Washington Watch: Omnibus funding bill includes $500 Pell Grant increase

Congressional appropriators have released the text and accompanying reports for the fiscal year 2023 Omnibus Appropriations Bill, which would fund the federal government for the remainder of the fiscal year. As expected, the legislation contains increases for key education and workforce development programs, but they are smaller than the increases contained in the Biden administration’s budget and Democratic appropriations bills released earlier this year.

Congressional negotiators in recent days had been at an impasse over how much to spend on non-defense discretionary programs. They had earlier agreed to a roughly 10% increase for defense programs, and Democrats wanted a similar increase for non-defense programs. Republicans insisted that overall funding for all programs not exceed the total amount requested by the Biden administration in its FY 2023 budget. This would result in a smaller percentage increase for non-defense programs because the 10% increase for defense programs exceeded the administration’s request.

According to the Senate Democrats, the FY 23 omnibus allocates $772.5 billion to non-defense discretionary programs, a $42.5 billion (5.8%) increase over FY 22.

The Senate will take the measure up first, and it is expected to attract enough Republican support to pass. The bill would then go to the House for passage and then to the president for his signature. This must all be completed by the end of the day Friday to avoid a government shutdown.

Education Department

Funding for the U.S. Education Department increased by $3.4 billion (4.2%) over last year. This figure is $8.7 billion less than what the Biden administration had requested.

The biggest highlight for community colleges in the ED funding is a $500 increase to the Pell Grant maximum award, which will rise to $7,395 for academic year 2023-24. This equals the largest single-year increase in the maximum award. Combined with last year’s increase, the maximum award has gone up by $900 in just two years.

Once again, Congress increased the maximum award by dipping into the large amount of surplus program funds that have resulted from program cost decreases over the last several years. The bill also rescinds $360 million from prior-year discretionary funds, but due to the large surplus this has no effect on Pell Grant awards.

HEA Title III programs increased by 15% on average, with larger percentage increases generally going to the smaller programs. Funding for the Title III-A Strengthening Institutions program lagged a little behind that average percentage increase, but still went up by $12 million (10.9%). This was a priority for the American Association of Community Colleges (AACC).

Other community college priorities, including Title V Hispanic-Serving Institutions, Perkins CTE state grants, Adult Basic Education, Child Care Access Means Parents in School were all increased (see table below).   

Department of Labor

U.S. Department of Labor (DOL) appropriations increased by $680 million (4.7%) overall. Funding for the Training and Employment Services account fared slightly better, increasing 5.8% to $4.1 billion.

AACC’s top priority DOL program, the Strengthening Community Colleges Training Grants (SCCTG), increased from $50 million in FY 22 to $65 million this year. While this total is well below the administration’s request of $100 million, it is the largest percentage increase (30%) among all the training programs. Registered apprenticeship grants, a perennial favorite, went up by 21% (from $235 million to $285 million). Other programs, including Workforce Innovation and Opportunity Act formula funding streams for dislocated workers, adults and youth received more modest increases.

Other priorities not included

Several non-funding legislative provisions that AACC and other stakeholders had hoped might be part of the bill were not included in the final package. These included legislation to make Pell Grants completely tax-free and eliminate the “Pell offset” that reduces American Opportunity Tax Credit eligibility for many community college students, extend Pell grant eligibility to short-term training programs, and provide permanent protection for DACA recipients and other Dreamers. AACC will continue advocating for these measures in the 118th Congress. We thank the many of your who assisted in our advocacy efforts this year, particular in the frantic closing weeks of the Congressional session.

ProgramFunding Increase (millions of $)Increase Percentage
Perkins CTE State Grants503.6
Adult Education State Grants253.6
Federal Work Study201.7
Strengthening Institutions1210.9
Hispanic-Serving Institutions44.924.5
Alaska Native/Native Hawaiian Insts.3.114.5
Native American Non-Tribal3.646.2
Tribal Colleges7.717.5
Title VI/Fulbright Hays44.9
WIOA Adult151.7
WIOA Youth151.6
WIOA Dislocated Worker201.9
Apprenticeship Grants5021.3
NSF ATE761.3

About the Author

Jim Hermes
Jim Hermes is associate vice president of government relations at the American Association of Community Colleges.
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