Low-Income Students

For the last several years, policymakers have been focusing on trying to find ways to simplify the Free Application for Federal Student Aid, or FAFSA, in order to encourage more eligible students to apply for student aid for college. However, a new report by our colleagues at the Institute for College Access & Success (TICAS) shows that some of these students -- often those with the fewest resources available to pay for college -- are ending up without federal aid because of the red tape they run into after completing the FAFSA.

The process of obtaining financial aid from the government is more complex than one would expect.  After student aid applicants submit the FAFSA, the U.S. Department of Education reviews the applications to make sure that they are complete. The Department then marks incomplete applications, and those that contain contradictory information, with “reject codes” and returns them to the applicants. Next, the Department flags a minimum of 30 percent of applications to be verified by each college to be sure that students applying for aid are in fact eligible. Many colleges also ask students to provide additional documentation, above and beyond what’s required by the federal government and states, before awarding them aid.

The goal is to ensure that the right students are receiving money for college. However, the report, “After the FAFSA: How Red Tape Can Prevent Eligible Students From Receiving Financial Aid,” examined more than 59,000 FAFSA applications from 13 California community colleges and found that these logistical hoops can sometimes discourage the most financially needy students from pursuing the aid for which they are qualified. The TICAS report, in fact, found that on average at the schools reviewed, about one third of aid applicants “who appeared eligible for Pell Grants did not receive them.” [Disclosure: Higher Ed Watch is supported, in part, by a grant from TICAS.]

Last week, the Department of Education released data on the 339 applicants for the 2010 Promise Neighborhood competitive grant program. Congress included $10 million in 2010 appropriations for Promise Neighborhood planning grants, a particular priority of President Obama. The Promise Neighborhood program is a new program that was first funded in 2010. These grants provide funds to support the development of a plan to implement a comprehensive approach to education in a high-need area that includes a focus on community and family involvement in education. Promise Neighborhoods seek to break down the silo-ed nature of public services in local areas to create a more supportive and synchronized system.

The Department of Education plans to award up to 20 Promise Neighborhood grants ranging from $400,000 to $500,000 under the fiscal year 2010 appropriation that was made last December. These grants, which will support organizations as they plan their Promise Neighborhoods, will last for 12 months. Depending on the further availability of funds, the Department of Education may provide further grant aid that will fund the implementation of projects receiving planning grants.

For the 2010 grant competition, 339 non-profits, institutions of higher education (IHEs) and other organizations applied for grants. Unsurprisingly, the vast majority (260) of the applicants were non-profit organizations. Sixty-two IHEs applied for grants and 17 other types of organizations applied. In most cases, “other” organizations included city governments and school boards.

The Department of Education also identified three “absolute” priorities under which each applicant must apply. The first priority requires an applicant to submit a proposal for how it plans to create a Promise Neighborhood. This proposal must include descriptions of the community it will serve, how it will maintain the programs it implements, and what methods it will use to evaluate its progress. Every applicant must fulfill the requirements of this priority. Applicants that only apply under the first priority must find matching grants equal to 50 percent of their Promise Neighborhood grants. Of the total applicants, 270 applied under only the first priority.

Applicants can also choose to apply under the second or third absolute priorities, given that they also meet the requirements under the first priority. Forty-eight applicants applied from rural communities, qualifying them for the second priority, while 21 applicants applied from tribal communities, qualifying them for the third priority. Applicants under the second and third priorities must find matching grants equal to only 25 percent of their Promise Neighborhood grants.

Organizations applied from all 50 states and the District of Columbia and larger states tended to have more applicants than smaller states. For example, California had 45 applicants and New York had 29. In contrast, only three organizations applied for grants in Iowa and only one applied in South Dakota. Surprisingly, Texas had only 19 applicants, relatively few given its large population size. The District of Columbia, on the other hand, had 9 applicants, significantly more than 37 other states.

The Department of Education expects to announce grant winners in September 2010, meaning they have less than two months to weed through 339 applications and narrow it down to around 20 winners. But for those 20 winners, this grant could be the first step in a major overhaul of how American communities deliver education services.

