Shannon M. Mahan
Specialist in Education Policy
The Federal Pell Grant program, authorized by Title IV of the Higher Education Act of 1965, as amended (HEA; P.L. 89-329), is the single largest source of federal grant aid supporting postsecondary education students. The program is estimated to have provided over $33 billion to approximately 8.7 million undergraduate students in fiscal year (FY) 2010. For FY2011, the total maximum Pell Grant was funded at $5,550. The program is funded primarily through annual appropriations, although mandatory appropriations play a smaller, yet increasing, role in the program.
Pell Grants are need-based aid that is intended to be the foundation for all federal student aid awarded to undergraduates. There is no absolute income threshold that determines who is eligible or ineligible for Pell Grants. Nevertheless, Pell Grant recipients are primarily low-income. In FY2008, an estimated 62% of Pell Grant recipients considered to be dependent upon their parents had a total family income at or below $30,000. Of Pell Grant recipients considered to be independent of their parents, an estimated 83% had a total family income at or below $30,000.
The Pell Grant program has garnered considerable attention over the past several years in Congress. Most recently, the Continuing Appropriations and Surface Transportation Extensions Act of 2011 (CASTEA; P.L. 111-322) provided $23.2 billion in discretionary funding for FY2011, or an increase of $5.7 billion over FY2010. In March 2010, the SAFRA Act, passed as part of the Health Care and Education Reconciliation Act of 2010 (HCERA; P.L. 111-152), established indefinite mandatory appropriations beginning in FY2010 to provide for increases to the maximum award amount funded with annual discretionary appropriations. The program also received substantial discretionary and mandatory supplemental funding through the American Recovery and Reinvestment Act of 2009 (ARRA; P.L. 111-5). The statutory authority for the Pell Grant program was most recently reauthorized by the Higher Education Opportunity Act of 2008 (HEOA; P.L. 110-315).
The Pell Grant program recently experienced substantial increases in program costs—largely due to legislative changes that have led to increased benefits for more students, increases in the number of students enrolling in college and applying for Pell Grant aid, and a weakened economy. These factors, combined with inadequate discretionary and mandatory appropriations in some years, and catch-up appropriations in other years, led to funding shortfalls and surpluses in the program from FY2008 to FY2010. The program is currently fully funded through FY2011 based on the latest official estimates of program costs.
Many of the issues concerning the Pell Grant program that confront Congress include potential challenges associated with funding the program, both in the short term and the long term. In the short-term, substantial discretionary appropriations may be required in FY2012 to ensure current award levels are maintained, leading to the program comprising an increasingly larger share of the discretionary funding allocated for programs that are funded in Labor, Health and Human Services (HHS), and Education appropriations. As a long-term strategy for funding the program, Congress could consider reclassifying the program as an entitlement, and thus providing only mandatory funding for the program each year. Such action would preclude annual funding shortfalls and surpluses in the program, but the initial costs of reclassification could be substantial under congressional budgetary rules. Congress could also consider ways to change the distribution of overall benefits by targeting aid to the most needy students or by revising the program’s award rules and eligibility parameters.
Date of Report: January 10, 2011
Number of Pages: 48
Order Number: R41437
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David P. Smole
Specialist in Education Policy
Three Higher Education Act (HEA) student financial aid programs—the Federal Supplemental Educational Opportunity Grant (FSEOG) program, the Federal Work-Study (FWS) program, and the Federal Perkins Loan program—collectively are referred to as the campus-based programs. The campus-based programs were reauthorized under the Higher Education Opportunity Act (HEOA; P.L. 110-315), which amended and extended authorization for programs funded under the HEA. The campus-based programs are currently authorized to be funded through FY2014.
Under the campus-based programs, federal funding is provided to institutions of higher education for the provision of need-based financial aid to students. Institutions participating in the programs are required to provide a match of approximately one-third of the federal funds they receive. The campus-based programs are unique among the need-based federal student aid programs in that the mix and amount of aid awarded to students are determined by each institution’s financial aid administrator according to institution-specific award criteria (which must be consistent with federal program requirements), rather than according to non-discretionary award criteria, such as that applicable for Pell Grants and subsidized Stafford Loans.
