Federal update: D.C. lawmakers back in action, deadline looming to act on debt ceiling issue

Lori Clark
Lori Clark

The Senate and the House of Representatives have both taken a week of district time over the last several weeks, with both chambers scheduled back this week.

The major issue facing Congress and the Obama administration is the need to increase the nation’s debt ceiling before the U.S. government begins to default on its borrowing, projected to be around Aug. 2.

With the financial markets getting skittish over the last several weeks and the economic recovery faltering, bipartisan negotiations accelerated last week with both parties calling for a quick resolution. May statistics showed that private-sector job creation is slowing, and the unemployment rate increased for the first time in eight months.

There is not yet any agreement on how much to raise the debt limit, how much to cut spending or what form an agreement might take.

Republicans are calling for agency spending caps with automatic cuts if the caps are breached. Democrats want caps on annual deficits that could trigger tax increases. A potentially large area of conflict is the spending level for FY 2012. It is widely expected that any final deal will include significant spending reductions to federal agencies.

We continue to monitor these negotiations closely and will report on any impacts to higher education, including student financial assistance programs and research and development funding programs. We also continue to be in close contact with Illinois Congressional Delegation on these critical issues.

There seems to be growing bipartisan interest in a plan to stimulate economic growth by overhauling the U.S. tax code, but this is a very complicated issue that is unlikely to play a role in the current negotiations.

In other news, the Illinois General Assembly approved redistricting legislation before it adjourned May 31, and this will impact the boundaries of congressional districts.

NIU’s DeKalb campus would be moved from the 14th Congressional District (currently held by Rep. Randy Hultgren) to the 16th District (currently held by Rep. Don Manzullo). The Republicans are expected to launch a legal challenge to these maps, so we will have to wait to see if the boundaries are redrawn. NIU has a very good relationship with both representatives.

Finally, the U.S. Department of Education released its final regulations requiring career college programs to better prepare students for “gainful employment” or risk losing access to federal student aid.

Under the new regulations which apply to most for-profit programs and certificate programs at nonprofit and public institutions, a program would be considered to lead to gainful employment if it meets at least one of the following three metrics:

  • at least 35 percent of former students are repaying their loans (defined as reducing the loan balance by at least $1);
  • the estimated annual loan payment of a typical graduate does not exceed 30 percent of his or her discretionary income;
  • or the estimated annual loan payment of a typical graduate does not exceed 12 percent of his or her total earnings.

Congresswoman Virginia Foxx, R-N.C., chair of the Subcommittee on Higher Education and Workforce Training, has introduced legislation (H.R. 2117) that would repeal two Department of Education regulations that inject the federal government into issues that are traditionally academic or state affairs.

The “state authorization” regulation forces states to follow federal rules when granting a college or university permission to operate within the state. The regulation might require distance education programs to get authorization in every state where its students live in order to participate in federal student financial aid programs.

The Voices section of NIU Today features opinions and perspectives from across campus. Lori Clark is director of federal relations for NIU.

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