ICCTA - June 6, 2002 Action Alert

ICCTA Action Alert
Juen 6, 2002

The following legislative update was prepared by the Association of Community College Trustees.

Washington Update
What’s New: June 6, 2002

FED UP Legislation Introduced in the House
After soliciting more than 3,000 comments on regulatory and technical changes needing to be made to the Higher Education Act, Representative Howard "Buck" McKeon (R-CA), Chairman of the House 21st Century Competitiveness Subcommittee, introduced legislation on June 5 to improve student access to federal financial assistance and streamline burdensome regulations on colleges.

The legislation, H.R. 4866, is named "Upping the Effectiveness of Our Federal Student Aid Programs," or FED UP for short. The legislation is the result of a long process of soliciting comments from the higher education community that began over a year ago. ACCT participated in that process and submitted comments and recommendations along with other higher education associations.

Briefly, H.R. 4866 will help ensure that students receive their federal student loans faster by extending two expiring provisions that keep interest rates low and allow students to receive their loans faster. FED UP also helps students to avoid defaulting on their student loans by providing several avenues via which a student can avoid entering into default because of temporary difficulties in making payments on their loans. The bill also lifts the two-year "wait out" provision for Hispanic-serving Institutions that prevent them from seeking federal HSI monies within a two-year application period. And the legislation clarifies the "Return of Funds" provisions by ending the practice of requiring students to fully repay their Pell Grants if they had already enrolled, but later withdrew from an institution.

Congress Moves to Erase Pell Grant Shortfall
One of ACCT’s main legislative priorities is securing funds to erase a serious shortfall in the Pell Grant program of $1.3 billion. The shortfall is a result of an unexpectedly high participation rate in the program due to increased enrollment in higher education and greater participation by needy students.

The House of Representatives passed a Fiscal Year 2002 supplemental bill, H.R. 4775, which includes $1 billion for the Pell grant shortfall, on May 24. The bill also "borrows" $300 million from the Pell program's allocation for next year, effectively closing the $1.3 billion gap in the program.

The Senate Appropriations Committee passed its version of the supplemental on May 23, which also included $1 billion for the Pell grant shortfall. The Senate will take up its version of the Supplemental, S. 2551, after the Memorial Day Recess.

For additional information on federal issues, contact J. Noah Brown, ACCT's Director of Public Policy, at 202-775-4667.

Illinois Community College Trustees Association
401 E. Capitol Ave., Suite 200
Springfield, IL 62701-1711
217-528-2858 (phone)
217-528-8662 (fax)
ICCTA@communitycolleges.org (e-mail)
http://www.communitycolleges.org