DC Digest – FY15 Budget Update
President Obama released his FY15 budget on Tuesday, a $3.9 trillion plan that seeks to balance investments to help the economy and spread economic opportunities against continued spending cuts and tax increases in an effort to continue reducing annual deficits.
The budget request would keep most student aid and basic research programs level-funded, but the new proposals stand little chance of passing a gridlocked Congress that is gearing up for the midterm elections this fall.
The president’s budget is largely a political exercise this year, since Congress already set top-line budget levels for federal spending as part of the budget compromise reached in December.
Proposals important to higher education are below:
Opportunity, Growth, and Security Initiative
The core budget contains little if any new money for scientific research, but the administration’s proposes the Opportunity, Growth, and Security Initiative, a $56 billion fund that would provide a huge influx of funds for research agencies. However, funding for the initiative is dependent on changes to the tax code that are unlikely to happen.
In the absence of funds from the Opportunity, Growth, and Security Initiative:
– National Institutes of Health would receive a total of $30.2 billion, up slightly from the $30.15 billion in FY14
– National Science Foundation would receive a 1.2 percent increase overall, to $7.255 billion from $7.18 billion in 2014, but most of that increase would be for education programs and operations, resulting in a 0.03 percent dip for research funding.
– Department of Defense 6.1 Basic Research would decrease by almost 7%, to $2.077 billion.
– The Department of Energy would receive $12.3 billion for R&D, including $5.1 billion for DOE’s Office of Science (an increase of .9%).
– Department of Homeland Security Science and Technology Directorate would receive $1.07 billion, a decrease from $1.2 billion in FY14.
– NASA Science Mission Directorate would receive $4.97 billion, a slight decline from the $5.15 billion provided in FY 14.
National Endowment for the Humanities
NEH would be level-funded at $146 million.
– Pell Grant maximum award would increase by $100 to $5,830. The administration’s budget plan also issues a call to “strengthen academic progress requirements in the Pell Grant program to encourage students to complete their studies on time.
– Other aid programs (SEOG, Federal Work Study, etc.) would continue to keep their current levels of funding.
New Education Programs
The President’s budget proposes an $8 billion initiative over 10 years that would reward colleges that successfully enroll and graduate a significant number of low- and moderate-income students on time. Under the plan, colleges would be rewarded with a grant calculated based on the number of Pell Grant-eligible students they graduate on time. The grant could be used to fund innovations and other interventions aimed at increase college access.
-Permanently extends the the American Opportunity Tax Credit, currently slated to expire after December 2017.
– Eliminates taxability of loan amounts forgiven under Income-Based and Income-Contingent repayment programs.
– Makes Pell Grants excludable from taxable income, and better coordinates Pell Grant and AOTC.
– Caps the tax value of certain itemized deductions, including the charitable deduction, for upper-income taxpayers.
Student Loan Changes
The President’s budget calls for the expansion the “Pay As You Earn” income-based repayment program to all student borrowers regardless of when they took out their loans.
Funding for the State Department’s educational and cultural exchange programs would rise slightly, to $577.9 million from $568.6 in 2014.
The core Fulbright Program would see its funding cut by about $30 million, to $204 million from 2014’s $234 million.
Funding for the Department of Education International Education Programs would increase to $76.2 million, up from $72 million in FY 14.
Funding Details in Obama’s FY15 Budget for Education and Science (Chronicle of Higher Ed – subscription required)
The 2015 Budget, Real and Illusory (Inside Higher Ed)
AAU Statement on the Administration’s FY15 Budget (pdf)
FY2015 Science and Technology R&D Budget (pdf)
Major U.S. Science Agencies Face Flat Prospects (sciencemag.org)