AACC Year End Legislative Update

Looking Backward and Forward: Year-End Legislative Report AACC and CRD December 14, 2010•David Baime AACC Senior VP for Government Relations & Research•Jim Hermes AACC Director of Government Relations• Laurie Quarles AACC Legislative Associate• Polly Binns CRD Executive Director

Summary of 111th Congress• Love it or Hate it, Output was Significant:• Recovery and Reinvestment Act, Feb. 2009. ▫ Massive investment in CCs: Stabilization $, Pell Grant $, Billions of $ in competitive grants.• American Graduation Initiative. ▫ Proposed July 2009; Led to March 2010 budget reconciliation legislation (originally SAFRA).• Education Jobs Fund, August 2010.• Pending Tax Legislation Has Potential Great Impact.

Community College And Career Training Program (CCCTP)• Pending Legislative Changes to Program. ▫ H.R. 6517 just introduced by Rep. Sander Levin.  Broadens scope of program to include workers who are or are likely to become eligible for unemployment insurance.  Makes for-profit schools ineligible for program.  Provides administrative funds to DOL.  Extends TAA authorization through end of 2012.  House action imminent; Senate in question.

Community College And Career Training Program (CCCTP)• Solicitation for Grant Applications (SGA) Expected at end of December or Very Early January—Mark AACC’s Words!• 90 Days Minimum to Respond to SGA.

Community College And Career Training Program (CCCTP)• $500 Million per Year for Four Years Under Trade Adjustment Assistance Act. ▫ Funded by 2010 Health Care and Education Reconciliation Legislation. • Minimum of 0.5% of funds to institution(s) in each state, but no state distribution per se. ▫ Funds not limited to serving TAA recipients but design must reflect their needs.

Community College And Career Training Program (CCCTP)• Individual Competitive Grants Start at about $2.5 Million over Three Years, Consortia Grants Higher. ▫ Institution may be fiscal agent on only one grant per year, but may partner in other consortia . ▫ Reform and innovation emphasized—no simple program expansion.• Uses of Funds . ▫ Curriculum development, equipment, faculty time, etc. ▫ No real property; renovation of existing property may be possible. ▫ Tuition charges not envisioned in early phase of grants.• Strong Evaluation Component.

Gainful Employment Regulations• Proposed New Student Aid Eligibility Standards. ▫ Virtually all for-profit school programs. ▫ Certificate programs at non-profits.• Effort Driven by For-Profit Sector Abuses/Expansion ▫ (3 Senate Hearings—Another to Come).• Much at Stake for Community Colleges.• Regulatory Framework Reflects Significant New Federal Role in Higher Education.

Gainful Employment Regulations• Regulations Advanced Through Two Department of Education “Notice(s) of Proposed Rulemaking” (NPRM).• Final Regulations on October 29 included broad range of issues (credit hour, ATB, Satisfactory Academic Progress) as well as reporting framework for gainful employment. The latter is generally satisfactory.

July 26, 2010 Gainful Employment NPRM• Gainful Employment Sole Focus ▫ Requires programs to meet standards relating to loan repayment and debt-to-income ratio to retain full eligibility. ▫ AACC position would largely neutralize impact on community colleges. ▫ For-profit institutions will vigorously challenge rule in Congress and/or in the courts.

Tax Issues (AOTC)• American Opportunity Tax Credit (AOTC) Created in ARRA to replace the Hope Scholarship but Expires in 2010.• For Community College Students, Far Preferable to Hope Scholarship: ▫ Larger ($2,500) credit better geared to low-cost institutions.  100% of first $2,000 in tuition, 25% of next $2,000 ▫ Covers “course materials.” ▫ 40% refundable.

Tax Issues (AOTC)▫ Obama-Republican tax deal extends AOTC for 2 years—big victory aided by continuation of “spend now, pay later” policies.▫ Replay of intense current debate can be expected in 2012.

Tax Issues—Section 127• Section 127 Provides up to $5,250 of Tax-Free Educational Assistance to Incumbent Workers. ▫ Huge benefit to individuals attending community colleges. ▫ Provisions expire in 2010 absent extension.• Obama-Republican Tax Deal Extends for 2 Years; Big CC Victory.

FY 2011 Labor-HHS-Education Appropriations• No FY 2011 Congressional Budget.• No Final FY 2011 Appropriations bills.• Two Continuing Resolutions (CR) to date.• House approved Full-Year CR on December 8.• Senate Democrats working on FY 2011 Omnibus Spending Measure.• Republicans favor short-term CR through February.

