SUNY Federal Relations Update: May 24, 2013

FY 2014 Appropriations

On Tuesday, the Budget battle continued with little change in the overall funding picture for FY 2014. The House Appropriations Committee approved “302(b) budget allocations” or funding levels for the 12 individual appropriations bills.

The budget allocations provide approximately $625B for the Defense, Military Construction-VA and Homeland Security bills, less than a one percent cut from the current level. Non-defense discretionary accounts, including the Department of Education and research funding portfolio would face a $72B cut or 17% reduction ($35B of the cut would come from a 22% reduction in the Labor, Education and Health and Human Services bill).

Senate Appropriations Chairwoman Barbara Mikulski (D-MD) is preparing to unveil her spending levels after the Memorial Day recess. It is expected that Senate spending levels will hold domestic programs steady and calling for defense budgets to take more significant cuts.

Update on Comprehensive Immigration Reform

The Senate Judiciary Committee gave final approval Tuesday to the “Gang of Eight” immigration reform bill. Senate leaders are hoping to consider the bill in early June. The prospect got a boost when Minority Leader Mitch McConnell (R-KY) said he would not block debate from starting on the floor.

The legislation passed by a vote of 13 to 5 with three Republicans joining 10 Democrats to approve the measure. The vote came after the Committee considered more than 200 amendments during five markups. Lead sponsor Senator Chuck Schumer (D-NY) said, “We got a good vote in committee, we expanded our little group to another vote, and the feeling is very strong here. I think we gained some momentum today. I really do.”

Senator Schumer secured Senator Hatch's support by negotiating a deal to loosen restrictions on H-1B visas for high-skilled workers:

· Market-based formula for determining the annual increases in the number of H-1B visas, capping the increase if the jobless rate in specific fields is above a certain threshold.

· Removes language requiring companies to attest that they didn’t displace current existing workers in certain circumstances. The agreement instead only stipulates they do not have the intent to displace U.S. workers for non-H-1B companies but only for STEM positions. For all other professions, there would remain a strict prohibition against displacing workers within 90 days of visa petitions.

The Committee approved two amendments impacting the DREAM Act section which creates a five-year path to legal permanent residency for certain individuals. One of those amendments, proposed by Senator Richard Blumenthal (D-CT), would allow Dreamers to enlist in the military and become citizens within one year of serving. Another one, filed by Senator Mazie Hirono (D-HI), would make Dreamers eligible for some student loans and federal work-study programs to help pay for college.

Student Loan Interest Rates

On Thursday, the House passed H.R. 1911, the Smarter Solutions for Students Act by a vote of 221 – 198. The legislation ties interest rates for student loans to 10-year Treasury notes with rates for subsidized and unsubsidized Stafford loans to be set each year at the 10-year Treasury note plus 2.5%. While rates for graduate and PLUS loans would be set at the 10-year note plus 4.5%. Overall interest rates would be capped at 8.5% for Stafford loans and 10.5% for graduate and PLUS loans, respectively.

Earlier this week, the House Committee on Education and the Workforce held a hearing with Education Secretary Arne Duncan to examine the Administration’s FY14 budget and policy proposals. During the hearing, Secretary Duncan affirmed support for a long-term solution that is budget-neutral to prevent upcoming student loan interest rate hike. In response, the Obama Administration issued a “Statement of Administration Policy” on upcoming vote on HR 1911 and recommended the President veto the bill in its current form.

The American Council on Education along with other higher education associations sent the attached letter to the House Education and Workforce Committee highlighted their views on provisions of the bill.

Improving Postsecondary Education Data for Students Act

On Wednesday the House approved, H.R. 1949, Improving Postsecondary Education Data for Students Act.) The bill authored by Congressman Luke Messer (R-IN), directs the Secretary of Education to convene an advisory committee to study what information students and families have, want, and need in researching their college options.

Federal Student Loan Refinancing Act

Senator Kirsten Gillibrand (D-NY) will introduce the Federal Student Loan Refinancing Act, which requires the U.S. Secretary of Education to refinance government loans carrying interest rates above four percent into fixed four-percent loans.

The legislation targets loans funded and owned by the Education Department through the Direct Loan program, as well as government-guaranteed debt owned by the government and the private sector under the Federal Family Education Loan program. Senator Gillibrand’s office estimates the legislation would bring relief for 2.7 million borrowers in New York and the and the 37 million borrowers nationwide.