Higher Ed Spending Not as Big as Hoped

Democrats on the House Education and Labor Committee revealed their proposals Wednesday for billions of dollars in new higher education spending -- from tuition-free community college to increased Pell Grants -- as Congress works to develop President Biden’s Build Back Better Act.

The bill text is modeled on Biden’s American Families Plan, released in April, and will be a part of a package that Democrats intend to pass using a procedural process called budget reconciliation. That allows the legislation to pass with a simple 51-vote majority in the Senate, meaning Republican support won’t be necessary.

The primary difference between the initiatives Biden proposed and what congressional Democrats included is the level of investment -- with a $3.5 trillion limit on the overall package and other committees jockeying to fund their priorities, the amount of funding appropriated for individual programs often doesn’t match the president’s initial goals. For example, the legislation includes a $500 increase to the maximum Pell Grant for the 2022-23 award year -- and a staggered boost of $500 for subsequent award years until 2030 -- while Biden initially proposed a $1,400 increase.

“In particular, while we appreciate the committee’s recognition of the fundamental importance of Pell Grants, a $500 increase to the maximum grant award does not go nearly far enough,” said Ted Mitchell, president of the American Council on Education.

Tuition-free community college would become a reality under the bill through a program referred to as America’s College Promise. The legislation would create a federal-state partnership grant to eliminate the cost of tuition at a community college or a tribal college or university. The federal government would contribute 100 percent for the first year, decreasing its share by 5 percent for each subsequent year.

“Our campuses are responding very positively to the legislation,” said David Baime, senior vice president for government relations at the American Association of Community Colleges. “America's College Promise represents a dramatic step to make higher education universal in America through the nation’s community colleges. That rises to the top for our campuses.”

America’s College Promise would also allow states to use any leftover money from the grant for need-based aid at four-year public institutions. That will allow lower-income students to have more choice in where they attend college, rather than basing their decision solely on which one is free, said Lanae Erickson, senior vice president at the think tank Third Way. However, the program would only last for five years.

“Even though it’s for a much shorter period than what I think folks were hoping for, it still includes a lot of really important funding and policy priorities,” said Michele Streeter, associate director of policy and advocacy at the Institute for College Access and Success.

The bill also appropriates considerably less funding for a new grant program to support completion and retention efforts at institutions than what was included in the American Families Plan. Biden originally proposed $62 billion for student success funding, but Congress’s bill only includes $9 billion. Though it isn’t as much as many were hoping, experts still appreciated that it’s an investment Congress chose to prioritize.

“I wish it was more, of course, but it is the biggest investment in history in college completion,” Erickson said. “Certainly, $9 billion is nothing to sneeze at. It’s really a focus on the students that need the help the most and a focus on getting them through college -- not just enrolled. That’s been a big change over time.”

The legislation includes large investments in historically Black colleges and universities, tribal colleges and universities, and other minority-serving institutions -- it provides a total of $1.45 billion in institutional aid from fiscal year 2022 to 2026. There’s also $2 billion available to improve research and development infrastructure at MSIs and the creation of a tuition assistance grant program, which would reduce tuition and fees for low-income students attending an HBCU, TCU or MSI during their first two years of college.

“It feels like they are following up with their commitment to make sure they're increasing this support to help students afford college, especially given these challenging times,” said Deborah Santiago, CEO of Excelencia in Education. “And I find that to be positive.”

Other higher education provisions in the bill include making recipients of the Deferred Action for Childhood Arrivals program eligible to receive federal financial aid, funding for community college workforce training grants and additional funding for career and technical education through the Carl D. Perkins Career and Technical Education Act of 2006.

Though the higher education investments weren’t as large as some had hoped, advocates and experts were pleased over all with the House Democrats’ proposal.

“We always want more and we’re going to have to keep pushing for more, but I do think it’s going to make a difference if this all goes through the way it’s packaged together right now,” Streeter said.

And getting the package through Congress at its current funding levels is the next hurdle that Democratic leaders are facing. Senator Joe Manchin, the Democrat from West Virginia, penned an op-ed last week stating that he won’t support a $3.5 trillion bill and urging his colleagues to “hit a strategic pause.” Senate Majority Leader Chuck Schumer, a Democrat from New York, responded Wednesday that Congress is “moving full speed ahead” on the legislation.

The House Education and Labor Committee will mark up the bill today.