Governmental Relations update: What’s next for education?

Now that the presidential election has concluded and Congress will be heading back for its “lame-duck” session beginning next week, Diverse Issues in Higher Education details key higher education issues at stake in the coming weeks and next term in the article, “Decision 2012 — What’s Next for Education.”

Key Issues:

• Sequestration: Across-the-board cuts, known as a sequester. Federal education programs would lose about 8 percent of funding with the prospect of additional cuts in future years. Highlights: In higher education, a projected $66 million reduction in federal TRIO programs could eliminate services for 61,000 low-income students and $24 million cut for GEAR UP would affect 57,000 low-income youth. Pell grants are exempt from these automatic cuts in 2013.
• American Opportunity Tax Credit set to expire: This tax credit allows low- and middle-income families to deduct up to $2,500 of college tuition expenses annually.
• Effort to hold down tuition increases: Both Obama and U.S. Education Secretary Arne Duncan have cited a goal to cut the rate of college tuition increases in half within 10 years, though the administration still will need to provide details on how to accomplish that goal.
• Pell grant shortfall: By eliminating student loan subsidies given to banks, Obama has funded increases in the maximum grant for needy students. But due to heavy use of the program in the recession, Pell has a shortfall approaching $8 billion by 2014. Leading Republicans also have indicated a need to shore up the program for the long term.
• Interest rates: While Obama and Congress sparred in 2012 over the interest rate on student loans, that issue is far from over, and it will resurface in 2013. By enacting only a short-term fix in 2012, student loan interest rates are again scheduled to double from 3.4 percent to 6.8 percent next summer without additional action.
• Higher Education Act (HEA) reauthorization: Congress is likely to begin hearings on renewal of the HEA in 2013, an opportunity for both the White House and congressional Republicans to float new ideas to improve access, completion and affordability. Some observers think Congress may turn to HEA before it considers the future of No Child Left Behind, the K-12 law whose renewal has been snarled in delays on Capitol Hill.
• STEM and teachers: The president has called for creating a Science, Technology, Engineering and Mathematics (STEM) Master Teacher Corps that will recruit and prepare 100,000 new math and science teachers. “We can out-compete China and Germany by out-educating them,” an Obama campaign plan states.

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