Note: this transcript was provided by an external transcription service.
Mushtaq Gunja: Welcome to dotEDU, the public policy podcast from the American Council on Education. I am Mushtaq Gunja. And I am joined, I think, oh, there they are. By my co-hosts, Jon Fansmith and Sarah Spreitzer as always. Hello Jon and Sarah, how are you? You guys were both slow to turn on your cameras and I was slightly worried.
Sarah Spreitzer: It's Monday. It's Monday. Of course we're going to be slow.
Mushtaq Gunja: Sarah-
Jon Fansmith: We're texting each other about you, Mushtaq. That's why.
Mushtaq Gunja: That's my biggest fear. And we are joined also today by a special guest host friend of the pod, Ted Mitchell, our fearless leader. Ted, how are you?
Ted Mitchell: Friend of the pod sounds like it belongs on my business card. I love it. I love it. Good to be here everyone.
Mushtaq Gunja: And today we are going to spend the bulk of our time talking about congressional funding, the state of the budget, where we are in shutdown land and a whole bunch of things related to dollars. But before we do, Ted, we thought we might ask you on to quickly give us a little bit of a sense of what is happening in the wake of the murder of Charlie Kirk. It happened on a college campus. Kirk was well known for debating on college campus. I know you've been talking to the press a bunch about it and I wondered if you had any reflections.
Ted Mitchell: Yeah, I do. Thanks and thanks guys for letting me join today. And it's clear that the first thing we need to remember about the Charlie Kirk murder is that it was a murder, plain and simple. It was a calculated cold-blooded murder, and it happens too often on a daily basis in America. But the Charlie Kirk murder, as we've been reminded, is not just about the murder of one individual and the tragedy that that is for his friends and family and all of the people who knew him and admired him, but it is also representative of the really dispiriting fact that in America we are finding recourse in violence to the polarization and differences that we have as a society.
And I think that while it is true that Charlie Kirk was murdered on a college campus, his murder was not about higher education, but, it reminds us in really chilling terms of the work that we have ahead of us to use our campuses as places where people learn how to have civil dialogue, how to have a polite conversation, even impolite conversation, but have conversation and debate about the issues that divide us, and not to simply revert to violence. The fact that Charlie was murdered on a college campus reminds us of our duty, of our responsibility to our students, our faculty, and more importantly our society. That if we can't create places of civil dialogue, where will those take place? And so I know that we've been at work at this forever. If you look back in the history of higher education, this is one of the things that people always talk about, higher ed's important role in creating democratic citizens and citizenry. That's what this is. We need to do that.
We had called to action last spring after the events in Israel and Gaza. We have worked diligently before, during and after that to create places on our campus for civil dialogue and Charlie Kirk's coming to a variety of our campuses was a part of that. And I think we need to double down on invitations to people from a variety of political perspectives to come to our campus to present their views and to do so in a way that fosters dialogue that doesn't shut it down and certainly, certainly doesn't generate or support violence.
We've had our go at cancel culture and I think that it's important for all of us to recognize that cancel culture is always bad. It is always counter to free expression, but it's even more important for us on campus to understand that it is counter to working from different points of view to find the truth. And so we're going to disagree. Our ideas are going to rub up against each other. That friction isn't going to be comfortable, but it's essential. And so let's make a vow to each other that we're not going to support, cancel culture from the left, from the right. We are instead going to build places on our campus for the discussion of the issues that will shape the future of our country. So sorry for the sermon, but I think every once in a while we need to remind ourselves why we're here and not be buffeted around, but to find some first principles that we can hold onto as we face the winds and waves of the storm we're in.
Mushtaq Gunja: Do you have advice for us as we are surfing those winds and waves on our college campuses?
Ted Mitchell: Well, I think that it's easy to say that cancel culture is wrong. It's harder to bring that into practice, but I think that opening our aperture and who do we invite to campus, how we create the forums for people to come to campus and discuss controversial issues. But I think that we need to think of ourselves in our leadership roles on campuses kind of as producers of a documentary on how we have a civil dialogue on campus and we need to orchestrate it. We need to think about the where we need to think about the when we need to think about the who we need to think about the interactions and really think about it as a production that we are responsible for and our students are both participants, the studio audience, and we needed to think about that in every bit. As much detail as a producer in Hollywood or in New York thinks about curating the shows that we see either online or on what we used to call air.
Mushtaq Gunja: Yeah, you are welcome to hang out for as much of this podcast as you would like. We love having you.
Ted Mitchell: Thanks.
Mushtaq Gunja: I know that the media often calls, so please hang with us if you'd like, but otherwise if you need to go...
Ted Mitchell: I'm seeing a lot of friends' names go by in the chat, so I may hang out for a little bit, but I know that I'm due to explain H-1B visas to inquiring minds, but I think I'll be doing that over here. You guys are going to be doing it right here. It's great to see you, great to be with you and great to see so many of you on the chat.
Mushtaq Gunja: Hey Ted, before you go, Cassie Barkhart asks, explain the hats behind you, Ted exclamation point.
