January 2012
Federal Student Aid in the 2012 Budget
Congress in late December completed action on the 2012 federal budget. Changes in student aid policies were among the issues included in the funding package.
The good news is that the annual maximum Pell grant award will be maintained at the $5,550 level for the 2012-2013 academic year. Given an increased need for assistance and a larger number of eligible students, the total cost of Pell grants has significantly increased during the past several years. Keeping the maximum award at $5,550, therefore, required other budget cuts to fund the increased costs.
Changes in the program, which become effective July 1, 2012, include:
- The lifetime limit on Pell grants will be reduced from 18 to 12 semesters
- Ability-to-benefit students (those who do not have a high school diploma or GED) will be eliminated from the program
- “Auto-zero” Expected Family Contribution, meaning immediate qualification for a maximum Pell award, will be set at $23,000 of family income (down from the current $30,000); this may impact up to 75 Canisius students
- Students from the highest family earners who have been eligible for Pell awards, who have received a $555 grant, will be eliminated; up to 42 Canisius undergraduates may be affected by this change
- The in-school interest subsidy on student loans for the six-month grace period following undergraduate graduation will be temporarily eliminated between July 1, 2012 and July 1, 2014
Canisius students, parents, faculty, staff and alumni recently joined in a national petition signing effort to support Pell and other federal student aid. Canisius affiliates accounted for more than 1,400 signatures, placing our school in the top ten nationally in support of federal student aid.
April 19, 2011
Update On Federal, State Budget Actions Affecting Higher Education
The legislative budget actions in Washington and Albany will have an impact on colleges and universities. While the New York State budget is in place through March 2012, final action for the federal fiscal year 2011 that began on October 1, 2010 was just completed last week, and work is underway for the 2012 budget year that will begin next October.
Federal Budget
The prolonged battle to conclude the 2011 budget, a process begun in February 2010, finally ended on April 14 after down-to-the-wire votes.
Congress approved a budget that maintains the maximum Pell award at $5,550 for now, although the year-round Pell option, which offered the opportunity for Pell awards for summer attendance, was eliminated. Supplemental Educational Opportunity Grants (SEOG) were preserved in the completed budget with a small cut. Approximately one-third of Canisius’ undergraduates (1,044) currently receive Pell grants. Nearly one in six also received SEOG awards this year.
Work on the 2012 federal fiscal year also began in earnest last week with the House’s approval of a budget plan. The House version of the 2012 budget could reduce the maximum Pell grant by up to $550 annually. Democratic leadership in the House has offered an alternative 2012 budget that would maintain the $5,550 annual maximum Pell award. The House’s 2012 budget vote is just one step on the road that will lead to specific appropriations for next year. Final action is months away.
State Budget
Although Governor Andrew Cuomo and state legislators wrestled with a $10 billion gap in the 2011 budget, student financial aid was not generally affected. In fact, the maximum Tuition Assistance Program (TAP) award was restored to $5,000 annually, after having been cut by $87 last year. While other minor changes in TAP were implemented in the budget, cuts in higher education funding were made mainly to direct funding for colleges and universities. A 10 percent cut in Bundy direct institutional aid to independent colleges and universities will mean a $40,000 cut to Canisius during the next year. Major operational cuts of approximately ten percent were made to the SUNY and CUNY budgets.
September 1, 2010
Updates On State, Federal Budget Impact On Student Aid
New York State
After a delay of more than four months, the State Legislature completed action on the 2010-2011 budget in early August. Working to close a gap of more than $9 billion, the budget cut several billion dollars in spending while also raising taxes and fees by more than $1 billion.
Cuts impacting Canisius students included the following:
* An across-the-board cut in all Tuition Assistance Program (TAP) awards of $75. In the past academic year, more than 1,400 Canisius students received a TAP award.
* The elimination of Graduate TAP awards.
* Various minor changes in TAP that tightened satisfactory academic progress requirements; eliminated TAP eligibility for loan defaulters; and reduced TAP awards for married students.
* A two percent cut in Bundy Direct Aid to colleges, which Canisius uses for student aid. The budget cut will reduce Bundy funds received by Canisius by approximately $9,000 this year.
Part of the state budget process also included nearly 7, 000 appropriation vetoes by Governor Paterson, including two grants affecting Canisius: a $25,000 appropriation for the 2010 NCAA basketball tournament; and an $8,000 appropriation for the college’s Literacy Center. Reimbursement claims have been submitted on both appropriations, however, and the college will receive the funds.
The Federal Budget
As President Obama and the Congress work on federal spending and deficit issues, the Pell program that provides financial assistance to students has become part of the discussion. Because of a larger number of students who are eligible for Pell awards, and because student and family economic conditions in many cases result in higher individual awards, a shortfall of approximately $6 billion has developed in total funds available for the program. While the funding shortfall could result in a reduction in Pell grants, that outcome is not seriously anticipated at this time.
April 13, 2010
Government News Update
Highlights in this month’s issue include information on new federal higher education legislation, funding for the Institute for Autism Research and information on the New York State budget.
The Student Aid and Fiscal Responsibility Act
While approval of the Higher Education Opportunity Act in 2008 set out major federal policy that covers a full range of higher education issues over a six year period, Congress has been considering additional legislation that will change certain federal policies and make additional funds available to students.
The House of Representatives last fall approved its version of the Student Aid and Fiscal Responsibility Act (SAFRA). The Senate held back as members waited to determine if the SAFRA bill would be merged with federal health care legislation in the parliamentary procedure known as “budget reconciliation.” That has occurred. SAFRA has been approved by both houses and was signed by President Obama on March 30.
Included in the legislation are initiatives that will:
* Require all colleges to convert to direct lending by July 1, 2010. Congressional sponsors project savings from this move at $61 billion over the next ten years because the direct loan program administered by financial aid offices will cost less than the bank-based lending program that has dominated the federal college loan program. Canisius is already in the direct loan program.
* Allocate $36 billion of those savings to Pell grant increases and to cover shortages in current Pell grant accounts that have occurred due to changed eligibility requirements and a larger number of students attending college. A portion of the savings will be used to reduce the federal deficit as well as to provide funds for other educational programs.
* Increase funding for Pell grants starting in federal fiscal year 2013 to bring the full-year maximum award to $5,975 in 2018.
* Beginning with loans originating on or after July 1, 2014, limit monthly payments on federally subsidized student loans to 10 percent of discretionary income, and forgive loans entirely after 20 years.
Funding for Canisius Institute for Autism Research
The 2010 federal budget includes a $400,000 appropriation to Canisius College for science programs, including equipment and technology. The appropriation was sponsored by Rep. Brian Higgins and Rep. Chris Lee and will be used by the college’s Institute for Autism Research.
A new request for federal Fiscal Year 2011 (FY11) funding for the Institute has been submitted to Senator Kirsten Gillibrand, who has previously sponsored legislation and appropriations for autism research at other institutions. A second request for funds has been submitted to Senator Charles Schumer, Congresswoman Louise Slaughter and Congressmen Higgins and Lee for funds to equip and renovate Science Hall. Action on the FY11 requests is several months away.
State budget
The State Legislature continues to review Governor Paterson’s proposed 2010-2011 budget, which must close a projected $9.2 billion budget gap. The governor has proposed some minor changes in the Tuition Assistance Program but it appears that the Legislature will reject most of those plans. A cut to Bundy aid, which most independent colleges and universities use to supplement student financial aid, appears likely. The state’s new fiscal year began on April 1, but a new budget is not completed to date.