According to the President’s 2011 budget request, the Obama Administration hopes to make the Promise Neighborhood program more permanent with $210 million in fiscal year 2011 appropriations. However, both the House and Senate Appropriations Subcommittee bills suggest that this goal may be difficult to achieve – they only provide $60 million and $20 million, respectively, for the program in 2011.

By Richard D. Kahlenberg

Next week, the Fifth Circuit Court of Appeals will hear a new challenge to racial preferences at the University of Texas. The litigation once again raises the question: should programs continue to emphasize race or should they shift their focus to alternatives such as economic disadvantage?

Currently, most colleges say they consider both factors but in fact most put a much greater emphasis on race. The Mellon Foundation’s William Bowen has found that for students within a given SAT range, being an underrepresented minority increases one’s chances of admission by 28 percentage points. (That is, a white student with a given score might have a 30 percent chance of admission, but an African-American or Latino student with a similar score would have a 58 percent chance of admission.) By contrast, Bowen found, students from poor families receive “essentially no break in the admissions process; they fare neither better nor worse than other applicants.” 

Likewise, a new analysis by Princeton sociologist Thomas Espenshade and his coauthor Alexandria Walton Radford finds that, at highly selective private colleges and universities, the boost provided to African-American applicants is worth 310 SAT points (on a 400-1600 scale), compared with 130 points for poor students. Moreover, the 130 points is an average amount that is distributed unequally by race. Comparing students with similar academic records, Espenshade and Radford find that being low-income increases the chances that black, Hispanic, or Asian students will be admitted to private institutions, but significantly reduces the chances that a white student will be admitted. With a similar academic record, a poor white student has just an 8% chance of admission, compared with a 28% chance for upper-middle-class whites, and an 87% chance for low-income blacks.

Next year, all young adults between the ages of 19 and 26 will have the option of remaining on their parents’ health insurance. This is one of the most popular elements of the new health care reform law, and it is expected to remove a sizeable barrier to health care access for    a group that too often lacks coverage -- but will it be this simple?

For college students, it might not be. Depending on how new regulations are written, accessing health care on campus could remain costly and restrictive for many students.

As Higher Ed Watch has reported, colleges tend to strongly encourage (and sometimes mandate) students to buy school-sponsored student health insurance/benefit plans (SHIBPS) even if the students or their families have alternate health insurance that offers more-comprehensive coverage. At many schools, students are allowed to opt out but are charged much higher fees when they try to use their insurance at their campus health centers.

Colleges and insurance companies, such as United Health Care and Aetna, want to keep things as they are – as they have lucrative deals that could be threatened if students decide to stay en masse on their parents’ health plans. Parental plans tend to offer more generous coverage with fewer annual lifetime caps on benefits than those offered by schools.

Today, the House Committee on Education and Labor is holding a hearing on the Improving Nutrition for America’s Children Act. This bill, which was introduced earlier in June, aims to improve access to quality meals served in and out of schools to children. The proposed legislation would also implement food safety standards and establish nutrition standards for all food served in schools, not just those associated with the federally subsidized school nutrition program.

Currently, student eligibility for federally subsidized school meals is determined by either direct certification using the Food Stamp program or Temporary Assistance for Needy Families (i.e. welfare) data available, or by paper application in which parents report their income to demonstrate that their child is eligible. This proposed act would improve access to school meals by allowing schools to use Medicaid data for direct certification in addition to food stamp and TANF data. Ed Money Watch has repeatedly supported this change which would increase the percent of students that are identified for eligibility via direct certification, eliminating some of the paper application burden on schools and parents.

Additionally, the proposed legislation would allow schools with high concentrations of poverty to eliminate paper applications entirely and use census data to determine average eligibility for the program. For these schools, which would otherwise be distributing free or reduced lunches to 75 percent of their students or more, eliminating the paper application would significantly streamline the school meal process.

Federal reimbursement rates for subsidized meals are also a point of contention among stakeholders and the Improving Nutrition for America’s Children Act would make changes in this area as well. Currently, schools are reimbursed $2.68 for each free lunch served, $2.28 for each reduced price lunch served, and $0.25 for each full price meal served. This reimbursement rate is adjusted each year based on the Consumer Price Index for food served away from home in urban communities. The base reimbursement rate for the meal programs would be increased by six cents, the first time the base reimbursement rate has been increased in 30 years. This increase, though small, would better enable schools to comply with increased nutrition requirements and serve higher quality meals to children.

