[Appendix]
[Detailed Budget Estimates by Agency]
[Department of Education]
[From the U.S. Government Printing Office, www.gpo.gov]


                     THE BUDGET FOR FISCAL YEAR 2005

[[Page 343]]

 
                         DEPARTMENT OF EDUCATION

              OFFICE OF ELEMENTARY AND SECONDARY EDUCATION

                              Federal Funds

General and special funds:

                     Education for the Disadvantaged

    For carrying out title I of the Elementary and Secondary Education 
Act of 1965 (``ESEA'') and section 418A of the Higher Education Act of 
1965, [$14,528,522,000] $15,105,168,000, of which [$6,983,169,000] 
$7,522,480,000 shall become available on July 1, [2004] 2005, and shall 
remain available through September 30, [2005] 2006, and of which 
$7,383,301,000 shall become available on October 1, [2004] 2005, and 
shall remain available through September 30, [2005] 2006, for academic 
year [2004-2005] 2005-2006: Provided, That [$7,107,283,000] 
$7,037,592,000 shall be available for basic grants under section 1124: 
Provided further, That up to $3,500,000 of these funds shall be 
available to the Secretary of Education on October 1, [2003] 2004, to 
obtain annually updated educational-agency-level census poverty data 
from the Bureau of the Census: Provided further, That $1,365,031,000 
shall be available for concentration grants under section 1124A: 
Provided further, That [$1,969,843,000] $4,146,187,000 shall be 
available for targeted grants under section 1125: Provided further, That 
[$1,969,843,000] $793,499,000 shall be available for education finance 
incentive grants under section 1125A: Provided further, That $9,500,000 
shall be available to carry out part E of title I: [Provided further, 
That $235,000,000 shall be available for comprehensive school reform 
grants under part F of the ESEA:] Provided further, That from the 
[$8,842,000] funds available to carry out part [E] A of title I, up to 
[$1,000,000] $10,000,000 shall be available to the Secretary of 
Education to provide technical assistance to state and local educational 
agencies concerning part A of title I. (Division E, H.R. 2673, 
Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0900-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Grants to local educational 
        agencies........................      10,045      14,022      13,342
00.05 Reading first State grants........       1,280       1,077       1,125
00.06 Early reading first...............         149          94         132
00.07 Striving readers..................                                 100
00.08 Even start........................         247         269
00.09 Literacy through school libraries.          12          20          20
00.10 State agency programs.............         443         453         442
00.11 Comprehensive school reform.......         234         244
00.12 Evaluation........................           9           9           9
00.13 Close up fellowships..............           1
00.14 Advanced placement................          23
00.15 Dropout prevention programs.......          11
00.16 Migrant education projects........          39          35          35
                                           ---------   ---------  ----------
10.00   Total new obligations...........      12,493      16,223      15,205
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         490       2,376
22.00 New budget authority (gross)......      14,379      13,846      15,205
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           2
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      14,871      16,222      15,205
23.95 Total new obligations.............     -12,493     -16,223     -15,205
23.98 Unobligated balance expiring or 
        withdrawn.......................          -2
24.40 Unobligated balance carried 
        forward, end of year............       2,376
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       7,070       7,145       7,822
40.35   Appropriation permanently 
          reduced.......................         -79         -82
42.00   Transferred from other accounts.           5
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       6,996       7,063       7,822
55.00   Advance appropriation...........       7,383       6,783       7,383
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................      14,379      13,846      15,205
    Change in obligated balances:
72.40 Obligated balance, start of year..       6,082       7,289       9,361
73.10 Total new obligations.............      12,493      16,223      15,205
73.20 Total outlays (gross).............     -11,253     -14,151     -14,344
73.40 Adjustments in expired accounts 
        (net)...........................         -31
73.45 Recoveries of prior year 
        obligations.....................          -2
74.40 Obligated balance, end of year....       7,289       9,361      10,222
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       6,067       6,149       6,671
86.93 Outlays from discretionary 
        balances........................       5,186       8,002       7,673
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      11,253      14,151      14,344
    Net budget authority and outlays:
89.00 Budget authority..................      14,379      13,846      15,205
90.00 Outlays...........................      11,253      14,151      14,344
---------------------------------------------------------------------------

                        SUMMARY OF PROGRAM LEVEL

                        (in millions of dollars)

                                     2003-2004 
                                      academic 
                                        year      2004-2005 
                                                academic year 2005-2006 
                                                            academic year
New Budget Authority................       6,996       7,063       7,822
Advance appropriation...............       6,783       7,383       7,383
                                    ------------------------------------
      Total program level...........      13,779      14,446      15,205
                                    ====================================
Change in advance appropriation from 
the previous year...................        -600        +600

    Grants to local educational agencies.--Funds are allocated through 
four formulas--Basic Grants, Concentration Grants, Targeted Grants and 
Education Finance Incentive Grants--for local programs that provide 
extra academic support to help raise the achievement of eligible 
students in high-poverty schools or, in the case of schoolwide programs, 
help all students in high-poverty schools to meet challenging State 
academic standards. States must annually assess participating students 
in at least reading and mathematics, and school districts must identify 
for improvement, and provide assistance to, schools that for two 
consecutive years do not make adequate yearly progress toward helping 
all groups of students reach the proficient level on the State 
assessments. Districts must provide students attending such schools the 
choice of attending another public school that is not identified for 
improvement. After three or more years of a school not making adequate 
progress, students who remain in the school would be permitted to obtain 
supplemental educational services from a public- or private-sector 
provider. Schools that do not improve would be subject to progressively 
stronger corrective actions and, after six years of not making adequate 
yearly progress, reconstitution under a restructing plan. A portion of 
funds would support technical assistance to help States and local 
educational agencies implement effective programs.

    Reading first State grants.--Funds provide assistance to State and 
local educational agencies in establishing reading programs for students 
in grades K-3 that are grounded in scientifically based reading 
research, in order to ensure that every student can read at grade level 
or above by the end of third grade.

    Early reading first.--Funds provide assistance to support local 
efforts, through competitive grants, to enhance the school readiness of 
young children, particularly those from low-income families, through 
scientific, research-based strategies and professional development that 
are designed to enhance the verbal skills, phonological awareness, 
letter knowl

[[Page 344]]

edge, pre-reading skills, and early language development of children 
ages three through five.

    Striving readers.--This new initiative supports the development, 
implementation, and evaluation of scientifically based reading 
interventions for middle school or high school students reading 
significantly below grade level. The program complements the Reading 
First program, which improves reading in elementary schools.

    Literacy through school libraries.--Funds support competitive grants 
to local educational agencies to provide students with increased access 
to up-to-date school library materials and professional certified 
library media specialists.

    State agency migrant program.--Funds support formula grants to 
States for educational services to children of migratory farmworkers and 
fishers, with resources and services focused on children who have moved 
within the past 36 months.

    State agency neglected and delinquent program.--Funds support 
formula grants to States for educational services to children and youth 
under age 21 in State neglected, delinquent, or adult correction 
facilities.

    Evaluation.--Funds support a series of impact studies designed to 
identify effective reading interventions in Title I and studies of the 
implementation of key No Child Left Behind requirements including 
assessments, accountability systems, school improvement requirements, 
public school choice, and supplemental educational services.

    Migrant education projects.--Funds support grants to institutions of 
higher education and other nonprofit agencies that assist migrant 
students to earn a high school equivalency certificate or to complete 
their first year of college.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0900-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
24.0  Printing and reproduction.........           1           1           1
25.1  Advisory and assistance services..           9          12          11
25.2  Other services....................          50          65          60
25.3  Other purchases of goods and 
        services from Government 
        accounts........................           4           5           5
41.0  Grants, subsidies, and 
        contributions...................      12,429      16,140      15,128
                                           ---------   ---------  ----------
99.9    Total new obligations...........      12,493      16,223      15,205
---------------------------------------------------------------------------

                                

                               Impact Aid

    For carrying out programs of financial assistance to federally 
affected schools authorized by title VIII of the Elementary and 
Secondary Education Act of 1965, [$1,236,824,000] $1,229,527,000, of 
which [$1,070,000,000] $1,063,687,000 shall be for basic support 
payments under section 8003(b), [$50,668,000] $50,369,000 shall be for 
payments for children with disabilities under section 8003(d), 
[$46,208,000] $45,936,000 shall be for construction under section 8007 
and shall remain available through September 30, [2005, $62,000,000] 
2006, $61,634,000 shall be for Federal property payments under section 
8002, and [$7,948,000] $7,901,000, to remain available until expended, 
shall be for facilities maintenance under section 8008[: Provided, That 
$1,500,000 of the funds for section 8007 shall be available for the 
local educational agencies and in the amounts specified in the statement 
of the managers on the conference report accompanying this Act: Provided 
further, That, notwithstanding any other provision of law, these funds 
shall remain available until expended]. (Division E, H.R. 2673, 
Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0102-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Payments for federally connected children:

00.01   Basic support payments..........       1,025       1,064       1,064
00.02   Supplemental payments for 
          children with disabilities....          51          50          50
                                           ---------   ---------  ----------
00.91   Subtotal, payments for federally 
          connected children............       1,076       1,114       1,114
01.01 Facilities maintenance............           7           7           8
02.01 Construction......................          48          47          46
03.01 Payments for Federal property.....          60          62          62
                                           ---------   ---------  ----------
10.00   Total new obligations...........       1,191       1,230       1,230
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          38          35          35
22.00 New budget authority (gross)......       1,188       1,230       1,230
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,226       1,265       1,265
23.95 Total new obligations.............      -1,191      -1,230      -1,230
24.40 Unobligated balance carried 
        forward, end of year............          35          35          35
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       1,196       1,237       1,230
40.35   Appropriation permanently 
          reduced.......................          -8          -7
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       1,188       1,230       1,230
    Change in obligated balances:
72.40 Obligated balance, start of year..         202         293         176
73.10 Total new obligations.............       1,191       1,230       1,230
73.20 Total outlays (gross).............      -1,097      -1,347      -1,235
73.40 Adjustments in expired accounts 
        (net)...........................          -2
74.40 Obligated balance, end of year....         293         176         171
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       1,013       1,078       1,078
86.93 Outlays from discretionary 
        balances........................          84         269         157
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,097       1,347       1,235
    Net budget authority and outlays:
89.00 Budget authority..................       1,188       1,230       1,230
90.00 Outlays...........................       1,097       1,347       1,235
---------------------------------------------------------------------------

    Impact Aid helps to replace the lost local revenue that would 
otherwise be available to educate federally connected children. The 
presence of certain students living on Federal property, such as 
students who are military dependents or who reside on Indian lands, can 
place a financial burden on local educational agencies that educate 
them. The property on which the children live and their parents work is 
exempt from local property taxes, denying local educational agencies 
access to the primary source of revenue used by most communities to 
finance education.

    Basic support payments.--Payments will be made on behalf of 
approximately 1.1 million federally connected students enrolled in about 
1,290 local educational agencies to assist them in meeting their 
operation and maintenance costs. Average per-student payments will be 
approximately $980.

