CSU Office of Federal Relations

Obama Releases 2015 Budget Plan

March 25th, 2014

On March 4, the White House released the President’s FY 2015 budget. While generally adhering to the spending caps included in the two-year budget deal negotiated by Congress last December, the proposed budget blueprint is accompanied by a “budget sidecar,” called the Opportunity, Security and Growth Initiative, which proposes an additional $56 billion in spending, split evenly between defense and non-defense discretionary funding, and generally paid for through tax code changes. The budget also proposes to permanently repeal sequester caps starting in FY 2016 and replace them with a balanced package of deficit reduction.

Under the administration’s FY 2015 budget, discretionary funding for the Department of Education would be $69 billion, which represents a 2 percent increase from FY 2014. Most postsecondary education programs would be level-funded from the amount received in FY 2014.

Of particular interest to the CSU, Pell Grant program funding would be sufficient to allow for a scheduled increase in the maximum grant to a projected $5,830, up from $5,730 in FY 2014. The administration would also tighten satisfactory academic progress requirements for Pell recipients in as yet unspecified ways, and re-establish a pathway for students to receive Pell without first receiving a high school diploma or GED.

Supplemental Educational Opportunity Grants (SEOG) and Federal Work-Study would receive $733.1 million and $974.7 million respectively, the same as FY 2014. Also receiving level funding are early outreach and completion programs, including GEAR UP ($301.6 million) and TRIO ($638.3 million).

In recent years, several programs that assist minority-serving institutions (MSIs) have received a mix of mandatory and discretionary funds. With regard to discretionary money, funding for Asian American and Native American Pacific Islander-Serving Institutions (AANAPISIs) and Hispanic-Serving Institutions (HSIs) would remain stable from FY 2014. However, mandatory funding for AANAPISIs and for the HSI STEM program would increase slightly, while mandatory funding for postbaccalaureate HSI programs would expire as scheduled on September 30, resulting in a net marginal increase for AANAPISI programs to $8 million (from $7.7 million), and net decrease for HSI programs to $207.4 million (from $210.9 million). Also of interest to the MSI community, FIPSE‘s “First in the World” competition, which had been funded at $75 million in FY 2014, would be increased to $100 million, with $75 million reserved for a new competitive grant program for MSIs to undertake innovative and cost-saving strategies to improve student outcomes.

As in past years, the administration proposes to eliminate Teacher Quality Partnership (TQP) grants, and use the funding as part of a larger teacher and School Leader Pathway program. International education programs would see a small boost, from $72.1 million in FY 2014 to $76.2 million in FY 2015, with funds designated for visits and studies in foreign countries.

With respect to other agencies and programs of interest, AmeriCorps would be flat-funded at $335.4 million. While NSF overall would see a slight increase in funding, the Robert Noyce Teacher Scholarship and the Louis Stokes Alliance for Minority Participation (LSAMP) programs would both continue to receive funding at the FY 2014 levels of $60.89 million and $45.62 million respectively. Within the U.S. Department of Agriculture, Hispanic Serving Institution Education Partnerships would be level-funded at $9.2 million, while the Capacity Building for Non-Land Grant Colleges of Agriculture (NLGCA) program, which received $4.5 million for FY 2014, would see its funding eliminated. And, as in past years, the administration budget proposes $10 million for a new endowment fund for Hispanic-Serving Agricultural Colleges and Universities (HSACUs), though the program has never been funded by Congress. On the tax side, itemized income tax deductions, including the current deduction for charitable giving, would see their value reduced for upper-income earners, while the American Opportunity Tax Credit (AOTC), currently set to expire in 2017, would become a permanent feature of the tax code.

Also outlined in the President’s FY 2015 budget is a new State Higher Education Performance Fund, which would provide $4 billion in competitive mandatory funding over four years, to be matched on a one-to-one basis by recipients, for states to support, reform, and improve the performance of their higher education systems similar to “Race to the Top” for elementary and secondary education. The budget would include an additional $7 billion over ten years for a new “College Opportunity and Graduation Bonus,” to reward colleges that successfully enroll and graduate a significant number of low-income students on time, and $52 million in new funds for design and implementation of the administration’s planned college rating system. However, given that lawmakers in both parties agreed to overall spending caps for FY 2015 just last December, it is highly unlikely that Congress will be willing to increase domestic spending, even accompanied by offsets, in order to fund new initiatives. The Senate has already indicated that it is unwilling to consider a 2015 budget resolution, and House budgeteers are also encountering resistance to doing so. Earlier this month, the CSU joined more than one thousand associations and institutions in urging House and Senate appropriators to restore funding for education, health, and labor programs to pre-sequester levels.

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Last Updated: May 08, 2015