Perhaps most controversially, the bill would require all food sold in schools - including food in vending machines, sold after school hours, sold a la carte during school hours - to comply with the science-based nutrition standards connected with the school nutrition program. This change presents some problems for schools and school lunch programs that derive significant revenue from food sales made outside of the federally subsidized program like a la carte offerings and vending machines. In many cases, these schools rely on this revenue to keep their school lunch programs afloat. Requiring schools to revamp these offerings, potentially pushing them to offer less attractive selections, may put them on shaky financial ground.

In addition to these changes, the Improving Nutrition for America’s Children Act would increase funding for nutrition education, establish more community and school gardens, improve school food safety mechanisms and training, and make sure that more students get continuous meal service during the summer as well as during the school year.

While the bill’s supporters are touting the Improving Nutrition for America’s Children Act as bipartisan, only one of the 30 cosponsors is Republican. This lack of Republican support could spell trouble for the bill in the House, which represents a significant increase in spending on child nutrition programs. The Senate has also presented a similar piece of legislation, titled the Healthy, Hunger-Free Kids Act, which included some offsets for the increased cost of the program. This bill, presented by Senator Blanche Lincoln (D-AR), has no cosponsors and has been reported out of committee. Check back with Ed Money Watch for more updates on this process.

We’ve been hearing a lot lately about teachers. State budget crises have forced school districts to pink slip thousands of teachers across the country and teacher union contracts require inexperienced teachers to be let go first. This has left many, primarily low-income, schools to increase class sizes or rely on substitutes to fill teaching gaps.

At the same time, much media attention has been focused on the two Obama administration one-time competitive grant programs signed into law as part of the American Recovery and Reinvestment Act of 2009. The $4.4 billion Race to the Top (RttT) program requires that states design programs that improve the distribution of teachers in order to win grants. This requirement has led several states to pass teacher-focused legislation to comply with these requirements. Similarly, the $650 million Investing in Innovation (i3) program includes an “improving teacher distribution” category under which 354 local education agencies and organizations applied for grants.

But RttT and i3 are not the only federal programs that address teachers – despite all of the media attention they have received. In fact, the federal government funds 15 individual programs, run by the Department of Education, that provide either formula or competitive grants to local education agencies, states, institutions of higher education, and partnerships with non-profits, or grants or loans directly to teachers. In 2010, the federal government spent $3.9 billion – 5.9 percent of the Department of Education’s discretionary budget – on programs addressing teacher training, distribution, compensation, and retention.

Nine of these programs fall under the Elementary and Secondary Education Act (ESEA), accounting for $3.7 billion in spending. The Obama administration’s proposed program consolidations for ESEA reauthorization would fold these programs with other instructional and leadership initiatives into several larger programs relating to teaching and learning. This would include one $2.5 billion formula grant program for efforts to improve teacher effectiveness and several smaller competitive grant programs targeted at improving teacher quality and instruction in specific subject areas.

Detailed information on these federal programs is not readily available through a centralized source, making it difficult to judge the federal government’s support for teachers. In response, the Federal Education Budget Project (FEBP) has published a Background and Analysis page as part of the FEBP website that explains the size, scope, and purpose of federal programs that support teacher training and development programs. This timely new resource helps provide clarity on the many different federal teacher programs.

The Federal Programs for K-12 Teachers page includes summaries and funding information for the 15 federal teacher programs in the table below.¹

¹These programs are labeled as K-12 programs. However, it is often unclear whether they might also apply to pre-kindergarten teachers too. Our colleagues at Early Ed Watch raise that question in a post today.

In the last year, California’s entire system of higher education has been battered by budget cuts, skyrocketing enrollment, and student protests. All of the state’s universities have suffered, but in many ways it’s the community colleges that have been hit the hardest. While the four-year university systems can tighten admissions criteria or decide to raise fees, community colleges cannot. Instead they cut vital student services or courses -- an estimated 6 percent across the system. Current students are scrambling to get the classes they need, often winding up on discouragingly long waiting lists, and many new students are simply being turned away. First-time enrollments are down 12 percent statewide, according to the system’s chancellor’s office. The community college system is a bit like an overrun emergency room in a disaster area, with a fixed set of supplies and a never-ending stream of patients.

