Higher Education and Financial Aid for College

Tuesday, February 07 2006 @ 02:55 AM EST

Contributed by: Admin

Higher Education and Financial Aid for College

President Bush Allows College Tuition to Soar Un-checked. In the past few years, the weakened economy, regressive tax cuts for the wealthy and federal budget cuts have pushed higher tuition prices onto college students and their families. The average tuition and fees at four-year public colleges have risen 40%, when adjusted for inflation, since 2001.

Yet not only has President Bush failed to provide any relief, but his FY 2007 budget breaks his $5,100 Pell promise, cuts critical college access programs and fails to cut excessive lender subsidies-which should be recycled into the student aid programs to boost Pell Grants and to significantly decrease the cost of borrowing college loans.

Bush Freezes the maximum Pell grant scholarship. This is the fourth time that President Bush has either frozen or cut the maximum Pell Grant scholarship since 2001-despite the fact that the 2004-05 maximum Pell scholarship was worth $900 less than the maximum scholarship 30 years ago, when adjusted for inflation.

Bush breaks his promise to raise the maximum Pell scholarship to $5,100. Six years ago, George W. Bush pledged to make college more affordable by increasing the maximum Pell Scholarship for all college freshmen to $5,100, but he has yet to make good on his promise.

Bush fails to cut excessive lender subsidies. Abandoning some of his key 2006 budget proposals, President Bush fails to follow through on $2.26 billion in cuts (through 2010) to excessive lender subsidies. If the President's 2007 budget included these cuts, the savings generated by eliminating these excessive subsidies to lenders could pay to increase the maximum Pell grant by $100 each year through FY 2010.

Bush denies more than 460,000 students low cost loans in 2007. The President's FY 2007 budget cuts $664 million from the Perkins College Loan Program by requiring that participating colleges return the Federal portion of collections made on Perkins Loans in 2007. As a result, this year more than 460,000 low- and middle-income students will be denied low-cost loans (interest rates on Perkins loans are set at a fixed rate of 5%) to help pay for their college education.

Bush cuts places billions in student aid at risk. President Bush's FY 2007 budget puts stable student aid administrative funds at risk by subjecting them to an annual appropriation. The Bush budget will force administrative funding to compete against Pell grants and other education priorities for resources, and will jeopardize the Department of Education's ability to administer the student aid programs-which have a long history of fraud and abuse-safely and soundly.

According to the Bush Administration, in 2006 these critical funds were used to: disburse $117 billion in student aid grants and loans to nearly 10 million students; process more than 13 million federal financial aid applications; oversee the participation of more than 6,200 schools in the student loan programs; and collect $105 billion in outstanding direct student loans.

Bush eliminates critical programs that boost college opportunities and access:

• Bush eliminates the successful Gaining Early Awareness Program (GEAR UP). GEAR UP has a proven track record of enabling more schools to offer rigorous college prep coursework that is crucial to students enrolling in, and graduating from, college. In 2006, more than 600,000 low-income students took part in GEAR UP.
• Bush eliminates the effective TRIO programs Upward Bound, Upward Bound Math and Science, and Talent Search. Students in the Upward Bound program are four times more likely to earn an undergraduate degree than those students from similar backgrounds who do not participate in TRIO. In 2006, more than 400,000 low-income, high risk and first generation college students participated in the Upward Bounds and Talent Search programs.

Bush eliminates loan forgiveness to teachers, military service members and law enforcement officers. In his FY 2007 budget President Bush eliminates Perkins Loan forgiveness funding, and as a result, students who borrow Perkins loans and who become teachers, law enforcement officers or who serve in the military will lose out on loan forgiveness.

Bush freezes work-study and supplemental college grants. President Bush freezes funds for work-study and Supplemental Educational Opportunity Grants (SEOG)-which provide aid to more than 2 million students with the most financial need.

Bush eliminates the state college scholarship initiative (LEAP), risking $1 billion in non-federal student aid. President Bush eliminates the $66 million Leveraging Educational Assistance Partnerships (LEAP) initiative, which encourages states to establish college scholarships for college students. In 2001-2002, the federal investment in LEAP leveraged more than $1 billion in matching state spending.

Tom Manatos
Advisor to the Leader
House Democratic Leader Nancy Pelosi
(202) 225-0100
tom.manatos@mail.house.gov

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