Here’s some recent federal policy info from CEF (and a few other sources). Sorry I’ve been a bit behind in getting these to you lately. Budget FY 2018 budget action – Last week the House passed the Senate’s version of the FY 2018 budget without a conference committee to produce a compromise budget or any of the other normal stuff you would do. Bear in mind that this has nothing to do with the budget — it’s all about creating a vehicle for passing tax reform without the need for 60 votes in the Senate, as the resolution contains reconciliation instructions that provide fast-track procedures for consideration of tax cut legislation later this fall. From CEF: “We still expect that final defense and non-defense discretionary levels for FY 2018 will be set in a separate budget deal that will lead either to a FY 2018 omnibus appropriations package or a year-long continuing resolution.” CEF letter to Congress on need to eliminate the sequester, maintain parity between defense and non-defense discretionary funding – From Sheryl Cohen, CEF: Last week CEF sent the attached letter to all Members of Congress urging elimination of the austerity level sequester caps that require Congress to $3 billion non-defense discretionary (NDD) funding for fiscal year (FY) 2018 by $3 billion below the FY 2017 level. Without an increase in the cap, Congress will struggle to pass funding bills that meet the nation’s needs for key programs, including education. The letter also stresses the need to continue the principle of parity by raising the NDD cap by an amount equal to the increase in the defense cap, as has been the case in all past cap increases. Tax Reform Center on Budget and Policy Priorities’ fact sheet on tax cut implications for education funding – From Sheryl Cohen, CEF: "The Center on Budget and Policy Priorities has published a fact sheet on what it calls a two-step tax and budget agenda and how it could lead to deeper cuts to education funding in the future. The Administration and congressional budgets for fiscal year (FY) 2018 already contain deep cuts for discretionary education funding, and the Center argues that enacting tax cuts that worsen the deficit by $1.5 trillion will enhance arguments to offset the costs by cutting discretionary spending even further." Implications of tax reform on education – Many members of the education community here in DC are looking at how tax “ reform" could impact education funding at the federal and state level. Here are the links to the House Republicans tax plan: https://waysandmeansforms.house.gov/uploadedfiles/taxcutsandjobsactsectionbysection.pdf <https://waysandmeansforms.house.gov/uploadedfiles/tax_cuts_and_jobs_act_section_by_section.pdf> https://waysandmeansforms.house.gov/uploadedfiles/billtext.pdf <https://waysandmeansforms.house.gov/uploadedfiles/bill_text.pdf> You may want to take a look at these links, and to the NGA paper attached: The state and local tax deduction at http://www.americansagainstdoubletaxation.org/ <http://www.americansagainstdoubletaxation.org/> The progressive community view of broader tax reform at http://stoptrumptaxcuts.org/ <http://stoptrumptaxcuts.org/> Meanwhile, Sarah Abernathy prepared the following summary today: “Below is a summary of the education-related provisions including the Joint Committee on Taxation’s (JCT’s) estimate of how much revenue they raise or cost. In total, these education-related provisions raise federal revenues by $68.3 billion over ten years, primarily by repealing above-the-line deductions for higher education costs and by repealing two existing higher education tax credits. The Ways and Means Committee is planning to mark up the bill next week.” Title I - Tax Reform for Individuals Subtitle C – Simplification and Reform of Education Incentives Above-the-line deduction for interest on student loans – repeals the following higher education benefits: a. existing deduction of up to $2,500 for interest on education loans, b. exclusion from income of the interest on US bonds that are used for qualified higher education expenses c. exclusion from income of qualified tuition reductions provided by educational institutions to their employees, spouses, or dependents d. exclusion from income of employer-provided education assistance, currently up to $5,250 per year JCT estimate: raises $47.5 billion over ten years Consolidate higher education tax credits – Repeals the Hope Scholarship Credit and the Lifetime Learning Credit, which are alternatives to the existing American Opportunity Tax Credit (AOTC). The AOTC provides a maximum tax credit of $2,500 per year for up to four years of post-secondary education, phasing out for joint filers with incomes above $180,000; up to $1000 of the annual tax credit is refundable. The bill consolidates all three existing options into an “enhanced AOTC,” and adds a fifth year of eligibility at half the rate, making up to $500 refundable. JCT estimate: raises $17.3 billion over ten years. Consolidate education savings rules – Ends future contributions to Coverdell education savings accounts. People could make tax-free rollover contributions to 529 accounts, which could now be used for up to $10,000 of expenses for elementary and high school education and for apprenticeship programs. JCT estimate: raises $0.6 billion over ten years. Student loan discharges – Excludes from taxable income any income from discharging a student debt on account of death or total disability (currently, any such forgiven debt constitutes income). JCT estimate: reduces revenue by $0.1 billion over ten years. Title V - Exempt Organizations Subtitle B - Excise Taxes, Section 5103 Investment income of private colleges and universities – Impose a new excise tax of 1.4 percent on net investment income on private colleges and universities with at least 500 students and assets of at least $100,000 per full time student the previous year. JCT estimate: raises $3.0 billion over ten years. Staff Changes Earlier this week one of the CEF updates also included a list of staffing changes in the education world here in D.C.. Here they are, for those interested: Denise Forte, House Committee on Education and the Workforce – We have learned that Denise Forte is leaving her position as Staff Director for the Democratic staff of the House Education and the Workforce Committee, which she has held since January 2015. No word yet on who will replace her. Buyouts at the Department of Education’s (ED’s) Office of Federal Student Aid – the Washington Postreported Friday that ED will offer incentives for employees of the Office of Federal Student Aid to take early retirement or voluntarily leave. Those who are eligible will be informed this week, and will have two weeks to decide whether to accept the offer. ED is continuing the hiring freeze put in place early this year. Kenneth Marcus, ED’s Assistant Secretary for Civil Rights – On Thursday, the White House announced the President’s intention to nominate Kenneth Marcus to serve as ED’s Assistant Secretary for Civil Rights. He served in that role (without Senate confirmation – his title was “Delegated the authority of the assistant secretary”) under President George W. Bush, and is currently President and General Counsel of the Louis D. Brandeis Center for Human Rights Under Law. Douglas Webster, ED’s Chief Financial Officer – EdWeek reports that Douglas Webster is the nominee to be ED’s chief financial officer. He is currently the director of risk management at the U.S. Agency for International Development. Regulations Department of Education Regulatory Reform Task Force - Following on the discussion with Cheryl at our meeting last month: the Department’s Regulatory Reform Task Force has issued a second status report (attached) listing its actions to reduce regulatory burdens. From what I can remember, this covers a lot of what Cheryl talked to us about. The report does note NCL”s role in helping the Department check the box that they “sought view” on the proposed changes. The Office of Career, Technical, and Adult Education (OCTAE) attended the meeting of the National Coalition on Literacy on October 5, 2017, to seek views on adult education guidance and regulations that may merit repeal, replacement, or modification. (Coalition members include the American Council on Education, the American Library Association, the Correctional Education Association, the Coalition on Adult Basic Education, and ProLiteracy.) On November 15, 2017, OCTAE’s Division of Adult Education and Literacy will discuss regulatory reform with the State Directors of Adult Education at the National Adult Education Professional Development Consortium National Training Institute. Never let it be said that NCL isn’t doing its part in providing regulatory relief…. Jeff