But open up a typical course catalog for fall semester 2010 and you might not know the system is in a crisis. Community colleges continue to offer a broad array of courses that are primarily for personal enrichment and recreation: ceramics, motorcycle maintenance, musical improvisation, table tennis, sculpture, Pilates, kayaking, rock-climbing, to name just a few. (Not to mention Korean, Portuguese, Punjabi, and Russian, among dozens of others.) It’s a fantastic set of offerings, but hard to justify when students are getting turned away from truly essential courses, for example in mathematics, nursing, or accounting. Many recreational and enrichment courses are offered for full credit, subsidized by the state at the same rate as any academic or vocational class, and take up precious classrooms and parking spots. Certainly, individual campuses are trying to make sensible cuts where they can, but it’s clear that the system as a whole is operating on a fixed track, unable to set priorities in a budget crisis and shift resources accordingly.

On Monday, the Washington Post’s PostPartisan blog published an opinion piece attempting to dispel myths about the “teacher layoff crisis.” Opinion writer Charles Lane tells readers not to believe the hype about the drastic consequences of 100,000 to 300,000 teachers losing their jobs in the coming school year. He says a proposed $23 billion Education Jobs Fund pending in Congress, which would help states avoid teacher lay offs, is both unnecessary and not enough to stimulate the economy anyway. He claims that even if 300,000 teachers lost their jobs, the student-teacher ratio in the country would only increase from 15.3 students per teacher to 16.6 students per teacher, a seemingly insignificant jump.[1] But his analysis oversimplifies the situation surrounding teacher layoffs, painting a rosier picture of student-teacher ratios than may be the reality in many schools.

Lane is correct in stating that current estimates of potential teacher layoffs – ranging from 100,000 to 300,000 – are shaky at best. These numbers are based on worst-case scenario counts of teachers that have been pink slipped, but have not officially lost their jobs. Typically, schools pink slip far more teachers than will actually be let go in case something drastic really happens. Additionally, these numbers do include non-instructional staff like administrators, janitors, and bus drivers, further obscuring the relationship between the number of actual layoffs and the direct impact they will have on classrooms.

However, Lane does not account for the variation in potential teacher layoffs or the variation in student-teacher ratios in classrooms across the country. In many states, the situation is far more dire than Lane makes it seem. For example, the budget situation in California is particularly challenging right now, meaning that as many as 36,000 teachers have been pink slipped. According to the National Center for Education Statistics, the average student-teacher ratio in California in 2008 was 20.8 students per teacher. If 36,000 teachers are let go, the student-teacher ratio in the state will increase to 23.6 students per teacher, an increase of nearly three students.

In New Jersey, current student-teacher ratios are much lower – 12.4 students per teacher. But the state’s projected budget deficit suggests that as many as 9,950 teachers could lose their jobs in the coming year. Such a change would increase the state’s average student teacher ratio by more than 1 student to 13.6 students per teacher. In Virginia, where 10,000 teachers could potentially lose their jobs, the student-teacher ratio could increase from 17.1 to 19.9 students per teacher, almost three students and more than twice the national number Lane cites.

Teacher layoffs also do not affect schools within a state or even a district evenly. According to teacher seniority rules in place in most schools, the teachers that were most recently hired are let go first. This means that new, or less experienced teachers are laid off first during budget cuts. Typically, more experienced, tenured teachers work in high-income schools because those schools are perceived to be more attractive teaching placements. As a result, less-experienced teachers tend to work in low-income schools. Because the less-experienced teachers will be laid off first due to seniority rules, low-income schools will bear the majority of the burden of the teacher lay offs. The students in these schools, who often benefit the most from low student-teacher ratios, will be disproportionately effected by teacher lay offs.

When viewed nationally, an across-the-board increase in student-teacher ratios from 15.3 to 16.6 seems insignificant, as such large aggregations often do. But the reality in some states and in low income schools could be much worse than Lane acknowledges. While it’s impossible to know how many teachers will lose their jobs in the coming school year, it’s imperative that we keep the discussion about the impact of these lay offs as honest as possible. Skimming over the details, as Lane does with student-teacher ratios, distorts the debate and could result in some truly negative consequences for our students and schools.

