College students are big winners in the compromise stimulus package

The dust is beginning to settle on the final stimulus bill (officially the American Recovery and Investment Act, or ARIA) that President Obama signed today and higher education is one of the big winners.  It appears the bill will help soften the blow of state budget cuts but there is a lot of discretion on how the money will eventually be spent.  Nevertheless, students and institutions should get some direct relief in the form of loan programs, infrastructure, and overall budget support.  Here is a brief summary of the primary higher-ed related items in the final $787 billion bill:

Increased Pell Grants:  The popular grant program gets a boost of $15 billion.  A combination of ARIA funding and previous congressional action will increase the maximum Pell Grant amount by $1,000 to $5,350.  The pool of eligible students will grow by an estimated 800,000.

Stafford Loans: ARIA increases the annual limit for the unsubsidized Stafford Loan for undergraduate students by $2,000 and the aggregate by $8,000.

Tax Credit: The Hope Scholarship tax credit for the 2009 and 2010 tax years grows to $2,500, a $700 increase.

Federal Work Study: ARIA increases funding for FWS by $490 million. This yields $613 million in additional funding for FWS and, when the institutional matching funds are included, enough funding for an additional 200,000 recipients.

Aid for States: $39.5 billion for “backfilling” of state budget cuts including facilities modernization.  In addition states will receive $8.8 billion for governors to award for “high priority” needs, including education.

Research: Portions of the ARIA funding provided to the National Institutes of Health ($1.5 billion), National Science Foundation ($100 million) and others are designated for university research programs.

Over all it looks like a big win for colleges and college students.