President’s Budget for FY 2023 Seeks to Double Pell Grants, but in a Multi-Year Process
March 30, 2022

​The Biden administration released its budget blueprint for FY 2023 on Monday, proposing a substantial increase for Pell Grants and more funding for historically under-resourced higher education institutions among the provisions for the Department of Education (ED).

The president's budget request to Congress, which begins the federal funding process each year, outlines detailed program-by-program funding levels for the upcoming fiscal year. The administration also uses the budget request to introduce new policies, programs, or changes they would like to see enacted. Actual funding for each federal agency comes in the form of appropriations bills drafted and approved by Congress ideally by Sept. 30 each year, and the president's request has no binding authority on that process.

The president's request for FY 2023 includes $88.3 billion in discretionary funding for ED programs, $26.3 billion of which is for federal student aid. Notably, the budget outlines a long-range plan to double the maximum Pell Grant by 2029, starting with an increase to $8,670 for the 2023-24 award year, $1,775 more than the maximum award for 2022-23.

In a statement, ACE President Ted Mitchell called the proposal “a substantial down payment on the president's promise to double the maximum Pell Grant, a proven and effective program which helps roughly seven million moderate- and low-income students gain access to postsecondary education each year."

The administration estimates that 6.7 million students from low- and middle-income backgrounds would benefit from the increased funding for the Pell Grant program.

The budget request also includes a total of $1.1 billion for historically Black colleges and universities (HBCUs), tribal colleges and universities, Hispanic Serving Institutions, and other minority-serving and low-resourced institutions, including community colleges. Mitchell praised these provisions as well, noting “the need to correct existing inequities in higher education."

Among the other financial aid provisions, the president's request would allocate $880 million for the Federal Supplemental Educational Opportunity Grant (FSEOG) program and $1.19 billion for Federal Work-Study (FWS). Though the levels proposed represent a decrease in funding from FY 2022, the administration has said this was not intentional. Congress just passed a $1.5 trillion dollar package to fund the government for the remainder of FY 2022, which began Oct. 1, 2021, earlier this month. The lack of regular order in the budget process—which has been going on for a number of years now—meant that the president's request for FY 2023 had to be based ​on FY 2021 figures.

For those programs that appeared to receive a cut from what Congress approved for FY 2022, ED officials said in a briefing Monday that they support funding those programs at their current levels and will work with lawmakers to ensure that happens. ACE and many in the higher education community remain concerned about funding for key financial aid programs and will work with Congress and the administration to see these programs receive the funding they need.

On the research side, the administration is requesting $49 billion for the National Institutes of Health (NIH), a $4 billion increase over FY 2022. This includes $5 billion for a new Advanced Research Projects Agency for Health inside the NIH. The budget requests $10.5 billion for the National Science Foundation, a $1.66 billion increase from the FY 2022 enacted level. This includes $880 million requested for the new Directorate for Technology, Innovation, and Partnerships. 

The administration also released a tax proposal that would exclude student debt relief from taxation, meaning borrowers would not be taxed on loans that are forgiven. The American Rescue Plan (ARP) provided this benefit for student debt discharged after Dec. 31, 2020, and before Jan. 1, 2026. The Biden administration's request would make this provision permanent.

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