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President George W. Bush

President Bush proposes tight federal budget

Higher education will feel the pinch

By John Engelen

From Brief, February 9, 2005

On Monday, President Bush released his budget request for fiscal year 2006. It is one of the tightest federal budget submissions since President Reagan's in 1981.

The budget proposes overall spending of $2.55 trillion in fiscal year 2006, an increase of 3 percent over fiscal year 2005. The discretionary portion of the budget--the $840.3 billion that Congress actually controls--would increase by about 2 percent, not even the expected rate of inflation.

Of the $840.3 billion discretionary portion, the President would increase defense spending by $19 billion to $419 billion, about 4.8 percent. That does not include funding for Iraq and Afghanistan, for which he plans to request an additional $80 billion later this year. He also would increase spending for homeland security by 3 percent but cut $6.4 million (9.1 percent) from the university center program.

Responses to the President's budget

For more details about President Bush's budget proposal, see responses from the following organizations, of which the University of Minnesota is a member institution.

Association of American Universities, or download the AAU response directly, a 112-page PDF document

American Council on Education

Several articles about specific parts of the President's budget were published in the Chronicle of Higher Education online Feb. 8. Watch the Chronicle (subscription required) for continued reporting on the federal budget process.

All other discretionary spending would be cut by $2 billion (.07 percent) and total less than $390 billion.

Research dollars

On the research front, President Bush proposed an increase of less than 1 percent for the National Institutes of Health (NIH); a 2.4 percent increase for the National Science Foundation (NSF)--with cuts to NSF education and human outreach programs; a 6 percent cut to the Environmental Protection Agency (EPA); and, most significantly, a 10 percent cut overall to the U.S. Department of Agriculture (USDA).

Interestingly, the President protected much of the bottom line for agricultural research but shifted from formula funding--a basic component of USDA funding to land-grant universities--to competitive programs. This will spark an intense debate within the research community.

While the Department of Defense budget would rise, basic research programs would be cut by 14.2 percent. The Department of Energy's basic research programs would be cut by 3.8 percent, as well.

Funding for the National Endowment for the Humanities would remain level.

Funding for students

On the student loan side, the President's budget suggests elimination of the Perkins loan program, which translates into a loss of $6.4 million in loans available to 3,300 students at the University of Minnesota-Twin Cities alone. He proposed altering formulas for Supplemental Educational Opportunities Grants (SEOG) and work-study programs, which could mean changes at the Crookston, Duluth, and Morris campuses as well as the Twin Cities.

The President plans to use the savings to increase the maximum Pell grant by $100 a year for five years, to $4,550. In addition, a new Enhanced Pell Grant for State Scholars program would provide $1,000 more to Pell recipients who complete a State Scholars curriculum in high school. Subsidized loan limits for first- and second-year students would be raised.

The budget would eliminate several crucial Department of Education TRIO programs targeting at-risk high school students--including Upward Bound--which would have another direct negative impact for the University. The U has overseen TRIO programs serving thousands of students since 1965.

The President proposed level funding level for the Graduate Assistance in Areas of National Need (GAANN) program and Javits fellowships.

Long debate ahead

On a cautionary note, it is very important to remember that this is the start of a very long and arduous debate. Universities should not overreact. While the President's budget request frames the debate, it often bears little resemblance to what Congress eventually enacts.

University staff will be working hard in Washington to advocate for the University's needs, and we will continue to keep you informed as the budget process goes forward.

See also "Let the sessions begin," Brief, January 12, 2004.

John Engelen is director of federal relations for the University of Minnesota.

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