Trump Administration’s FY 2018 Budget Misses the Mark for HBCU Programs

UNCF Provided Roadmap for Additional Investment; Not Reflected in Budget

UNCF issued the following statement regarding the release of President Donald Trump’s FY 2018 federal budget proposal and its potential impact on historically black colleges and universities (HBCUs):

“Just two weeks ago, after questioning the constitutionality of a long-standing federal HBCU program, President Trump announced his ‘unwavering support’ for HBCUs. Unfortunately, that support did not translate into increased federal investments in HBCUs. Our preliminary review of the budget proposal reveals only a single budget increase targeted to HBCUs; and, in fact, the proposed budget would cut federal financial aid lifelines that thousands of HBCU students depend on to attend college and earn their degrees,” said Dr. Michael L. Lomax, UNCF president and CEO.

President Trump’s proposed budget would cut federal student aid programs by more than $143 billion over 10 years; in effect, shifting those resources into defense spending. In contrast, one of President Obama’s first initiatives was to reform the federal student loan program by removing commercial banks from the program, which saved nearly $90 billion over 10 years and made possible major investments in Pell Grants and an $850 million 10-year mandatory investment in HBCUs.

“If President Trump truly wants to surpass President Obama’s legacy on HBCUs, then he will need to demonstrate that federal aid under his watch did more to increase access, persistence and completion at HBCUs, reduce HBCU student debt, and enhance the financial sustainability of these institutions,” said Lomax. “At first glance, the FY 2018 budget does not put the government on a path to meet this test. UNCF will continue to work with both Congress and the administration to raise awareness of the budget priorities and needs of HBCUs and the students they serve.”

In March, UNCF outlined its budget priorities in a letter to the Office of Management and Budget, offering the administration a detailed roadmap for investing in HBCUs, as well as in college access, affordability and success for low-income students. Below is a detailed look at vital programs in the president’s budget that impact HBCUs and the students they serve, including items that were budget priorities in UNCF’s letter to OMB:

Title III HBCU Grants. The president’s budget proposal provides discretionary funding of $245 million, or level funding, for the Part B, Strengthening HBCUs Program, while UNCF requested $375 million in full funding for the grants, which are vital for the nation’s 101 accredited HBCUs and support a broad range of investments in academic and student services, infrastructure and technology, teacher training, fiscal management, endowment building and scholarships. The budget proposes to fund the Historically Black Graduate Institutions program at $63 million, the same as FY 2017, which is 50 percent less than UNCF’s $125 million full funding request. The HBCU Endowment Challenge Grants received no funding in the president’s proposed budget, despite a call from the HBCU community to revive the initiative with $220 million to boost HBCU endowments that are less than half the size, on average, than endowments at other institutions.

Title III, Part D, HBCU Capital Financing Program. This program, which was recently subjected to unfounded constitutionality concerns, provides low interest loans for capital improvement projects at HBCUs. In a welcome sign of support, the president’s budget assumes an increase in new loans, by $31 million above FY 2017 levels, to $313 million, which will support much needed infrastructure projects on HBCU campuses.

Other Support for Low-Income and Minority Students. The president’s budget request includes nearly $350 million in cuts to Title III, Part A grants that support colleges with large populations of low-income and minority students, as well as TRIO and GEAR UP, both of which support college success for at-risk students at HBCUs and other institutions.

Pell Grants. Low-income students at HBCUs and other colleges would see their Pell Grants frozen over the next 10 years under the president’s proposed budget. The lack of inflation adjustments to the Pell Grant would drive its already historically low purchasing power to new lows. In addition, the president’s proposed budget would cancel $3.9 billion in available Pell funds that are needed for program improvements, on top of a rescission of $1.3 billion proposed by the administration and enacted in the FY 2017 budget. In total, $5.2 billion would be taken from Pell reserves if Congress approves this proposal. The president’s budget would maintain funding for “summer” Pell grants, which Congress permanently reinstated in the FY 2017 budget.