    Payments for Children with Disabilities.--Payments in addition to 
those provided under the Individuals with Disabilities Education Act 
will be provided on behalf of approximately 35,000 federally connected 
students with disabilities in about 870 local educational agencies. 
Average per-student payments will be approximately $910.

    Facilities maintenance.--Funds are used to provide emergency repairs 
for school facilities that serve military dependents and are owned by 
the Department of Education. Funds are also used to transfer the 
facilities to local educational agencies.

    Construction.--Formula payments will be provided to approximately 
180 local educational agencies with large proportions of federally 
connected students. Payments will be made on behalf of about 140,000 
students who are military dependents or who reside on Indian lands. In 
addition, approxi

[[Page 345]]

mately 25 construction grants will be awarded competitively to local 
educational agencies.

    Payments for Federal Property.--Payments will be made to 
approximately 200 local educational agencies in which real property 
owned by the Federal Government represents 10 percent or more of the 
assessed value of real property in the local educational agency.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0102-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
21.0  Travel and transportation of 
        persons.........................                       1           1
25.3  Other purchases of goods and 
        services from Government 
        accounts........................                       1           1
41.0  Grants, subsidies, and 
        contributions...................       1,191       1,228       1,228
                                           ---------   ---------  ----------
99.9    Total new obligations...........       1,191       1,230       1,230
---------------------------------------------------------------------------

                                

                       School Improvement Programs

    For carrying out school improvement activities authorized by titles 
II, part B of title IV, part A [and subparts 6 and 9 of part D] of title 
V, parts A and B of title VI, and parts B and C of title VII of the 
Elementary and Secondary Education Act of 1965 (``ESEA''); the McKinney-
Vento Homeless Assistance Act; section 203 of the Educational Technical 
Assistance Act of 2002; and the Civil Rights Act of 1964, 
[$5,834,208,000] $5,940,493,000, of which [$4,282,199,000] 
$4,389,178,000 shall become available on July 1, [2004] 2005, and remain 
available through September 30, [2005] 2006, and of which $1,435,000,000 
shall become available on October 1, [2004] 2005, and shall remain 
available through September 30, [2005] 2006, for academic year [2004-
2005] 2005-2006: Provided, That [funds made available to carry out part 
B of title VII of the ESEA may be used for construction, renovation and 
modernization of any elementary school, secondary school, or structure 
related to an elementary school or secondary school, run by the 
Department of Education of the State of Hawaii, that serves a 
predominantly Native Hawaiian student body: Provided further, That from 
the funds referred to in the preceding proviso, not less than $1,000,000 
shall be for a grant to the Department of Education of the State of 
Hawaii for the activities described in such proviso: Provided further, 
That funds made available to carry out part C of title VII of the ESEA 
may be used for construction: Provided further, That $391,600,000] 
$410,000,000 shall be for subpart 1 of part A of title VI of the ESEA: 
Provided further, That [$27,821,000] $27,654,000 shall be available to 
carry out [part D of title V of the ESEA] section 203 of the Educational 
Technical Assistance Act of 2002: Provided further, That [no funds 
appropriated under this heading may be used to carry out section 5494 
under the ESEA] notwithstanding section 2202(a)(2) of the ESEA, the 
Secretary shall reserve $120,000,000 of the funds available for part B 
of title II of that Act for competitive grants under that section that 
are designed to improve the achievement of secondary school students in 
mathematics, of which up to $1,000,000 may be used for technical 
assistance and evaluation. (Division E, H.R. 2673, Consolidated 
Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1000-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Direct program:
      Obligations by program activity:

        Improving teacher quality:
00.01     Improving teacher quality 
            State grants................       2,930       2,674       2,930
00.02     Early childhood educator 
            professional development....          15          15          15
00.03     Mathematics and science 
            partnerships................          98         152         269
00.04   Educational technology State 
          grants........................         683         706         692
00.05   Preparing tomorrow's teachers to 
          use technology................          62
00.06   21st Century community learning 
          centers.......................         993       1,015         999
00.07   State grants for innovative 
          programs......................         385         582         297
00.08   Javits gifted and talented 
          education.....................          11          11
00.09   Foreign language assistance.....          16          17
00.10   Foundations for learning grants.           1
00.11   State assessments...............         397         396         410
00.12   Education for homeless children 
          and youth.....................          55          60          60
00.13   Education for Native Hawaiians..          31          33          33
00.14   Alaska Native education equity..          31          33          33
00.15   Training and advisory services..           7           7           7
00.16   Rural education.................         167         169         168
00.17   Comprehensive assistance centers                                  28
00.18   School leadership...............          12
00.19   Advanced credentialling.........          10
00.20   Troops-to-teachers..............          18          11
00.21   Transition to teaching..........          42
00.22   National writing project........          17
00.23   Civic education.................          29
00.24   Teaching of traditional American 
          history.......................          99
00.25   Education technology national 
          activities....................          15
00.26   Ready-to-learn television.......          23
00.27   Charter schools grants..........         199
00.28   Credit enhancement for charter 
          school facilities.............          25
00.29   Voluntary public school choice..          26
00.30   Magnet schools assistance.......         109
00.31   Fund for the Improvement of 
          Education programs of national 
          significance..................         245
00.32   Character education.............          25
00.33   Reading is fundamental/
          Inexpensive book distribution.          25
00.34   Elementary and secondary school 
          counselling...................          32
00.35   Smaller learning communities....         140         161
00.36   Star schools....................          27
00.37   Ready to teach..................          13
00.38   Physical education for progress.          60
00.39   Community technology centers....          32
00.40   Exchanges with historic whaling 
          and trading partners..........           7
00.41   Arts in education...............          34
00.42   Parental information resource 
          centers.......................          42
00.43   Women's educational equity......           3
00.44   Comprehensive school reform.....          75           1
        Safe and drug-free schools and 
            communities:
00.45     State grants..................         469         336
00.46     National programs.............         253          14
                                           ---------   ---------  ----------
01.00 Total direct program..............       7,988       6,393       5,941
09.01 Reimbursable program..............          67
                                           ---------   ---------  ----------
10.00 Total new obligations.............       8,055       6,393       5,941
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         249         263
22.00 New budget authority (gross)......       8,069       6,130       5,940
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           2
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       8,320       6,393       5,940
23.95 Total new obligations.............      -8,055      -6,393      -5,941
24.40 Unobligated balance carried 
        forward, end of year............         263
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       6,289       4,399       4,505
40.35   Appropriation permanently 
          reduced.......................         -52         -34
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       6,237       4,365       4,505
55.00   Advance appropriation...........       1,765       1,765       1,435
68.10 Spending authority from offsetting 
        collections: Change in 
        uncollected customer payments 
        from Federal sources (unexpired)          67
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       8,069       6,130       5,940
    Change in obligated balances:
72.40 Obligated balance, start of year..       8,142       9,581       7,017
73.10 Total new obligations.............       8,055       6,393       5,941
73.20 Total outlays (gross).............      -6,592      -9,003      -6,611
73.40 Adjustments in expired accounts 
        (net)...........................         -16
73.45 Recoveries of prior year 
        obligations.....................          -2
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................         -67
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................          60          46
74.40 Obligated balance, end of year....       9,581       7,017       6,347
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       1,124       1,526       1,301
86.93 Outlays from discretionary 
        balances........................       5,468       7,477       5,310
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       6,592       9,003       6,611
    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........         -60         -46
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................         -67
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............          60          46
    Net budget authority and outlays:
89.00 Budget authority..................       8,002       6,130       5,940

[[Page 346]]

90.00 Outlays...........................       6,532       8,957       6,611
---------------------------------------------------------------------------

    Note.--Includes $28 million in budget authority in 2005 for 
activities previously financed from the Department of Education:

                        (in millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Institute of Education Sciences, 
Institute of Education Sciences.....          58          57

                        SUMMARY OF PROGRAM LEVEL

                        (in millions of dollars)

                                     2003-2004 
                                      Academic 
                                        Year      2004-2005 
                                                Academic Year 2005-2006 
                                                            Academic Year
New Budget Authority................       6,237       4,365       4,279
Advance Appropriation...............       1,765       1,435       1,435
                                    ------------------------------------
      Total program level...........       8,002       5,790       5,714
                                    ====================================
Change in advance appropriation over 
previous year.......................           0        -330           0

    Improving teacher quality.--
            Improving teacher quality State grants.--Funds support State 
        and school district activities to prepare, train, and recruit 
        high-quality teachers to improve student achievement.
            Early childhood educator professional development.--Funds 
        support competitive grants to improve the knowledge and skills 
        of early childhood educators who work in communities that have 
        high concentrations of children living in poverty.
            Mathematics and science partnerships.--Funds support State 
        and local efforts to improve students' academic achievement in 
        mathematics and science by promoting strong teaching skills for 
        elementary and secondary school teachers, including integrating 
        teaching methods based on scientifically-based research and 
        technology into the curriculum.

    Educational technology State grants.--Funds support formula grants 
to States, which target funds to high-poverty school districts, to 
acquire computers, connections, software, and teacher training to enable 
schools to integrate technology effectively into curricula.

    21st Century community learning centers.--Funds support formula 
grants to States, which award subgrants to communities to provide 
academic enrichment opportunities and related services to students, 
primarily students who attend high-poverty schools, and their families 
during before-school, after-school, weekend, and summer hours.

    State grants for innovative programs.--Funds support formula grants 
to States and local educational agencies to help implement innovative 
strategies for improving student achievement.

    State assessments.--Funds support formula grants to States to 
develop and implement the new assessments, and related accountability 
efforts, that States would use to test all children annually in grades 
3-8 in reading and mathematics.

    Education for homeless children and youth.--Funds support formula 
grants to States to provide educational and support services that enable 
homeless children and youth to attend and achieve success in school.

    Education for Native Hawaiians.--Funds provide supplemental 
education services to Native Hawaiians in areas such as family-based 
education, special education, gifted and talented education, higher 
education, curriculum development, teacher training and recruitment, and 
community-based learning.

    Alaska Native education equity.--Funds provide supplemental 
education services to Alaska Natives in areas such as educational 
planning, curriculum development, teacher training, teacher recruitment, 
student enrichment, and home-based instruction for pre-school children. 
Grants also go to organizations specified in the law.

    Training and advisory services.--Funds support grants to regional 
equity assistance centers that provide technical assistance to school 
districts in addressing equity in education related to issues of race, 
gender, and national origin.

    Rural education.--Funds support formula grants under two programs: 
Small, Rural Schools Achievement and Rural and Low-Income Schools 
programs. Funds under the Small, Rural Schools Achievement program, 
which provides rural local educational agencies with small enrollments 
with additional formula funds and flexibility in the use of other 
Federal formula funds, are allocated by formula directly from the 
Department to eligible local educational agencies. Funds under the Rural 
and Low-Income Schools program, which targets rural local educational 
agencies that serve concentrations of poor students, are allocated by 
formula to States, who in turn allocate funds to eligible local 
educational agencies within the States.