Each program provides students with a distinct type of aid. The FSEOG program provides grant aid only to undergraduate students. The FWS program provides undergraduate, graduate, and professional students the opportunity for paid employment in a field related to their course of study or in community service. The Perkins Loan program provides low-interest loans with favorable terms and conditions to undergraduate, graduate, and professional students.
Funding is provided to institutions separately for each program according to formulas that take into account both the allocation institutions received in years past (their base guarantee) and their proportionate share of eligible students’ need that is in excess of their base guarantee (their fair share increase). From these funds, institutions’ financial aid administrators award aid to eligible students having financial need.
The programs are among the oldest of the federal postsecondary aid programs; however, they now operate amidst a host of other aid programs and tax benefits, some of which are not needbased. At present, a relatively small proportion of all students receive campus-based financial aid. Over the past decade, the number of institutions participating in the programs has also declined.
This report describes the FSEOG, FWS, and Federal Perkins Loan programs, as amended by the HEOA. It also presents historical information on appropriations provided for the programs and the federal student aid that has been made available to students through the programs. It will be updated to reflect legislative action in the 112th Congress.
Date of Report: January 7, 2011
Number of Pages: 27
Order Number: RL31618
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Karen E. Lynch
Analyst in Social Policy
Gail McCallion
Specialist in Social Policy
Federal support for child care and education comes in many forms, ranging from grant programs to tax provisions. Some programs serve as specifically dedicated funding sources for child care services (e.g., the Child Care and Development Block Grant, or CCDBG) or education programs (e.g., the Preschool Grants Program and Infants and Toddlers Program funded under the Individuals with Disabilities Education Act). For other programs (e.g., Temporary Assistance for Needy Families, or TANF), child care is just one of many purposes for which funds may be used. In many cases, federal programs target low-income families in need of child care, but in the case of certain tax provisions, the benefits reach middle- and upper-income families as well. This report provides an overview of federal child care, early education, and related programs, and their current funding statuses.
Funding for many child care, early education, and related programs is provided each year as part of the annual appropriations process for the Departments of Health and Human Services (HHS), and Education (ED). This report provides a brief funding history for a selection of such early childhood care and education programs. For FY2011, Congress has passed a series of continuing resolutions, the most recent of which, P.L. 111-322, is scheduled to expire on March 4, 2011. These continuing resolutions generally maintained funding at the FY2010 rate for the annually appropriated early childhood programs discussed in this report. In addition to reviewing the status of FY2011 appropriations, this report also summarizes the Obama Administration’s FY2011 funding requests for these programs. Finally, this report provides final FY2010 funding levels and a six-year funding history for the select early childhood care and education programs and tax provisions discussed throughout this report.
Several early childhood care and education programs have funding authorizations that have already expired or are due to expire soon. The Child Care and Development Block Grant, for instance, expired in FY2002. However, it has continued to be funded through appropriations legislation. Authorization for many programs under the No Child Left Behind Act expired at the end of FY2008, though they have also continued to receive funding. Mandatory child care and TANF funds were temporarily extended for FY2011 by the Claims Resolution Act of 2010 (P.L. 111-291), but are also due for reauthorization in this Congress.
Date of Report: January 11, 2011
Number of Pages: 22
Order Number: R40212
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Jeffrey J. Kuenzi
Specialist in Education Policy
Congress has historically recognized the importance of teacher quality in improving the academic performance of elementary and secondary school students; however, federal policy has only recently begun to address the impact of teacher compensation systems on both quality and performance. Growing concern about the dominant feature of these systems—the single salary schedule—has led to a variety of compensation reform efforts around the country. These efforts include pay-for-performance incentives that attempt to align teacher compensation more closely with student achievement, as well as other reforms that link increased pay to improved teacher competency or to service in hard-to-staff positions.
Congress provided significant support to several existing compensation reform efforts by enacting the Teacher Incentive Fund (TIF) through the Labor-HHS-Education Appropriations Act of 2006 (P.L. 109-149). The concise passage that provides program authority for TIF states that funds are intended to “develop and implement performance-based teacher and principal compensation systems in high-need schools.” Little additional guidance has been provided with respect to how these reforms are to be implemented.