Supplemental Educational Opportunity Grants (SEOGs). The proposed elimination of $733 million for SEOGs, a vital program that supplements Pell awards to the poorest students to pay college tuition, would negatively impact more than 55,000 HBCU students who rely on this assistance to go to and through college.

Federal Work-Study. The president’s budget requests $500 million—a 50 percent cut— for Federal Work-Study. Reductions to these funds could impact more than 26,000 HBCU students who receive work-study jobs that not only help pay for college expenses, but also enhance their employment prospects.

Perkins Loans. The president’s budget proposal eliminates Perkins Loans for financially needy students, including more than 10,000 HBCU students who rely on these loans when grant aid is not sufficient to meet their college expenses.

Subsidized Student Loans. The president’s budget request also would end subsidized federal student loans for financially needy students. In effect, this proposal would increase loan debt for more than 6 million undergraduates, making college less affordable in the long run. In 2014, 65 percent of HBCU students—more than 165,000 students—received subsidized loans, compared to only 37 percent of students at non-HBCUs. UNCF’s recent study, Fewer Resources, More Debt, documents that HBCU students already incur more student loan debt than other students, despite attending affordable institutions; yet, the student aid reductions in the FY 2018 budget would increase their debt burden.

Public Service Loan Forgiveness. The budget proposal would eliminate loan forgiveness for eligible borrowers who are employed full-time in public service careers.    If enacted, changes to the program take effect July 1, 2018, which grandfathers 550,000 individuals who have been approved for this program. African American students overwhelmingly choose careers in public service, which includes roughly one in five black adults.

New Income-Driven Student Loan Repayment. UNCF welcomes the administration’s proposals to consolidate five loan repayment plans into one single program. UNCF has long recommended this student loan reform that is essential for the 80 percent of HBCU students who borrow federal subsidized and unsubsidized loans. We hope to work with the administration on the details of the plan, which differ in significant respects from the current REPAYE plan.

HBCU Historic Preservation Program. The president proposes to nix competitive grants for the HBCU Historic Preservation Program, which would assist some of the 61 HBCUs with hundreds of buildings on the National Register of Historic Places that need restoration. Thanks to Congress, the FY 2017 budget contains $4 million in overdue funding for this National Park Service-administered program. For FY 2018, HBCUs sought a significant boost to $50 million.

HBCU STEM Programs. The president’s budget request would reduce overall spending by $5 million for HBCU STEM programs housed at the National Science Foundation, which are dedicated to building a stronger pipeline of African Americans who enter STEM careers. HBCUs produce 24 percent of African American bachelor’s degree recipients in STEM fields. UNCF recommended that this investment be increased by $58 million to $185 million.

HBCU/Minority Institutions (HBCU/MI) Research & Development Program. The president’s budget proposal recommends $25 million for the HBCU/MI national security research program, despite an $8 million increase from Congress in FY 2017 and a more than $50 billion increase overall for the Department of Defense (DoD). UNCF recommended $40 million for this program, which would establish at least three new Centers of Excellence and award more scholarships and fellowships to students enrolled at HBCUs and Minority Institutions.

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About UNCF:
UNCF (United Negro College Fund) is the nation's largest and most effective minority education organization. To serve youth, the community and the nation, UNCF supports students' education and development through scholarships and other programs, strengthens its 37 member colleges and universities, and advocates for the importance of minority education and college readiness. UNCF institutions and other historically black colleges and universities are highly effective, awarding 20 percent of African American baccalaureate degrees. UNCF annually awards $100 million in scholarships and administers more than 400 programs, including scholarship, internship and fellowship, mentoring, summer enrichment, and curriculum and faculty development programs. Today, UNCF supports more than 60,000 students at more than 1,100 colleges and universities across the country. Its logo features the UNCF torch of leadership in education and its widely recognized trademark, "A mind is a terrible thing to waste.® Learn more at UNCF.org, or for continuous news and updates, follow UNCF on Twitter, @UNCF and #HBCUFacts.