The House and the Senate approved H.Rept. 111-89 , the conference report to accompany S.Con.Res. 13 , the Concurrent Resolution on the Budget for Fiscal Year 2010, on April 29, 2009. The FY2010 budget resolution includes reconciliation instructions directing the Senate HELP Committee and the House Education and Labor Committee to report changes in laws within their jurisdictions to reduce the deficit by $1 billion for the period of FY2009 through FY2014. The instructions for the House specifically direct the Education and Labor Committee to report a bill that invests in education while reducing the deficit by $1 billion over the FY2009-FY2014 period. On July 21, 2009, the House Education and Labor Committee marked up H.R. 3221 , the Student Aid and Fiscal Responsibility Act of 2009; and on July 27, 2009, the committee reported H.Rept. 111-232 to accompany H.R. 3221 . On September 17, 2009, the House passed H.R. 3221 by a vote of 253 to 171. H.R. 3221 would amend the HEA by making changes to existing programs and by establishing several new programs and benefits. It would also establish several new non-HEA programs. Major proposals made in H.R. 3221 include the following. The authority to make loans under the FFEL program would be terminated after June 2010. CBO estimates that this would reduce mandatory spending by $41.8 billion over the FY2009-FY2014 period, and by $86.8 billion over the FY2009-FY2019 period. These savings would be large enough to achieve the spending reductions specified in S.Con.Res. 13 and to offset increases in mandatory spending that would result from other proposals in H.R. 3221 (described below). Beginning July 1, 2010, all student loans made under Title IV of the HEA would be made under the William D. Ford Federal Direct (DL) program. Contracts for the servicing of DL program loans would be awarded competitively, except in states served by not-for-profit servicers where contracts would be awarded to not-for-profit servicers that meet federal standards and agree to service loans at rates determined by the Secretary to be commercially reasonable. Beginning July 1, 2010, a new Federal Direct Perkins Loan would be offered under the DL program; and authority to make new loans under the current Federal Perkins Loan program would end. Loan authority totaling $6 billion would be annually allocated among institutions of higher education (IHEs) eligible to participate in the DL program. Beginning in FY2010, indefinite mandatory appropriations would be provided for the Federal Pell Grant program. Mandatory appropriations would supplement annual discretionary appropriations and would provide an increase above the annual appropriated Pell Grant maximum award. Beginning with award year (AY) 2011-2012, annual increases to the Pell Grant award amount would be indexed to the percent change in the Consumer Price Index for All Urban Consumers (CPI-U), plus one percentage point. Effective for AY2011-2012, the HEA, Title IV federal student aid need analysis methodology would be simplified and requirements for aid applicants to report certain asset-related financial information on the Free Application for Federal Student Aid (FAFSA) would be eliminated. Mandatory funding for HEA programs serving Historically Black Colleges and Universities (HBCUs) and other Minority-Serving Institutions would be provided for FY2010 through FY2019. Mandatory funding would be provided for programs in a new HEA College Access and Completion Innovation Fund (CACIF). CACIF programs would include the College Access Challenge Grant program, the State Innovation Completion Grants program, and the Innovation in College Access and Completion National Activities program. Mandatory funding would be provided to establish and fund three Modernization, Renovation, and Repair grant programs for school facilities. These would include a program for the modernization, renovation, and repair of elementary and secondary school facilities; a program of supplemental grants for Louisiana, Mississippi, and Alabama; and a program for community college modernization and construction. Mandatory funding would be provided to establish and fund an Early Learning Challenge Fund under which competitive grants would be awarded to states for the purpose of improving standards and the quality of state early childhood education programs. Mandatory funding would be provided to establish and fund the American Graduation Initiative grant program for the purpose of reforming community colleges, and to improve education and training for workforce development. The "Defund ACORN Act" would prohibit organizations that have run afoul of certain federal or state campaign finance, election, or voter registration laws from being awarded federal grants or contracts and from receiving federal funds. CBO estimates the termination of FFEL program lending would reduce mandatory