Ted Mitchell: Well, welcome to the hat collection. We've just moved back into our space at ACE and I've been trying over time to collect hats from all of our member organizations, and I think I'm up to 119 today. We found out on Friday that I had already run out of shelf space, so over the weekend facilities put in another shelf and it is also fully occupied. So I'm not sure what other walls I'm going to be able to take up, but the hat collection is your collection. It's how I always remind myself of who I am, who we are and the importance of the work that you do. So if you've got a spare hat, send it along.
Sarah Spreitzer: And Ted, I'll mention that you often wear those hats when we go to Capitol Hill when you're representing ACE so that people are reminded that those are our members.
Ted Mitchell: Indeed. And I try, if I'm meeting with one of your presidents to always have the hat available and put it on and I'm just glad I'm not using something bigger and harder to carry around than a hat to represent you all.
Jon Fansmith: Foam finger or something?
Ted Mitchell: There we go. But thanks everybody and Mushtaq, thanks for inviting me today.
Mushtaq Gunja: Before we sort of move on to talking a little bit about funding cuts and all of that, I think one of the things we've seen over the last few days is really a little bit of political pressure from many, but maybe especially the federal government to sort of police what is happening on our campuses. Jon, Sarah, I wondered if you had any reaction to what we've seen over the few days post the murder of Charlie Kirk?
Sarah Spreitzer: Oh, yeah. I was going to jump in with kind of what we saw earlier this year with Secretary Rubio revoking student visas for participation in protests on college campuses. He has said that he'll do the same regarding social media and posts speaking out against Charlie Kirk and I don't know if we've seen any proof of that yet, but obviously the secretary has pretty broad authority to revoke those visas and they've already established a precedent for doing that earlier this year.
Jon Fansmith: Yeah, I would sort of add on to what Sarah said. I think one of the things that's certainly concerning as we look about what's happening, and I think Ted really summarized the situation quite well, it's one of the things that was certainly central to who Charlie Kirk was and how he chose to shape the culture was through this idea of engagement, especially intentionally in some cases going places where he knew his views were not going to be well received. And I think there is a certain concern. You see when you see people, secretary McMahon called for sanctioning voices of people she called on the fringe of academia. That goes really in the opposite direction of certainly what his legacy was, which is this idea of engagement, which I think Ted reinforced. We often talk about the way to deal with even the worst forms of speech, hate speech and threatening speech is with more speech and with clarity and with engagement in civil debates, that is historically what the American concept of free speech has been centered on.
And so to see, particularly it's one thing when you see calls in the public and I think with tensions and feelings and emotions very high, everyone expects that sort of thing regardless of political persuasion and regardless of the incident. But when you see members of the government talking about implementing changes, calling for changes, suppressing people's speech, you start to really worry a little bit about what this does to climate. Is that going to actually exacerbate the problems? We've seen this inability for people to cross differences and have discussions and whether that's on a college campus or in social media or in a public square in whatever form you take it, this is an opportunity to double down on that engagement on rebuilding the civic discourse.
And so certainly angry speeches is an outcome in situations like this. What we hope is the better angels are what we're going to guide towards and there are certainly people doing that who are making that call. It's not uniform unfortunately, and a reminder of how much work we at higher ed because we really are the people who should lead the way in that regard need to do to build the culture we want to see.
Mushtaq Gunja: Yeah, and I think as Ted noted, I think we have been doubling down on the right ways to be able to have for civil discourse post to October 7th. I think what's really happened on college campuses has really reminded us about how important our roles are here. And so I mean we can't always control what is going to happen at the federal government level, what all of our political leaders are going to do, but what we might be able to do is be sort of the best versions of ourselves and really provide good arenas for us to be able to debate ideas in a productive, a productive way.
And we might not always like everything that is said, but providing a safe and reasonable place for those discussions to happen I think is going to be really important. And as always, we'll be trying to help here at ACE in any way that we might be able to please let us know. Friends, can we talk a little bit about funding and about the state of where we are and Jon, I don't even know exactly how to ask this question to sort of tee us up. Maybe let's just start here.
The government's about to run out of money. Theoretically we have a budget that needs to get passed. Jon, where are we on all of that?
Jon Fansmith: And if people know I'd appreciate some tips in the chat. It's a very uncertain environment. The quick summary is that the federal fiscal year ends on September 30th short of Congress affirmatively doing something that the president would sign to provide funding either long-term or short-term for federal agencies as of that date, midnight on the night of the 30th, the government will go into shutdown. We had a lot of activity last week. It's the classic storm in fury signifying nothing. The house passed a short-term bill that would've extended funding at current levels out through November 21st. It went to the Senate. The Senate voted it down. Democrats in the Senate offered an alternative that was also voted down. So as it stands, there's no real pathway forward. Luckily Congress has taken this week to go on recess, so they are not here in town to work on this.
It doesn't mean negotiations won't happen to be abundantly clear. They are perfectly capable of negotiating without being physically in DC, but we are steamrolling towards a shutdown without a lot of clear pathways for it. Now this is worth pointing out. Sarah and I have probably said some variation of what I just said every year for the last five or six years, at some point at least it feels a little bit different this time Democrats feel strongly incentivized to fight to push for a shutdown in part because of some of the things we're going to talk about in just a second.
