5 Higher Education Bills to Monitor This Lame-Duck Session

Transparency, HBCUs, and the federal Pell Grant program have a chance to take center stage during Congress’ lame-duck session this year.

Every two years, lawmakers scramble to pass neglected legislation during the lame-duck session, which starts after a midterm or general election and ends when the new Congress is sworn in during January.

It’s never quite clear what a lame-duck Congress’ priorities may be, but with Republicans set to take control of the U.S. House of Representatives, lawmakers will likely push to get last-minute legislation through.

That will include higher education issues.

BestColleges spoke with experts in the policymaking space to get a sense of what specific bills have a chance at passing this December.

Perhaps the most substantial thing Congress can do for higher education is also the one that seems least likely to get done.

President Joe Biden’s proposed budget for 2023 included a call to double the maximum Pell Grant — the federal grant program aimed at low- and middle-income students — by 2029. The first step in that process was to increase the max grant to $8,670 in 2023, a 25.7% increase from what Congress approved for the 2022 fiscal year.

Congress must do this through a budget bill.

Historically, crafting the yearly budget is a lengthy process. The 2022 budget, for example, didn’t pass until mid-March 2022.

For that reason, some policy analysts, including Tanya Ang of Higher Learning Advocates, are skeptical that the budget will pass during lame duck.

“I think it’s leaning toward the unlikely side, and if they do get something done, it would be a Dec. 31 type of thing,” she said. “But, we’ve been surprised before. Hopefully, this will be one of those times.”

Karen McCarthy, vice president of public policy and federal relations at the National Association of Student Financial Aid Administrators (NASFAA), told BestColleges that now may be the best shot Democrats have at passing the party’s preferred budget. This may be the motivation needed to spur action before the year’s end.

If not, financial aid administrators will feel pressured to give lowball financial aid offers since they won’t know the maximum Pell Grant award for the 2023-24 academic year.

“Nobody likes to have to go back and revise financial aid offers,” she said. “When you do have to, you want to revise it up, not down.”

Congress has come close but ultimately chose not to expand the use of Pell Grants to short-term credential programs over the past two years through a version of the Jumpstart Our Businesses by Supporting Students (JOBS) Act.

The House of Representatives even passed a version of the COMPETES Act that included the JOBS Act. This bill, however, failed in the Senate.

The JOBS Act would expand the types of programs for which Pell Grants are applicable. Most notably, it could apply to short-term job training programs that span as few as eight weeks.

There is some hesitancy regarding the JOBS Act.

Shelbe Klebs, education policy advisor at the think tank Third Way, told BestColleges that there is less data about these short-term programs. It is difficult to determine how valuable they are, and, therefore, difficult to convince Congress it’s worth allowing students to use federal grants toward them.

That’s where the next bill comes in.

The College Transparency Act (CTA) would alleviate some of the concerns Klebs has with the JOBS Act, she said.

“Should there be a push to pass the JOBS Act, at minimum that Pell expansion must be paired with CTA,” she said.

CTA expands what information colleges and universities must provide students interested in enrolling. According to a report from the Institute for Higher Education Policy, the following data points are not currently required in the Integrated Postsecondary Education Data System but would be in the new data system:

CTA would force institutions to share this data concerning all students. Currently, the College Scorecard only includes students who receive federal financial aid.

Like the JOBS Act, the House of Representatives passed CTA as an add-on to the COMPETES Act that failed in the Senate.

Klebs added that different versions of the bill have enjoyed bipartisan support over many years.

However, this could be a do-or-die moment for the bill.

Klebs said that Republican U.S. Rep. Virginia Foxx, seeking a waiver to remain her party’s leader in the House Committee on Education and Labor, has been a staunch opponent of CTA for years.

Because Republicans will soon control the House of Representatives, advancing CTA during the next Congress will be substantially more difficult if Foxx remains in charge.

The IGNITE HBCU, TCU, and MSI Excellence Act is a newer version of a longstanding bill to increase funding for historically Black colleges and universities (HBCUs). This version expands the mission to other minority-serving institutions (MSIs), including tribal colleges and universities (TCUs).

Advocates say lame duck is the best time to pass this wildly popular measure.

Lodriguez Murray, senior vice president of public policy at the United Negro College Fund (UNCF), previously told BestColleges that it was “made clear” to the bill’s sponsor, U.S. Rep. Alma Adams of North Carolina, that her original proposal aimed solely at HBCUs would not move forward unless she expanded its scope. The previous version of the IGNITE Excellence Act attracted 219 co-sponsors in the House of Representatives — more than half of the chamber.

Murray said the bill would support grant programs to improve infrastructure at MSIs.

Perhaps most importantly, that includes improving research facilities. He said there are currently no HBCUs with an R1 research designation. He hopes the IGNITE Excellence Act could provide the funds these institutions need to reach that level.

“We think that it is a necessity that this bill passes this Congress,” Murray said. “It’s not something to visit next year; this is needed now.”

Taxes are complicated, and receiving a Pell Grant only makes filing your taxes more burdensome.

In short, college students are eligible for the American Opportunity Tax Credit (AOTC). However, to claim the credit, a student with a Pell Grant must subtract their grant from eligible expenses, which reduces their AOTC eligibility. You can avoid that by using Pell Grant funds to cover nontuition expenses, but then that portion of the Pell Grant becomes taxable.

Having trouble following? That’s where the Tax-Free Pell Grant Act comes in.

McCarthy of NASFAA said approximately 730,000 Pell Grant students are affected each academic year and could be losing out on tax credits because of how complicated the process is.

“Part of the point of the bill is that it is super complicated as a tax filer to understand how it all works,” she said. “It’s really not something that most tax filers can wrap their head around to figure out how to get all the tax credits for which they are eligible.”

Making Pell Grants nontaxable would eliminate the need for recipients to go through this complicated filing process, she said. Additionally, it’s a general advocacy principle that lower-income students who qualify for government aid shouldn’t be forced to pay taxes on that aid.

A group of 16 advocacy groups and higher education organizations, led by the American Council on Education, recently penned a letter to lawmakers urging them to pass the Tax-Free Pell Grant Act.

McCarthy added that the Tax-Free Pell Grant Act would likely need to pass as part of a larger tax bill, which decreases its chance of passing during lame duck.