President Releases FY22 Budget; Senate Reaches Agreement on Short-Term Pell
Short-Term Pell Grants
Last week, Senate leaders reached an agreement to include an amendment expanding Pell Grants for vocational training programs as part of the U.S. Innovation and Competition Act (S 1260 (117)). Introduced by Senators Tim Kaine (VA) and Rob Portman (OH), the amendment is modeled on the JOBS Act (S 864 (117)) and allows students enrolled in career training programs as short as eight weeks long to be eligible for Pell Grants, which are currently generally limited to programs that run for at least 15 weeks. The proposal would expand Pell Grants only to vocational training programs at nonprofit and public institutions— for-profit colleges would be excluded.
The amendment includes some language aimed at appeasing critics who are concerned these short-term programs won’t produce good outcomes for students. It requires the colleges to demonstrate that graduates of their short-term programs receive a median increase in earnings of 20 percent after completing the training. And colleges would also have to “prominently” publish information about completion rates, job placement rates and post-graduate earnings. The Senate postponed final passage of the bill until next week when Congress returns from the weeklong Memorial Day break.
President’s Budget Request
On Friday, May 28, the White House released President Joe Biden’s $6 trillion Fiscal Year 2022 (FY22) budget request, which includes two plans the President has already introduced - the American Jobs Plan and the American Families Plan. It includes investments in education, research, public health, and proposes changes to the country’s tax code. The plan lays out $1.5 trillion in discretionary funding along with the $2.3 trillion American Jobs Plan and $1.8 trillion American Families Plan investments.
The American Jobs Plan
The budget begins with the American Jobs Plan, which revitalizes manufacturing, secures U.S. supply chains, and trains workers for the jobs of the future. The plan also calls for raising the wages and benefits for essential home care workers and makes substantial investments in the infrastructure of America’s care economy, starting by creating new and better jobs for caregiving workers.
The proposal provides funding to train American workers for well-paying, middle-class jobs using evidence-based approaches such as sector-based training and registered apprenticeships. It requires that goods and materials are made in America and shipped on U.S.-flag, U.S.-crewed vessels. The plan would also ensure that Americans, especially those who have endured systemic discrimination and exclusion for generations, have a fair shot at obtaining good-paying jobs with a choice to join a union; higher and equal pay; safe and healthy workplaces; and workplaces free from racial, gender, and other forms of discrimination and harassment.
The American Families Plan
The American Families Plan would make investments from early childhood to post-secondary education so that all children and young people are able to grow, learn, and gain the skills they need to succeed. It would provide universal access to high-quality preschool to all three- and four-year-olds, led by a well-trained and well-compensated workforce. It would provide Americans two years of free community college and invest in making college more affordable for low- and middle-income students, including students at Historically Black Colleges and Universities (HBCUs), Tribal Colleges and Universities (TCUs), and Minority-Serving Institutions (MSIs) such as Hispanic-serving Institutions (HSIs) and Asian American and Native American Pacific Islander-Serving Institutions. It would also invest in America’s teachers and students, improving teacher training and support so that schools become engines of growth at every level.
The American Families Plan would provide direct support to families to ensure that low- and middle-income families spend no more than seven percent of their income on child care and that the child care they access is of high quality and provided by a well-trained and well-compensated child care workforce. It would also provide direct support to workers and families by creating a national comprehensive paid family and medical leave program that would bring the American system in line with competitor nations that offer paid leave programs.
Education Investments Department of Education
The President’s budget requests $102.8 billion for the Department of Education, a $29.8 billion or 41 percent increase over the 2021 enacted level.
The proposal includes $36.5 billion for Title I grants, a $20 billion increase compared to the 2021 enacted level to ensure that every student, especially those from disadvantaged backgrounds, receives a high-quality education. This funding, the single largest year-over-year increase since the inception of the Title I program, builds on investments in the American Rescue Plan Act of 2021 that will help all schools reopen safely and addresses disparities under-resourced schools have historically faced.
It also prioritizes the physical and mental well-being of students through a $1 billion investment to increase the number of counselors, nurses, and mental health professionals in schools.
