Federal Update: February 10, 2009
>Economic Stimulus Package
>Private Lender Bailouts
>FAFSA Simplification
Economic Stimulus Package:
The House of Representatives passed their version of HR 1, the American Recovery and Reinvestment Act, on January 28, mostly along party lines (244 to 188). The House bill includes $15.6 billion for a $500 increase in the maximum Pell Grant and to eliminate the shortfall in the program. The House bill also includes billions for other education initiatives, including a $2,500 tax credit for higher education expenses. NACAC sent a letter to both chambers in support of education investment, particularly investment in the Pell Grant.
Senators Susan Collins (R-ME) and Ben Nelson (D-NE) collaborated to introduce a substitute bill that cut nearly $110 billion from the version passed by the Senate Appropriations Committee on January 27 (S 336). The Collins/Nelson substitute includes both the Pell Grant increase (at a slightly lower level) and the higher education tax credit. However, it eliminates funds for Work Study and reduces the amount available for Title I grants under NCLB and higher education modernization projects, among other cuts to education initiatives.
The Senate continues debate on the bill this morning, with a final vote expected around noon. Thank you to everyone who contacted their Senators last week in support of education provisions in the bill! The next step after today’s vote will be conference committee, where negotiators from both chambers will reconcile the two bills. NACAC will urge conferees to make sure the Pell Grant increase and the education tax credit from the House bill are included in the final bill.
For more information, including comparisons between the House and Senate versions, visit NACAC’s page devoted to the economic stimulus plan.
Private Lender Bailouts:
The Emergency Economic Stabilization Act (PL 110-343) became law last fall, and was designed to help ailing credit markets. Private lenders of student loans are allowable recipients of bailout funds under TARP (Troubled Asset Relief Program) authorized by this law. Payment of funds under this law is scheduled to begin this month. NACAC and its coalition partners have urged the Secretary of the Treasury to implement specific conditions to protect student borrowers in light of taxpayer funds being used to finance private loans. Visit NACAC’s Legislative Action page to read the letter, and also visit NACAC’s page devoted to private student loans.
FAFSA Simplification:
The Department of Education has released a report to Congress on its efforts to simplify the FAFSA, as required by the 2008 reauthorization of the Higher Education Act. Visit NACAC’s Legislative Action page for details.
Find legislation in your state that affects your job and the students you serve: NACAC’s State Legislative Portal.
Please contact NACAC staff at legislative@nacacnet.org with any questions.