The House of Representatives will vote Wednesday on an economic stimulus bill that would nearly double the size of the federal Pell Grant Program and provide billions of dollars in new financial aid and spending for universities and colleges.
The bill is modeled after President Barack Obama’s request for an $825 billion stimulus package to combat the current recession and invest in education, health care and infrastructure programs.
The bill would significantly enlarge the Pell Grant Program, which distributes federal grants to about 6 million university students each year. The Department of Education warned Congress last year that the program would face a $6 billion shortfall in 2009 without additional funding.
The bill would increase funding for the program by $15.6 billion, from $16.2 billion in 2008. It would also raise the maximum grant per student by about $500, to $5,350 per year.
The bill also includes a $2,000 increase per student for some student loans, more tax credits for students, a $490-million program to support working students, $6 billion to modernize campus buildings and $39 billion for state governments to distribute to school districts and public colleges.
Henry Urick, the assistant director of the Office of Student Financial Services, said students could use the new financial aid.
Urick said financial aid applications at UT have been increasing about 4 percent a year since 2000, even as enrollment has remained flat for the same period and the amount of financial aid his office distributes has increased more slowly.
Urick said the growing demand for financial aid was largely due to the state Legislature’s deregulation of university tuition in 2003. Deregulation occurred when the state turned over the power to set tuition to the UT System Board of Regents.
“Deregulation brought more applicants into the financial aid pool,” Urick said.
Since tuition was deregulated, the overall cost of attendance at UT for one undergraduate semester has risen between 35 percent and 60 percent, from less than $8,000 in 2003 to between $10,735 and $12,640 in 2008, according to the financial aid office’s estimates. In the same period, the total amount of financial aid distributed has only risen about 25 percent.
Government and education experts said UT students are currently under significant financial pressure.
“Anything done to make more loans and grants available to UT students would be a good thing,” said Sherri Greenberg, a professor at the LBJ School of Public Affairs and a former state representative. “Though Texas is more fortunate than most of the country, we’re feeling the effects of the recession.”
William Lasher, a professor in the College of Education, said the state government has been underfunding UT for decades, especially since tuition was deregulated.
“With deregulation, the state has been able to step away from helping the students,” he said. “The share of the University’s operating budget that comes from the state has been declining for 20 years.”
Though the House bill is expected to pass Wednesday’s vote with the support of most Democrats as well as the president, it will likely take weeks to become law. The House and the Senate need to agree on an identical version of the bill before it becomes law. Republican leadership is expected to oppose the bill.
On his Web site House Minority Leader John Boehner criticized spending money on colleges that have “billion-dollar endowments.”
“[The bill is] loaded with hundreds of billions in spending on programs and projects — most of which will not impact our ailing economy for many years, if ever.”
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