FY 2019 Budget

FY 2019 PRESIDENT’S BUDGET

DEPARTMENT OF EDUCATION

2/12/2018
“The President’s Budget request expands education 

freedom for America’s families while protecting our 

nation’s most vulnerable students....The Budget also 

reflects our commitment to spending taxpayer dollars 

wisely and efficiently by consolidating and 

eliminating ineffective Federal programs that are 

better handled at the state or local level. I look 

forward to working with Congress to pass a Budget 

that puts students first and returns power in 

education to where it belongs: with states, districts 

and families.” 

- Secretary of Education, Betsy DeVos

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 Providing better choices for more families to attend a high-quality 

school.

 Supporting high-quality special education services to children with 

disabilities.

 Creating new and alternative pathways to successful careers for 

students.

 Promoting innovation and reform around STEM education.

 Implementing school-based opioid abuse prevention strategies.

 Making the Department more efficient while limiting the Federal 

role in education.

FY 2019 Budget Themes
The FY 2019 President’s Budget provides:

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$63.2 billion in discretionary funding, a $3.6 billion or 5 percent 

decrease below the 2017 enacted level.

$129.8 billion in new postsecondary grants, loans, and work-study 

assistance to help an estimated 11.5 million students and their families 

pay for college.

The Budget also supports:

Higher Education Act reauthorization proposals to address student debt and 

higher education costs, while reducing the complexity of student financial aid.

Reauthorization of the Perkins Career and Technical Education Act that would 

promote and expand apprenticeships, consistent with the President’s Executive 

Order.
Non-Defense Discretionary Cap Deal Addendum

The FY 2019 Budget reallocated funds from non-defense to defense to pay 

for the Administration’s National Security and National Defense Strategies.

As a result of the 2-year cap deal, which raises the non-defense 

discretionary spending caps, the President is adding back funding to ED’s 

FY 2019 Budget request. This addendum includes:

Impact Aid Basic Support Payments: +$525 million; total of 

$1.189 billion.

TRIO: +$400 million; total of $950 million. 

School Choice: +$500 million; total of $1.0 billion.

Work Study: +$300 million; total of $500 million.

Elimination of the Pell Rescission of $1.6 billion in unobligated 

balances in the Pell Grant program. 

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More Choices for More Families

$1 billion for a new Opportunity Grants program that would 

expand both private and public school choices, particularly for 

students from low-income families or attending schools 

identified for improvement under the Elementary and 

Secondary Education Act.

$500 million for the Charter Schools program to strengthen 

State efforts to start new charter schools or expand and 

replicate existing high-performing charter schools, while 

providing up to $100 million to meet the growing demand for 

charter school facilities.

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High-Quality Special Education Services to Children 

with Disabilities

$12.8 billion to maintain the Federal investment in the 

Individuals with Disabilities Education Act State formula grant 

program to help offset the cost of providing special education 

and related services to approximately 6.8 million children with 

disabilities.

$222 million for discretionary grants to States, institutions of 

higher education, and other organizations to support a variety of 

activities to help ensure that high-quality special education and 

related services are available to meet the unique needs of 

children with disabilities and their families.

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More Pathways to Successful Careers

Expanding the Pell Grant program to cover short-term programs. 

The Department’s fiscal year 2019 Budget proposes to expand Pell 

Grant recipients’ eligibility to include high quality short-term 

programs that provide students with a credential, certification, or 

license in an in-demand field, with sufficient guardrails in place to 

balance students’ needs with protecting taxpayers’ interests. 

Perkins Reauthorization: the Budget includes level funding of 

$1.1 billion for Career and Technical Education (CTE) State 

Grants to support a Perkins Act reauthorization proposal that 

would increase support for high school CTE programs, promote 

and expand apprenticeships, prioritize CTE STEM programs 

(especially in high school), and target services to disadvantaged 

students. 

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Promoting Innovation and Reform in STEM Education

Consistent with the Presidential Memorandum on STEM education, 

the Budget includes $200 million in new grants to improve STEM 

education. 

$180 million for Education Innovation and Research for 

competitive grants that would support evidence-based innovations 

designed to improve student achievement in STEM fields, 

including computer science.

$20 million to support innovative Career and Technical Education 

programs in STEM fields, including computer science, through 

awards to consortia of secondary and postsecondary providers that 

would work with employers and local workforce agencies to ensure 

that these programs are aligned with regional workforce and labor 

market needs.