But they don't think the administration is a good faith actor and the kinds of things they would want in place, the things they've asked for are just unpalatable to Republicans including reversing all of the cuts to Medicaid that were just in the reconciliation bill that was signed on July 4th. So clearly not something Republicans are going to pick up and do. It's a problem. I mean I think Sarah and I would've said, and jump in here Sarah too, our guess would be we get a short-term CR, it'd push some time into the fall. I still think that's a possibility maybe shorter than November, maybe October or so, and then maybe delay a shutdown. But the rhetoric's pretty heated at this point in a way that's a little bit different than what we normally see.
Sarah Spreitzer: Yeah, I mean it's interesting that the house passed CR would fund the government until I think it's November 20th, that would put us right before Thanksgiving. So that is trying to push for something to be done. It's not like a year-long CR, which I think is what some Republicans have been calling for. We've also heard that the House and the Senate are working on a mini-bus where they are conferencing some bills that they've already passed that are considered non-controversial and that would be Legislative affairs, which is VA funding and things like that, and then the Agricultural bill. And they seem to be close to an agreement on that.
And so if you did pass the CR until November, would that give them time to do work on other appropriations bills? I feel like we're running into this thing and we're going to talk about this later about some of the defunding that's going on in the grant programs is that Congress continually that they felt that some of the decisions being made in FY 25 were being made as President Trump was coming into office and that everything would kind of return to normal in FY 26.
They would put the programming money in and it would be spent out by the administration. And I think that larger argument is clouding this end of the year discussion, which is very different than previous end of the year discussions. I mean, if we go into a shutdown, it's happened before, but it's always been on what to fund in the federal government. I think now it's becoming more of a what appropriations bills even mean in this environment where the administration is just funding whatever they want. They're not really following congressional intent and that's a bigger question. And so maybe the Dems accept a CR until November 20th so that they can have these more complicated conversations or maybe we go into a shutdown now so that they can continue to make their major points that things need to change
Mushtaq Gunja: Mean. And Sarah Jon, we will get to the substance of what's in these budgets in just a second, but from a big picture perspective, I think one of the things that strikes me as we think about whether the government's going to shut down how the Dems are going to respond is it seems very difficult to sign on to a budget if the dollars that you agree to be spent aren't going to be spent. Right. We've been living in this world of rescission, right? This word that I feel like we never really used before and now all we do is talk about rescission all the time. This idea that the government, the executive is not actually spending the dollars that were allocated to it by Congress, and this means this in particular seems to be hitting some higher ed programs. How exactly Jon, Sarah, I mean how are the Dems supposed to agree to any sort of budget when the dollars that they agreed to might not get spent? I mean, how are they thinking about that?
Jon Fansmith: Yeah, well is so if you look at some of the appropriations bills that were passed in the Senate, keeping in mind the Senate has to do a bipartisan process. There was language in there and that essentially ties the hands of the administration and how they can repurpose essentially attempts to enforce what the law actually requires, which is that Congress has the power of the purse and when they send things to the administration, the administration's legal obligations to spend money as Congress directed, there's a lot of budget wonkishness that's worth diving into for just a second. I try to stay out of that generally, but we are operating under a year-long CR, which is what Sarah mentioned for the current fiscal year, fiscal year 25, it seems kind of irrelevant. It provides the funding at previous year's level. You just sort of, the deal was reached, we're going to fund the government at what we spent in FY 24.
It actually matters a lot because the actual structure of the way the budget was done essentially put money into categories going to the agencies rather than money into delineated programs. And there's an argument, I'm not going to pretend that I know absolutely what the law says in this case because it's a matter of some dispute, but there's an argument that the administration has seized on in which has some support from people who are not necessarily just supporters of the administration saying that because of that sort of broad bucketing of funding, it gives the administration unusual leeway to switch money inside those categories. So they take education money and spend it on defense, but within education, within financial aid, they can shift things around to reflect their priorities that in a normal fiscal year when Congress passes an omnibus bill or they pass individual bills where they've said, this is how much for these programs, they don't have that flexibility.
The argument, at least this right now for the current fiscal year that we're heading towards the end of is that they have that flexibility. And we have seen that especially in the last couple of weeks. But much to your point, if you are a Democrat in Congress, what you have also seen in the last couple weeks is that the administration is using that authority, ambiguous authority members of Congress. Democrats certainly dispute that they have the ability to do that. They're using that to pursue very political choices about what gets funded and why. And so why would you trust it without rock solid guarantees that the administration will spend the money you send them for the purpose for which you send it? There's really not much sense in participating in a budget process because it becomes irrelevant. You're only funding the administration's priorities under those terms.
Sarah Spreitzer: But I think Jon, I mean, I don't think we would've guessed that that would've happened back in March when they did the year-long CR, right? I don't think this has ever happened before. So Congress is at this new point right now. How do they ensure that their funding priorities are carried out? I mean, they hold the power of the purse. The president proposes Congress disposes, as we always say, and so we're at this point right now, right, with a CR, are they going to include more guardrails around whether or not the administration will spend the money out.
