Financial aid could suffer $99M loss

Federal funding of student financial aid could take a $99 million hit in the next fiscal year under the higher education appropriations bill reported out of a House of Representatives subcommittee yesterday.

If the bill was implemented as currently written, said a spokesperson for committee member U.S. Rep. Nancy Pelosi (D-Calif.), a 6 percent drop in federal work-study funding would mean 62,000 fewer students could participate in the program during the 2000-01 academic year.

The bill also gives colleges and universities $140 million less than Congress allocated to higher education this year, making significant cuts to many school-run programs while totally eliminating funding to others.

While cutting $2.37 billion in funding for Pell Grants from the current year, the bill adds $150 to the maximum allowable grant amount. The Pell Grant program is the largest federally funded grant program for individual students.

"The committee and the chairman place the Pell Grants at the very highest priority," a subcommittee spokesperson said. "We don't have a lot of money."

Eight months after the Clinton administration made its fiscal year 2000 budget recommendation in January, the Republican-led 15-member Subcommittee on Labor, Health and Human Services and Education sent the bill to the full appropriations committee, which could take it up next week.

Oct. 1 marks the end of the current fiscal year, when the new budget should theoretically take effect.

Tom Butts, associate vice president for University relations, said Congress will file a continuing motion extending the time it has to finalize the budget bills. It could be two to three more months before the higher education bill passes both houses and is signed into law, he said.

Butts, who lobbies in Washington, D.C. on behalf of the University, said the process is still in such a preliminary stage that it's unknown exactly how the dollar amounts could affect the University.

"The numbers look pretty much like a freeze," Butts said. "They're substantially lower than the higher education groups have been advocating."

But, he added, universities are expected to fare slightly better by the time a finalized bill is implemented.

"What chairman (Rep. John) Porter (R-Ill.) was trying to do was get something out of the committee," Butts said. "I don't think anyone thinks this is what the final product will look like."

Because all 12 other appropriations subcommittees have already sent their bills to the full committee, significant amounts of money initially designated for education have already been claimed for other departments. To make up for that deficit, the bill pulls more than $14 million in advance funding from fiscal year 2001 appropriation funding for the Department of Education.

"Everyone knew beforehand that the Republicans would make a budget gimmick," said Pelosi's spokesperson. "The hole was so big that the only way to fill the hole was to borrow from next year or to come up with gimmicks."

By taking such a large amount from the following year, universities won't be able to plan ahead as easily, he said, explaining that there will be more uncertainty to what level of appropriations will be available in future years.

"They may not be able to act properly on decisions that are crucial," he said.

09-24-99