Federal Education Budget Project

IDEA Authorized Funding Streams

The No Child Left Behind Act of 2001 (NCLB) is the most recent iteration of the Elementary and Secondary Education Act of 1965 (ESEA), the major federal law authorizing federal spending on programs to support K-12 schooling. ESEA is the largest source of federal spending on elementary and secondary education.

The federal government funds higher education primarily through student-based financial aid (i.e. vouchers), in contrast to K-12 education funding, which is mostly institution-based (i.e. much like aid to local school districts). Higher education federal aid is targeted to the financially-neediest students, although in recent years the federal government has expanded higher education funding to include support for middle class families.

Within the next two weeks, the U.S. Department of Education’s Inspector General is expected to release an audit of the Nelnet Corporation, a major student loan provider, recommending that it be ordered to repay hundreds millions of dollars in taxpayer subsidy payments to the U.S. Treasury and halt additional, future subsidy billings estimated to exceed $1.3 billion.

At issue are subsidy payments guaranteeing Nelnet and other student loan companies a 9.5 percent rate of return for student loans originally… more

The mission of the New America Foundation's Education Policy Program is to develop ideas that advance the cause of equity, access, and excellence in education. The program proposes comprehensive education policy changes from pre-kindergarten to graduate school with the goal of closing multiple opportunity and achievement gaps nationwide. The Education Policy Program spans three separate initiatives: The Early Education Initiative, the Federal Education Budget Project, and Higher Ed Watch.

This week and next, federal lawmakers will consider a comprehensive overhaul of the terms and conditions associated with over $68 billion in new federally guaranteed student loans distributed each year to more than 10 million students and their families attending over 6,800 institutions of higher education. Changes of this magnitude in federal student loan law were last made over seven years ago and are not scheduled to be considered again until 2012.

In the first independent analysis of the pending and… more