    Comprehensive centers.--Funds support no fewer than 20 comprehensive 
centers, with at least one center in each of the 10 geographic regions, 
to provide technical assistance, training, and professional development 
in reading, mathematics, science, and technology to States, districts, 
and schools.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1000-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Direct obligations:

24.0    Printing and reproduction.......           1
25.1    Advisory and assistance services          15          20          22
25.2    Other services..................          62          18          18
25.3    Other purchases of goods and 
          services from Government 
          accounts......................          23
25.5    Research and development 
          contracts.....................          10
25.7    Operation and maintenance of 
          equipment.....................           1
41.0    Grants, subsidies, and 
          contributions.................       7,876       6,355       5,901
                                           ---------   ---------  ----------
99.0      Direct obligations............       7,988       6,393       5,941
99.0  Reimbursable obligations..........          67
                                           ---------   ---------  ----------
99.9    Total new obligations...........       8,055       6,393       5,941
---------------------------------------------------------------------------

                                

                            Indian Education

    For expenses necessary to carry out, to the extent not otherwise 
provided, title VII, part A of the Elementary and Secondary Education 
Act of 1965, [$121,573,000] $120,856,000. (Division E, H.R. 2673, 
Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0101-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Grants to local educational 
        agencies........................          97          96          96
00.02 Special programs for Indian 
        children........................          19          20          20
00.03 National activities...............           5           5           5
                                           ---------   ---------  ----------
10.00   Total new obligations...........         121         121         121
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......         121         121         121
23.95 Total new obligations.............        -121        -121        -121
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         122         122         121
40.35   Appropriation permanently 
          reduced.......................          -1          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         121         121         121

[[Page 347]]

    Change in obligated balances:
72.40 Obligated balance, start of year..         145         147         142
73.10 Total new obligations.............         121         121         121
73.20 Total outlays (gross).............        -116        -126        -121
73.40 Adjustments in expired accounts 
        (net)...........................          -3
74.40 Obligated balance, end of year....         147         142         141
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           3           6           6
86.93 Outlays from discretionary 
        balances........................         113         120         115
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         116         126         121
    Net budget authority and outlays:
89.00 Budget authority..................         121         121         121
90.00 Outlays...........................         116         126         121
---------------------------------------------------------------------------

    The Indian Education program supports the efforts of local 
educational agencies and tribal schools to improve teaching and learning 
for the Nation's American Indian and Alaska Native Children.

    Grants to local educational agencies.--Formula grants support local 
educational agencies in their efforts to reform elementary and secondary 
school programs that serve Indian students, with the goal of ensuring 
that such programs assist participating students in meeting the same 
academic standards as all other students. In 2003, the Department made 
1,183 formula grants to local educational agencies and tribal schools 
serving more than 470,000 students.

    Special programs for Indian Children.--The Department makes 
competitive awards for demonstration projects in early childhood 
education, professional development grants, American Indian Teacher 
Corps grants, and grants for the American Indian Administrator Corps. 
The professional development awards in this activity are designed to 
improve the quality of teachers and administrators in school districts 
with concentrations of Indian students.

    National activities.--Funds support research, evaluation, data 
collection, and related activities.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0101-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
25.2  Other services....................           4           4           4
41.0  Grants, subsidies, and 
        contributions...................         117         117         117
                                           ---------   ---------  ----------
99.9    Total new obligations...........         121         121         121
---------------------------------------------------------------------------

                                

                           Reading Excellence

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0011-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         447         226          65
73.20 Total outlays (gross).............        -220        -161         -65
74.40 Obligated balance, end of year....         226          65
    Outlays (gross), detail:
86.93 Outlays from discretionary 
        balances........................         220         161          65
    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................         220         161          65
---------------------------------------------------------------------------

    Reading Excellence.--This program has been replaced by the Reading 
First program in the Education for the Disadvantaged account. Amounts in 
these schedules reflect balances that are spending out from prior-year 
appropriations.

                                

                            Education Reform

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0500-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         781         226
73.20 Total outlays (gross).............        -532        -226
73.40 Adjustments in expired accounts 
        (net)...........................         -24
74.40 Obligated balance, end of year....         226
    Outlays (gross), detail:
86.93 Outlays from discretionary 
        balances........................         532         226
    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................         532         226
---------------------------------------------------------------------------

    Programs in this account have been transferred to the School 
Improvement account or discontinued. Amounts in this schedule reflect 
balances that are spending out from prior-year appropriations.

                                

                      Chicago Litigation Settlement

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0220-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct Program Activity...........           1
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................           1
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           1
23.95 Total new obligations.............          -1
    Change in obligated balances:
72.40 Obligated balance, start of year..           1           1
73.10 Total new obligations.............           1
73.20 Total outlays (gross).............          -1
74.40 Obligated balance, end of year....           1
    Outlays (gross), detail:
86.93 Outlays from discretionary 
        balances........................           1
    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................           1
---------------------------------------------------------------------------

    Funds made available under this account were reappropriated by the 
Supplemental Appropriations Act, 1987 (Public Law 100-71) from funds 
enjoined in United States of America v. Board of Education of the City 
of Chicago. The funds were reappropriated for the specific purpose of 
settling this case. The funds are used by the Chicago Board of Education 
to implement Project CANAL (Creating A New Approach to Learning), the 
project approved by the court to support the Board's desegregation 
efforts.

                                


 
                  OFFICE OF INNOVATION AND IMPROVEMENT

                              Federal Funds

General and special funds:

                       Innovation and Improvement

    For carrying out activities authorized by [parts] part G [and H] of 
title I, subpart 5 of part A and parts C and D of title II, and parts B, 
C, and D of title V[, and section 1504] of the Elementary and Secondary 
Education Act of 1965 (``ESEA''), [$1,106,811,000] $885,181,000: 
Provided, That [$74,513,000 for continuing and new grants to demonstrate 
effective approaches to comprehensive school reform shall become 
available on July 1, 2004, and remain available through September 30, 
2005, and shall be allocated and expended in the same manner as the 
funds provided under the Fund for the Improvement of Education for this 
purpose were allocated and expended in fiscal year 2003: Provided 
further, That $18,500,000 shall be available to carry out section 
2151(c) of the ESEA, of which not

[[Page 348]]

less than $10,000,000 shall be provided to the National Board for 
Professional Teaching Standards, not less than $7,000,000 shall be 
provided to the National Council on Teacher Quality, and up to 
$1,500,000 may be reserved by the Secretary to conduct an evaluation of 
activities authorized by such section] $100,000,000 shall be for subpart 
2 of part B of title V: Provided further, That [$430,463,000] 
$170,185,000 shall be available to carry out part D of title V of the 
ESEA[: Provided further, That $177,271,000 of the funds for subpart 1, 
part D of title V of the ESEA shall be available for the projects and in 
the amounts specified in the statement of the managers on the conference 
report accompanying this Act]. (Division E, H.R. 2673, Consolidated 
Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0204-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Troops-to-teachers................                      15          15
00.02 Transition to teaching............                      45          45
00.03 National writing project..........                      18
00.04 Teaching of traditional American 
        history.........................                     119         119
00.05 School leadership.................                      12
00.06 Advanced credentialing............                      18           7
00.07 Charter school grants.............                     219         219
00.08 Credit enhancement for charter 
        school facilities...............                      37         100
00.09 Voluntary public school choice....                      27          27
00.10 Magnet schools assistance.........                     109         109
00.11 Choice incentive fund.............                                  50
00.12 Advanced placement................                      24          51
00.13 Dropout prevention program........                       5
00.14 Close Up fellowships..............                       2
00.15 Ready-to-learn television.........                      23          23
00.16 FIE programs of national 
        significance....................                     281          45
00.17 Adjunct Teacher Corps.............                                  40
00.18 Military Families Initiative......                                  10
00.19 Reading is fundamental/Inexpensive 
        book distribution...............                      25          25
00.20 Star schools......................                      20
00.21 Ready to teach....................                      14
00.22 Exchanges with historic whaling 
        and trading partners............                       8
00.23 Excellence in economic education..                       2
00.24 Arts in education.................                      35
00.25 Parental assistance information 
        centers.........................                      42
00.26 Women's educational equity........                       3
                                           ---------   ---------  ----------
10.00   Total new obligations...........                   1,103         885
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                   1,103         885
23.95 Total new obligations.............                  -1,103        -885
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                   1,110         885
40.35   Appropriation permanently 
          reduced.......................                      -7
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............                   1,103         885
    Change in obligated balances:
72.40 Obligated balance, start of year..                               1,048
73.10 Total new obligations.............                   1,103         885
73.20 Total outlays (gross).............                     -55        -761
74.40 Obligated balance, end of year....                   1,048       1,172
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                      55          44
86.93 Outlays from discretionary 
        balances........................                                 717
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........                      55         761
    Net budget authority and outlays:
89.00 Budget authority..................                   1,103         885
90.00 Outlays...........................                      55         761
---------------------------------------------------------------------------

    Improving teacher quality.--
        Troops-to-teachers.--Funds assist eligible members of the armed 
    forces to obtain certification as teachers and to become highly 
    qualified teachers.
        Transition to teaching.--Funds support competitive grants to 
    establish programs to recruit and retain highly qualified mid-career 
    professionals and recent college graduates as teachers in high-need 
    schools.
        Teaching of traditional American history.--Funds support 
    competitive grants to school districts for activities to improve 
    history instruction and provide professional development for 
    teachers of American history.

    School choice and flexibility.--
        Advanced credentialing.--Funds support the development of an 
    advanced credential based on the content expertise of master 
    teachers. Funds also support related activities to encourage and 
    support teachers seeking advanced certification or advanced 
    credentials.
        Charter school grants.--Funds support competitive grants to 
    State educational agencies and charter schools to support the 
    planning, design, initial implementation, and dissemination of 
    information regarding charter schools. These schools are created by 
    teachers, parents, and members of the community, and are exempt from 
    certain local, State, and Federal regulations.
        Credit enhancement for charter school facilities.--Funds support 
    competitive grants to State and local governments, nonprofit 
    entities, and public and nonprofit consortia, to assist charter 
    schools in acquiring, leasing, and renovating school facilities. 
    Funds above $200 million are used for the Per-Pupil Facilities Aid 
    program, which provides funds to States to assist charter schools in 
    obtaining facilities.
        Voluntary public school choice.--Funds support competitive 
    grants to State educational agencies and local educational agencies 
    to implement programs that provide students, particularly students 
    who attend low-performing schools, with expanded public school 
    choice options.
        Magnet schools assistance.--Funds support competitive grants to 
    local educational agencies to establish and operate magnet school 
    programs that are part of an approved desegregation plan.
        Choice incentive fund.--Funds will support grants to States, 
    local educational agencies, and community-based nonprofit 
    organizations with a proven record for securing educational 
    opportunities for children. These grants will support efforts to 
    increase the capacity of high-quality public and private schools to 
    serve additional students.

    FIE programs of national significance.--Funds support nationally 
significant projects to improve the quality of elementary and secondary 
education in order to help all children meet challenging State content 
and student achievement standards.