Jon Fansmith: I mean, I guess.
Ted Mitchell: Proposes, the administration disposes? Is that what we always say?
Mushtaq Gunja: I never heard you say that but I like it.
Sarah Spreitzer: Wow. I'm shocked. I thought that was at the top of mind for everyone in Civics 101.
Mushtaq Gunja: I think I need to go back and take Civics 101 again, Jon, you were about to say.
Jon Fansmith: Yeah, no, I mean we should dive into actually what they've been doing. I think it's pretty illustrative of this issue, but to your point, Sarah, right? We know what Congress needs to do to constrain the administration, which is pass appropriations bills and maybe make sure the tables are included in the legislative text rather than the report language. Although the report language matters too.
Sarah Spreitzer: I mean, who would've thought that though back in March? I mean, who really would've thought that because they didn't include the tables somehow that implied that Congress was giving the administration wide range to just spend the money however they wanted to.
Jon Fansmith: Well, I think probably a few people-
Sarah Spreitzer: I would not have guessed that. Maybe you did, maybe you did, Jon, you didn't tell me about it.
Mushtaq Gunja: All right, let's get into what the source of these cuts are, where it's all gone. Sarah, there's a couple of questions in the chat, tables? Please explain.
Sarah Spreitzer: Yeah, I mean the tables are something that's usually attached in the back of an appropriations bills that spells out how the funding is supposed to be spent among the programs. So as Jon was saying, they may say this huge pot of money to the Title IV financial aid programs, but then in the tables they might say out of that pot of money, so much money to work study so much money to the Pell program, so much money to Gear Up or trio. So we didn't have those this year and everybody was kind of like, well, that's strange, but I'm sure it'll be fine.
Jon Fansmith: Yeah, usually if you read the legislative language of an appropriations bills, it'll say, here's this much money in this category. But then these tables that we're referring to say, Pell Grants gets X amount of money and it's very clearly delineated what programs get what funding, and that has generally been seen sort of as an easy way to understand how the money's broken out, but there's never really been a challenge to spending the money in those lines. Sarah has it exactly right in this because it's a continuing resolution. It was done without the tables. You don't have something that in clear, unambiguous language from Congress says, this is what we intend the administration to do with this money and that congressional intent is really important in the administration. They are compelled to do it when Congress has made it clear what they want them to do and they didn't do that this time.
But I know we really would like to talk a little bit about what's going on with the MSI programs and with TRIO, and I think these are important in this conversation we're having because this is the administration using funding as a political tool and just very briefly, because they're essentially the same function. Some differences since the beginning of this administration, we've seen individual grants canceled. We've seen lines of research funding or other types of funding that have been canceled because of the subject of that work or what it covers. What we have seen as we head towards the end of this fiscal year and as it affects the Title III and Title V institutional support programs and TRIO grants, which are both big areas of higher education support, is that the administration has made some determinations about what they think is aligned with their priorities.
And in a number of these cases, both MSIs and TRIO programs, they have decided to either cancel that funding or shift that funding in a way that no administration previously has. I'll start with Title III and Title V and then maybe move to TRIO if that's okay with both of you. Yeah, so there is Title III and Title V programs under the Higher Education Act or programs that provide direct support to institutions based generally on the characteristics of the students on their campuses.
They are meant to help institutions that serve underrepresented populations, especially high need, low-income, underrepresented populations. It gets a little confusing because there's two kinds of institutions covered under Title III and Title V programs. There are two types of institutions that are known as mission institutions, and those are historically black colleges, universities and tribal colleges and universities, and they're known as mission institutions because they have that designation in federal law because of their mission has nothing to do with the percentages of students on their campuses, it's that they have historically served this incredibly valuable role in their communities working with populations that have real distinct needs from the general population.
A lot of ways, especially historically and most importantly, have been incredibly underfunded relative to a lot of their peer institutions. The other grouping are generally what's known as the minority-serving institutions. And in those cases, those are programs. Those are institutions that meet an eligibility requirement in federal law because they have a certain percentage of students of a specific racial or demographic group on the campus. So think about a Hispanic-serving institution that is an institution that's serving 40%, I believe. Check me on that Mushtaq.
Mushtaq Gunja: 25%.
Jon Fansmith: 25%, thank you. Of their student enrollment is Hispanic students, students of Hispanic origin. They therefore qualify for some additional federal support. It's a complicated funding formula. It's allocated across these programs a lot of different ways. What this administration did last week announced actually a week and a half ago announced was that they would take all of the available funding, about 350 million worth that went to the MSI institutions, seven categories of MSI institutions, and would transfer that funding along with some other funding captured from other parts of the budget, primarily from teacher preparation programs to send a total of about $495 million just to the HBCUs and TCUs. So essentially they zeroed out all the funding that would've gone to all of the MSIs and transferred that to the HBCUs and TCUs. This is certainly concerning for a lot of reasons. We are very far into the fiscal year institutions within those programs, generally year to year don't see a huge shift in terms of the amount of support that's available to them.