The American Jobs Plan calls for $50 billion over 5 years to rebuild and modernize public K-12 schools and the American Families Plan calls for $9 billion over 10 years to boost teacher preparation and diversity. Additionally, it asks for $100 billion over 10 years to bring high-quality, reliable broadband to all families. It also calls for $1 billion in mandatory funding in FY22 to expand career pathways for middle and high school students.
To ensure that children with disabilities have the opportunity to thrive, the Budget includes $16 billion, a $2.7 billion increase from the 2021 enacted level, for Individuals with Disabilities Education Act (IDEA) grants that would support special education and related services for more than 7.6 million preschool through grade 12 students. It also provides $732 million for early intervention services for infants and toddlers with disabilities or delays, funding services that have a proven record of improving academic and developmental outcomes. The $250 million increase for early intervention services would be paired with reforms to expand access to these services for underserved children, including children of color and children from low-income families.
The President also calls for $7.4 billion for the Child Care and Development Block Grant, an increase of $1.5 billion over the 2021 enacted level, to expand access to quality, affordable child care for families, as well as an $11.9 billion investment in Head Start, a $1.2 billion increase. The Administration would also work with States to ensure that these resources support increased wages for early educators and family child care providers, the majority of whom are women of color.
In addition, it provides an increase of $30 million to $443 million for Full Service Community Schools, which play a critical role in providing comprehensive wrap-around services to students and their families, from afterschool to adult education opportunities, and health and nutrition services.
The largest increase since 2009, the budget request also provides funding to increase the maximum Pell Grant by $400 - this increase, together with the $1,475 Pell Grant increase in the American Families Plan, represents a significant first step to deliver on the President’s goal to double the grant. The discretionary request would also make Pell Grants available to “DREAMers,” students who are Deferred Action for Childhood Arrivals (DACA) recipients. In total, the request invests an additional $3 billion in Pell Grants. It would bring the maximum award to $8,370 for 2022-2023.
In the American Jobs Plan there is $12 billion over five years to improve community college facilities and build new facilities in education deserts. While the American Families Plan calls for $123 billion over 10 years to make community college free, plus another $62 billion to close college completion gaps, according to the Education Department. And, more than $80 billion over 10 years for MSIs, HBCUs and TCCUs.
Workforce Development and Training Investments
Department of Labor
The President’s budget requests $14.2 billion for the Department of Labor (DOL) in FY 2022, a $1.7 billion, or 14 percent, increase from the FY 2021 enacted level.
The President’s budget provides $3.7 billion, a $203 million or 6-percent increase over the 2021 enacted level, for Workforce Innovation and Opportunity Act (WIOA) State Grants to make employment services and training available to more dislocated workers, low-income adults, and disadvantaged youth hurt by the economic fallout from the COVID-19 pandemic. The discretionary request advances the goal of developing pathways for diverse workers to access training and career opportunities by also investing in critical programs that serve disadvantaged groups, including justice-involved individuals, at-risk youth, and low-income veterans.
The request asks for $285 million, a $100 million increase over FY21 enacted levels, to expand Registered Apprenticeship (RA) opportunities while increasing access for under-served groups.
The budget aims to strengthen the Unemployment Insurance (UI) system through investments to ensure states can better handle high volumes of claims; and be better prepared in the future by fully funding and updating the formula for determining the amount States receive to administer UI, the first comprehensive update in decades. In addition, the discretionary request includes a $100 million investment to support the development of information technology solutions that can be deployed in states to ensure timely and equitable access to benefits.
It also includes a $100 million investment for the Department’s new multi-agency POWER+ Initiative, aimed at reskilling and re-employing displaced workers in Appalachian communities. The discretionary request also provides $20 million for a new program, developed in collaboration with the Department of Veterans Affairs, focused on helping veterans shift to careers in clean energy, which would help combat climate change while preparing veterans for high-quality careers.
Department of Energy
The Department of Energy is provided with $2 billion to put welders, electricians, and other skilled laborers to work building clean energy projects across the nation. This investment supports a historic energy efficiency and clean electricity standard that would transform the electric sector to be carbon-pollution-free by 2035 while creating good-paying union jobs. According to the President, transforming the U.S. electricity sector—and electrifying an increasing share of the economy—represents one of the biggest job creation and economic opportunity engines of the 21st Century.