    Adjunct Teacher Corps.--Funds will support partnerships between 
school districts and appropriate public and/or private institutions to 
enable well-qualified professionals to teach specific high-school 
courses in the core academic subjects, particularly in mathematics and 
science. The program would support multiple approaches for utilizing 
these highly-trained individuals, such as part-time or substitute 
teaching and distance learning in areas of their professional expertise.

    Military Families.--Funds would assist military families meet the 
challenges of moving their children into new school districts with 
varying academic and health-related requirements. The state grant 
program, to be jointly administered by the Department of Education and 
Defense, will encourage reciprocity agreements among states and school 
districts and fund data management systems and other activities to 
facilitate moves from one school district to another.

    Reading is fundamental/inexpensive book distribution.--Funds support 
reading motivation activities, including the distribution of free books 
to children.

    Ready-to-learn television.--Funds support the development, 
distribution, and production of educational video and accompanying 
materials and services for preschool children, elementary school 
children, and their parents to facilitate student academic achievement.

    Advanced placement.--Funds support grants to States to pay test fees 
for low-income students if they are enrolled in an Advanced Placement 
course and competitive grants to State educational agencies, local 
educational agencies, and

[[Page 349]]

national nonprofit educational entities to expand access for low-income 
individuals to Advanced Placement classes.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0204-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
25.1  Advisory and assistance services..                       2           2
25.2  Other services....................                      34          25
25.3  Other purchases of goods and 
        services from Government 
        accounts........................                       5           3
25.5  Research and development contracts                       4           3
41.0  Grants, subsidies, and 
        contributions...................                   1,058         852
                                           ---------   ---------  ----------
99.9    Total new obligations...........                   1,103         885
---------------------------------------------------------------------------

                                


 
                  OFFICE OF SAFE AND DRUG-FREE SCHOOLS

                              Federal Funds

General and special funds:

                 Safe Schools and Citizenship Education

    For carrying out activities authorized by subpart 3 of part C of 
title II, part A of title IV, and subparts [2,] 3 and 10 of part D of 
title V of the Elementary and Secondary Education Act of 1965 
(``ESEA''), [title VIII-D of the Higher Education Amendments of 1998, 
and Public Law 102-73, $862,813,000,] $838,897,000 of which 
[$470,483,000] $440,908,000, shall become available on July 1, [2004] 
2005 and remain available through September 30, [2005] 2006: Provided, 
That [of the amount available for subpart 2 of part A of title IV of the 
ESEA, $850,000 shall be used to continue the National Recognition Awards 
program under the same guidelines outlined by section 120(f) of Public 
Law 105-244: Provided further, That $445,483,000] $440,908,000 shall be 
available for subpart 1 of part A of title IV and [$234,680,000] 
$275,069,000 shall be available for subpart 2 of part A of title IV[: 
Provided further, That $128,838,000 shall be available to carry out part 
D of title V of the ESEA] , of which $5,000,000, to remain available 
until expended, shall be for the Project School Emergency Response to 
Violence program to provide education-related services to local 
educational agencies in which the learning environment has been 
disrupted due to a violent or traumatic crisis: Provided further, That 
of the funds available to carry out subpart 3 of part C of title II, up 
to [$11,922,000] $11,852,000 may be used to carry out section 2345 [and 
$2,980,000 shall be used by the Center for Civic Education to implement 
a comprehensive program to improve public knowledge, understanding, and 
support of the Congress and the state legislatures: Provided further, 
That $25,000,000 shall be for Youth Offender Grants, of which $5,000,000 
shall be used in accordance with section 601 of Public Law 102-73 as 
that section was in effect prior to enactment of Public Law 105-220]: 
Provided further, That of the funds available to carry-out subpart 10 of 
part D of title V, up to $2,000,000 may be used to support the Special 
Olympics. (Division E, H.R. 2673, Consolidated Appropriations Bill, FY 
2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0203-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Safe and drug-free schools and communities:

00.01   State grants....................                     441         441
        National programs:
00.02     Alcohol abuse reduction.......                      30
00.03     Mentoring program.............                      50         100
00.04     Other national programs.......                     154         175
                                           ---------   ---------  ----------
00.91   Subtotal, Safe and drug-free 
          schools and communities.......                     675         716
01.01 Character education...............                      25          25
02.01 Elementary and secondary school 
        counseling......................                      34
03.01 Physical education program........                      70          70
04.01 Civic education...................                      29          29
05.01 State grants for incarcerated 
        youth offenders.................                      20
06.01 Literacy program for prisoners....                       5
                                           ---------   ---------  ----------
10.00   Total new obligations...........                     858         840
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                     856         839
23.95 Total new obligations.............                    -858        -840
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                     863         839
40.35   Appropriation permanently 
          reduced.......................                      -7
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............                     856         839
    Change in obligated balances:
72.40 Obligated balance, start of year..                                 815
73.10 Total new obligations.............                     858         840
73.20 Total outlays (gross).............                     -43        -598
74.40 Obligated balance, end of year....                     815       1,057
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                      43          42
86.93 Outlays from discretionary 
        balances........................                                 556
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........                      43         598
    Net budget authority and outlays:
89.00 Budget authority..................                     856         839
90.00 Outlays...........................                      43         598
---------------------------------------------------------------------------

    Safe and drug-free schools and communities.--
        State Grants.--Funds provide formula grants to States to support 
    research-based drug- and violence-prevention programs and to 
    implement strategies to improve school safety.
        Mentoring program.--Funds provide grants to local educational 
    agencies and community-based organizations for mentoring programs 
    serving at-risk youth in conjunction with the efforts of the USA 
    Freedom Corps.
        Other National Programs.--Funds support national activities to 
    prevent violence and the illegal use of drugs among, and to promote 
    safety and discipline for, students.

    Character Education.--Funds provide grants to support the design and 
implementation of character education programs in the Nation's 
elementary and secondary schools.

    Physical Education Program.--Funds provide grants to local 
educational agencies and community-based organizations to initiate, 
expand, or improve physical education programs for students.

    Civic Education.--Funds support a grant to the nonprofit Center for 
Civic Education to promote civic competence and responsibility and 
improve the quality of civics and government education through 
coursework and curricula on the history and principles of the 
Constitution of the United States; and grants to eligible organizations 
for cooperative education exchange programs to improve the quality of 
civic and economic education in emerging democracies through exemplary 
curriculum and teacher training programs for educators. These activities 
complement civics programs coordinated by the USA Freedom Corps.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0203-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
24.0  Printing and reproduction.........                       1           1
25.1  Advisory and assistance services..                       2           2
25.2  Other services....................                      13          12
25.3  Other purchases of goods and 
        services from Government 
        accounts........................                       2
41.0  Grants, subsidies, and 
        contributions...................                     840         825
                                           ---------   ---------  ----------
99.9    Total new obligations...........                     858         840
---------------------------------------------------------------------------

                                


 
                 OFFICE OF ENGLISH LANGUAGE ACQUISITION

                              Federal Funds

General and special funds:

                      English Language Acquisition

    For carrying out part A of title III of the ESEA, [$685,258,000] 
$681,215,000, of which [$560,301,000] $595,715,000 shall become

[[Page 350]]

available on July 1, [2004] 2005, and shall remain available through 
September 30, [2005: Provided, That notwithstanding section 
3111(c)(4)(B)(ii), the Secretary may, in determining the allotments 
under section 3111(c)(3), use the same Census data for the number of 
limited English proficient children and youth used for the previous 
year's allotments under section 3111(c)(3) and the most recent data 
collected from States for the number of immigrant children and youth 
that is acceptable to the Secretary] 2006: Provided [further], That 
funds reserved under section 3111(c)(1)(D) of the ESEA that are not used 
in accordance with section 3111(c)(2) may be added to the funds that are 
available July 1, [2004] 2005 through September 30, [2005] 2006 for 
State allotments under section 3111(c)(3). (Division E, H.R. 2673, 
Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1300-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Language acquisition State grants.         685         692         681
                                           ---------   ---------  ----------
10.00   Total new obligations...........         685         692         681
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          12          11
22.00 New budget authority (gross)......         684         681         681
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         696         692         681
23.95 Total new obligations.............        -685        -692        -681
24.40 Unobligated balance carried 
        forward, end of year............          11
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         690         685         681
40.35   Appropriation permanently 
          reduced.......................          -4          -4
41.00   Transferred to other accounts...          -2
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         684         681         681
    Change in obligated balances:
72.40 Obligated balance, start of year..         833         938         811
73.10 Total new obligations.............         685         692         681
73.20 Total outlays (gross).............        -565        -819        -627
73.40 Adjustments in expired accounts 
        (net)...........................         -14
74.40 Obligated balance, end of year....         938         811         865
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           5          34          34
86.93 Outlays from discretionary 
        balances........................         560         785         593
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         565         819         627
    Net budget authority and outlays:
89.00 Budget authority..................         684         681         681
90.00 Outlays...........................         565         819         627
---------------------------------------------------------------------------

    Language acquisition State grants.--This program provides formula 
grants to States to improve services for limited English proficient and 
immigrant students. States are accountable for demonstrating that 
limited English proficient students are learning English and meeting the 
same high State standards as all other students. The statute also 
authorizes national activities including professional development and 
evaluation, and requires funding for a national information 
clearinghouse on English language acquisition. The statute also 
continues discretionary grants for bilingual instructional services and 
bilingual professional development grants made under the antecedent 
statute.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1300-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
25.5  Research and development contracts           2           2           2
41.0  Grants, subsidies, and 
        contributions...................         683         690         679
                                           ---------   ---------  ----------
99.9    Total new obligations...........         685         692         681
---------------------------------------------------------------------------

                                


 
         OFFICE OF SPECIAL EDUCATION AND REHABILITATIVE SERVICES

                              Federal Funds

General and special funds:

                            Special Education

    For carrying out parts B, C, and D of the Individuals with 
Disabilities Education Act, [$11,307,072,000] $12,176,101,000, of which 
[$5,604,762,000] $6,560,447,000 shall become available for obligation on 
July 1, [2004] 2005, and shall remain available through September 30, 
[2005] 2006, and of which $5,413,000,000 shall become available on 
October 1, [2004] 2005, and shall remain available through September 30, 
[2005] 2006, for academic year [2004-2005] 2005-2006: Provided, [That 
$11,400,000 shall be for Recording for the Blind and Dyslexic to support 
the development, production, and circulation of recorded educational 
materials: Provided further, That $1,500,000 shall be for the recipient 
of funds provided by Public Law 105-78 under section 687(b)(2)(G) of the 
Act to provide information on diagnosis, intervention, and teaching 
strategies for children with disabilities: Provided further,] That the 
amount for section 611(c) of the Act shall be equal to the amount 
available for that section during fiscal year [2003] 2004, increased by 
the amount of inflation as specified in section 611(f)(1)(B)(ii) of the 
Act[: Provided further, That $6,879,000 of the funds for section 672 of 
the Act shall be available for the projects and in the amounts specified 
in the statement of the managers of the conference report accompanying 
this Act]. (Division E, H.R. 2673, Consolidated Appropriations Bill, FY 
2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0300-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Direct program:
      Obligations by program activity:

