1 / 29

NYSFAAA Federal Update May 13, 2011

NYSFAAA Federal Update May 13, 2011. Agenda. Context Fiscal Year 2011 Fiscal Year 2012 Budget Resolution Debt Ceiling NASFAA Advocacy. Budget Context. FY 2012 Budget. FY 2011 Budget. Debt Ceiling. Budget Characterization. Budget Characterization. Passing the Buck. Media Circus.

halden
Download Presentation

NYSFAAA Federal Update May 13, 2011

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. NYSFAAAFederal UpdateMay 13, 2011

  2. Agenda • Context • Fiscal Year 2011 • Fiscal Year 2012 • Budget Resolution • Debt Ceiling • NASFAA Advocacy

  3. Budget Context FY 2012 Budget FY 2011 Budget Debt Ceiling

  4. Budget Characterization

  5. Budget Characterization Passing the Buck Media Circus Horse Trading

  6. Public Says… YouGov Poll – April 2011 http://today.yougov.com/news/2011/04/04/congress-and-spending/

  7. FY 2011 Budget Is…

  8. DONE!!!

  9. FY2011 Budget, In Review Last short-term continuing resolution (CR) expired April 14th This was 4th CR, cumulative total of $12 billion in cuts On February 19th House of Representatives passed H.R. 1, a 7-month CR Cut $100 billion from FY 2011 requested levels Cuts maximum Pell Grant by $845 Eliminates funding for FSEOG and LEAP H.R 1 failed in the Senate and Senate’s alternative bill also failed

  10. FY2011 Budget, In Review How Does It Impact Student Aid? Pell Cuts and/or Changes in Long-Term CR Maximum $5,550 maintained—VICTORY Elimination of Year-Round Pell Crossover regulation lifted for summer 2011 Other Changes 0.2% percent cut across-the-board SEOG cut by $20 million Eliminate LEAP and Byrd Scholarships Cut $25 million from TRIO; $20 million from GEAR UP Cut $1.6 million from Javits Fellowships

  11. FY 2012 Budget Process • President Releases Budget Request - Done • Budget resolution process - In Process • Budget Conference Report • President submits detailed budget request to Congress • Appropriations Committees draft bills • Appropriations bills voted on and passed

  12. Pell Program Outlook • $20 billion shortfall for 2012-13 • If take no action now, maximum grant could have been reduced to $3,240 (a loss of $2,310) for 2012-13 • Budget reflects changes in existing Pell program and cuts to offset the expense of retaining a Pell maximum award of $5,550

  13. The Pell Protection Act President Obama’s FY 2012 Request

  14. Elimination of 2nd Scheduled Awards • Effective 2011-12, occurred in FY 2011 CR • Higher costs than expected • No federal data on acceleration • Savings of $8 billion in 2011-12 and $60 billion over next 10 years

  15. Elimination of Subsidized Loans for Graduate Students • Effective 2012-13 • Graduate students only • Subsidies are not well-targeted • Subsidies don’t encourage enrollment • Savings of $2 billion in 2011-12 and $29 billion over next 10 years

  16. FAFSA and Verification, 2012-13 • Savings of $340 million in FY 2012 • Applicants who filed tax return before FAFSA will be directed to use IRS data retrieval • If use data retrieval, verification of that data is met • If do not use data retrieval, or subsequently change data: • Must explain why to school, and • May be required to verify with IRS-supplied documentation

  17. Simplify Loan Servicing for Split Loans • 6 million students have split loans • Would allow all federal student loan payments to be made to one federal loan servicer • Not the same as consolidation • Financial incentive to borrowers to participate • Savings of $2 billion in 2012-13

  18. Restructure the Perkins Loan Program • Similar language as last year’s proposal • Lower cost alternative to private loans • Unsubsidized, 6.8% interest rate • Loan funds increase from $1 billion to $8.5 billion • Savings of $6.8 billion over 10 years

  19. Other Proposals • Eliminate LEAP • Extend American Opportunity Tax Credit • Funding at FY2010 levels for FWS, FSEOG, GEAR UP • Small funding increase for TRIO programs • Replace TEACH Grant program with Presidential Teaching Fellows program • $1.25 billion over 5 years to reward states and institutions that help more students earn degrees

  20. FY 2012 Budget Resolution Released last month by Chairman Ryan (R-WI) The Path to Prosperity: Restoring America’s Promise Cuts $6.2 trillion in government spending, compared to President Obama’s FY 2012 request Reduces deficit by $4.4 billion, compared to President Obama’s FY 2012 request Repeal and defund HCERA

  21. FY 2012 House Budget Resolution • For Pell, the assumptions are: • - Lower the maximum award (apparently to pre-ARRA levels which we believe is FY 2008 levels – apx. $17 billion • - Limit Pell grants to 6 years (12 semesters) • - Eliminate College Cost Reduction and Access Act of 2007 [CCRAA] provisions, including auto-zero, IPA amounts. • - Eliminate administrative fees paid to participating institutions. • - Elimination of HCERA could include mandatory Pell savings • and strengthened IBR provisions.

  22. Debt Ceiling Debt Ceiling: Cap set by Congress on the amount of debt the federal government can legally borrow Current is $14.294 trillion Will likely reach this amount by May 16th, but Aug 2 extension Congress will have to vote to raise debt ceiling This is typical, done so 10x since 2001 Likely tough fight on this ahead

  23. What’s Going On Right Now? • What does the Senate Say? • House 302 (a) Allocations?

  24. Advocacy Build relationships with your lawmakers now by delivering information sheets on how their constituents—the students and families you serve—benefit from the student aid programs. Follow the latest legislative developments by reading Today’s News, the NASFAA Advocate, and following us on the NASFAA Facebook page and the Save Student Aid Facebook page. Share with NASFAA all your correspondence with lawmakers so we can support you and understand how to better work with your Congressional delegates. Visit NASFAA’s “Take Action Page” to stay up-to-date on NASFAA’s latest calls to action.

  25. QUESTIONS? mccleanm@nasfaa.org OR policy@nasfaa.org

More Related