Republicans Agree on Spending Plan That Could Cut Student-Aid Money

Republicans in the U.S. House of Representatives and Senate have reached agreement on a spending blueprint for the 2016 fiscal year that could lead to deep cuts in education spending and a reduction in benefits for student-loan borrowers.

The plan, which will guide appropriators as they draft spending bills for the fiscal year that begins in October, assumes that lawmakers will eliminate mandatory Pell Grant money, subjecting the program’s entire budget to the annual appropriations process. That’s how the program was financed until recently, but some advocates worry that a shift back to 100-percent discretionary funding would make Pell Grants vulnerable to budget cuts.

In a letter sent on Thursday, the Committee for Education Funding, an advocacy group, predicted the change would lead to cutting the maximum Pell award to $4,860 — a reduction of $915, or 15.8 percent, from the $5,775 maximum in place for the 2015-16 academic year.

The plan also assumes that appropriators will abolish the in-school interest subsidy on Stafford student loans, reverse a recent expansion of income-based repayment, and end public-sector loan forgiveness. For undergraduate students who borrow the maximum $23,000, that would raise their total debt by $4,900 over 10 years, a 16-percent increase, according to the Committee for Education Funding.

Members of the appropriations committees aren’t bound by the blueprint, but they will have to find savings elsewhere if they reject its proposed cuts.

The House adopted the plan on Thursday; the Senate is expected to approve it next week.

Kelly Field is a senior reporter covering federal higher-education policy. Contact her at kelly.field@chronicle.com. Or follow her on Twitter @kfieldCHE.