So they can predict with some degree of certainty, additional federal resources coming in. These are institutions that by their very nature are serving large populations of low income students. And so this abrupt shift in the funding, even if, and again, I would personally dispute it, I know many others would dispute it, the administration has legal authority to do that, even if you assume and accept that the impact, the harm that is done to those institutions is enormous. It's also a little bit surprising in some ways the administration, the president's budget request from earlier in this year proposed maintaining funding. In fact talked about the importance of those programs from the higher ed side. You think about the students they're serving. Yes, absolutely. HBCUs and tribal colleges serve a lot of students in incredible ways, but so do these other schools and that's why the funding is there. So I don't know if we want to go into the other thing with the court case around HSIs that's a little bit complicated or we can move on to just sort of an overview of the TRIO programs. I don't know, what do you think?
Sarah Spreitzer: Well, Jon, I was actually going to ask about that because is there a difference between an HBCU designation and an HSI designation and the core case right now that we have pending in Tennessee? Because I think that adds somewhat to, you have to understand one to understand the other. So can you talk a bit about that?
Jon Fansmith: Yeah, and I'll reiterate, there's kind of a clear dividing line among the institutions that get resources through Title III and title, and that is that this designation as either a mission institution term of art, not in law or an MSI, HBCUs and TCUs have a historic designation as falling into those categories. There are some HBCUs that are not majority black student enrolled, but they are historically black colleges and universities. So there's no dependency on who is enrolled at the student, what their undergraduate or what their student body looks like. The court case is something that we had been, and this is a case in Tennessee, it was brought by students for fair Admissions, the same group who brought the admissions cases against Harvard and UNC, and they essentially sued the Department of Education in partnership with the state of Tennessee saying that the HSI program, because of its requirement that institutions enroll a percentage of Hispanic students to be eligible to participate, violated the students' prepared Admissions versus Harvard-UNC cases.
Essentially saying a federal benefit was only being awarded on the basis of the racial composition of the class. That case has been brought, it has not advanced. Our colleagues at HACU in partnership with another group have sought to intervene to defend the HSI designation in the program. As far as I'm aware, and maybe one of our HACU colleagues is in the chat that can jump into that request to intervene has not yet been granted. So I think the case is still very much up in the air. What was important about that case is when it was brought, the Department of Justice, which is the government's attorneys, when the government is sued, declined to intervene, essentially saying, we're not going to contest this. We agree with the plaintiffs in this case, we see HSIs as being discriminatory, the HSI program as being discriminatory. It's one of the reasons HACU had to intervene because the government would not defend their own program.
Going back to strategy to project 2025, this was an idea that they would eliminate funding for the MSI programs and use that as a block grant to states to support low-income underrepresented students. So a lot of this has been sort of playing out in slow motion over the last year or so. We've just seen a very sudden acceleration of it this year. Now it's important to keep in mind what the administration is doing is moving FY-twenty-five, year 25 money from those programs to the HBCUs and TCUs. It doesn't necessarily mean those programs will be eliminated. It does not mean that they won't get money in fiscal year 26, and if Congress follows the process, Sarah and I were talking about where they require the administration to fund along their lines. You could see all those programs have their funding restored for the next year. It's still a $350 million hole in hundreds of institutions budgets.
The impact will be felt and felt relatively immediately, even if going forward funding resumes. There's a lot of concerns. We have been working a lot with our colleagues and with allies on the hill, and this is one that I think somebody in the chat talked about. What's the response been on the hill? Well, a lot of these programs, these institutions have really strong bipartisan support. These programs have existed and been funded at the levels they have for so long because a lot of members of Congress see the importance of these institutions, not just in their districts but across the country.
And so this is one of those things where the administration may have a set of priorities, but I don't know that it's broadly reflected by people on the hill. And we may see some things done. We're certainly going to keep pushing for things to be done to address the problems this has caused to fix those problems, to restore the funding. Still early stages, obviously, and again, the administration is working in a way that I don't think any of us contemplated because we don't necessarily share their view on the legality of the measure, but we're in the beginning stages of that fight. But there's a lot of people who want to get involved.
Mushtaq Gunja: Quick thoughts, I mean, on the intervention side, I was at a conference a couple of weeks ago and there was a question about whether or not the district court was going to grant HACUs move to intervene to defend the grants. And it's unusual for us to be in this sort of situation where a government grant is not being defended by the administration. It's unusual but not unprecedented in changes in administration. This sometimes happens when the priorities of the administration sort of change. In those cases, intervention is sometimes granted, and I would think that this would be a case that would be ripe for somebody to be able to intervene to be able to defend the program.
Hopefully HACU, because of the congressional support that you talked about, Jon, these dollars have been allocated. This is not a new program. These dollars have been allocated for some amount of time with broad-based bipartisan political support. And now the idea that it was all unconstitutional all along, maybe, but probably should get a court hearing. It would be, the way that I would think about it if I got to wear those black robes that I so desperately want at some point. So there's that part of this. Jon, question for you, and Sarah, please chime in too.
