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Billions on the Way for Higher Education

By Cynthia McCabe

March 23, 2010 — Largely lost in the celebration over the passage of healthcare reform this week was another huge win for college-bound students and the rest of the higher education community: the legislation passed by the House of Representatives Sunday night includes billions of dollars for students financial aid and community colleges.

The legislation also cut banks out of the student loan business as middlemen by putting the federal government in charge of directly lending to students. The savings from that change will help fund a new $36 billion allocation for Pell Grants — the biggest spending boost to the program for low-income students since it was created. Between 2011 and 2017, the individual Pell Grant maximum will raise from $5,500 a year to $5,975.

Lawmakers also included a provision to have the Pell Grant amount adjust for inflation. Previously, there was no such adjustment and in some years grant amounts remained stagnant while inflation grew.

Also, it provides roughly $2 billion for grants to community colleges, to help students complete their studies.

National Education Association President Dennis Van Roekel called the vote "a proud and historic moment for America," adding that “reforming our health care system and supporting postsecondary education will help ensure that our people are physically ready and that our nation is better prepared to meet the fiscal challenges of competing in a global economy.”

The NEA played a key role in the higher education provisions. After numerous delays and setbacks, the year-long effort is on the verge of a successful and dramatic conclusion. Final passage of the legislation is expected from the Senate later this week as it finishes with the “budget reconciliation” process.

It was a year ago that President Obama stood in front of Macomb Community College in Michigan, his shirt sleeves rolled up, and laid out an ambitious goal. By 2020, America would once again produce the highest proportion of college graduates in the world.

In order to provide community colleges with some of the intended funds outlined in this American Graduation Initiative announced by President Obama, House and Senate negotiators included $2 billion, spread out over four years, for community colleges, in the legislation passed this week. The funds come through an existing Department of Labor program called Trade Adjustment Assistance. While this program traditionally provides direct benefits for training, health insurance support, and other supports to workers who have lost their jobs due to foreign trade, the new funding will provide program support money to community colleges that are often on the frontline of worker training. In the wake of the economic collapse, community colleges have seen enrollments jump significantly as laid-off workers seek training for new employment opportunities. 

“We are looking forward to Senate passage of the bill and once it becomes law, to working with the Administration to be sure that faculty and staff on campuses can lend their expertise to grant development and implementation,” said Jim Rice, President of the National Council for Higher Education. “It will be critical to be able to use funds for staffing needs, which are significant with the increased enrollments we are seeing due to the economic challenges facing our nation."


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