FOR IMMEDIATE RELEASE
Contact: Allie Arcese
Director of Communications
WASHINGTON, D.C., APRIL 26, 2023 — The House of Representatives on Wednesday voted 217-215 to pass the Limit, Save, Grow Act of 2023, House Speaker Kevin McCarthy’s proposal to address the debt limit by cutting funding back to fiscal year 2022 levels and capping spending over the next 10 years. The Department of Education has estimated that the proposal would diminish the impact of the federal Pell Grant program, hinder the department’s ability to administer student aid, and eliminate work-study jobs for thousands of students.
Although the bill does not specify agency- or program-level cuts, Republicans have said that their budget proposal would not reduce defense spending. Under that assumption, the White House estimates that lowering fiscal year 2024 topline levels for non-defense funding to fiscal year 2022 levels would result in a roughly 22% cut.
The bill would also end the ongoing pause on student loan repayments and interest accrual by unraveling the executive orders that extended the payment pause following the enactment of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, prohibit the administration from carrying out its debt cancellation program currently being considered by the United States Supreme Court, block the Biden administration's proposed income-driven repayment plan, and permanently prevent the Department of Education from issuing regulations that would increase costs associated with the student loan program.
“Cuts to the student aid programs will certainly limit our economy, as doing so annihilates the educational dreams of millions of Americans,” said NASFAA President and CEO Justin Draeger. “By reducing funding to fiscal year 2022 levels and allowing only paltry increases for the next decade, this bill would have dire impacts on students who depend on federal aid. Low- and middle-income families have seen their average income increase only marginally in the last 30 years, according to the College Board, while the cost of college has continued to grow. Now is the time to double down on funding for need-based student aid, not hamstring the well-targeted programs that expand postsecondary access to students who otherwise may never attend college."
NASFAA policy experts are available to speak to members of the media about the impact that funding cuts could have on federal student aid programs. To set up an interview, please email NASFAA Director of Communications Allie Arcese or call (202) 785-6954.
The National Association of Student Financial Aid Administrators (NASFAA) is a nonprofit membership organization that represents more than 29,000 financial aid professionals at approximately 3,000 colleges, universities, and career schools across the country. NASFAA member institutions serve nine out of every 10 undergraduates in the U.S. Based in Washington, D.C., NASFAA is the only national association with a primary focus on student aid legislation, regulatory analysis, and training for financial aid administrators.
Publication Date: 4/26/2023