Budget Control Act of 2011

Obama Signs Budget Control Act 

President Obama signed the Budget Control Act of 2011 into law on Aug. 2 to increase the nation's debt ceiling by $2.4 trillion. The law impacted student aid by:

  • Eliminating the in-school loan interest subsidy for graduate and professional students
  • Providing $17 billion for Pell Grants for fiscal years (FY) 2012 and 2013
  • Eliminating Direct Loan repayment incentives 
 

The law also required Congress to convene a 12-member, bipartisan "Super Committee" to develop legislation to reduce the federal deficit by at least $1.2 trillion, but the group failed to meet this requirement triggering automatic, across-the-board cuts in 2013. Pell Grants would be exempt from these cuts, but other student aid programs would be impacted.

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