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On February 10, President Donald Trump released his budget proposal for fiscal year 2021. A Budget for America’s Future calls for the government to “reduce wasteful, unnecessary spending, and to fix mismanagement and redundancy across agencies” and provides $740.5B for defense programs and $634.5B for non-defense programs. The total provided for non-defense programs is $44.5B below the caps set in a budget deal last summer.

It is important to note that the president's budget request is just that: a request. While the budget outlines the White House's priorities, Congress has the power of the purse and will work on passing spending bills for the various federal agencies before the fiscal year begins on October 1.

Department of Education and Student Aid

The budget request calls for an overall cut of 7.8 percent to the Department of Education, compared to the FY20 enacted level. Pell Grants would be level-funded, meaning the maximum award would remain at the FY20 amount of $6,345. Students would be able to use Pell Grants at high-quality, short-term programs under the proposal, which also calls for the grants to be available to certain incarcerated students.

Subsidized Direct Loans would be eliminated under the proposal. Further, the president’s budget would place limits on loan borrowing by capping the amount graduate students and parents could receive through PLUS loans. Additionally, the document calls for a single income-driven repayment plan, capped at 12.5 percent of a borrower’s discretionary income.

Historically black colleges and universities would maintain funding at the FY20 level. The budget request also calls for changes in how discretionary and mandatory funds are administered to Hispanic-serving institutions (HSIs). The Higher Education Act (HEA) currently authorizes numerous Title III and Title V programs, but the budget proposes a Consolidated MSI Grant program, which would combine 11 existing HEA Title III and V programs, including the three HSI programs, into a single formula-based allocation.

The Federal Work-Study Program would be cut by more than 50 percent in the proposed budget, though career and technical education programs would see an increase of funding by almost $900M. The budget plan also calls for the elimination of the Public Service Loan Forgiveness Program, the Supplemental Education Opportunity Grant, and the International Education and Foreign Language Studies programs. As was the case in the FY20 budget, this year’s request calls for the TRIO and GEAR UP Programs to be consolidated into a $950 million state formula grant.

Free speech on campus was also mentioned in the FY21 budget. The document states that “colleges and universities that receive federal research or education grants must adhere to the requirements of the First Amendment to the Constitution and all other requirements of federal law.”

Research

The National Institutes of Health would receive a cut of $3B while the National Science Foundation would receive a cut of $500M. The budget requests a $175M increase in funding for the Agriculture and Food Research Initiative, a grant program administered by the Department of Agriculture. The Department of Defense’s Basic Research program would see a cut of $300M, funding the program at $2.3B while the Defense Advanced Research Projects Agency (DARPA) would see a $108M (3.1 percent) increase in funding.

Environmental Protection Agency

The budget proposal would cut 26.5 percent, or $2.4B, from the Environmental Protection Agency (EPA) and once again proposes user fees for participants in the ENERGY STAR Program. Participating entities would pay a fee to offset the costs of managing and administering the program.

Other proposals include:

  • The elimination of the National Endowment for the Arts and National Endowment for the Humanities
  • Elimination of the Department of Energy’s Advanced Research Projects Agency-Energy (ARPA-E)
  • A 14-percent cut ($727M) to the National Oceanic and Atmospheric Administration (NOAA)
  • A 12-percent increase in funding to NASA

Contact

Bryan Dickson

Director, Student Financial Services and Educational Programs

202.861.2505


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