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Federal update: ‘No good news for higher ed’

February 16, 2011
Lori Clark

Lori Clark

There has been a lot of activity in Washington, D.C., over the past week, primarily related to the federal FY2011 budget. Unfortunately, there is no good news for higher education or NIU.

We want to provide you with the best information that we have been able to compile, recognizing that this information may change as Congress begins to debate another Continuing Resolution for the FY 2011 budget this week.

As mentioned in the Feb. 2 column, Congress has been unable to pass any appropriation bills this fiscal year, so the federal government has been operating under a series of Continuing Resolutions (CRs).

The current CR expires Friday, March 4, so Congress will be debating a CR that is intended to carry us through the remainder of the federal fiscal year (until Sept. 30, 2011).

Late last Friday, the House Appropriations Committee released a list of the proposed cuts. Largely as a result of increasing pressures from the conservative wing of the Republican caucus, these proposed cuts were even more dramatic than anticipated.

The current proposal includes cuts totaling more than $60 billion below the FY10 budget levels, and they are about $100 billion below the Obama administration’s budget request for FY11. This CR legislation represents the largest single discretionary spending reduction in the history of Congress.

If Congress is unable to agree on a CR by the March 4 expiration date, a shutdown of the federal government could be imminent.

A number of these proposed cuts would have a significant impact on programs of importance to the entire higher education community. As examples, the CR seeks to cut the following programs from the FY10 levels:

Cuts in student financial aid programs, as well as research and development funding, will be detrimental to NIU and higher education.

At NIU, we are contacting members of Illinois’ Congressional delegation to discuss the negative impact that these cuts would have on the university, its students and faculty. We have included contact information for U.S. Sens. Durbin and Kirk and Congressman Randy Hultgren below should you wish to contact their offices directly about these proposed budget cuts.

On Monday, Feb.14, President Obama released his budget request for FY2012. The president’s budget will be used as the starting point for FY12 budget debates and negotiations. Highlights include:

Pell grants

The administration is requesting $41.2 billion for Pell grants, the amount needed to maintain the current maximum award level of $5,550. To maintain this maximum award level, the administration is requesting the suspension of the year-round Pell program that currently allows students to take out two full Pell grants while studying year-round and the elimination of the eligibility of graduate and professional students to participate in Pells.

Other Department of Education programs and initiatives

As part of its emphasis on college completion, the administration is proposing at least two new programs to address its goal of leading the world again in college completion rates by 2020.

The “First in the World” initiative would be funded at $125 million and is designed as a “venture capital” program to encourage innovative approaches by institutions. A College Completion Incentive Grants program would provide funds to 25 states in the first year which would, in turn, provide incentives to institutions. The GEAR-UP, work study and the Supplemental Education Opportunity Grants would both be level-funded, while TRIO (federal outreach and student services programs for disadvantaged students) would see an increase of $10 million.

In addition, there is a proposal to expand the Perkins Loan program by $7.5 billion.

National Institutes of Health (NIH)

The administration is requesting a 2.4 percent increase above the FY10 enacted level. The Common Fund would grow by $13 million over FY10. This account supports cross-cutting, trans-NIH programs that require participation by at least two NIH Institutes or Centers.

The Cures Acceleration Network would be funded at $100 million. The National Children’s Study would be funded at $194 million. Research Project Grants would decrease by 228 from the FY10 level to 9,158. Research training stipends would increase an average of 4 percent. Full-Time Training Positions would decline from FY10 by 330 to 16,831.

The budget request highlights three areas of exceptional opportunity instrumental in paving the way for more rapid scientific advances across all areas of human health and disease, including global application: technologies to accelerate discovery, including DNA sequencing, nanotechnology, computational biology and microarray technology; enhancing the evidence base for health care decisions, including comparative effectiveness research and personalized medicine research; and new investigators, new ideas, including two programs, the NIH Director’s New Innovator Award and the Early Independence Award.

Department of Energy

The administration is requesting an 11.9 percent increase over the enacted FY10 level.

Within the DOE budget, the administration’s request maintains the doubling path for the Office of Science (SC). Most of the SC would see increases, including Basic Energy Sciences (24.1 percent increase); Advanced Scientific Computing Research (21.5 percent increase); Biological and Environmental Research (22.1 percent increase); High Energy Physics (0.8 percent increase); Nuclear Physics (15.9 percent increase); and Workforce Development for Teachers and Scientists (72.2 percent increase).

ARPA-E would be increased by 41 percent above the levels approved in the American Recovery and Reinvestment Act. Programs supported through the Energy Efficiency and Renewable Energy (EERE) account would be funded at a total of $3.2 billion, a 44.1 percent increase. 

