Federal Policy Update
To:            AASCU Presidents and Chancellors
From:        Ed Elmendorf, Sr. Vice President of Government Relations and Policy Analysis
                  Robert Moran, Director of Federal Relations and Policy Analysis
                  Blakely Whilden, Assistant Director of Federal Relations and Policy Analysis
Re:            Events the week of January 31
Date:         February 4, 2011
*** Information Advisory ***
Academic Year 2011-2012 Pell Grant Amounts
On Tuesday, February 1, the Department of Education announced the maximum Pell Grant award for academic year 2011-2012 would be $5,550. The announcement can be found here. The notice highlights that fiscal year 2011 funding has not been finalized and that as Congress finalizes these funding levels, it is possible that the Pell award may change.
Fiscal Year 2011 funding
As noted above, Congress must complete the fiscal year 2011 funding cycle. Currently, the federal government is funded through a continuing resolution (CR) that expires March 4th. On Thursday of this week, House Budget Committee Chairman Paul Ryan (R-WI) announced the top-line funding level for FY11 at $1.55 trillion. This amount will provide $420 billion for non-security programs, down from an FY10 level of $464 billion and $58 billion below the amount requested by President Obama for FY11. Immediately following that announcement, the Chairman of the House Appropriations Committee, Harold Rogers (R-KY), released the allocations to his twelve subcommittees. The amount provided for the Labor, Health and Human Services, and Education Appropriations measure is $157 billion, nearly $7 billion below the FY10 funding levels.  Click here for the Appropriations Committee press release with an instructive table comparing the announced figures (Appropriations 302(b)s) with the FY10 and President’s requested levels for FY11.
Cohort Default Rates
The Department of Education today released an updated 3-year cohort default rate (CDR) chart for all institutions of higher education. Currently, schools that have a 2-year CDR above 25% for three consecutive years become ineligible for Title IV student aid programs. Beginning in 2014, the Department is required to use the 3-year CDRs and penalize schools that have 3 consecutive years at 30%. Analysis indicates that the average CDR doubles for AASCU institutions from 5.51% (using a 2-year rate) to 10.12% (the 3-year rate). Institutions are encouraged to review their specific numbers in order to determine potential impact on Title IV participation and compliance.   
National Council for Teaching Quality & US News & World Report Survey to Rate Teacher Preparation
On Tuesday, January 18, U.S. News & World Report and the National Center on Teaching Quality (NCTQ) announced plans to evaluate 1000 teacher preparation programs in higher education over the next year. The results of this survey are expected to be announced in 2012, and are intended to inform aspiring teachers, consumers and policymakers. AASCU has heard from a handful of members with concerns about this survey. AASCU staff are examining the methodology and attempting to answer outstanding questions about the survey, and will be back in touch with presidents and chancellors with further guidance very soon.
Form 1099 reporting
Included in the passage of last year’s health care reform bill was a provision that requires businesses to report payments made to corporations and certain payments related to gross proceeds with respect to goods and other property to the IRS using Form 1099. AASCU signed a letter expressing concerns about the implementation of this provision, which can be found here. This past week, the Senate voted to repeal this reporting provision. There is no time frame for House consideration, but AASCU will continue to monitor the progress of this action.

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