Scholarship News

House and Senate Pass 2010 Budget Outlines


April 3, 2009
by Scholarships.com Staff
Yesterday, the House and Senate both passed outlines for the 2010 federal budget.  Both propose about $3.5 trillion in spending and preserve many of the priorities of President Obama's budget, including more spending on federal student financial aid. A conference committee will hammer out the differences between the two packages and create a compromise budget.

Yesterday, the House and Senate both passed outlines for the 2010 federal budget.  Both propose about $3.5 trillion in spending and preserve many of the priorities of President Obama's budget, including more spending on federal student financial aid. A conference committee will hammer out the differences between the two packages and create a compromise budget.

On financial aid, the main point of contention continues to be the proposal to eliminate the bank-based Federal Family Education Loan Program and switch to federal Direct Loans for Stafford and PLUS loans.  The language of the House budget outline paves the way for the elimination of FFELP by instructing the Committee on Education and Labor to find $1 billion in savings through the budget reconciliation process.  The Senate bill does not include such a provision, and instead includes (largely symbolic) language promoting a student lending system built on competition and choice.

After an outline is agreed upon, then specific spending legislation will start to emerge, and the fate of FFELP, as well as the proposed expansions to Pell Grants and Perkins Loans, can be determined.  So far, it appears that many of these changes, as well as healthcare and environmental reform, are on their way to becoming reality.

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