COMMUNITY COLLEGE FEDERAL LEGISLATIVE OVERVIEW January 2014 Jee Hang Lee Vice President for Public Policy and External Relations Association of Community College Trustees

 Climate on Capitol Hill  Appropriations and Budget  Pell Grants  White House Proposals  HEA Reauthorization  Negotiated Rulemaking  DREAM Act  WIA FEDERAL LEGISLATIVE OVERVIEW

 2013 ended and 2014 began with some signs of bipartisanship.  Debt ceiling will once again have to be addressed by Congress in late-February.  Election-year politics will also factor into the legislative outlook. CLIMATE ON CAPITOL HILL

 In December, Congress passed the Bipartisan Budget Act, which set topline funding levels for FY 2014 and 2015, and partially replaced sequestration.  Under the agreement, funding levels for FY 2014 and FY 2015 were set at $1.012 trillion and $1.014, respectively.  This is $45 billion more than what was mandated under sequestration, but $46 billion less than pre-sequestration levels for FY  Under the deal, mandatory cuts for non-exempt programs as a result of sequestration remain in place and are actually extended for two years.  However, sequestration is a multi-year event, and barring Congressional intervention will return in full for discretionary programs in FY BIPARTISAN BUDGET AGREEMENT

 Unlike previous continuing resolutions, the FY 2014 omnibus appropriations bill shifts discretionary funding to specific priorities.  The news for community colleges is mixed.  Funding for SEOG, Federal Work Study, TRIO, and GEAR UP was all restored to pre-sequester levels.  Most funding for Title III and V programs restored.  Perkins CTE and WIA were partially restored.  Adult Basic Education and Literacy state grants were frozen at post sequester levels for FY FY 2014 APPROPRIATIONS

PROGRAM FY 2013 (Continuing Resolution HR 933) FY 2013 After Sequestration FY 2014 Omnibus Change from Pre- Sequestration Funding Pell Grant Maximum$5,645 $5,780$85 SEOG$733,130,000$696,175,000$733,130,000$0 Federal Work Study$974,728,000$925,595,000$974,728,000$0 Perkins CTE$1,120,784,000$1,064,446,000$1,117,598,000($3,186,000) Adult Basic and Literacy Education $593,803,000$563,995,000 ($29,808,000) TRIO$838,252,000$795,998,000$838,252,000$0 GEAR UP$301,640,000$286,435,000$301,640,000$0 WIA State Grants$2,598,093,000$2,468,189,000$2,588,108,000($9,985,000) Strengthening Institutions$80,462,000$76,406,000$79,139,000($1,287,000) Hispanic Serving Institutions $100,231,000$95,179,000$98,583,000($1,648,000)

 The automatic (CPI) increase in the maximum grant for AY brought total to $5,780 – an $85 increase.  The Pell Grant program has a surplus for FY 2014, and a relatively small shortfall in FY  Beyond 2015 the program is slated to have significant shortfalls— “cliff effect.” The program is expected to have a $5 - $6 billion shortfall each year. PELL GRANTS

 The White House has introduced a proposal aimed at college affordability and student debt.  Some items can be achieved through executive authority while others will need to be accomplished via HEA reauthorization.  In January, the White House held a national summit on higher education - dedicated to launching a plan of action for increasing college access and success for low-income and disadvantaged students.  Near-term actions include:  Creating a new system to rate institutions;  Promoting income based repayment;  Waiving financial aid rules for innovative programs such as competency based learning;  Tightening standards of satisfactory academic progress. WHITE HOUSE PROPOSALS

 The Higher Education Act (HEA) was last reauthorized in  The legislation authorizes Pell Grants, Stafford Loans, Federal Work-Study, TRIO, GEAR UP, Title III-A, Title V, Predominantly Black Institutions, and international education.  Reauthorization will focus on a number of issues, which may include:  Increasing completion rates and reducing tuition;  Accreditation;  Better consumer information;  Data collection relating to student outcomes;  Innovative learning models.  President has proposed tying federal financial aid benefits to ratings system via HEA reauthorization. HEA REAUTHORIZATION

 Last spring, the US Department of Education (ED) called for new rounds of negotiated rulemaking on a number of topics, including: gainful employment (GE); program integrity; credit hour; state authorizations; and other topics.  The GE panel met this fall, and discussed items ranging from modified eligibility metrics for GE metrics to additional requirements for adding new GE programs.  While the community college negotiators indicated they could support the final GE draft (with some modifications), consensus was not met.  The final GE regulations are expected to be issued by the Department soon. NEGOTIATED RULEMAKING

 Last summer, the Senate passed comprehensive immigration reform (Border Security, Economic Opportunity, and Immigration Modernization Act).  Senate bill provides DREAMers an expedited path to citizenship.  Senate bill also lifts the federal ban on in-state tuition for DREAM students.  Individual states would have the prerogative to decide whether or not to allow DREAM students to receive in-state tuition.  DREAMers who spend five years in “residential provisional immigrant” (RPI) status would be eligible to apply for long-term permanent resident status.  House legislative outlook problematic; comprehensive reform faces uphill climb. DREAM ACT

 House Passed SKILLS Act in March via a mostly party-line vote  Program consolidation & system governance are primary wedge issues.  No required community college seat on WIBs.  Bill expands training contracts, streamlines trainer reporting requirements.  At the end of July, the Senate HELP Committee reported-out on a bi-partisan basis the Workforce Investment Act of  In contrast to House, Senate bill focuses more on fixes within current structure, emphasizing greater alignment and better outcomes data.  Retains the community college slot on WIBs, but makes state WIB representation optional.  State unified plan is a central component of bill.  Reauthorizes the Community Based Job Training Grants (CBJTG) program. WORKFORCE INVESTMENT ACT (WIA)

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