There are several types of institutions that are affected and grants that are affected in my understanding. I mean, there's a set of dollars to NAPCs our folks that are serving Asian Pacific Islander students. There's some for, I think some Native American-serving dollars that are separate from the tribal colleges and universities, some dollars to predominantly black institutions. What do you think the strategy was to go after HSIs here via Tennessee? Why did they choose that program and does it mean anything for what's going forward?
Jon Fansmith: Yeah, and as always, I'm loathe to put myself into the mindset of people whose views I strongly disagree with. I think one of the things about it is that HSIs exist sort of separately from the other MSIs. They're in title. I think there is probably, since it's one of the bigger pools of funding relative to something like PBIs, there are a lot of institutions that should qualify as HSIs based on their undergraduate, or sorry, their student enrollment. And one of the big problems with that from our perspective, one of the problems with that program is not its existence by any means, but the lack of funding necessary to make sure that all the institutions that are doing this work are getting the support they need. I think that's probably, if you had to identify why they went after HSIs, it's that they're the most common institutional type that would qualify.
They happen to be in most states and certainly the biggest program. So you're certainly getting more bang for your buck. They're also, frankly, a lot of these institutions, understandably, are incredibly sympathetic both to the public and to policymakers because of the work they do, because of the history that they have, because of the populations to serve and how well they do that. It's also worth monitoring. I saw a good friend of ACE Pat McGuire in the chat mentioning the fact that what's often overlooked is while we're talking about money going to these schools based who some percentage of their student population is, the money goes for improvements to the institution that benefit all of the students on those campuses.
This is not a program that only benefits Hispanic students or Black students or Native American students on a campus. These funds go to improve the educational experience of everyone. So it is a lot of misrepresentation of what the programs are, what they do, and who they serve. And I think to your earlier point, Mushtaq, if you want to start ascribing motives for these actions, I think that misrepresentation kind of gets you to what you need to know about what's the driving force.
Sarah Spreitzer: See, I thought, Jon, you were going to talk about the fact that I think a lot of this is coming from the January 20th executive order on DEI and the mention there of students for fair Admission and how broadly they could apply that. And I think we've seen it applied to everything from grants that have previously been awarded that underwent the peer review process to programs that have been set up by Congress. I don't know if it's anything specific about HSIs. I just see this as continuing efforts that have started since the first day of this administration to broadly apply that Supreme Court ruling as broadly as possible.
Jon Fansmith: Oh yeah, absolutely. I mean, I agree entirely. They have taken an interpretation of what students for fair Admissions meant in the higher education context that is so far beyond any reasonable interpretation of what that means in terms of how race and diversity is handled on college campuses. And they've sought to apply it everywhere they could. So you're right, this is the through line from the start of the administration. It's not a surprise we're here. It's just clearly kind of an abusive and unfortunate approach.
Mushtaq Gunja: And it's why I do think that a court should take this up because there are broad executive orders about what the decision SFFA means that aren't clear from the face of the decision. And so let's see where the Supreme Court takes us, where the lower courts take us and how far they extend these rulings. But the broad executive orders, as we've said over and over, don't have the force of law. So let's see if we can test it. And I really do hope that the court intervenes or allows intervention here so that way we can see what the ramifications of that court ruling are. Can I just go over to Trio and just ask one, maybe if you guys can take this very quickly, what else is, so there's a set of grants to MSIs that had been sort of cut out, zeroed out, and some Trio funding has been as well. What else is in that bucket of dollars that have been zeroed out by this administration?
Sarah Spreitzer: I was going to put in a plug for our tiny Title VI international programs. I mean, those are programs that have been around for years. They fund area studies and foreign language assistant grants and basically just like TRIO, grants have been funded, have received notice that they're no longer going to be funded and that the program's not going to continue. So again, following this ability of this administration to make these decisions, even though Congress funded Title VI programs in the FY-24 budget.
Jon Fansmith: I will say there's also some things happening in the K-12 space in the same area. The administration is trying to direct funding to charter schools, I believe by repurposing funding. They're also trying to put a lot more money into a version of history education in advance of the 250th anniversary of the United States. That's meant to uplift a certain way of teaching and approaching American history, that there was a partnership that was announced, the Department of Ed with Heritage Foundation and Turning Point in a number of other groups to sort of pursue that effort. Sarah pointed out international education. There's been teacher, especially teacher preparation programs, cuts were made, or not cuts, but repurposing, shifting that funding around to eliminate those programs. So it's not just higher ed, but what we've seen, particularly with the MSI and the TRIO piece is higher ed's getting the bulk of where the impact will be felt.
Mushtaq Gunja: Talk to me, you two, about what the future of these programs look like in the FY26 funding cycle. I mean, is there appetite on either a partisan or bipartisan basis to refund some of this? What have you seen there?