Because more than 13 percent of the FY10 EERE budget has been allocated for earmarks, the administration’s proposal would use those funds to triple industrial technologies, double building and geothermal technologies and increase many other programs. The exceptions were the Federal Energy Management Program, which would be cut by 3 percent, and Hydrogen and Fuel Cell Technologies and Water Power, both of which would see significant cuts.

The budget also calls for a new Better Buildings Initiative at $100 million in loan guarantees. The program is geared toward hospitals and universities, and it would allow the funds to be used to make infrastructure improvements.

National Science Foundation

The administration is proposing a 13 percent increase in NSF funding above the FY10 enacted levels. Most of the increase would come from the Research and Related Activities (R&RA) account.

The Education and Human Resources (EHR) account would increase by 4.4 percent, and the Major Research Equipment and Facilities Construction (MREFC) account would see an increase of 91.6 percent.

NSF is proposing a number of interdisciplinary activities within the agency, including: increasing the number of research grants by 2,000; $12.4 million for Integrated NSF Support Promoting Interdisciplinary Research and Education (INSPIRE); $76.1 million for Research at the Interface of the Biological, Mathematical, and Physical Sciences (BioMaPs); new STEM programs, such as Teacher Learning for the Future ($20 million), Widening Implementation and Demonstration of Evidence-based Reforms ($20 million), and Transforming Broadening Participation through STEM ($20 million); and, 2,000 new Graduate Research Fellowships and increasing the stipend levels.

To help promote competitive marks and encourage entrepreneurship, the NSF budget proposal includes: $1 billion for the NSF component of the Wireless Innovation (WIN) fund to significantly expand the nation’s wireless broadband capacities; and $146.9 million to support Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs.

Department of Commerce

The administration is seeking to provide $5 billion to help expand the next generation of wireless broadband networks in rural America. This investment will complement the efforts of the Federal Communications Commission to reorient its Universal Service Fund toward broadband support.

The budget allocates $3 billion of spectrum receipts to the WIN Fund, to help develop and promote cutting-edge wireless technologies to advance public safety, Smart Grid, telemedicine, distance learning, and other broadband capabilities.

The administration also is requesting a 7.5 percent increase in funding for Economic Development Assistance programs. A portion of these funds ($40 million) will aid businesses and regions through the Regional Innovation Program authorized in the America COMPETES Reauthorization Act and provide financing for science and research parks.

National Institute of Standards and Technology

The administration’s budget for NIST is a 16.9 percent increase over the FY10 enacted levels.

The budget includes $764 million for its laboratories, and the increase would be used for cyber security, interoperability standards, measurement services for industry, advanced materials, advances in manufacturing related measurements, including biomanufacturing, nanotechnology measurements, energy efficiency and environmental measurements, resilience standards, and a post-doctoral research associateship program.

In addition, the Hollings Manufacturing Extension Partnership, which helps firms identify grown strategies and adopt more efficient manufacturing processes, would see an increase of $17.9 million over FY10 appropriations, to $142.6 million. The Technology Innovation Partnership would increase $5.1 million to $75 million, which would permit a new solicitation. A new Advanced Manufacturing Technology Consortium Program to promote industry consortia to tackle common technological barriers to innovation and manufacturing of new products would be funded at $12.3 million.

Other impacts on higher education

Several parts of the administration’s tax package for FY12 would impact higher education.

The administration would make the American Opportunity Tax Credit (AOTC) permanent and would extend the deduction of qualified tuition and related expenses through next year.

The budget also would exclude from taxation the balance of loans for students taking advantage of either the income-contingent and income-based repayment (ICR and BIR) program. This provision would become effective Jan. 1, 2012. In addition, the Individual Retirement Account roll-over provision would be extended through 2012, and the budget once again calls for the limiting of itemized deductions, including charitable contributions, to 28 percent for high-income taxpayers.

On the research side, the administration is proposing an expanded, simplified and permanent Research & Experimentation (R&E) Tax Credit to further incentivize companies to increase their research activities.

Detailed information on the president’s budget submission can be found at

Contact Information for Congress

U. S. Sen. Richard Durbin
230 S. Dearborn St., Suite 3892
Chicago, Ill., 60604
(312) 353-4952 (District Office)
(202) 224-2152 (D.C. Office)

U.S. Sen. Mark Kirk
230 S. Dearborn St., Suite 3900
Chicago, Ill., 60604
(312) 886-3506 (District Office)
(202) 224-2854 (D.C. Office)

Congressman Randy Hultgren
1797 State Street, Suite A
Geneva, Ill., 60134
(630) 232-7104 (District Office)
(202) 225-2976 (D.C. Office)

Lori Clark is director of federal relations for NIU.