March 10, 2023

Yesterday, the Biden-Harris Administration released their proposed budget for Fiscal Year (FY) 2024. The budget builds on the FY 2023 omnibus passed by Congress at the end of December 2022, and upon the Administration’s FY 2023 budget proposal, both of which missed opportunities to address the rampant crisis of basic needs insecurity in higher education.

“The President’s Fiscal Year 2024 budget moves in the right direction by proposing to make college more affordable for students and their families and by helping to address widespread student basic needs insecurity,”  said Bryce McKibben, Senior Director of Policy & Advocacy for The Hope Center for College, Community, and Justice. “We look forward to working with Congress to expand critical investments in students at a time when expiring pandemic-era supports are threatening the economic security of families across the country.”

Families are still reeling from the disruptions caused by the COVID-19 pandemic, and facing challenges due to the rising cost of living. Our research at The Hope Center shows that three in five college students do not have enough to eat or a safe place to live, with disproportionate  impacts on marginalized students including Black and Brown students, parenting students, LGBTQIA+ students, undocumented families, and many other groups. In order to guarantee that students thrive in higher education, we must first ensure that they have their basic needs met, and doing so will require transformative investments in our higher education and public benefit programs.

Despite the fact that students have faced high levels of basic needs insecurity for years, many of the vital economic security measures passed by Congress during the pandemic have begun to expire. Emergency grants for students that helped millions stay enrolled are now exhausted, and student flexibilities in the Supplemental Nutrition Assistance Program (SNAP) that allowed 3 million additional college students to qualify for food assistance will expire in the coming weeks without Congressional action. On top of this, families and students across the country have experienced a hunger cliff due to the expiration of additional SNAP emergency allotments earlier this month.

The FY24 budget includes a wide range of investments in students. In particular, we are encouraged that the Administration has included a permanent federal-state partnership for free community college—including a $500 million grant program for individual community colleges and state systems to expand tuition-free programs—as well as new affordability guarantees for four-year Historically Black Colleges and Universities (HBCUs), Tribal Colleges and Universities (TCUs), or Minority-Serving Institutions (MSIs).

“If we truly want to fulfill the promise of affordable higher education, a federal-state partnership that guarantees a tuition-free pathway at community colleges is an essential start,” said Mark Huelsman, Director of Policy & Advocacy at The Hope Center. “Free community college will help students focus on learning and allow them to leverage financial aid and other supports to afford basic necessities and reduce their debt.”

Elsewhere, the budget would expand upon and supplement the successful Basic Needs Grant program within the Fund for the Improvement of Postsecondary Education (FIPSE) by creating a new $30 million “Systemwide Holistic Student Supports” program that would allow institutions, systems of higher education, state agencies to build initiatives that connect students with public benefits including food and housing assistance, childcare, and mental health services. Congress has increased funding for the Basic Needs Grant for three consecutive years, and we look forward to working with the Administration and Congress to lift the exciting work of grantees and actualize the systemic change offered by this program. 

The budget would increase the maximum Pell Grant award to $8,215, a $820 increase over its current level, and expand Pell Grant eligibility to Dreamers. While the Pell increase would provide short-term relief to eligible students, the maximum grant would still cover just 29% of the cost of attending a public four-year college ($27,940 per year) and only 42% of the full cost of attending a community college ($19,230 per year). In order to transform our higher education system into one that is truly affordable for students, federal grant aid must be paired with federal incentives for states to reverse disinvestment from public higher education and rising cost burdens that fall disproportionately on systematically marginalized students.

The Biden Administration also acknowledges the problem of food insecurity among students in higher education and the need to eliminate barriers to food assistance like the Supplemental Nutrition Assistance Program (SNAP) for “low-income college students.” We encourage federal and state leaders to make pandemic-era SNAP eligibility expansions permanent—and rescind misguided and burdensome work requirements that prevent students from receiving vital food aid—in the upcoming farm bill reauthorization.

Other proposals that could impact students’ basic needs include:

• The Child Care Access Means Parents In School (CCAMPIS) would receive $95 million, a $20 million increase over FY23. This increase for parenting students is notable as the number of on-campus child care centers has declined in recent years. However, advocates have called for a total of $500 million for CCAMPIS, and current levels fall far below the need of students.
• The Postsecondary Student Success Grant program would receive $165 million, an increase of $125 million from FY23, for evidence-based programs that promote college retention and completion. Addressing students’ basic needs helps students succeed in higher education.
• Student Aid Administration, including the Office of Federal Student Aid, would receive $2.7 billion, a $620 million increase, to support financial aid recipients and student loan borrowers, including simplifying the FAFSA, reducing burdensome financial aid verification, building programs to address student loan default, and administering critical debt relief programs.
• A new School- and Campus-Based Mental Health Service program within FIPSE would receive $150 million to help colleges develop comprehensive strategies for student mental health. However, it remains unclear what level of investment the Administration proposes for the Garrett Lee Smith Campus Suicide Prevention Grants, which is currently the only federal program investing in the mental health needs of college students.
• The full Child Tax Credit (CTC) enacted in the American Rescue Plan Act (ARP) would be fully restored, a benefit which allowed families to receive monthly advance payments totalling up to $3,600 annually per child, and which dramatically reduced poverty and allowed more families to seek out skills and training.
• The exclusion of student debt relief from taxation, which was enacted through calendar year 2025 under ARP, would be made permanent.
• A policy included in the ARP to expand access to the Earned Income Tax Credit (EITC) for students in higher education who are living independently from their parents would be restored and extended permanently.

Unfortunately, the budget does not propose to exclude Pell Grants, emergency aid, and other grants and scholarships from taxation, as proposed in part by the Tax-Free Pell Grant Act. The Hope Center and numerous other organizations support repealing the tax on federal financial aid. Nor does the budget build upon the successful precedent set by the Higher Education Emergency Relief Fund (HEERF) by making federal support for emergency aid grants permanent. The budget also does not include any inflationary increases to the Supplemental Educational Opportunity Grant (SEOG) or Federal Work-Study (FWS) which make college more affordable and often provide students with a pass to easier access to public benefits. The campus-based aid programs are essential to reducing student basic needs insecurity.

We look forward to working with the Biden-Harris Administration on these issues and other proposals to expand investments in students and address the full cost of higher education. Students cannot be expected to learn if they are worried about where their next meal will come from, how they will afford rent or utilities, whether they can access child care, or if they can address health care or mental health services. It’s time to build a higher education system and safety net that recognizes students’ needs and helps them thrive.