        State grants:
00.01     Grants to States..............       8,246      10,371      11,068
00.02     Preschool grants..............         384         391         388
00.03     Grants for infants and 
            families....................         430         486         467
                                           ---------   ---------  ----------
00.91       Subtotal, State grants......       9,060      11,248      11,923
        National activities:
01.01     State improvement.............          52          97          51
01.02     Research and innovation.......          77          78
01.03     Technical assistance and 
            dissemination...............          53          53          53
01.04     Personnel preparation.........          92          92          91
01.05     Parent information centers....          26          26          26
01.06     Technology and media services.          38          39          32
                                           ---------   ---------  ----------
01.91       Subtotal, National 
              activities................         338         385         253
                                           ---------   ---------  ----------
02.00 Total Direct Program..............       9,398      11,633      12,176
                                           ---------   ---------  ----------
10.00 Total new obligations.............       9,398      11,633      12,176
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          99         135
22.00 New budget authority (gross)......       9,433      11,498      12,176
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       9,532      11,633      12,176
23.95 Total new obligations.............      -9,398     -11,633     -12,176
24.40 Unobligated balance carried 
        forward, end of year............         135
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       4,423       5,894       6,763
40.35   Appropriation permanently 
          reduced.......................         -62         -68
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       4,361       5,826       6,763
55.00   Advance appropriation...........       5,072       5,672       5,413
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       9,433      11,498      12,176
    Change in obligated balances:
72.40 Obligated balance, start of year..       6,137       7,019       9,543
73.10 Total new obligations.............       9,398      11,633      12,176
73.20 Total outlays (gross).............      -8,491      -9,109     -10,751
73.40 Adjustments in expired accounts 
        (net)...........................         -25
74.40 Obligated balance, end of year....       7,019       9,543      10,968
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       3,224       3,912       3,762
86.93 Outlays from discretionary 
        balances........................       5,267       5,197       6,989
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       8,491       9,109      10,751

[[Page 351]]

    Net budget authority and outlays:
89.00 Budget authority..................       9,433      11,498      12,176
90.00 Outlays...........................       8,491       9,109      10,751
---------------------------------------------------------------------------
    Note.--Excludes $78 million in budget authority for Research and 
Innovation in Special Education, which is proposed for later transmittal 
under the Institute of Education Sciences account. Comparable amounts 
for 2003 ($77 million) and 2004 ($78 million) are included above.

                SUMMARY OF GRANTS TO STATES PROGRAM LEVEL

                        [In millions of dollars]

                                     2003-2004 
                                      academic 
                                        year      2004-2005 
                                                academic year 2005-2006 
                                                            academic year
Current Budget Authority............       3,202       4,655       5,655
Advance appropriation...............       5,672       5,413       5,413
                                    ------------------------------------
    Total program level.............       8,874      10,068      11,068
                                    ====================================
Change in advance appropriation from 
the previous year...................        +600        -259

    State Grants:
        Grants to States.--Formula grants are provided to States to 
    assist them in providing special education and related services to 
    children with disabilities ages 3 through 21.
        Preschool grants.--Formula grants provide additional funds to 
    States to further assist them in providing special education and 
    related services to children with disabilities ages 3 through 5 
    served under the Grants to States program.
        The goal of both of these programs is to improve results for 
    children with disabilities by assisting State and local educational 
    agencies to provide children with disabilities with access to high 
    quality education that will help them meet challenging standards and 
    prepare them for employment and independent living.
        Grants for infants and families.--Formula grants are provided to 
    assist States to implement statewide systems of coordinated, 
    comprehensive, multi-disciplinary interagency programs to provide 
    early intervention services to children with disabilities, birth 
    through age 2, and their families.
        The goal of this program is to help States provide a 
    comprehensive system of early intervention services that will 
    enhance child and family outcomes.

    National activities:
        These activities include personnel preparation, technical 
    assistance, and other activities to support State efforts to improve 
    results for children with disabilities under the State Grants 
    programs.
        The goal of National Activities is to link States, school 
    systems, and families to best practices to improve results for 
    infants, toddlers, and children with disabilities.
        The General Education Provisions Act extension for Grants for 
    Infants and Families and National Activities programs applied 
    through September 30, 2003; authorizing legislation is required. 
    Pending legislation would transfer research activities currently 
    funded under this account to the Institute of Education Sciences.
        Performance data related to program goals include:

                                         2003 actual   2004 est.   2005 est.
Number of children served in first 
    quarter of fiscal year (in 
    thousands):
  Ages 3 through 21.....................       6,611       6,737       6,858
  Ages 3 through 5......................         647         666         686
  Birth through 2.......................         268         290         313

                                    1999-2000 ac2000-2001 actual  2001-2002 
                                                                      actual
    Educational Environment
Percent of children ages 6 through 21 
    provided special education in:
  Regular classrooms....................        47.3        46.5        48.4
  Resource rooms........................        28.3        29.8        28.3
  Separate classes......................        20.3        19.5        19.2
  Separate schools......................         2.9         3.0         2.9
  Residential facilities................          .7          .7          .7
  Home or hospital......................          .5          .5          .4
    Status of Exiting Students
Percent of students with disabilities 
    aged 14-21 leaving school:
  Graduated with a diploma..............        46.1        47.6        51.1
  Graduated through certification.......         9.4         9.2         9.5
  Dropped out of school.................        42.1        41.1        37.6
  Reached maximum age and other.........         2.4         2.1         1.8

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0300-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
25.1  Advisory and assistance services..           2           2           2
25.2  Other services....................          22          23          23
41.0  Grants, subsidies, and 
        contributions...................       9,374      11,608      12,151
                                           ---------   ---------  ----------
99.9    Total new obligations...........       9,398      11,633      12,176
---------------------------------------------------------------------------

                                

             Rehabilitation Services and Disability Research

    For carrying out, to the extent not otherwise provided, the 
Rehabilitation Act of 1973, the Assistive Technology Act of 1998 (``the 
AT Act''), and the Helen Keller National Center Act, [$3,013,305,000, of 
which $1,000,000 shall be awarded to the American Academy of Orthotists 
and Prosthetists for activities that further the purposes of the grant 
received by the Academy for the period beginning October 1, 2003, 
including activities to meet the demand for orthotic and prosthetic 
provider services and improve patient care] $3,047,197,000, of which 
$15,000,000 shall be for grants to States under title III of the AT Act: 
Provided, That [the funds provided for title I of the Assistive 
Technology Act of 1998 (``the AT Act'') shall be allocated 
notwithstanding section 105(b)(1) of the AT Act: Provided further, That 
section 101(f) of the AT Act shall not limit the award of an extension 
grant to three years: Provided further, That no State or outlying area 
awarded funds under section 101 shall receive less than the amount 
received in fiscal year 2003] the Federal share of such grants shall not 
exceed 75 percent, and the requirements in sections 301(c)(2) and 302 of 
the AT Act shall not apply to such grants: Provided further, That 
[$5,035,000 of the funds for section 303 of the Rehabilitation Act of 
1973 shall be available for the projects and in the amounts specified in 
the statement of the managers of the conference report accompanying this 
Act] funds available under the Vocational Rehabilitation State Grants 
program may be used by State Vocational agencies to pay for the fiscal 
year 2005 continuation costs of projects funded in fiscal year 2003 
under title VI, Part A, of the Rehabilitation Act. (Division E, H.R. 
2673, Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0301-0-1-506      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Direct program:

00.01   Vocational rehabilitation State 
          grants........................       2,533       2,584       2,697
00.02   Client assistance State grants..          12          12          12
00.03   Training........................          39          39          39
00.04   Demonstration and training 
          programs......................          21          24          19
00.05   Migrant and seasonal farmworkers           2           2
00.06   Recreational programs...........           3           2
00.07   Protection and advocacy of 
          individual rights.............          17          17          19
00.08   Projects with industry..........          22          22
00.09   Supported employment State 
          grants........................          38          38
00.10   Independent living..............         119         127         127
00.11   Program improvement.............           1           1           1
00.12   Evaluation......................           1           1           2
00.13   Helen Keller National Center....           9           9           9
00.14   National Institute on Disability 
          and Rehabilitation Research...         109         107         107
00.15   Assistive technology............          63          26          15
00.16   Access to Telework Fund.........          20
                                           ---------   ---------  ----------
01.00   Total direct program............       3,009       3,011       3,047
09.01 Reimbursable program..............           2           2           2
                                           ---------   ---------  ----------
10.00   Total new obligations...........       3,011       3,013       3,049
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          56
22.00 New budget authority (gross)......       2,956       3,013       3,049
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       3,012       3,013       3,049
23.95 Total new obligations.............      -3,011      -3,013      -3,049

[[Page 352]]

23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         424         430         411
40.35   Appropriation permanently 
          reduced.......................          -3          -3
41.00   Transferred to other accounts...          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         420         427         411
      Mandatory:

60.00   Appropriation...................       2,534       2,584       2,636
      Spending authority from offsetting 
          collections:

        Discretionary:
68.00     Offsetting collections (cash).                       1           1
68.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........           2           1           1
                                           ---------   ---------  ----------
68.90       Spending authority from 
              offsetting collections 
              (total discretionary).....           2           2           2
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       2,956       3,013       3,049
    Change in obligated balances:
72.40 Obligated balance, start of year..       1,070       1,193         994
73.10 Total new obligations.............       3,011       3,013       3,049
73.20 Total outlays (gross).............      -2,874      -3,210      -3,040
73.40 Adjustments in expired accounts 
        (net)...........................         -14
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -2          -1          -1
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................           1
74.40 Obligated balance, end of year....       1,193         994       1,001
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          80         300         288
86.93 Outlays from discretionary 
        balances........................         329         483         150
86.97 Outlays from new mandatory 
        authority.......................       1,941       1,809       1,845
86.98 Outlays from mandatory balances...         524         618         757
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       2,874       3,210       3,040
    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........          -2          -3          -1
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -2          -1          -1
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           2           2
    Net budget authority and outlays:
89.00 Budget authority..................       2,954       3,011       3,047
90.00 Outlays...........................       2,872       3,207       3,039
---------------------------------------------------------------------------

    Vocational rehabilitation State grants.--The basic State grants 
program provides Federal matching funds to State vocational 
rehabilitation (VR) agencies to assist individuals with physical or 
mental impairments to become gainfully employed. Services are tailored 
to the specific needs of the individual. Priority is given to serving 
those with the most significant disabilities. Current law requires that 
between 1.0 percent and 1.5 percent of the funds appropriated for the VR 
State grants program be set aside for Grants for Indians in 2004.

    The table below presents national data on selected performance 
measures for the VR State grants program. The data are based on the 
number of individuals whose service records were closed in fiscal years 
2001 (385,221) and 2002 (367,625).

