DeVos Defends 2021 Budget Proposal as House Appropriators Push for Answers

By Allie Bidwell Arcese, NASFAA Managing Editor

Education Secretary Betsy DeVos on Thursday appeared before a House appropriations subcommittee to justify the Trump administration's fiscal year 2021 budget request, as it relates to education funding. The budget request, released earlier this month, made several policy proposals, including setting loan limits for certain students and parents and restructuring the Office of Federal Student Aid (FSA), and proposed slashing funding for — or completely eliminating — several federal student aid programs.

The budget proposal requested a total of roughly $66.6 billion in funding for the Department of Education (ED), an 8.4% decrease from enacted fiscal year 2020 appropriations. Despite the dip in requested funding, DeVos told lawmakers the proposal "would invest in supporting continued economic growth and significantly improving services to recipients of postsecondary student financial aid." 

Central to her opening statement was the argument that increases in federal funding have not yielded the desired outcomes, and thus lawmakers must forge a different path. There is "no evidence at all," DeVos said, "that the federal government can simply spend its way to better educational outcomes." That claim, subcommittee chairwoman Rep. Rosa DeLauro (D-Conn.) said, "has no basis in reality."

Many of the proposed spending cuts that would impact student aid programs have been part of the administration's budget proposals for several years, as officials have said the cuts would consolidate duplicative programs. However, it's unclear as to whether any savings would be redirected into the remaining student aid programs, such as the federal Pell Grant program. 

DeLauro, in her opening statement, criticized the proposal's flatlining of funding for Pell Grants, adding that the millions of recipients "cannot afford for us to stand pat like this."

At last year's hearing on the administration's budget proposal, some questioned how ED would pay for a proposed expansion of the Pell Grant program — to extend eligibility to students enrolled in high-quality short-term programs, and to certain incarcerated individuals — without an increase in funding. The expansion was again proposed in the fiscal year 2021 budget.

Rep. Tom Cole (R-Okla.), ranking member of the subcommittee, on Thursday applauded DeVos for the proposal to expand Pell Grant program eligibility, saying many of the opportunities in short-term programs "offer high payment employment in a variety of fields needed throughout my district, as well as many others." 

And while Cole said he supported some of the proposed program consolidations contained in the budget plan, he saw others — such as plans to transition TRIO into a state formula grant program, and a proposal to consolidate several Minority-Serving Institution (MSI) funding streams into one — as "shortsighted."

DeVos did push, however, for increased funding — $114 million more than fiscal year 2020 — for ED's Next Generation (NextGen) Financial Services Environment, which she said would "give students, parents, and borrowers a seamless experience from application through repayment." 

Another notable reform on ED's agenda is to explore the idea of restructuring the governance of FSA and to investigate whether the performance-based organization would function more efficiently as an organization separate from ED. 

"While just about everything in the world of student aid has changed, [FSA's] structure and governance has stayed the same," she said. "Moreover, we should all be concerned that political interference could distract [FSA] from what should be a laser-like focus on delivering world-class service to help students and their families finance postsecondary education." 

NASFAA published a white paper in 2017 that also suggested structural changes to help FSA fulfill its mission as a performance-based organization (PBO), such as creating an oversight board that reports directly to the public, the secretary of education, and Congress.

At the FSA Training Conference in December, DeVos told a room full of financial aid professionals that she thought FSA would function better as a stand-alone agency, "run by a professional, expert, and apolitical Board of Governors." The 2021 budget has not provided any further details as to what a newly structured FSA may look like.

During Thursday's hearing, Cole said separating FSA "is an issue I think is worth thinking about," but noted that the appropriations committee may not be the best to consider the proposal, as it is "more of an authorizing function." 

"But I do support your efforts to streamline and create a more user-focused system for student borrowers," he said, referencing ED's NextGen initiative. 

Throughout her tenure — starting with her historic and divisive confirmation hearings — DeVos has been a lightning rod for controversy, often drawing strong negative reactions from Democrats. While DeVos acknowledged that some proposals may be unpopular, saying she was aware she would "invite criticism and hand wringing," Thursday's hearing was no different as the majority party pushed back against most proposals. DeVos urged lawmakers "to move beyond the immediate discomfort of change and instead focus on the needs of the rising generation." 

"What they need from American education is not the programs we fund today, simply because we funded them yesterday and the year before that and the decade before that," DeVos continued. "What they need is a complete rethinking and challenging of everything we do so that nothing stands in the way of their continued growth and success."

Still, Rep. Nita Lowey (D-N.Y.), chairwoman of the full appropriations committee, said that "without fail, your vision hurts our students and their families."

"Like every previous year, we will reject this outrageous proposal," Lowey said.

The next step of the annual budget and appropriations process is for the House and Senate to develop their respective funding proposals.

***

Don't miss the latest episode of NASFAA's weekly policy podcast, "Off The Cuff," as the team dives into a discussion on Thursday's appropriations subcommittee hearing.

For more information on the federal budget and appropriations process, check out NASFAA's Federal Budget and Appropriations page, which features a flowchart that explains the budget process and also includes recent news. In addition, NASFAA's Federal Budget FAQ page answers some of your most pressing budget questions. 

NASFAA encourages all members to join the "Fight for Financial Aid" by liking the campaign's Facebook page, tweeting with #Fight4FinAid, and by sharing campaign links with friends, colleagues, and students.

 

Publication Date: 2/28/2020


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