Student Aid Alliance Issues FY 2012 Budget Request for Aid Programs
NASFAA joined nearly 80 other higher education organizations that make up the Student Aid Alliance to request spending levels for federal student aid programs for the fiscal year (FY) 2012 budget.
The Student Aid Alliance FY 2012 Appropriations Request highlights the recent cuts to student aid programs in the FY 2011 budget and urges Congress to restore funding for these programs to ensure the U.S. can compete in the future global economy.
"Our members recognize that all options should be on the table in addressing the federal deficit," the Alliance request states. "But cutting back on programs that will strengthen our future work force is counterproductive to sparking innovation, increasing employment and stimulating business growth."
- The FY 2011 budget had a disproportionately negative impact on student aid programs due to:
- $9 billion cut from the Pell Grant Program with the elimination of year-round Pell Grants
- $1 billion cut to eliminate the Leveraging Educational Assistance Partnerships (LEAP) Program
- $20 million cut from the Federal Supplemental Educational Opportunity Grant (FSEOG)
- $26.6 million cut from TRIO
- $20.4 million cut from GEAR UP
Furthermore, all non-defense discretionary programs received an across-the-board additional 0.2 percent cut and interest rates on federal student loans for undergraduates will double from 3.4 percent this year to 6.8 percent on July 1, 2012.
In order to help students overcome financial barriers to higher education, the Alliance urges Congress to provide the following funding levels for aid programs.
- Sufficient funding to maintain the maximum Pell Grant award of $5,550.
- Restore FSEOG funding to $757.5 million.
- Fund the Federal Work-Study (FWS) Program at $980.5 million -- the same amount provided since FY 2007
- Restore Federal TRIO Program funding to $920.1 million to prevent 96,000 students from losing program services.
- Restore GEAR UP funding to $333 million to prevent 40,000 students from losing these services.
- Provide $125 million for Perkins Loan cancellations. The federal government has not provided reimbursements to institutions as required by law making hundreds of millions of dollars unavailable for low-interest Perkins Loans low-income students.
- Maintain the in-school interest subsidy for graduate student loans.
- Provide $9.69 million in funding for the Jacob K. Javits Fellowship Program
- Restore the Graduate Assistance in Areas of National Need (GAANN) Program to FY 2010 levels
- Provide $64 million in funding to restore the Leveraging Educational Assistance
- Partnerships (LEAP) Program. This program provides incentives to the states to continue state-based financial aid programs