes we will increase funding,” Senate Majority Leader Bill Frist, R-Tenn., said during debate March 10 on the budget resolution. Such a resolution guides tax and spending legislation but does not require the president’s signature.

‘Manna’ From Congress?

It’s up to congressional appropriators to spell out specific discretionary-spending levels for federal programs later this year.

President Bush’s fiscal 2005 budget request, put forward in early February, calls for $57.3 billion in discretionary money for the Department of Education, an increase of $1.7 billion, or 3 percent, over fiscal 2004. He wants $13.3 billion for Title I, $11.1 billion for special education state grants, and $12.8 billion for Pell Grants. He also proposed to abolish nearly 40 of the agency’s programs. (“Education Gains in Bush Budget Proposal,” Feb. 11, 2004.)

While the Senate budget resolution embraces key Bush administration requests on the discretionary side, it does not incorporate his call to terminate programs.

The resolution also parts company with the president’s request by adding money on the mandatory side. It would provide $3.7 billion for Pell Grants, and would set aside $5 billion more for a reserve fund tied to the reauthorization of the Higher Education Act.

Shortfalls in the Pell Grant program for low-income college students have occurred periodically since its inception, and closing those fiscal gaps after the fact is common. When more students apply than expected, the Education Department weathers a shortfall rather than deny grants to eligible students. But the size of the current shortfall has caused alarm.

“The program may not continue to be financially viable unless this shortfall is addressed,” said a summary of the budget resolution issued by Republicans on the Senate Budget Committee.

The $3.7 billion allotment was greeted as “manna” by Cynthia A. Littlefield, the director of federal relations for the Washington-based Association of Jesuit Colleges and Universities, who said the shortfall “has been a huge stumbling block for the Pell Grant program.”

She is hopeful that if the shortfall is removed, it will be easier to increase the award size to keep pace with climbing college costs.

House Starts Work

Democratic-led efforts to secure more education money by reversing recent tax cuts for wealthy Americans, were unsuccessful. Sen. Patty Murray, D-Wash., for example, offered a failed amendment that would have provided an extra $8.6 billion for programs under the No Child Left Behind Act.

“Unfortunately, the budget before the Senate by the Republicans falls $8.6 billion short of what our schools and our students need this year,” Sen. Murray said.

Meanwhile, the House Budget Committee March 11 began debating its version of the budget resolution, but was not expected to complete work until this week. At press time, no details were available about the House panel’s education spending figures, though the budget category that covers education, training, employment, and social services would increase by nearly $3 billion over the current year.

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