Sarah Spreitzer: I mean, yeah, I think these programs in what the House and the Senate have marked up in the fiscal year 2026 process included funding for these programs. TRIO and Gear Up are two programs that have been incredibly bipartisan, incredibly popular with Congress. In fact, we would often see administrations, whether they were Dems or Republicans defunding it, knowing that Congress was going to restore the funding, right? For them to just sit back and not do anything is incredibly shocking. And so again, that goes back to where we started this conversation. What is going to happen with fiscal year 2026? Does Congress intend for 2025 to be a blip? And for things to go back, I think the administration in their mind is like 2025 is not a blip. We have the authority to reprogram this funding. It's unclear if Congress is going to go along with that.
Jon Fansmith: And I will say, members of Congress generally care a lot about funding and how it impacts their constituents because it's absolutely a factor in them getting re-elected, right? We can be as idealistic as we want, but cynically, a lot of the reasons members of Congress fight over how much funding gets allocated where is because they see it tying directly back to their district. And when federal funding is coming to their district, it has a benefit for how they're perceived as supporting their constituents. You look at these, if you are an institution in a member of Congress's district, and as I talked about this, there are a lot of Republican members who are not happy with what the administration did because it is money that is going to blow a hole in the institution that's employing hundreds or thousands of people in their district. It's going to mean layoffs possibly.
It's going to mean cuts to services. It's going to mean programs being closed. Congress has a real incentive now, the administration is hammering home the necessity of them doing their jobs and actually directing the funding in ways that they should, because it's one thing to have, we talk about this all the time. It's one thing to rail against higher ed or whatever else you want to rail against. It's another When those things are rebounding on your constituents and the job market craters in your district, that's a very different matter. And I think, again, who knows, but I think in FY 26, both TRIO, Gear Up and the MSI programs will absolutely see additional funding, they did in both House and Senate appropriations bills. Those programs weren't zeroed out. Those programs were fully funded. Some cases saw increases. So these are not things that Congress wants to get rid of, and there's a lot of members privately at this point who are not happy with what the administration has done.
Mushtaq Gunja: Jon, I guess that segues to a couple of questions in the Q&A in this vein of, wait a minute, my current grants are being canceled, but I've been funded for either the next year or some version of that. What's going on? How are our institutions supposed to plan? What should they expect to see?
Jon Fansmith: Yeah, look, it's really hard and it's really uncertain. I'm not trying to sugarcoat that, right? And given what we have gone through, I don't want to say you should rely on the process working because certainly the process is not currently working. I feel like a broken record on this count. It is really critically important that members of Congress hear from institutions about the impact of the administration's policies on their bottom lines, on their day-to-day, what it means for the programs they are for the students, they enroll their ability to operate. That is the way we change this around in terms of how you plan for it. Again, I feel confident based on what Congress has already indicated in terms of funding, in terms of how broad the support for these programs are, there are few more popular programs within the higher education accounts than the MSI programs and the TRIO Gear Up programs, and a lot of credit to the advocacy groups representing those communities.
They do amazing work. COE and NCHEP and all of the groups that are working in the space do really good work, and they get a lot of receptivity because they're demonstrated effective programs serving really important constituencies. Yeah, I'm going to hammer it like call your congressman, let them know this is what the impact is. I think we have a winning argument. I think we have a pretty strong argument. I think the administration overplayed their hand here, and this is a time to push back really hard and make sure that they feel the pain of doing it.
Sarah Spreitzer: And Jon, I would just say in regards to what ACE is doing, we are focused on getting that message to the administration and Congress that spend out the FY25 funding as was allocated by Congress. But in the final FY26, like, can we put guardrails? Can we ensure that those tables are included so that the funding is spent out as Congress appropriated it?
Jon Fansmith: And the other ask is make them whole. If the damage has been done, if the administration is shifting money, then it's Congress's responsibility. It's not nice for them to do. It's their responsibility to make those programs whole to restore the funding that was improperly, maybe illegally shifted away from them.
Mushtaq Gunja: What are we seeing in these last few days of this fiscal year? Are the dollars that have been held back, are they starting to get spent? Are we seeing this program to program? I mean, I thought I saw that some of that NIH and NSF funding, maybe most of it actually ended up getting out the door, even if it was sort of weirdly haphazard and at the last minute. Do we have some hope that some of these dollars will come out in these last 10 days?
Sarah Spreitzer: I mean, some of it is kind of accounting tricks that they're doing. I don't want to say tricks, but if you're trying to get the money out funding a multi-year grant in one year rather than just putting out the money that year, yes, I think NIH at least will have spent all of their money, but they still saw a lot of grants being terminated and they still saw a lot of slowness in getting the money out of the door. And as an institution, how do you even plan for that? Right? It's not a very good business model.
Jon Fansmith: And I think you think about something like the TRIO programs, and I saw somebody in the chat mentioning McNair we're at the stage basically going back to August where institutions were supposed to get notification, not just, and McNair is coming up sort of the usual cycle, but other areas. And the administration has said, well, we'll get the funding out by the end of September. But schools are getting cancellation notices saying their grants are being, some are getting their grants, they're getting a continuation saying the funding will be coming. Again, shout out to COE. They've been tracking this very closely. There's about $40 million in canceled grants. Things where they have told institutions, "You will not get this money." And let's be really clear, that's significant. There's another 600 million or so that has not yet been awarded. Hopefully they do the right thing and award all 600 million of that.
