Yesterday, President Obama released his proposed federal budget for FY12.  The budget makes several investments in education and proposes some changes to the Pell in order to fund the grant at the current maximum level.

Higher Education Programs

The Administration’s 2012 request includes $2.3 billion for Higher Education Programs to help achieve the President’s goal of significantly increasing the percentage of Americans with postsecondary degrees or industry-recognized certificates.

A key priority for 2012 is a $150 million request for the Fund for the Improvement of Postsecondary Education (FIPSE) to support the “First in the World” competition. This proposal, which would be modeled after the i3 program for K-12 education, would provide incentives and rewards for innovation and building evidence of what works to reduce costs and improve outcomes in postsecondary education.

In addition the proposed budget would prioritize:

• A $40 million request for first-time funding for the Hawkins Centers of Excellence program to increase the talent pool of effective minority educators by expanding and reforming teacher education programs at minority-serving institutions (MSIs).
• A $484.8 million request in discretionary funding for the Aid for Institutional Development programs. The request would strengthen institutions of higher education that serve high proportions of minority and disadvantaged students, including Historically Black Colleges and Universities (HBCUs) and Historically Black Graduate Institutions (HBGIs), by improving their academic programs, institutional capacity, and student supports. The budget also provides $117.4 million for the Developing Hispanic-serving Institutions program.
• A $920.1 million request to support college preparation and completion activities for participants in the Federal TRIO Programs, as well as $323.2 million to serve an estimated 756,000 middle and high school students preparing for college through Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP).
• A $125.9 million request  for the International Education and Foreign Language Studies programs, which help meet the Nation’s security and economic needs through the development of expertise in foreign languages and area and international studies.
• A  $40.7 million request for merit- and need-based scholarships and fellowships to postsecondary students under Graduate Assistance in Areas of National Need (GAANN) programs.

Student Financial Assistance

The 2012 request would ensure that Pell Grants will be available to all eligible students through a combination of mandatory savings to offset rising Pell demand and changes in the Pell program that would reduce current and future costs. Proposed mandatory savings include the elimination of interest subsidies for graduate student loans and providing an opportunity for students with multiple loan servicers to convert their student debt to a single loan holder, while the elimination of the “two Pells” provision, which effectively made many students eligible for two Pell Grants in a single award year, would achieve significant cost savings. The 2012 request also would expand the Perkins Loans program and simplify access to student financial aid.

In addition, the 2012 budget includes a new College Completion Incentive Grants program that would make grants to States to encourage colleges to help students enroll in school and finish their studies with a degree or certificate and to reward institutions that produce successful outcomes. Finally, a new Presidential Teaching Fellows program would support K-12 education by recruiting and preparing talented students for the teaching profession through top-tier teacher preparation programs.