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Year-Round Pell Grants Return in FY17 Spending Agreement

May 15, 2017

Congressional leaders recently passed a FY17 spending bill that contains positive additions for the higher education sector, despite calls from President Donald Trump to cut financial aid programs. Trump signed the bill (H.R. 244) into law on May 5.

NACUBO joined 36 other higher education associations in an effort led by the American Council on Education (ACE) to thank congressional leaders for passing a bill that featured strong funding for education and research. In addition to offering appreciation, the letter encouraged House and Senate leaders to continue their support in the coming fiscal year.

Year-Round Pell Restored

The most notable higher education provision in the FY17 spending bill is the restoration of year-round Pell Grants, a program designed to allow students to maintain their academic progress in the summer months by providing up to one and one-half Pell Grants during a single award year. 

Though the FY17 appropriation is for award year 2017-18, it is unclear if the Department of Education will be ready or able to provide these extra Pell Grants this summer or if the grants will first become available in 2018. Congress has directed ED to issue guidance on year-round Pell by July 1; NACUBO will provide an update when it becomes available.

Federal Supplemental Educational Opportunity Grants and the Federal Work-Study program will receive level funding as a result of the spending bill, while GEAR UP and the Federal TRIO programs will receive slight increases in funding.

To fund year-round Pell, Congress cut $1.3 billion from the Pell surplus. The surplus—which stood at over $10 billion prior to the spending package passage—was the result of a strengthening economy after program costs were calculated several years ago. Those costs had increased significantly between 2008 and 2011. To cover the cost of running the program, Congress made changes to other Title IV programs, including the 2011 elimination of year-round Pell. Eventually, the economy recovered and the program began running a surplus. Trump has called for $3.9 billion in additional cuts to the Pell surplus in his FY18 budget request.

The FY17 funding agreement also directs ED to permit borrowers consolidating their student loans to be able to choose from any of the federal loan servicers for their new consolidated loans. ED will develop common performance metrics to assist borrowers in the selection process.

Steady Funding for Research

The budget contained a generally strong level of support for research funding within federal agencies. These numbers helped alleviate some concern within the higher education community after Trump’s proposal for the FY18 budget featured sizeable cuts to research funding across the federal government. Now that the FY17 budget is enacted, Congress will now turning its attention to FY18, which begins October 1.

The FY17 appropriations legislation enacts the following:

Department of Agriculture (USDA)

  • $1.059 billion for the National Institute of Food and Agriculture (NIFA), an increase of $36.43 million from FY16.
  • $375 million for the Agriculture and Food Research Initiative (AFRI), a $25 million increase.
  • Hatch Act Funds, $243.7 million, level with FY16.
  • Smith Lever Funds 3(b) and 3(c) , $300 million, level with FY16.
  • McIntire-Stennis Cooperative Forestry, $33.9 million, level with FY16.
  • 1890 Institutions Extension Services, $45.6 million, level with FY16.

Department of Defense

  • Total Funding: $516.1 billion.
     -Basic Research: $2.28 billion, a $33 million cut from FY16.
     -Defense Advanced Research Projects Agency (DARPA): $2.94 billion, a $48 million increase from FY16.

Department of Energy

  • Office of Science: $5.39 billion, a $41.8 million increase from FY16.
  • Advanced Research Projects Agency (ARPA-E): $306 million, a $15 million increase from FY16.

Department of Health and Human Services

  • National Institutes of Health (NIH): $34.1 billion, a $2 billion increase from FY16 (includes $352 million that was funded by the December 2016 Continuing Resolution for the 21st Century Cures Act).
  • Agency for Healthcare Research and Quality (AHRQ): $324 million, a $10 million cut from FY16.


  • Total Funding: $19.65 billion, a $368 million increase from FY16.
  • Science Mission Directorate: $5.765 billion, a $176 million increase from FY16.
     -Earth Science: $1.921 billion.
     -Astrophysics: $750 million.
     -Heliophysics: $678.5 million.
     -James Webb Space Telescope: $569.4 million.
  • Aeronautics Research Directorate: $660 million, a $20 million increase from FY16.
  • Space Technology Directorate: $687 million, same as FY16.
  • Space Grant Fellowship Program: $40 million, same as FY16.

National Endowment for the Humanities (NEH)

  • Total Funding: $149.8 million, a $1.9 million increase from FY16.

National Oceanographic and Atmospheric Administration (NOAA)

  • Oceanic and Atmospheric Research: $514 million, a $32 million increase from FY16.

National Science Foundation (NSF)

  • Total Funding: $7.472 billion, an $8.7 million increase from FY16.
     -Research and Related Activities Directorate: $6.033 billion, same as FY16.
     -Human Resources Directorate: $880 million, same as FY16.
     -Major Research Equipment and Facilities Construction: $209 million, a $9 million increase from FY16.


Liz Clark
Senior Director, Federal Affairs

Megan Schneider
Assistant Director, Federal Affairs

Bryan Dickson
Senior Policy Analyst