But as the McNair notices are being come out, you're finding a lot of McNair programs are getting cancellation notices as well. So this is a pretty critical time. And will the administration live up to their promises? I mean, very clearly, Ross Vought at OMB has talked about this idea of running out the clock. If we get to the end of the fiscal year and we haven't spent the money, we don't have to spend it because the fiscal year is over. You do worry, understandably, very concerned about as we approach the end of the year where those existing gaps are that they may not actually do what they've said they're going to do.
Mushtaq Gunja: One last question here. Workforce funding, things like WIOA, what's the future there? What are you guys seeing in your crystal ball?
Sarah Spreitzer: I mean, some of those programs actually did get transferred to Department of Labor, like staff have actually gone over to the Department of Labor. And again, I think that those are programs that have generally had bipartisan support, but whether or not there's certainty around the funding, I'm not sure.
Jon Fansmith: I mean that's another area, the administration from the campaign, but certainly the beginning has emphasized that they tend to put a lot of value in what they see as alternatives to traditional higher education and workforce programs are a big area for that. There's a lot of bipartisan interests in Congress and making changes to workforce programs have gotten really close in the past Congress about passing some legislation along those lines. So I actually think this is an area where if you're concerned about that, you might see more funding. Actually, that's an area of bipartisan interest and administration prioritization. It's not really in the same place as a lot of the programs we think is more traditionally Department of Education, higher education support programs
Mushtaq Gunja: And advice to our institutions. That is to contact your members of Congress now with, and I love the advice in the chat about include how many students are impacted the program staff, share those success stories. As you said, I mean these programs have been bipartisanly supported, not because they sound good, but because they've had demonstrated success. So let's make sure to remind everybody of that and hopefully that'll work. I know that we only have a couple of minutes left, but I think that there's one other big thing that happened over the weekend, Sarah, chaos in H-1Bs?
Sarah Spreitzer: Chaos just in general on the immigration front Bush talk. Just take that as a go. On Friday night, we saw a presidential proclamation come out from President Trump that said that the fee for H-1B Work Visas was going to be raised to a hundred thousand dollars. Currently it's around $780. There wasn't a lot of detail included about how this would be implemented, where the funding would go, also, how it would be applied. There were concerns about people actually coming into the country on Saturday night that could hold H-1Bs and whether or not they would be subject to this new $100,000 fee. So right now, I think everybody's trying to figure out how is this going to be implemented.
It's also unclear whether the president actually has the authority to do this, because usually there's a notice and comment when fees are raised and a justification for why the fee is being raised. So I'd say we're going to wait and see, but I think our HR professionals on our campuses are very nervous because obviously a hundred thousand dollars is a lot of money, and I think that that means as a result, we likely won't be employing H-1Bs that we rely on a lot of times for faculty, for staff positions, especially to teach high-need courses. And so we're going to be watching it closely.
Mushtaq Gunja: There really was, there really was a lot of chaos, and I'm still not entirely sure what the announcement is. It seemed like there was some disagreement between Secretary Lutnick and the Press Secretary about whether the hundred thousand dollars was going to be an annual amount or a one-time fee, and then what the carve-outs are going to be. Whether if you just like and know somebody in the administration, you might be exempted somehow from the hundred thousand dollars. I mean,
Sarah Spreitzer: Yeah, I heard it compared to the rollout of the first travel ban, a big idea without a lot of details behind it. And it was interesting that Secretary Lutnick, who was Secretary of Commerce, was in the Oval Office when the proclamation was announced, not the Secretary of Homeland Security, who's actually in charge of issuing the work authorizations. So again, I think that they're building the ship as it's being launched, and I think a lot of our industry partners, especially in the tech world, this is going to be a very big issue for them. And so we're going to be watching that. And then how this is going to impact our hiring.
Mushtaq Gunja: Jon, anything to comment on here on H-1Bs?
Jon Fansmith: Just that I'm incredibly happy to have Sarah on the ACE team and H-1Bs. I'm laughing as I say it, but honestly, we couldn't have a better person doing it, and I don't give it Sarah enough love in these chats, but she has a very complicated range of issues that is a disaster week just so well, so we're all lucky to have her, including all of our members.
Sarah Spreitzer: You're just lucky I check my email on the weekends.
Mushtaq Gunja: All right, friends, look, Sarah, I think we'll probably spend just a little bit of time next week or next time talking about how this all actually ended up playing out. And goodness knows, I think in a couple of weeks we're going to be somewhere on funding, maybe, maybe not. So we'll update all of you, but thank you all for coming. Thank you for the vibrant Q&A and the questions and comments in the chat. It was always very helpful and can't wait to see you next time. Thanks everybody. Oh, and I was only joking. I'm not really trying to be a judge. I would never leave ACE or any of you. I mean, obviously this is a job that I want for the rest of my life. Thank you all you.
Sarah Spreitzer: Thanks, Mushtaq.
Mushtaq Gunja: Bye everyone.
Sarah Spreitzer: Bye.
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