Trump’s bill cuts support for low-income students in HE

Among the US$1.7 trillion cuts contained in United States President Donald J Trump’s tax and spending plans, or what he has dubbed the “One Big Beautiful [Budget] Bill” (OBBB), is the largest ever reduction in funding for Pell Grants – federal grants made to the nation’s poorest college and university students – and other programmes designed to support low-income students, who are disproportionately either black or Hispanic.

The version of the OBBB that passed the House of Representatives by one vote (215 to 214) two weeks ago and is now before the Senate cuts the Pell Grant budget by one quarter, from US$37.1 billion to US$27.7 billion.

The bill represents a stark reversal from the administration of Joseph R Biden’s support for the Pell Grant. Between 2021 and 2024, Biden increased the grant from US$6,495 to US$7,395 – and had plans to increase it to US$8,145 if he won the 2024 election.

By contrast, and in contradistinction to the first Trump administration, during which there were modest increases in the Pell Grants, including through the 2019 FUTURE Act, which also increased funding for historically black colleges and universities (HBCUs), the OBBB would cut the grant by US$1,685 to US$5,710 – US$788 less than it was in 2021.

“Even during politically polarising times, the federal Pell Grant programme has historically seen broad bipartisan support,” said Melanie Storey, president and CEO of the National Association of Student Financial Aid Administrators, in a statement posted on the association’s website.

“Significantly reducing the maximum Pell Grant – an award targeted to low-income students – while cutting or eliminating complementary programmes reverses decades of commitment to the promise of the Higher Education Act and would result in considerable harm for students pursuing postsecondary education,” she noted.

Reduced eligibility

In addition to reducing the grants made to students, the OBBB will save money by drastically reducing eligibility.

Currently, both full-time and part-time students are eligible. A full-time student is defined as a student taking 12 credits (normally three courses) per semester, for 24 credits per year. A part-time student normally would take six credits per semester for 12 credits per year.

“They would make that 15 and 30 [for a full-time student],” Jon Fansmith, assistant vice-president of government relations for the American Council on Education (ACE), told a media briefing on 4 June. “That would also mean that the halftime level goes up because of the higher [full-time] threshold.

This change would eliminate the eligibility for all students studying less than half-time (as newly defined), which is one out of every 10 – or 700,000 – students, Fansmith explained.

According to Fansmith, this change targets two groups. The first, and smaller, is the part-time population of residential four-year colleges.

The second and much larger group is enrolled in open-access community colleges, most of which offer two-year degrees that allow entry into the third year of four-year programmes in that state’s state university system and, thus, are escalators for poor students into the higher education system.

More than two-thirds of the nation’s almost seven million community college students are part-time. And of these, 1.3 million received Pell Grants for the current academic year.

“These students are disproportionately working adults, disproportionately student parents. These are a population that ostensibly could get more aid if they took more courses, but realistically they don’t have the resources, the time, the money and the ability to juggle family life and work obligations to take more courses,” said Fansmith.

While white Americans account for 58% of the American population, and blacks account for 13.7% and Hispanics account for 19.5%, in community colleges, the number of black and Hispanic students is almost equal to white students.

Some 1.7 million community college students are white, and some 1.6 million students are either black or Hispanic, who, on the whole, are much poorer than are white students.

Accordingly, the cuts envisaged by the OBBB will fall most heavily on black and Hispanic students.

Scrapping of loans

Other measures in Trump's bill will also negatively affect low-income students.

If it becomes law, the Stafford Loan Program (SLP) will be eliminated. Under the SLP, established six decades ago, the federal government pays the interest on loans taken out by low-income students.

“I was actually shocked when we ran the analysis,” said Fansmith.

“That works out, on average, to costing those students over US$6,000 in terms of what their borrowing costs would be. Six thousand dollars more than low-income students will have to pay and not see any benefit whatsoever. They are borrowing the same amount; they’re just paying more to do it.”

Other programmes that will be eliminated include the ParentPlus Loans, which allow a parent of a dependent child who is enrolled in a college or university to take out a government loan to help pay for their child’s education expenses not covered by other grants or loans.

Also targeted for elimination is the GradPlus Loan programme that is available to graduate or professional students.

The OBBB will also eliminate programmes that provide childcare for students on campus, further hampering the ability of low-income students to attend college or university.

The budget set aside for work study will be slashed by almost US$1billion: from US$1.2 billion to US$250 million.

As Fansmith explained, “The reason it’s being cut so low is because they [the government] would switch from the government providing 75% of the funding and employers 25% to employers providing 75% and the government providing 25%.”

There are no government documents available that indicate whether work study employers will continue to participate in the programme as it is reworked by the OBBB.

Cuts to outreach programmes

On 3 June, when she appeared before the Senate Appropriations Committee – four days after the TRIO programmes were given two days’ notice to shut down – Secretary of Education Linda McMahon defended the proposal to eliminate almost all of the US$1.2 billion budget of the TRIO programmes, a suite of eight outreach programmes designed to help students from disadvantaged backgrounds enter and succeed in college.

The cutting of TRIO (and the Job Corps programme, which was also given two days to wind up) is not part of the OBBB but, rather, money cut from this year’s budget, that is, money Congress authorised but the administration refused to spend. (It is, therefore, similar to the billions of dollars cut from the National Science Foundation, National Institutes of Health and USAID.)

The administration’s goal, she said, is “to make education better, fairer and more accountable by ending federal overreach and empowering families, schools and states who best know the needs of their students.”

Speaking of the TRIO programmes specifically, McMahon said: “While I absolutely agree that there is some effectiveness of these programmes, in many circumstances, these programmes were negotiated at very tough terms in that the Department of Education has no ability to go in and look at the accountability of the TRIO programmes. It specifically eliminates our ability to do that.”

Senator Susan Collins, a Republican from Maine, who co-chairs the Congressional TRIO Caucus, said at the subcommittee hearing she strongly disagreed with the proposed TRIO cuts.

“From my experience in Maine, I have seen the lives of countless first-generation and low-income students, not only in Maine but across the country, who will often face barriers to accessing a college education, changed by the TRIO programme,” she stated.

International students

The ACE briefing also discussed the chaos international students are facing. At this point, the pause in new interviews for visas that Secretary of State Marco Rubio put in place two weeks ago remains, though ACE believes that the renewal of visas is proceeding, albeit slowly.

According to Sara Spreitzer, ACE vice-president and chief of staff for government relations, ACE is particularly concerned about the leaked policy which indicated that the State Department would start vetting social media accounts of applicants to Harvard.

“Under that policy, it looked like whether or not there were things posted on social media that didn’t align with US policy, an applicant would be in jeopardy.

“Most concerning was they said that lack of a social media profile would indicate concern. So, you couldn’t just go in and delete your social media accounts because they [the government] would take that almost as admitting that you had something to hide,” said Spreitzer.