In May we wrote that the Pell Grant program for low income college students has been weighing on Democratic Congressional leaders’ minds. Supplemental funding for the program under the American Recovery and Reinvestment Act of 2009 is running out and Congress is now faced with the costly challenge of maintaining the maximum grant level of $5,550 in future years. We also reported that the House Appropriations Committee intended to include $5.7 billion in supplemental funding for Pell Grants in its version of the fiscal year 2010 emergency supplemental appropriations bill. If this funding were approved, Democratic leaders would only need to fund Pell Grants at $17.5 billion instead of $23.2 billion when they draft the fiscal year 2011 budget allocations and appropriations in the coming weeks – an easier sell to deficit conscious lawmakers (though $23 billion will be appropriated for the program either way). The strategy, in other words, is to “pre-fund” part of the 2011-12 academic year Pell Grant as a fiscal year 2010 emergency.

If that sounds like a budget gimmick… well it is. In fact, this gimmick is about to bump up against a budget rule for Pell Grants and is producing a rather bizarre scenario. The Senate has already passed its version of the supplemental appropriations bill (with no Pell Grant funding). But House Democratic leaders, including Appropriations Committee Chairman David Obey, haven’t secured the votes for their version because of deficit spending proposed in an early draft (i.e. Pell Grant and other funding) that goes beyond funding for Iraq and Afghanistan military operations.

It appears that if the House considers the supplemental appropriations bill after June 30th, any Pell Grant funding in the bill will be “scored” by the Congressional Budget Office as $23.2 billion. If the bill is considered by Congress before June 30^th, it will be scored as is -- at whatever funding amount is provided -- most likely $5.7 billion. If Democratic leaders are having trouble winning votes due to the cost of the supplemental appropriation, a $23.2 billion score for Pell Grants certainly won’t help.

But don’t blame CBO for this crazy scenario. This is what happens when Congress tries to hide the true cost of the Pell Grant program by dividing up funding among multiple appropriations bills.

Back in 2005, Congress adopted a new rule that governs how CBO must report Pell Grant funding on an appropriations bill. Before the rule, the appropriations committees in the House and Senate knowingly underfunded the program year after year so they could spend money on other programs or give the appearance of fiscal restraint. To counteract this gaming, the rule requires that CBO “score” any appropriations bill that funds Pell Grants with the full cost of the program (as estimated in March) for the upcoming award year, even if the bill provides insufficient funding. In other words, the rule removes the incentive to underfund the program.

Here’s the kicker. The “upcoming award year” stated in the rule starts each July 1. Any Pell Grant appropriation taken up before this July 1st will, according to the rule, be funding the 2010-11 award year Pell Grant -- which has already been funded, so CBO will score the funding at whatever it actually is. But on July 1st the upcoming award year becomes 2011-12, and Congress hasn’t gotten around to appropriating funds for that year yet. Normally, Congress would fund Pell Grants for that year through the appropriations bill for the upcoming fiscal year, which isn’t usually completed until the fall.

The upshot is that any Pell Grant funding bill taken up after July 1st will be scored with the full cost of the 2011-12 Pell Grant, which is $23.2 billion (after including a $7.4 billion share of the one-time funding from the Heath Care and Education Reconciliation Act enacted earlier this year).

Democratic leaders in Congress should take this bizarre scenario as a sign. It’s time to stop hiding the full cost of the Pell Grant program through multiple bills. If the Pell Grant program needs $23.2 billion to support student grants, provide it all at once. And do it through the regular appropriations process.

Will the Members of Congress who won’t vote for a single $23.2 billion Pell Grant appropriation but will vote for two separate appropriations of $5.7 billion and $17.5 billion to fund the same program in the same year please stand up?

Who says child savings accounts has to be a nationally instituted policy? 

Our friends in the City by the Bay are planning to introduce a system of accounts for students to save for college. Today, a front-page story in the San Francisco Chronicle details the new program, set to roll out later this year, that would provide a college account for every kindergartener entering San Francisco’s public school program. The program is designed to be implemented gradually – 25% of incoming kindergarteners will be enrolled this school year, 50% next year, with universal enrollment by the third year.