Democrats' Plan to Hold Spending at '06 Levels Will Eliminate Earmarks, Cost Academe in Other Ways
By JEFFREY BRAINARD and ANNIE SHUPPY
The Chronicle of Higher Education
December 13, 2006
Washington
Federal spending for student aid and scientific research in the 2007 fiscal year will be frozen at last year's levels, and most academic earmarks will be eliminated, under a plan announced on Monday by chairmen of the Congressional appropriations committees. College lobbyists and a senior Democrat said that there remained a slim chance for some increases in education programs.
The near-elimination of earmarks could sap more than $1.5-billion annually in federal financing for universities, which over the past decade had received a rapidly growing portion of the noncompetitive grants, which are secured by members of Congress for their constituents.
In practical terms, freezing spending at 2006 levels means that funds for some student-aid programs and for scientific research will fall after inflation is factored in. The maximum Pell Grant award will remain level at $4,050, and the number of research-project grants awarded by the National Institutes of Health will fall.
Monday's announcement came from Sen. Robert C. Byrd of West Virginia and Rep. David R. Obey of Wisconsin, the incoming Democratic chairmen of the Senate and House Committees on Appropriations.
Mr. Byrd and Mr. Obey said they were forced to take the action because Republican leaders of Congress had failed to pass most of the 11 appropriations bills that finance the federal government annually before this year's session adjourned last week. Although the House succeeded in passing most of those bills, Senate leaders never scheduled votes on them to avoid bruising political battles before the November election.
As a stop-gap measure, the Republican-led Congress last week approved spending at 2006 levels for the 2007 fiscal year, which began October 1, but only through February 15.
Mr. Byrd and Mr. Obey said they wanted to freeze spending at 2006 levels for the remainder of the 2007 fiscal year, in order to "clear the decks" and allow Democrats to pursue their legislative priorities freely in the new session that begins in January.
Any work to finish the nine remaining spending bills for 2007 would have been time-consuming and politically difficult, higher-education officials said, and would have delayed Congress from taking up President Bush's budget for the 2008 fiscal year, which he will release in early February.
A freeze in spending "is a painful but probably unavoidable outcome," said Becky Timmons, vice president for government relations at the American Council on Education.
Mr. Byrd and Mr. Obey said they made their decision after consulting with colleagues, and they appeared to have the support of Sen. Harry Reid, a Nevada Democrat and the incoming Senate majority leader, and of Rep. Nancy Pelosi, a California Democrat and the incoming House speaker, although Mr. Reid and Ms. Pelosi did not sign the announcement.
Some academic earmarks will survive in 2007 -- but only those approved in appropriations bills for the Departments of Defense and of Homeland Security last fall (The Chronicle, September 28).
Defense-budget earmarks represented a third of the $2-billion in earmarked funds provided to colleges by Congress for the 2003 fiscal year. (The Chronicle assembled a grand total of academic earmarks annually until that year, when the survey was discontinued. No other organization has assembled such a tally since then.) Mr. Obey and Mr. Byrd's decision also affects nonacademic earmarks for 2007.
The two lawmakers said they would consider restoring earmarks in 2008, but only after Congress approves "new standards for transparency and accountability" -- a pledge that responds to the Jack Abramoff scandal and criticism surrounding the controversial grants.
The elimination of most earmarks is expected to free up some money that could be used for other spending priorities -- but it remains to be seen if any of the funds would flow to higher education, according to interviews on Tuesday with college lobbyists and a Congressional staff member.
In their announcement, Mr. Obey and Mr. Byrd wrote, "We will do our best to make whatever limited adjustments are possible within the confines of the Republican budget to address the nation's most important policy concerns."
That means the Democrats plan to live within blueprints approved last spring by Congressional Republicans that tightly constrained increases in 2007 for "domestic discretionary" spending, or nondefense spending not automatically set by law, Mr. Byrd and Mr. Obey said.
However, any increases are likely to go first toward "fixing emergencies," like providing enough federal workers to make sure existing programs continue to operate effectively, said a Congressional staff member who asked not to be identified. Expanding funds for programs faces "a bigger hurdle," he said.
In a briefing for reporters on Tuesday, a senior House Democrat, Rep. George Miller of California, who will lead the House Committee on Education and the Workforce, said finding additional money for 2007 for improving schools under the No Child Left Behind Act was also a priority.
Mr. Miller said it remains a priority for the Democrats to quickly pass legislation to cut in half the interest rate for federally subsidized student loans. However, although that would increase total federal spending, the federal subsidy would fall outside of discretionary spending, and so the change would not be blocked by the freeze announced by Mr. Obey and Mr. Byrd. Nevertheless, the Democrats must still find a way to pay for the proposed change in interest-rate policy (The Chronicle, November 17).
Besides providing funds for student aid, some college lobbyists hope that Ms. Pelosi will find room to support increased spending for physical-sciences research at the National Science Foundation and the Energy Department, a move proposed in February by President Bush and later included in now-defunct spending bills approved by the Senate appropriations committee and the full House (The Chronicle, September 8).
Meanwhile, the drastic curtailment of university earmarks prompted varying responses. It pleased some observers who considered the projects wasteful, pork-barrel spending that undermined peer review. But it sent officials at universities that have received earmarks scrambling to find other funds to continue some of the projects.
"I can't say that this is coming as a complete surprise," said Martha Stewart, director of federal relations for the University of Alaska system, given the growing drumbeat of criticism about earmarks.
The University of Alaska at Fairbanks ranked ninth among all colleges in total earmarked money received from 1998 to 2003, thanks to its powerful ally in Congress, Sen. Ted Stevens, who is the departing chairman of the Senate appropriations committee. (Ms. Stewart said she did not have figures on how much the university system received in earmarks in 2006.)
However, Ms. Stewart said, "We have been trying really hard to educate people that earmarked money is fickle and unreliable, and that the university desperately needed to get off of it."
Earmarks, she said, breed "some complacency, in that people think, I don't have to put together competitive proposals because I can depend on this money."
In recent years, she said, the university had pushed faculty members who received earmarked funds to find other sources of money within three to five years to continue their projects. Before that, though, the university had received earmarks for some "long term" projects, she said, "with no end in sight."
Even Senator Stevens, who has been among the most vociferous defenders of earmarks in Congress, "has seen the handwriting on the wall" and told the university's officials that they would become harder to get, Ms. Stewart said.
At Florida State University, Raymond E. Bye, director of federal relations, said the elimination of earmarks would affect about half a dozen projects for his institution that were contained in the proposed 2007 appropriations bills. He said administrators would work with managers of the research projects, in fields like engineering and criminology, in order to stretch out the resources they got in 2006.
Nevertheless, Mr. Bye said that he thinks university officials will regard Congress's decision as correct in the long term: "They had such difficulties facing them in '07 that it does seem to me a reasonable response to that problem."
