Yesterday, Congress passed a reconciliation bill that includes provisions to eliminate the Federal Family Education Loan Program (FFELP) and significantly boost funding for the Pell Grant program. The House Budget Committee voted 21 to 16 to report the bill to the full House for a vote.
The reconciliation bill marked-up by the House Budget Committee contained the Student Aid and Fiscal Responsibility Act (SAFRA). That SAFRA language is expected to be replaced with a streamlined bill when the reconciliation bill is sent to the House Rules Committee. The House could vote on the reconciliation bill as early as this week. While the new language has not been released, reports suggest the bill will include the following:
- Savings of $68 billion by eliminating FFELP and moving to direct lending.
- Pay off a portion of the Pell Grant program shortfall and automatically increase the maximum Pell Grant by the Consumer Price Index (CPI)
- Provide additional funding for Minority Serving Institutions
Unlike SAFRA, the new language is not expected to include:
- The Perkins Loan Program overhaul
- The American Graduation Initiative to provide $10 billion to Community Colleges
- The $3.5 billion College Access and Completion Fund
Efforts to pass student financial aid legislation still focus on combining an aid bill with health care legislation through budget reconciliation. Specifically, the House plans to pass the healthcare reform legislation that has already been passed by the Senate, clearing that bill to be signed into law. The House also plans to pass a separate reconciliation bill that would combine student aid reform with healthcare provisions to amend the healthcare reform bill passed by the Senate. Senate Democrats would then have to secure 50 votes to clear the reconciliation bill for the President, with Vice President Joe Biden casting the 51st vote.
Besides the Pell Grant funding provided in the reconciliation bill, the healthcare reform legislation passed by the Senate includes more than $510 million for student aid in the 2010 fiscal year. The Senate healthcare bill would:
- Eliminate the requirement for independent students to supply parental financial information to apply for aid from the Department of Health and Human Services
- Increase annual and aggregate Nursing Student Loan
- Create a pediatric specialty loan repayment
- Create a Public Health Workforce Loan Repayment Program
- Make grants to institutions to award scholarships to individuals employed in public and allied health positions
- Set authorized funding levels for the National Health Service Corps
- Make grants to institutions to provide need-based financial assistance in family medicine, general internal medicine, or general pediatrics
- Make grants to institutions to provide tuition and fee assistance to workers employed in long-term care settings
- Make grants to institutions for financial assistance to general, pediatric, and public health dentistry students
- Establish various support programs for practitioners of geriatric medicine
- Make nurse faculty eligible for the existing Nursing Student Loan Repayment Program.
- Create a United States Public Health Sciences Track, giving students tuition remission and a stipend for up to 4 years, in exchange for a service obligation.
- Reauthorizes Scholarships for Disadvantaged Students through 2015.
- Excludes from taxable income all amounts received under the National Health Service Corps Loan Repayment Program, certain related state programs, or under any other State loan repayment or loan forgiveness program that provides for health care services in under-served or shortage areas.
In addition, the bill would require insurance companies offering health insurance that provides dependent coverage of children to continue to make such coverage available for unmarried adult children until the age of 26. The bill specifically allows schools to continue offering their own student health plans.
The bill now goes to the full U.S. House of Representatives for a vote.