FY 2011 Labor-HHS-Education Appropriations—House• House Full-Year CR, H. 3082, includes $5.7 billion to address the Pell Grant shortfall.• Caps discretionary spending at FY 2010 level.• Most programs funded at FY 2010 levels with exceptions.• Career Pathways Innovation Fund (formerly CBJTG) eliminated.• No FY 2011 earmarks.

FY 2011 Labor-HHS-Education Appropriations—Senate• Senate Democratic FY 2011 Omnibus bill: ▫ Caps discretionary spending $22 billion above House & above FY 2010. ▫ Includes earmarks. ▫ Status of Pell shortfall uncertain. ▫ May include modest increases for Title III-A, HSIs, International Ed, & DOL Job Training Programs (not CPIF).

Education Jobs Legislation• $26 Billion in Aid Enacted in August.• Provided $10 Billion for the Education Jobs Fund, Limited to K-12.• Provided $16.1 Billion for Federal Medicaid assistance to States.• Important Maintenance of Effort (MOE) Language.

DREAM Act• Push for Senate Vote Fell Short in Late September. ▫ Enmeshed in “Don’t Ask, Don’t Tell.”• Election Promises Made for Another Vote.• House Passed Act 216-198 on December 8• Senate Vote Likely to Fall Short of 60 Needed. ▫ Republican support needed, may not be forthcoming. ▫ Affected by tax cuts and spending debates. ▫ Never say never!• Outlook Grim for Passage in 112th Congress.

October 5 White House Summit on Community Colleges• President Obama spoke at opening session but Dr. Jill Biden was the sparkplug. Over 100 attendees.• Breakout Sessions: ▫ Completion ▫ Financial Aid ▫ Innovation ▫ Online Learning ▫ Military Families ▫ Pathways to the Baccalaureate

Next Steps on White House Community College Summit• Administration Announced a Virtual Community College Summit to Take Place in 2011.• “Mini-Summits” Possible in Early 2011, to Precede Virtual.• AACC Working with the Obama Administration on Emerging plans.

1st Session of 112th Congress— Some Policy Issues• Budget Deficit Will Dominate Debate.• Tax Issues Kicked Down the Road to 2012.• WIA Reauthorization Seems Possible.• Pell Grant Program is Challenged.• For-Profit Issues Will Continue.• Obama to Retain Focus on Community Colleges.• “No Child Left Behind” (ESEA Reauthorization); Higher Education May be De-Emphasized.

1st Session of 112th Congress— Politics• Political Dynamics are Difficult to Predict. ▫ Most expect widespread gridlock.• New House Majority Will Exert Strong Control. ▫ 242 – 193; 63 new House Republicans.• Most New House Committee Chairmen are Known and Supportive of CCs—Kline, Guthrie, Camp.• Appropriations, Budget, and Education and Labor Committees Will Look Significantly Different.• CC Caucuses at Crossroads.

Budget Policy in the 112th Congress• Deficits Will Drive Debate.• House Republicans Committed to Returning Domestic Discretionary Spending to FY 2008 Levels.• Earmarks in Question.• Deals Necessary to Avoid Dysfunction.• Ability of Legislature to Reduce Deficit/Debt Must be Questioned—e.g., Obama Commission.

Community College Funding Priorities• In 2011, Status Quo May Look Very Good.• Pell Grant Program is Paramount— 3 Million CC Students Rely on Pell Grants Annually; Historically Has Drawn Bi-Partisan Support.• Carl D. Perkins Career and Technical Education Act Could be Vulnerable.• CCCTP Needs Vigilance.

Educating the New Congress• Acting Now is Critical—Make Your Mark!• Importance of Critical Federal Programs Should be Outlined; Limit the List.• CRD Federal Programs Guide.• Underscore Your Role as Sounding Board on Policy Issues.• AACC Has Developed Resources.

Important Dates in 2011• Workforce Development Institute: January 26- 29• Groundhog Day: February 2nd• National Legislative Summit: February 13-16• AACC Convention: April 9-12

Contact Information• David Baime ▫ 202-728-0200 x224, dbaime@aacc.nche.edu• Jim Hermes ▫ 202-728-0200 x216, jhermes@aacc.nche.edu• Laurie Quarles ▫ 202-728-0200 x249, lquarles@aacc.nche.edu

AACC Year End Legislative Update

by American Association of Community Colleges

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