CSU Office of Federal Relations

Stimulus Will Help CSU

February 19th, 2009

On February 17, President Obama signed HR 1, the American Recovery and Reinvestment Act of 2009, into law. Popularly known as the “economic stimulus” bill, the sweeping $787 billion measure will have a significant impact on public institutions of higher education. The CSU strongly advocated inclusion of several provisions that are designed to deliver increased financial aid to CSU students, expand national service, provide research and modernization funds for faculty and programs, and alleviate state budget cuts to education.

Student Financial Assistance: HR 1 invests billions of dollars in financial assistance for students and their families:

  • Provides $17 billion in new funding for the Pell Grant program, which provides direct aid for students with the greatest financial need. More than 120,000 CSU students receive Pell Grants. Under HR 1 the maximum grant is set to increase from the current $4,731 to $5,350 in 2009 and to $5,550 by 2010.
  • Adds $200 million to the Federal Work-Study program. Experts say this could help an additional 1,500 CSU students earn an average of $2,400 per year.
  • Creates a new, partially refundable American Opportunity Tax Credit, which will cover up to $2500 of the cost of tuition and course-related expenses per year for the first four years of college. This program replaces and expands the current Hope Scholarship Tax Credit.

National Service: HR 1 adds $200 million to expand AmeriCorps State and National and AmeriCorps VISTA programs. CSU students lead the nation in participation in national and community service.

Research: HR 1 injects approximately $16 billion into research through a number of federal agencies, such as the National Science Foundation, the Department of Energy, and the National Institutes of Health. Some funds may be used for research infrastructure, like lab equipment and modernization. Of particular interest to the CSU is specific support for programs related to Science, Technology, Engineering and Mathematics (STEM) fields, such as Professional Science Master’s programs, Robert Noyce Scholarships, and Math and Science Partnerships at NSF.

State Relief: The legislation also creates a complicated new $54 billion “State Fiscal Stabilization Fund,” a large chunk of which is supposed to go to governors to backfill state budget cuts to public education, from K-12 through college. While not mandatory, governors may also use some of these dollars to modernize, renovate, and repair public university infrastructure; no new construction is permitted with these funds.

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Last Updated: May 08, 2015