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Implementation of School-based Opioid Abuse 

Prevention Strategies

$42 million for School Climate Transformation grants to 

support the use of multi-tiered behavioral frameworks that can 

help school districts implement evidence-based strategies 

designed to mitigate the impacts of the opioid epidemic on 

students and schools.

$1 million for technical assistance and resources to help schools 

and postsecondary institutions address the opioid epidemic.

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Making the Department More Efficient While 

Reducing the Federal Role in Education

Eliminates, streamlines, or reduces funding for 39 discretionary programs 

that do not address national needs, duplicate other programs, are 

ineffective, or are more appropriately supported with State, local, or 

private funds, decreasing taxpayer costs by $6.7 billion. 

Streamlines and consolidates programs to achieve management 

efficiencies, focus Federal investments on activities supported by evidence, 

and reduce the Federal role in education. Examples include transitioning 

TRIO to a single State formula and merging six duplicative HEA Title III 

and V competitive grant authorities into a single institutional formula. 

Supports Federal Student Aid (FSA) in undertaking a monumental student 

loan servicing upgrade. FSA is reorganizing its fragmented servicing and 

operating infrastructure in order to provide an innovative, world-class 

financial services experience for its customers.

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Federal Student Aid’s Next Generation

Financial Services Environment

FEBRUARY 12, 2018
Federal Student Aid (FSA) has one of the largest consumer loan 

portfolios in the world. We should deliver for our customers on par with 

world-class financial services.

To do that, we have defined the Next Generation 

Financial Services Environment with four primary goals:

1. World-class customer experience, grounded in a mobilefirst, mobile-complete, and mobile-continuous environment, to 

improve customer outcomes

2. Greater operational flexibility to allow us to more rapidly 

integrate new capabilities and features

3. Reduce complexity, improve the stability and resiliency of our 

systems, and provide more cost-efficient solutions

4. Improve repayment outcomes and overall portfolio 

performance
Customers interface with multiple brands throughout the student lending lifecycle, 

creating a fragmented experience

WHO WE ARE TODAY

Student 

applies for aid 

through at least 

3 distinct 

websites

Example student lending lifecycle

DMCS

Student begins making 

payments again, at which 

point they are again 

reassigned to a different 

servicer

When student is unable to 

make payments, Default 

Mgmt Collection System

(DMCS) and private 

collection agencies take 

over customer interaction

Student receives 

federal loans, 

communicating 

primarily with their 

financial aid office

Upon graduation, student 

chooses from eight 

repayment plans 

through one (or more) 

servicers

Student makes 

payments online 

each month across 

an average of 5 

loans

Student may 

consolidate their loans, 

at which point loans 

can be reassigned to 

a different servicer

Servicer

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Servicer 

3

Servicer

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Today’s fragmented customer experience is driven by a diverse vendor landscape

WHO WE ARE TODAY

Servicer platforms (4 total), details follow

Schools Department of 

Education

Individual Servicers

Managing all phases of data management, 

processing and engagement

FSA PCAs

Collections

Default 

Management 

Collection System

PCA

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Application Current Account Servicing

Origination & 

Disbursement

FAFSA

COD 

School Financial Aid 

Offices (>6,000)

PHEAA

HESC

MOHELA

OSLA

CornerStone

Great Lakes

Navient Nelnet

Default Servicing

Granite State

Customer-facing brand
FSA is moving to a more integrated technical and operational architecture to allow FSA to 

be the front-facing brand for its customers and provide a world-class customer experience

OUR INTENTION

Customer-facing brand

FSA & Schools FSA FSA

One integrated platform for multiple external partners

FSA PCAs

Recovery

Default 

Management 

Collection System

PCA

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3

5

7

2

4

6

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Current Account Servicing

CRM and Other Engagement Layer Middleware

StudentAid Call 

Centers

myStudentAid

Partners

myStudentAid

Mobile

StudentAid

Web

Application 

FAFSA

Default Servicing

Multiple External Engagement Partners

Customer Engagement

Origination & Disbursement

COD 

School Financial Aid 

Offices (>6,000)

Enhanced 

disbursement 

mechanisms 

Platform 2.0 Platform 3.0

Common Integrated Data Management and Analytics

Enterprise-wide Identity Management Solution

Cybersecurity and Data Protection 

Multiple Servicing Operations Partners 

Rules Engine and Other 

Middleware

Rules Engine and Other 

Middleware

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myMoney

FAFSA 2.0