House Appropriators Protect Pell, Slash SEOG, FWS and many Problematic Regulations

The House Labor-HHS-Education Subcommittee marked up its FY 2025 spending bill at $185.8 billion, which is 11% below the FY 2024 spending level. With this reduced allocation, the subcommittee made drastic cuts to some critical student aid programs.

While the spending bill maintained the Pell Grant maximum award at $7,395, it cut in half the Supplemental Educational Opportunity Grant (SEOG) and Federal Work-Study (FWS) programs, taking $1 billion out of the two student aid programs. The committee also added policy riders that would effectively halt several problematic regulations, including the new overtime and financial value transparency rules.

The total Department of Education appropriated funding is $72 billion, which is $11 billion below last year’s final funding levels. From that total, $22.5 billion goes toward the Pell Grant program. Notably, the bill does not use Pell surplus dollars to fund other programs demonstrating the committee’s continued support for Pell. While maintaining funding for the foundational student aid program, the bill cuts SEOG to $455 million and FWS to $615 million and level funds TRIO and GEAR UP.

Funding increases are provided for Historically Black Colleges and Universities (HBCU) and Minority-Serving Institutions (MSI) grants in the Institutional Aid programs. But the bill eliminates 17 programs agency-wide, including higher education programs such as Teacher Quality Partnership Grants, Child Care Means Parents in School, Hawkins Centers of Excellence, and the HBCU/MSI Research and Development Infrastructure Grants.

The Republican majority characterizes the bill as being fiscally responsible while “prioritizing targeted education programs.” While the Democratic minority says the bill, “abandons college students and low-income workers trying to improve their lives through higher education or job training.”

Both subcommittee Chairman Robert Aderholt (R-AL) and Committee Chairman Tom Cole (R-OK) acknowledge that this bill is the first step in a longer process. The deep cuts signal where Republican priorities are, but with a slim majority in the House, compromises to increase funding would be required if any Democratic votes are needed for passage in the House this fall.

Policy language included in the bill bans any funds being used on a variety of regulations from the Department, including Title IX, financial value transparency/gainful employment, the most recent borrower defense to repayment changes, student loan forgiveness, and income-driven repayment. The bill also includes language prohibiting the Department of Labor from using any funds to “administer, implement, or enforce” the overtime rule. These policy riders are unlikely to survive negotiations with the Democratically-controlled Senate and would be vigorously opposed by President Biden.

The Senate Appropriations Committee has not released its allocation for the education subcommittee, but Chair Patty Murray (D-WA) and Vice Chair Susan Collins (R-ME) have been working in a bipartisan manner to agree to a top line spending level that respects the Fiscal Responsibility Act and the reality of the final FY 2024 funding levels. With both chambers starting from different places, it is sure to set up a budget battle similar to last year’s that will drag out into the lame duck post-election session.