Subsequent congressional action to extend the TIF has left the authorizing language largely unchanged. Prior to the TIF, federal education policy had not significantly addressed the nature of teacher compensation. Nevertheless, significant amounts of funding from several federal programs support the salaries of specific kinds of teachers, including teachers and paraprofessionals serving educationally disadvantaged students, newly hired teachers, and special education teachers.
As Congress moves to reauthorize the Elementary and Secondary Education Act (ESEA), proposals to leverage federal education spending to reform teacher compensation systems may receive serious consideration. Beyond recent increases in TIF appropriations through the American Recovery and Reinvestment Act (P.L. 111-5) and the Omnibus Appropriations Act of 2009 (P.L. 111-8), Congress may also consider altering and expanding the federal role in this area. Some proposals that would make changes to the federal effort in this area received attention in recent congressional sessions. These include a discussion draft for ESEA reauthorization circulated by the leadership of the House Education and Labor Committee as well as legislation to create Innovation Districts as part of the Obama Administration’s education agenda.
This report is intended to discuss a variety of issues that relate to compensation reform and the proposals Congress may consider during ESEA reauthorization. The report provides background on the teacher pay system, discusses the basic elements of compensation reform, and describes several reform efforts that are currently underway around the country. The report concludes with a discussion of recent legislative action and issues for ESEA reauthorization.
Date of Report: January 3, 2011
Number of Pages: 36
Order Number: R40576
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Cassandria Dortch
Analyst in Education Policy
The Title VII-A formula grant program, authorized by the Indian Education Act of the Elementary and Secondary Education Act (ESEA) as amended by the No Child Left Behind Act (NCLB; P.L. 107-110), is one of the current federal programs targeted to raising the educational achievement of Indian children. The Title VII-A Indian Education formula grant program is intended to provide supplementary funding for the education of Indian children. The program is intended to help Indian students meet state academic and content standards in an environment that values their culturally related academic needs. For purposes of the program, an Indian student is defined as a member or child or grandchild of a member of a federally recognized tribe, state-recognized tribe, or terminated tribe; an individual considered by the Secretary of the Interior to be an Indian; an Eskimo, Aleut, or other Alaska Native; or a member of an organized Indian group that received a grant under the program before October 20, 1994.
Local educational agencies (LEAs), Indian tribes, and Bureau of Indian Education (BIE)-funded schools are eligible for funding. To be eligible, LEAs must meet one of the following criteria: serve a minimum of 10 Indian students; have an enrollment of at least 25% Indian students; be located in Alaska, California, or Oklahoma; or be located on or in proximity to a reservation. An Indian tribe that represents a minimum of 50% of the LEA’s Indian enrollment is eligible in lieu of the LEA if the eligible LEA does not establish an Indian Parent Committee. The Indian Parent Committee contributes to and approves the LEA’s plan for using grant funds.
Grants are awarded by formula based on the enrollment of eligible Indian students and the average per pupil expenditure (APPE). In FY2010, it is estimated that the 1,265 grantees received an average of $220 per Indian student enrolled. The program’s FY2010 appropriation was $104 million. Grantees, 90% of which are LEAs, have served 448,000-481,000 Indian students each year since FY1999. Since FY1999, LEAs in three states—Alaska, Arizona, and Oklahoma—have received almost half (45%) of the funding. LEAs in 12 states have not received any funding since at least FY2002.
The 112th Congress may consider several issues related to the Title VII-A Indian education formula grant program and Indian education more generally as it considers reauthorization of the ESEA. The various definitions of Indian student used to determine eligibility for programs that support the education of Indian students complicates administration and makes program success difficult to measure. The educational outcomes of Indian children have continued to lag behind those of other American children. Many stakeholders believe the program is underfunded as measured by the program’s original 1972 statutory goals, the educational achievement gaps, and the need for culturally relevant education.
Date of Report: January 18, 2011
Number of Pages: 34
Order Number: R41598
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