spending by $41.8 billion over the FY2009-FY2014 period, and by $86.8 billion over the FY2009-FY2019 period. These savings would be large enough to achieve the $1 billion reduction in spending specified in S.Con.Res. 13 , and to offset increases in mandatory spending that would result from the other new or expanded education programs and benefits proposed under H.R. 3221 . Overall, CBO estimates that H.R. 3221 , as reported in H.Rept. 111-232 , would reduce mandatory spending by $13.3 billion over the FY2009-FY2014 period, and by $7.8 billion over the FY2009-FY2019 period. CBO also estimates that enactment of the proposals reported in H.R. 3221 , if fully funded, would increase discretionary spending by $3.6 billion over the FY2009-FY2014 period, and by $13.5 billion over the FY2009-FY2019 period. Most of these discretionary costs would be for the administrative costs of increased DL program lending and for growth in the discretionary costs of Pell Grant awards that would increase due to changes in need analysis procedures and eligibility criteria. Table 1 shows amounts of mandatory funding that would be authorized and provided for programs that would be amended or newly authorized under H.R. 3221 , as passed by the House. The remainder of this report provides brief descriptions of the programs that would be amended or established under H.R. 3221 . It begins with a review of changes that would be made to programs authorized under the HEA. This is followed by a review of new non-HEA programs that would be established and funded under H.R. 3221 . This report will be updated as warranted to track legislative developments. The Federal Pell Grant program, authorized by Title IV, Part A, Subpart 1 of the HEA, is the largest source of federal grant aid to low-income students for postsecondary education and is the foundation for all federal student aid awarded to undergraduate students. The Federal Pell Grant program is estimated to provide approximately $25 billion in aid to over seven million students for AY2009-2010. Pell Grants are need-based aid and eligibility is limited to undergraduate students. There is no absolute income threshold that determines who is eligible and who is ineligible for Pell Grants, although Pell Grant recipients primarily have low incomes. For the most recent award year for which complete data are available (AY2007-2008), 83% of Pell Grant recipients considered to be dependent upon their parents for financial support had total parental income below $40,000. Of Pell Grant recipients considered to be independent of their parents, 84% had total income below $30,000. The Federal Pell Grant program is currently funded with both discretionary and mandatory appropriations, although the program is primarily funded with annual discretionary appropriations. The maximum appropriated Pell Grant award amount is specified in annual appropriations measures. For AY2009-2010, the maximum appropriated Pell Grant award amount is $4,860. For AY2008-2009 through AY2012-2013, an automatic additional increase to the appropriated Pell Grant award amount is provided through mandatory appropriations. For AY2009-2010, the mandatory add-on is $490. In order to receive the additional mandatory increase, students must qualify for the minimum appropriated Pell Grant award, which, as defined for eligibility purposes, is 5% of the annual appropriated maximum Pell Grant award. For AY2009-2010, the total maximum Pell Grant award amount is $5,350 and the effective minimum award for a full-time student is $976. H.R. 3221 includes provisions that would change the method by which future additional mandatory Pell Grant award amounts are determined and increases direct spending by providing permanent mandatory budget authority, while continuing to preserve a larger role for annual discretionary appropriations in determining the base maximum Pell Grant award to which additional mandatory amounts are added each year. The CBO baseline for mandatory spending as it relates to the Pell Grant program includes approximately $30.3 billion in mandatory budget authority from FY2010 to FY2017, as provided in the CCRAA and ARRA, and an additional $9.8 billion in FY2018 and FY2019. According to the CBO, the provisions included in H.R. 3221 that would affect the future determination of additional mandatory Pell Grant award amounts are estimated to increase direct spending by $38.7 billion from FY2010 to FY2019. Provisions in H.R. 3221 that would affect the future funding and determination of additional mandatory Pell Grant awards include the following. H.R. 3221 would provide indefinite mandatory appropriations for the Pell Grant program beginning in FY2010. The Federal Pell Grant program would remain authorized through FY2017 under HEA, section 401(a)(1). Mandatory budget authority amounts currently specified for FY2010 through FY2017 would be eliminated.