Education Secretary Arne Duncan

Education Secretary Arne Duncan Jay LaPrete/AP

Education budget focuses on college affordability

Plan increases Pell Grants and asks Congress to stop a interest-rate hike on student loans from going into effect in July.

President Obama stressed college affordability in his budget, proposing to increase Pell Grants and asking Congress to stop a interest-rate hike on student loans from going into effect in July. The White House has shifted focus over the last year in its education message, emphasizing higher education and job training programs more than the policies governing the K-12 grades. This is in keeping with Obama’s “jobs are my top priority” election message, and also offers a chance for an oft-neglected part of the education policy world to get some attention.

The budget proposal seeks a $1.7 billion increase for the Education Department to $69.8 billion for fiscal year 2013, a 2.4 percent boost. The administration is seeking an $85 increase in the maximum Pell Grant to $5,635 for the 2014-2015 school year. Since 2008, the administration has increased the maximum Pell Grant by more than $900. The White House estimates that the grants ensure access to postsecondary education for nearly 10 million students.

The student loan proposal, which would keep interest rates at 3.4 percent, will require congressional action. But the Education Department is laying the groundwork in the budget to ensure that the change could be put in place without delay. House Education and the Workforce Committee Ranking Member George Miller, D-Calif., and Rep. Ruben Hinojosa, D-Texas, are begging committee Chairman John Kline, R-Minn., not to let the student loan interest rate go up. “This July, more than 7 million undergraduate students will see the interest rates on their need-based student loans double from 3.4 percent to 6.8 percent if Congress fails to act.  This increase will cost the average borrower more than $2,800 in additional interest payments,” Miller and Hinojosa said in a letter to Kline Friday.

Obama has devoted considerable attention to his career and job training plan already. His State of the Union address focused heavily on job training, and he appeared Monday at Northern Virginia Community College in Annandale, Va., to announce a new $8 billion “Community College to Career Fund” that will provide funding to community colleges to work with local businesses to train their students in high-demand areas.  

Notably, the White House budget makes no mention of the 2001 No Child Left Behind law that Congress is struggling to reauthorize. The administration has shifted gears here too, addressing the K-12 elements of education administratively through a waiver program that gives eligible states the flexibility to set, and meet, their own achievement standards. Without the waivers, which do not require congressional approval, many states would see their schools labeled as “failing” under outdated benchmarks set by No Child Left Behind. Obama has used the lawmakers’ disagreements about the law as the poster child for congressional inaction. The Education Department's waiver program for education is the central element of Obama's “We Can’t Wait” campaign, targeting Congress.

The budget request also includes $850 million for the Education Department’s Race to the Top competitive grant program, which is $300 million above the current level. Obama and Education Secretary Arne Duncan consider Race to the Top to be among the administration’s most successful domestic policy achievements because it has lured states to adopt considerable education reforms with very little federal money. Still, the program isn’t popular on Capitol Hill because lawmakers see it as overly prescriptive. It has consistently been given less funding from its original $4.35 billion level that was part of the 2009 economic stimulus bill.

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