A New Opportunity Agenda for Higher Education:
Making Critical Investments in Education and Training
January 20, 2000
Today, the President will announce that his FY2001 budget will include new
critical investments in higher education, training, and youth opportunities
as part of his New Opportunity Agenda. These initiatives include:
I. A $30 Billion College Opportunity Tax Cut to provide Tax Relief
for Millions of Families Struggling to Make College More Affordable.
II. Nearly $1 Billion for College Completion Challenge Grants, Pell
Grants, and Other Initiatives to Help Students Afford and Be Able to
Stay in School.
III. Over $400 Million in Increases in Initiatives to Keep Young
People on the Track to Success.
I. COLLEGE OPPORTUNITY TAX CUT TO MAKE COLLEGE MORE AFFORDABLE FOR MOREAMERICANS
The President will propose a College Opportunity Tax Cut costing $30
billion over 10 years to provide tax relief for millions of families
struggling to make college more affordable. When fully phased in, the
President's proposal would give families the option to claim a tax
deduction or a tax credit on up to $10,000 of tuition and fees for any
post-secondary education including college, graduate study, or training
courses. In general, the proposal would provide up to $2,800 annually in
tax relief per family. In order to expand this tax cut to more families,
the College Opportunity Tax Cut would phase out for married filers with
incomes between $100,000 and $120,000. The College Opportunity Tax Cut
builds on the Lifetime Learning tax credit that the President signed into
law in 1997. In addition, the President's FY2001 budget contains other
education tax incentives that were originally proposed in the FY2000
budget, including $1 billion over 10 years to provide tax-free treatment
for employer-provided graduate education and increased deductibility of
student loan interest.
II. NEARLY $1 BILLION IN INCREASES TO PELL GRANTS, SEOG, WORK STUDY, AND
THE NEW COLLEGE COMPLETION AND DUAL DEGREE INITIATIVES:
College Completion Challenge Grants. The FY2001 budget creates a new
initiative within the TRIO program called College Completion Challenge
Grants (CCCG). Although college enrollment rates have risen, 37 percent of
students that go on to post-secondary school drop out before they get a
certificate or a degree [Source: U.S. Department of Education, The
Condition of Education: 1999]. The problem is especially acute for
minorities: 29 percent of African Americans and 31 percent of Hispanics
drop out of college after less than one year, compared to 18 percent of
whites. The CCCG program is designed to address this problem with a
comprehensive approach including pre-freshman summer programs, support
services and increased grant aid to students. This $35 million initiative
will improve the chances of success for nearly 18,000 students.
Dual Degree Programs for Minority-Serving Institutions. The FY 2001
budget proposes a new program to increase opportunities for students at
minority-serving institutions that offer four-year degrees. Students would
receive two degrees within five years: one from a minority-serving
institution, and one from a partner institution in a field in which
minorities are underrepresented. This new $40 million program will serve
an estimated 3,000 students.
Pell Grants. The Pell Grant program provides grants to economically
disadvantaged young people to help pay the cost of a postsecondary
education. The maximum Pell Grant in FY2000 is $3,300. The President's
FY2001 budget increases the maximum to $3,500, more than 50 percent larger
than the maximum grant in 1993, to make a college education more affordable
for the nearly 4 million Pell Grant recipients. Funding for the Pell Grant
program is increased by over $716 million, bringing the total Pell Grant
appropriation to $8.356 billion.
SEOG. SEOG, the Federal Supplemental Educational Opportunity Grant
program, provides campus-based grant assistance to needy undergraduate
students. Generally, this program supplements the aid students receive
from other sources, and leverages institutional aid by at least one dollar
for every three federal dollars. The FY2001 budget provides $691 million
for SEOG, a $60 million increase, the largest increase in 10 years. An
estimated 1.2 million students (over 60,000 more than in 2000) will receive
awards in 2001.
Work Study. Work Study provides students the opportunity to work their
way through college. The FY 2000 budget achieved the goal of giving one
million students the opportunity to participate in Work Study. The FY2001
budget includes $1.011 billion for Work Study, an increase of $77 million
to continue this commitment to serve one million students.
III. OVER $400 MILLION IN INCREASES TO KEEP YOUNG PEOPLE ON THE TRACK TO
GEAR UP. GEAR UP is a nationwide initiative to encourage more
disadvantaged young people to have high expectations, stay in school, study
hard, and take the right courses to go to and succeed in college. GEAR UP
is funded at $200 million in FY 2000, enough to provide services to over
750,000 students. The FY 2001 budget provides a 62.5% increase to $325
million, enough to provide services to 1.4 million students.
TRIO. The TRIO programs seek to motivate and prepare students to go to
and stay in college. The FY 2001 budget provides $725 million for TRIO, an
increase of $80 million to help provide assistance to over 760,000
students, 37,000 more than in 2000.
Youth Opportunity Grants and Youth Training Formula Grants. Youth
Opportunity Grants are an initiative to provide comprehensive employment
and training assistance to all out-of-school young people in high poverty
areas. The program was passed as part of the bipartisan Workforce
Investment Act and is a critical component of the New Markets Initiative.
Funded at $250 million in FY 2000, this program would serve up to 50,000 of
the most disadvantaged young people in central cities and rural communities
across America. The President?s FY2001 budget provides a 50 percent
increase in funding to $375 million, enough to serve an additional 25,000
youth in high poverty areas. In addition, the FY2001 budget provides a $25
million increase (from $1.001 billion to $1.022), to the Youth Training
Formula Grants, enough to provide job training and summer job opportunities
to nearly 600,000 disadvantaged young people.
Youthbuild. The Youthbuild program, is targeted to 16-24 year old high
school dropouts, and provides disadvantaged young adults with education and
employment skills through rehabilitating and building housing for
low-income and homeless people. The program also helps to expand the supply
of housing in these categories. Funded at $42.5 million, the Youthbuild
programs will provides opportunities for approximately 2,000 trainees in
2000. The FY2001 increases funding by 76% to $75 million, enough to serve
approximately 3,330 trainees.
Job Corps. Job Corps is the nation's largest and most comprehensive
residential education and job training program targeted at impoverished
young people. The FY2001 budget increases Job Corps funding by $33
million, bringing the total Job Corps budget to $1.392 billion.