The President’s budget more than doubles funding — providing $442 million — for manufacturing programs at the National Institute of Standards and Technology (NIST), enabling the establishment of two new Manufacturing Innovation Institutes. The discretionary request also expands the Manufacturing Extension Partnership by providing $275 million, an increase of $125 million over the 2021 enacted level, to make America’s small and medium manufacturers more competitive and strengthen domestic supply chains.
Department of the Interior
The discretionary request provides over $450 million to the Department of Interior, more than double the 2021 enacted discretionary level, to remediate many of the thousands of orphaned oil and gas wells and reclaim abandoned mines on Federal and non-Federal lands, which builds on the goal of creating 250,000 good-paying union jobs cleaning up abandoned and often hazardous sites.
GOP Infrastructure Proposal
On Thursday, May 27, Senate Republicans unveiled a $928 billion infrastructure counteroffer to President Joe Biden. The plan includes $506 billion for roads, bridges and major infrastructure projects, including $4 billion for electric vehicles; $98 billion for public transit; $72 billion for water systems; $65 billion for broadband; $56 billion for airports; $46 billion for passenger and freight rail systems; $22 billion for ports and waterways; $22 billion for water storage; $21 billion for safety efforts; and $20 billion for infrastructure financing. The President’s latest offer to the Republicans was $1.7 trillion - a $600 billion decrease from his original plan. The President has urged the GOP to put at least a $1 trillion package together.
President Biden plans to meet with lead Republican negotiator Senator Shelley Moore Capito (WV) this week to reach a deal as soon as possible. The price tag gap isn’t the only hurdle, as both sides need to resolve differing visions for how to offset spending. Republicans have repeatedly rejected Biden’s call to raise corporate taxes, contending they could cover infrastructure costs with funds already allocated by Congress or with transportation user fees.
On Thursday, May 27, the Committee on Education and Labor Subcommittee on Higher Education and Workforce Investment held the hearing "Workforce Innovation and Opportunity Act Reauthorization: Creating Employment Pathways for Dislocated Workers.” Panelists included Joseph M. Barela, Executive Director of the Colorado Department of Labor and Employment, Denver, CO; PJ McGrew, Executive Director of Indiana Governor's Workforce Cabinet; Matt Sigelman, CEO of Burning Glass Technologies; and Portia Wu, Managing Director of U.S. Public Policy at Microsoft.
In a separate but parallel effort, House Education and Labor Committee Chair Bobby Scott (VA) introduced a package of three education bills in January - the Rebuild and Reopen America’s Schools Act, the Save Education Jobs Act, and the Learning Recovery Act - to reopen and rebuild schools, save educators’ jobs and help students recover lost time in the classroom. The package aims to invest a half-trillion dollars in K-12 schools for infrastructure upgrades and to mitigate job losses and academic setbacks caused by the pandemic.
Click here to read more about the bills.
Community Navigator Pilot Program
On Tuesday, May 25, the U.S. Small Business Administration (SBA) announced that it is accepting applications for its new Community Navigator Pilot Program, which will leverage a community navigator approach to reach small businesses, with a priority focus on those owned by socially and economically disadvantaged individuals, as well as women and veterans. SBA will accept applications through July 12, 2021, and anticipates making award decisions by August 2021.
Click here to learn more about the program.
Initial Jobless Rate
In the week ending May 22, the advance figure for seasonally adjusted initial claims was 406,000, a decrease of 38,000 from the previous week's unrevised level of 444,000. This is the lowest level for initial claims since March 14, 2020 when it was 256,000. The 4-week moving average was 458,750, a decrease of 46,000 from the previous week's unrevised average of 504,750. This is the lowest level for this average since March 14, 2020 when it was 225,500. The advance seasonally adjusted insured unemployment rate was 2.6 percent for the week ending May 15, a decrease of 0.1 percentage point from the previous week's unrevised rate.
The figure is below analysts' expectations of 425,000, and down almost 9% from the previous week. Still above the pre-pandemic average of around 225,000 per week, economists say the continued drop reflects an economy returning to historical norms. Continuing claims fell 4% to 3.6 million, and those receiving benefits under all programs, including gig workers and the self-employed, fell by 175,000 to 15.8 million. Roughly 40% of those out of work (including those looking for work but not receiving benefits) are considered long-term unemployed workers—out of a job for 27 weeks or longer.
Click here to access the full report.