The Surprising Survival (at least for now) of an Unpopular Federal Student Aid Program

[Editor's Note This post ran first on our sister blog Ed Money Watch]

President Obama in his fiscal year 2012 budget request put two federal student aid programs for college students on the chopping block: the Leveraging Educational Assistance Partnership (LEAP) program, which provides states with money for need-based aid for undergraduates, and the Robert C. Byrd Honors Scholarship program, which provides funds to states for merit scholarships. In their efforts to reduce federal spending in the current fiscal year, federal lawmakers have already killed the LEAP program but have so far left the Byrd scholarship program in place.

This may prove to just be a temporary reprieve, however, as the White House and Congress continue to negotiate a final budget bill for the remainder of the year that would make deeper spending cuts than those that have already been approved. Nonetheless, the fact that the Byrd Honors Scholarship program, which dates back to the 1980s, has made it through the first several rounds of cuts unscathed is fairly remarkable considering that it doesn’t have much of a constituency outside of Congress fighting for it. In fact, it is one of the few federal student aid programs that the Student Aid Alliance, a coalition of higher education associations and student advocacy groups, does not champion.

Truthfully, given its namesake, the program has never really needed the groups’ support. The program was the brainchild of the late Sen. Robert Byrd of West Virginia, who not only was the longest serving Member of Congress ever but also was the top Democrat on the Senate Appropriations Committee for nearly two decades. In that position, he held a powerful grip over the country’s purse strings.

According to a 2005 Chronicle of Higher Education article, Byrd had a very personal reason for pushing for a program that would reward top performing high-school students with college scholarships. As “the valedictorian of his Depression-era high school” in the mid-1930s, Byrd had been heartbroken to find “that he could not afford to attend college at the time.” He didn’t want other exceptional students to suffer the same fate.

Under the program, which Congress created in 1986 as part of legislation renewing the Higher Education Act, the U.S. Department of Education provides funds to state educational agencies, which then use the money to allot scholarships of $1,500 each to top high school seniors who plan on attending colleges that participate in the federal student aid programs. At first, the scholarships were non-renewable. But in 1992, Congress expanded the program to allow students to continue receiving these awards for up to four years of college.

The overall amounts of funds states receive each year are based, according to the Education Department, “on the ratio of the state’s school-aged population (5-17 year olds) to the total school-aged population in all participating states.” The U.S. Virgin Islands, Guam, America Samoa, and the Northern Mariana Islands are each guaranteed 10 new scholarships per year. No state or territory can receive less than $15,000 in new scholarship funds in a given year.

Under the temporary spending bills that Congress has passed so far for the 2011 fiscal year, the Byrd program is scheduled to receive $42 million, the same amount as it got in 2010. Under this appropriation, the program would be able to continue to fund 28,000 scholarships a year, including 7,350 new ones.

But is the program needed at a time when colleges and states are already shelling out billions of dollars in merit based aid each year?

The Obama administration certainly doesn’t think so. The Byrd program was one of a little more than a dozen education programs that the president proposed eliminating as part of his fiscal 2012 budget request.

“By targeting students who are already likely to attend and succeed in college, and by awarding relatively small amounts, the Byrd Honors Scholarship program does not effectively improve college access or completions,” the Education Department stated in its budget summary. “The Administration believes that the reallocation of funding from the Byrd Honors Scholarship program to larger programs with more flexible authorities will result in administrative savings and improved college access.”

The administration has proposed replacing both the LEAP and Byrd program with a new College Completion Incentive Grant program, which would provide $1.25 billion to states over the next five years to make "systemic reforms” in their higher education systems with the goal of graduating more students. With Republicans in charge of the House of Representatives, and the appetite on Capitol Hill for budget cuts, the chances that this proposal will be enacted are, to be generous, slim to none.

Still, most student aid experts agree with the administration’s assessment that there is absolutely no need for the government to continue supporting an exclusively merit-based aid program. [The administration and Congress have already allowed two short-lived student aid programs that rewarded both merit- and need -- Academic Competitiveness and SMART grants -- to quietly expire.]

Without the support of the administration or of any constituency to speak of, it seems unlikely that the Byrd Honors Scholarship program will continue to escape the budget axe for long. After all, it is a small, redundant program that has long outlived its purpose, considering the vast sums that states and colleges pour into merit aid each year. Still, the program may very well live to see another day, if lawmakers feel it is just too soon to kill a program that bears the name of their former formidable colleague.