                   CONSUMER OUTCOMES (CASES CLOSED)

                                          2001 actual     2002 actual
Individuals achieving employment 
 outcomes...............................       233,691         221,084
 Percent with significant disabilities..         88.0%           88.8%
Employment outcomes as a percent all of 
 individuals receiving services.........         60.7%           60.1%

    The 2005 budget request reflects a multi-year Administration effort 
to reform job training programs, target resources to programs with 
documented effectiveness, and eliminate funding for duplicative and 
overlapping programs. Consistent with this crosscutting reform, the 
budget consolidates funding for three programs in this account 
(Supported Employment State Grants, Projects with Industry, and the 
Migrant and Seasonal Farmworkers program) within the Vocational 
Rehabilitation State Grants program.

    Client assistance State grants.--Formula grants are made to States 
to provide assistance in informing and advising clients and applicants 
of benefits available under the Rehabilitation Act and, if requested, to 
pursue legal or administrative remedies to ensure the protection of the 
rights of individuals with disabilities.

    Training.--Grants are made to States and public or nonprofit 
agencies and organizations, including institutions of higher education, 
to increase the number of skilled personnel available for employment in 
the field of rehabilitation and to upgrade the skills of those already 
employed.

    Demonstration and training programs.--Grants are made for programs 
that expand and improve the provision of rehabilitation services or that 
further the purposes of the Rehabilitation Act.

    Protection and advocacy of individual rights.--Formula grants are 
made to State protection and advocacy systems to protect the legal and 
human rights of individuals with disabilities.

    Independent living.--Grants are awarded to States and nonprofit 
agencies to assist individuals with significant disabilities in their 
achievement of self-determined independent living goals. Grants are also 
awarded to provide support services to older blind individuals to 
increase their ability to care for their own needs.

    Program improvement.--Funds are used to promote broad-based planning 
and coordination, improve accountability, and enhance the Department's 
ability to address critical areas of national significance in achieving 
the goals of the Rehabilitation Act. Examples of program improvement 
activities include technical assistance, dissemination, and performance 
measurement activities.

    Evaluation.--Studies are conducted to evaluate the impact and 
effectiveness of various programs authorized under the Rehabilitation 
Act.

    Helen Keller National Center for Deaf-Blind Youths and Adults.--The 
Center provides services to deaf-blind youths and adults and provides 
training and technical assistance to professional and allied personnel 
at its national headquarters center and through its regional 
representatives and affiliate agencies.

    National Institute on Disability and Rehabilitation Research.--The 
Institute carries out a comprehensive and coordinated program of 
rehabilitation research and related activities. Through grants and 
contracts, it supports the conduct and dissemination of research aimed 
at improving the lives of individuals with disabilities. The Institute 
also promotes the development and utilization of new technologies to 
assist these individuals in achieving greater independence and 
integration into society.

    Assistive technology loan program.--Grants are made to States to 
establish or expand alternative financing programs to increase access to 
assistive technology for individuals with disabilities. 

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0301-0-1-506      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Direct obligations:

25.1    Advisory and assistance services          10          10           9
25.2    Other services..................           2           2           2
25.3    Other purchases of goods and 
          services from Government 
          accounts......................           1           2           1
25.5    Research and development 
          contracts.....................           1
41.0    Grants, subsidies, and 
          contributions.................       2,995       2,997       3,035
                                           ---------   ---------  ----------

[[Page 353]]


99.0      Direct obligations............       3,009       3,011       3,047
99.0  Reimbursable obligations..........           2           2           2
                                           ---------   ---------  ----------
99.9    Total new obligations...........       3,011       3,013       3,049
---------------------------------------------------------------------------

                                

           Special Institutions for Persons With Disabilities

                  american printing house for the blind

    For carrying out the Act of March 3, 1879, as amended (20 U.S.C. 101 
et seq.), [$16,500,000] $16,403,000. (Division E, H.R. 2673, 
Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0600-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct Program Activity...........          15          16          16
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................          15          16          16
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          16          16          16
23.95 Total new obligations.............         -15         -16         -16
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          16          16          16
    Change in obligated balances:
72.40 Obligated balance, start of year..           6           7           1
73.10 Total new obligations.............          15          16          16
73.20 Total outlays (gross).............         -14         -22         -16
74.40 Obligated balance, end of year....           7           1           1
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           8          15          15
86.93 Outlays from discretionary 
        balances........................           6           7           1
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          14          22          16
    Net budget authority and outlays:
89.00 Budget authority..................          16          16          16
90.00 Outlays...........................          15          22          16
---------------------------------------------------------------------------

    The Federal appropriation supports the production of free 
educational materials for students below the college level who are 
blind, research related to developing and improving products, and 
advisory services to consumer organizations on the availability and use 
of materials. In 2003, the portion of the Federal appropriation 
allocated to educational materials represented approximately 58.5 
percent of the Printing House's total sales. The full appropriation 
represented approximately 61.6 percent of the Printing House's total 
budget.

                                

                National Technical Institute for the Deaf

    For the National Technical Institute for the Deaf under titles I and 
II of the Education of the Deaf Act of 1986 (20 U.S.C. 4301 et seq.), 
[$53,800,000] $53,803,000, of which [$367,000] $685,000 shall be for 
construction and shall remain available until expended: Provided, That 
from the total amount available, the Institute may at its discretion use 
funds for the endowment program as authorized under section 207. 
(Division E, H.R. 2673, Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0601-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Operations........................          52          53          53
00.02 Construction......................           2                       1
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................          54          53          54
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          54          53          54
23.95 Total new obligations.............         -54         -53         -54
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          54          53          54
    Change in obligated balances:
72.40 Obligated balance, start of year..                       2           5
73.10 Total new obligations.............          54          53          54
73.20 Total outlays (gross).............         -53         -50         -54
74.40 Obligated balance, end of year....           2           5           4
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          52          50          50
86.93 Outlays from discretionary 
        balances........................           1                       4
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          53          50          54
    Net budget authority and outlays:
89.00 Budget authority..................          54          53          54
90.00 Outlays...........................          53          50          54
---------------------------------------------------------------------------

    This residential program provides postsecondary technical and 
professional education for people who are deaf to prepare them for 
employment, provides training, and conducts applied research into 
employment-related aspects of deafness. In 2003, Federal appropriations 
represented 81 percent of the Institute's operating budget. The request 
includes funds for the Endowment Grant program. The request also 
includes funds for part of the cost of construction projects to renovate 
the NTID theater and construct a new student development center.

                                

                          Gallaudet University

    For the Kendall Demonstration Elementary School, the Model Secondary 
School for the Deaf, and the partial support of Gallaudet University 
under titles I and II of the Education of the Deaf Act of 1986 (20 
U.S.C. 4301 et seq.), [$100,800,000] $100,205,000: Provided, That from 
the total amount available, the University may at its discretion use 
funds for the endowment program as authorized under section 207. 
(Division E, H.R. 2673, Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0602-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Operations........................          98         100         100
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................          98         100         100
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          97         100         100
23.95 Total new obligations.............         -98        -100        -100
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          98         101         100
40.35   Appropriation permanently 
          reduced.......................          -1          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............          97         100         100
    Change in obligated balances:
72.40 Obligated balance, start of year..                                   6
73.10 Total new obligations.............          98         100         100
73.20 Total outlays (gross).............         -97         -94        -100
74.40 Obligated balance, end of year....                       6           6
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          97          94          94
86.93 Outlays from discretionary 
        balances........................                                   6
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          97          94         100
    Net budget authority and outlays:
89.00 Budget authority..................          97         100         100
90.00 Outlays...........................          98          94         100
---------------------------------------------------------------------------

    This institution provides undergraduate and continuing education 
programs for persons who are deaf, and graduate programs related to 
deafness for students who are deaf and students who are hearing. The 
University also conducts basic and applied research and provides public 
service programs for persons who are deaf and persons who work with 
them.

    Gallaudet operates two elementary and secondary education programs 
on the main campus of the University. The Kendall Demonstration 
Elementary School serves students who are

[[Page 354]]

deaf from infancy through age 15, and the Model Secondary School for the 
Deaf serves high school age students who are deaf. Both schools also 
develop and disseminate information on effective educational techniques 
and strategies for teachers and professionals working with students who 
are deaf or hard of hearing.

    In 2003, the Federal appropriation represented 65.3 percent of the 
University's total revenue, which also includes other Federal funds such 
as student financial aid, vocational rehabilitation, Endowment Grant 
program income, and competitive grants and contracts, and 97.3 percent 
of the revenue related to the elementary and secondary schools. The 
request also includes funds for the Endowment Grant program.

                                


 
                OFFICE OF VOCATIONAL AND ADULT EDUCATION

                              Federal Funds

General and special funds:

                     Vocational and Adult Education

    For carrying out, to the extent not otherwise provided, [the Carl D. 
Perkins Vocational and Technical Education Act of 1998,] the Adult 
Education and Family Literacy Act, [and subparts 4 and 11 of part D of 
title V of the Elementary and Secondary Education Act of 1965 
(``ESEA''), $2,121,690,000, of] $590,233,000, which [$1,304,712,000] 
shall become available on July 1, [2004] 2005 and shall remain available 
through September 30, [2005 and of which $791,000,000 shall become 
available on October 1, 2004 and shall remain available through 
September 30, 2005: Provided, That notwithstanding any other provision 
of law or any regulation, the Secretary of Education shall not require 
the use of a restricted indirect cost rate for grants issued pursuant to 
section 117 of the Carl D. Perkins Vocational and Technical Education 
Act of 1998] 2006: Provided, [further] That of the amount provided for 
Adult Education State Grants, [$69,545,000] $69,135,000 shall be made 
available for integrated English literacy and civics education services 
to immigrants and other limited English proficient populations: Provided 
further, That of the amount reserved for integrated English literacy and 
civics education, notwithstanding section 211 of the Adult Education and 
Family Literacy Act, 65 percent shall be allocated to States based on a 
State's absolute need as determined by calculating each State's share of 
a 10-year average of the Immigration and Naturalization Service data for 
immigrants admitted for legal permanent residence for the 10 most recent 
years, and 35 percent allocated to States that experienced growth as 
measured by the average of the 3 most recent years for which Immigration 
and Naturalization Service data for immigrants admitted for legal 
permanent residence are available, except that no State shall be 
allocated an amount less than $60,000: Provided further, That of the 
amounts made available for the Adult Education and Family Literacy Act, 
[$9,223,000] $9,169,000 shall be for national leadership activities 
under section 243 and [$6,732,000] $6,692,000 shall be for the National 
Institute for Literacy under section 242[: Provided further, That 
$185,000,000 shall be available to carry out part D of title V of the 
ESEA: Provided further, That $175,000,000 shall be available to support 
the activities authorized under subpart 4 of part D of title V of the 
Elementary and Secondary Education Act of 1965, of which up to 5 percent 
shall become available October 1, 2003 and shall remain available 
through September 30, 2005, for evaluation, technical assistance, school 
networking, peer review of applications, and program outreach 
activities, and of which not less than 95 percent shall become available 
on July 1, 2004, and remain available through September 30, 2005, for 
grants to local educational agencies: Provided further, That funds made 
available to local education agencies under this subpart shall be used 
only for activities related to establishing smaller learning communities 
in high schools]. (Division E, H.R. 2673, Consolidated Appropriations 
Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0400-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Vocational education:

        Annual appropriations:
          Vocational education:
00.01       State grants................       1,185       1,204         791
00.02       National programs...........          12          12          12
00.03       Occupational and employment 
              information...............          10           9           1
00.04       Tribally controlled 
              postsecondary vocational 
              institutions..............           7           7
00.05       Tech-prep education State 
              grants....................         105         109
00.06     Tech-prep demonstration.......          10           5
                                           ---------   ---------  ----------
00.91       Total, Vocational education.       1,329       1,346         804
          Adult education:
01.01       State grants................         554         595         574
01.02       National Institute for 
              Literacy..................           6           7           7
01.03       National leadership 
              activities................           9           9           9
                                           ---------   ---------  ----------
01.91       Total, adult education......         569         611         590
02.01     State grants for incarcerated 
            youth offenders.............          19
03.01     Literacy programs for 
            prisoners...................           5           5
04.01   Smaller learning communities....                                 174
05.01   Community technology centers....                      10
                                           ---------   ---------  ----------
10.00   Total new obligations...........       1,922       1,972       1,568
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          56          78         215
22.00 New budget authority (gross)......       1,943       2,109       1,381
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,999       2,187       1,596
23.95 Total new obligations.............      -1,922      -1,972      -1,568
24.40 Unobligated balance carried 
        forward, end of year............          78         215          27
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       1,165       1,331         590
40.35   Appropriation permanently 
          reduced.......................         -13         -13
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       1,152       1,318         590
55.00   Advance appropriation from prior 
          year..........................         791         791         791
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       1,943       2,109       1,381
    Change in obligated balances:
72.40 Obligated balance, start of year..       1,652       1,618       1,658
73.10 Total new obligations.............       1,922       1,972       1,568
73.20 Total outlays (gross).............      -1,943      -1,932      -1,965
73.40 Adjustments in expired accounts 
        (net)...........................         -13
74.40 Obligated balance, end of year....       1,618       1,658       1,261
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         613         661         585
86.93 Outlays from discretionary 
        balances........................       1,330       1,271       1,380
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,943       1,932       1,965
    Net budget authority and outlays:
89.00 Budget authority..................       1,943       2,109       1,381
90.00 Outlays...........................       1,943       1,932       1,965
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Enacted/requested:
  Budget Authority..................       1,943       2,109       1,381
  Outlays...........................       1,943       1,932       1,965
Legislative proposal, not subject to 
    PAYGO:
  Budget Authority..................                                 221
  Outlays...........................                                  51
                                    ------------------------------------
Total:
  Budget Authority..................       1,943       2,109       1,602
  Outlays...........................       1,943       1,932       2,016
                                    ====================================

    Vocational education.--The Administration is working with Congress 
to develop legislation reauthorizing programs included in the Carl D. 
Perkins Vocational and Technical Education Act of 1998. When new 
authorizing legislation is enacted resources for the affected programs 
will be requested.

    Adult education--
        State programs.--Funds support formula grants to States to help 
    eliminate functional illiteracy among the Nation's adults, to assist 
    adults in obtaining a high school diploma

[[Page 355]]

    or  its equivalent, and to promote family literacy. A portion of the 
    funds are reserved for formula grants to States to provide English 
    literacy and civics education for immigrants and other limited 
    English proficient adults.
        National Institute for Literacy.--Funds support the Institute's 
    national leadership activities to improve and expand the Nation's 
    system for delivery of literacy services.
        National leadership activities.--Funds support discretionary 
    activities to evaluate the effectiveness of Federal, State, and 
    local adult education programs, and to test and demonstrate methods 
    of improving program quality.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0400-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........                       1           1
11.3      Other than full-time permanent           1           1           1
                                           ---------   ---------  ----------
11.9        Total personnel compensation           1           2           2
25.1    Advisory and assistance services           1
25.2    Other services..................           3           3           5
25.3    Other purchases of goods and 
          services from Government 
          accounts......................          18          27          27
25.5    Research and development 
          contracts.....................           9           1           5
41.0    Grants, subsidies, and 
          contributions.................       1,889       1,939       1,528
                                           ---------   ---------  ----------
99.0      Direct obligations............       1,921       1,972       1,567
99.5  Below reporting threshold.........           1                       1
                                           ---------   ---------  ----------
99.9    Total new obligations...........       1,922       1,972       1,568
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-0400-0-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................          15          19          19
---------------------------------------------------------------------------

                Office of Vocational and Adult Education

                     Vocational and Adult Education

              (Legislative proposal, not subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0400-2-1-501      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Vocational education:

        Annual appropriations:
          Vocational education:
00.01       Secondary and technical 
              education.................                                 199
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                                 199
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                 221
23.95 Total new obligations.............                                -199
24.40 Unobligated balance carried 
        forward, end of year............                                  22
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                                 221
    Change in obligated balances:
73.10 Total new obligations.............                                 199
73.20 Total outlays (gross).............                                 -51
74.40 Obligated balance, end of year....                                 149
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                                  51
    Net budget authority and outlays:
89.00 Budget authority..................                                 221
90.00 Outlays...........................                                  51
---------------------------------------------------------------------------

    The resources in this schedule are proposed for later transmittal 
under proposed legislation to reform the Carl D. Perkins Vocational and 
Technical Education Act of 1998 (Perkins). The reforms would promote 
stronger accountability for results by linking grantee funding to 
success in achieving improved student outcomes.

    Secondary and technical education.--The proposed reforms to Perkins 
would create a coordinated high school and technical education 
improvement program. The program would support and extend the goals of 
Title I of the Elementary and Secondary Education Act (ESEA) by 
requiring States and LEAs to focus more intensively on improving student 
outcomes, such as academic achievement, and ensuring that students are 
being taught the necessary skills to make successful transitions from 
high school to college and college to the workforce.

    Funds would flow to States by formula, and States, in turn, would 
use most of their allocations to make competitive grants to partnerships 
between local education agencies and community and technical colleges. 
In addition, under the proposed national activities authority, the 
Department of Education would make grants to States to expand the State 
Scholars programs that increase the percentage of high school students 
who have the solid academic foundation necessary to succeed in 
postsecondary education and a dynamic labor market.

                                


 
                    OFFICE OF POSTSECONDARY EDUCATION

                              Federal Funds

General and special funds:

                            Higher Education

    For carrying out, to the extent not otherwise provided, section 121 
and titles II, III, IV, V, VI, and VII of the Higher Education Act of 
1965 (``HEA''), as amended, [section 1543 of the Higher Education 
Amendments of 1992, title VIII of the Higher Education Amendments of 
1998, and] the Mutual Educational and Cultural Exchange Act of 1961, 
[$2,094,511,000,] and section 117 of the Carl D. Perkins Vocational and 
Technical Education Act, $1,977,028,000, of which [$2,000,000] 
$1,500,000 for interest subsidies authorized by section 121 of the HEA 
shall remain available until expended: Provided, That [$9,935,000] 
$9,876,000, to remain available through September 30, [2005] 2006, shall 
be available to fund fellowships for academic year [2005-2006] 2006-2007 
under part A, subpart 1 of title VII of said Act, under the terms and 
conditions of part A, subpart 1: Provided further, That [$994,000] 
$988,000 is for data collection and evaluation activities for programs 
under the HEA, including such activities needed to comply with the 
Government Performance and Results Act of 1993: Provided further, That 
notwithstanding any other provision of law, funds made available in this 
Act to carry out title VI of the HEA and section 102(b)(6) of the Mutual 
Educational and Cultural Exchange Act of 1961 may be used to support 
visits and study in foreign countries by individuals who are 
participating in advanced foreign language training and international 
studies in areas that are vital to United States national security and 
who plan to apply their language skills and knowledge of these countries 
in the fields of government, the professions, or international 
development: Provided further, That up to one percent of the funds 
referred to in the preceding proviso may be used for program evaluation, 
national outreach, and information dissemination activities: Provided 
further, That [$123,110,000 of the funds for part B of title VII of the 
Higher Education Act of 1965 shall be available for the projects and in 
the amounts specified in the statement of the managers of the conference 
report accompanying this Act] the funds provided for title II of the HEA 
shall be allocated notwithstanding section 210 of such Act. (Division E, 
H.R. 2673, Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0201-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Aid for institutional development:

00.01   Strengthening institutions......          81          81          81
00.02   Strengthening tribally 
          controlled colleges and 
          universities..................          23          23          24
00.03   Strengthening Alaska Native and 
          Native Hawaiian-serving 
          institutions..................           8          11           6

[[Page 356]]

00.04   Strengthening historically black 
          colleges and universities.....         214         223         240
00.05   Strengthening historically black 
          graduate institutions.........          54          53          58
00.06   Minority science and engineering 
          improvement...................           9           9           9
                                           ---------   ---------  ----------
00.91     Subtotal, aid for 
            institutional development...         389         400         418
      Other aid for institutions:

01.01   Developing Hispanic-serving 
          institutions..................          92          94          96
01.02   International education and 
          foreign language studies......         108         103         103
01.03   Fund for the Improvement of 
          Postsecondary Education.......         171         157          32
01.05   Demonstration projects to ensure 
          quality higher education for 
          students with disabilities....           7           7
01.06   Interest subsidy grants.........           3          10           2
01.07   Tribally controlled 
          postsecondary vocational and 
          technical institutions........                                   7
                                           ---------   ---------  ----------
01.91     Subtotal, other aid for 
            institutions................         381         371         240
      Assistance for students:

02.01   Federal TRIO programs...........         827         833         833
02.02   Gaining early awareness and 
          readiness for undergraduate 
          programs (GEAR UP)............         293         298         298
02.03   Byrd honors scholarships........          41          41          41
02.04   Javits fellowships..............          10          10          10
02.05   Graduate assistance in areas of 
          national need.................          31          31          31
02.06   Thurgood Marshall legal 
          educational opportunity 
          program.......................           5
02.07   B.J. Stupak Olympic scholarships           1           1
02.08   Child care access means parents 
          in school.....................          16          16          16
                                           ---------   ---------  ----------
02.91     Subtotal, assistance for 
            students....................       1,224       1,230       1,229
03.01 Teacher quality enhancement.......          89          89          89
04.01 GPRA data/HEA program evaluation..           1           1           1
05.01 Underground railroad program......           2           2
                                           ---------   ---------  ----------
10.00   Total new obligations...........       2,086       2,093       1,977
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          17          18          10
22.00 New budget authority (gross)......       2,086       2,085       1,977
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       2,103       2,103       1,987
23.95 Total new obligations.............      -2,086      -2,093      -1,977
24.40 Unobligated balance carried 
        forward, end of year............          18          10          10
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       2,100       2,097       1,977
40.35   Appropriation permanently 
          reduced.......................         -14         -12
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       2,086       2,085       1,977
    Change in obligated balances:
72.40 Obligated balance, start of year..       2,702       2,833       2,752
73.10 Total new obligations.............       2,086       2,093       1,977
73.20 Total outlays (gross).............      -1,931      -2,174      -2,105
73.40 Adjustments in expired accounts 
        (net)...........................         -24
74.40 Obligated balance, end of year....       2,833       2,752       2,624
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          62         106         100
86.93 Outlays from discretionary 
        balances........................       1,869       2,068       2,005
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,931       2,174       2,105
    Net budget authority and outlays:
89.00 Budget authority..................       2,086       2,085       1,977
90.00 Outlays...........................       1,930       2,174       2,105
---------------------------------------------------------------------------
    Note.--Includes $7 million in budget authority in 2005 for 
activities previously financed from the Department of Education:

                       (in millions of dollars)
                                          2003 actual      2004 est.
Office of Vocational and Adult Education             7               7

    Aid for institutional development.--
        Strengthening institutions.--Funds support planning and 
    development grants for improving academic programs and financial 
    management at schools that enroll high proportions of disadvantaged 
    students and have low per-student expenditures.
        Strengthening tribally controlled colleges and universities.--
    Funds support grants to American Indian tribally controlled colleges 
    and universities with scarce resources to enable them to improve and 
    expand their capacity to serve Indian students.
        Strengthening Alaska Native and Native Hawaiian-serving 
    institutions.--Funds support Alaska Native and Native Hawaiian-
    serving institutions to enable them to improve and expand their 
    capacity to serve Alaska Native and Native Hawaiian students.
        Strengthening historically black colleges and universities.--
    Funds support grants to help historically black undergraduate 
    institutions to improve and expand their capacity to serve students, 
    and to strengthen management and fiscal operations.
        Strengthening historically black graduate institutions.--Funds 
    support grants to help historically black graduate institutions to 
    improve and expand their capacity to serve students, and to 
    strengthen management and fiscal operations.
        Minority science and engineering improvement.--Funds support 
    grants to predominantly minority institutions to help them make 
    long-range improvements in science and engineering education and to 
    increase the participation of minorities in scientific and 
    technological careers.

    Other aid for institutions.--
        Developing Hispanic-serving institutions.--Funds support 
    Hispanic-serving institutions to enable them to improve and expand 
    their capacity to serve students.
        International education and foreign language studies programs.--
    Funds promote the development and improvement of international and 
    foreign language programs.
        Fund for the improvement of postsecondary education.--Funds 
    support a broad range of postsecondary reform and improvement 
    projects, as well as international consortia programs.
        Interest subsidy grants.--Funds meet mandatory interest subsidy 
    costs of construction loan commitments made prior to 1974.
        Tribally controlled postsecondary vocational and technical 
    institutions.--Funds support the operation and improvement of 
    tribally controlled postsecondary vocational institutions, to ensure 
    continued and expanded educational opportunities for Indian 
    students.

    Assistance for students.--
        Federal TRIO programs.--Funds support postsecondary education 
    outreach and student support services through 5 major programs 
    designed to help individuals from disadvantaged backgrounds enter 
    and complete college and graduate studies.
        Gaining early awareness and readiness for undergraduate 
    programs.--Funds support early college preparation and awareness 
    activities at the State and local levels to ensure that low-income 
    elementary and secondary school students are prepared for and pursue 
    postsecondary education.
        Byrd honors scholarships.--Funds support merit-based 
    scholarships to students who have demonstrated outstanding academic 
    achievement and who show promise of continued academic excellence 
    for study at an institution of higher education.
        Javits fellowships.--Funds support fellowships to students of 
    superior ability who have financial need and who are pursuing 
    doctoral degrees in the arts, humanities, and social sciences.
        Graduate assistance in areas of national need.--Funds support 
    fellowships to graduate students of superior ability who have 
    financial need and who are from traditionally under-represented 
    backgrounds for study in areas of national need.

[[Page 357]]

        Child care access means parents in school.--Funds support a 
    program designed to bolster the participation of low-income parents 
    in postsecondary education through the provision of campus-based 
    child care services.

    Other aid.--
        Teacher quality enhancement.--Funds support programs that seek 
    to make lasting changes in the ways our Nation recruits, prepares, 
    licenses, and supports teachers.
        GPRA data/HEA program evaluation.--Funds support data collection 
    and evaluation activities for programs under the Higher Education 
    Act of 1965, including such activities needed to comply with the 
    Government Performance and Results Act of 1993.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0201-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
25.1  Advisory and assistance services..           3           4           4
25.2  Other services....................           4           5           6
25.3  Other purchases of goods and 
        services from Government 
        accounts........................           2           2           2
25.7  Operation and maintenance of 
        equipment.......................           1           1           1
41.0  Grants, subsidies, and 
        contributions...................       2,076       2,081       1,964
                                           ---------   ---------  ----------
99.9    Total new obligations...........       2,086       2,093       1,977
---------------------------------------------------------------------------

                                

                            Howard University

    For partial support of Howard University (20 U.S.C. 121 et seq.), 
[$240,180,000] $238,763,000, of which not less than [$3,573,000] 
$3,600,000 shall be for a matching endowment grant pursuant to the 
Howard University Endowment Act (Public Law 98-480) and shall remain 
available until expended. (Division E, H.R. 2673, Consolidated 
Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0603-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 General support...................         205         216         209
00.02 Howard University Hospital........          30          30          30
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................         235         246         239
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           4           7
22.00 New budget authority (gross)......         238         239         239
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         242         246         239
23.95 Total new obligations.............        -235        -246        -239
24.40 Unobligated balance carried 
        forward, end of year............           7
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         240         240         239
40.35   Appropriation permanently 
          reduced.......................          -2          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         238         239         239
    Change in obligated balances:
72.40 Obligated balance, start of year..           4                      15
73.10 Total new obligations.............         235         246         239
73.20 Total outlays (gross).............        -239        -232        -239
74.40 Obligated balance, end of year....                      15          14
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         235         225         225
86.93 Outlays from discretionary 
        balances........................           4           7          14
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         239         232         239
    Net budget authority and outlays:
89.00 Budget authority..................         238         239         239
90.00 Outlays...........................         238         232         239
---------------------------------------------------------------------------

    Howard University is a private, nonprofit educational institution 
consisting of 12 schools and colleges. Federal funds are used to provide 
partial support for university programs as well as for the teaching 
hospital facilities. In 2003, Federal funding represented approximately 
58 percent of the university's revenue.

                                

      College Housing and Academic Facilities Loans Program Account

    For Federal administrative expenses authorized under section 121 of 
the Higher Education Act of 1965, [$774,000] $578,000 to carry out 
activities related to existing facility loans entered into under the 
Higher Education Act of 1965.

  Historically Black College and University Capital Financing Program 
                                 Account

    The aggregate principal amount of outstanding bonds insured pursuant 
to section 344 of title III, part D of the Higher Education Act of 1965, 
shall not exceed $357,000,000, and the cost, as defined in section 502 
of the Congressional Budget Act of 1974, of such bonds shall not exceed 
zero.
    For administrative expenses to carry out the Historically Black 
College and University Capital Financing Program entered into pursuant 
to title III, part D of the Higher Education Act of 1965, as amended, 
[$210,000] $212,000. (Division E, H.R. 2673, Consolidated Appropriations 
Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0241-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.09 Federal administration............           1           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 99.5)...................           1           1           1
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......           1           1           1
23.95 Total new obligations.............          -1          -1          -1
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................           1           1           1
    Change in obligated balances:
72.40 Obligated balance, start of year..           1
73.10 Total new obligations.............           1           1           1
73.20 Total outlays (gross).............          -1          -1          -1
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           1           1           1
    Net budget authority and outlays:
89.00 Budget authority..................           1           1           1
90.00 Outlays...........................           1           1           1
---------------------------------------------------------------------------

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in 
                            millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0241-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115001Historically Black Colleges and 
        Universities....................         269         269         170
                                           ---------   ---------  ----------
115901Total direct loan levels..........         269         269         170
    Direct loan subsidy (in percent):
132001Historically Black Colleges and 
        Universities....................        0.00        0.00        0.00
                                           ---------   ---------  ----------
132901Weighted average subsidy rate.....        0.00        0.00        0.00
    Direct loan subsidy budget authority:
133001Historically Black Colleges and 
        Universities....................
                                           ---------   ---------  ----------
133901Total subsidy budget authority....
    Direct loan subsidy outlays:
134001Historically Black Colleges and 
        Universities....................
                                           ---------   ---------  ----------
134901Total subsidy outlays.............
    Direct loan downward reestimate subsidy budget 
                authority:
137001Historically Black Colleges and 
        Universities....................
                                           ---------   ---------  ----------
137901Total downward reestimate budget 
        authority.......................
----------------------------------------------------------------------------

    Administrative expense data:
351001Budget authority..................           1           1           1
358001Outlays from balances.............
359001Outlays from new authority........
---------------------------------------------------------------------------

    The College Housing and Academic Facilities Loans Program and the 
Historically Black College and University Capital Financing Program are 
administered separately, but are consolidated for presentation purposes.

[[Page 358]]

    College Housing and Academic Facilities Loans Program.--Funds for 
this activity pay the Federal costs for administering the College 
Housing and Academic Facilities Loans (CHAFL), College Housing Loans 
(CHL), and Higher Education Facilities Loans (HEFL) programs. Prior to 
1994, these programs provided financing for the construction, 
reconstruction, and renovation of housing, academic, and other 
educational facilities. Although no new loans have been awarded since 
fiscal year 1993, costs for administering the outstanding loans will 
remain through 2030.

    Historically Black College and University Capital Financing 
Program.--The Historically Black College and University (HBCU) Capital 
Financing Program provides HBCUs with access to capital financing for 
the repair, renovation, and construction of classrooms, libraries, 
laboratories, dormitories, instructional equipment, and research 
instrumentation. The Higher Education Amendments of 1992 granted the 
Department authority to enter into insurance agreements with a private 
for-profit Designated Bonding Authority to guarantee no more than 
$375,000,000 in outstanding principal and unpaid accrued interest 
combined. The bonding authority issues the loans and maintains an escrow 
account in which 5 percent of each institution's principal is deposited. 
This amount is estimated to be sufficient to cover all potential 
delinquencies and defaults. No subsidy appropriations are required. The 
2005 budget provides funds for continuing Federal administrative 
activities only.

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-0241-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................           7           7           5
---------------------------------------------------------------------------

                                

     College Housing and Academic Facilities Loans Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4252-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.02 Interest paid to Treasury.........           2           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 43.0)...................           2           1           1
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                       1
22.00 New financing authority (gross)...           3           1           1
22.60 Portion applied to repay debt.....                      -1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......           3           1           1
23.95 Total new obligations.............          -2          -1          -1
24.40 Unobligated balance carried 
        forward, end of year............           1
    New financing authority (gross), detail:
      Mandatory:

69.00   Offsetting collections (cash)...           5           2           2
69.47   Portion applied to repay debt...          -2          -1          -1
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........           3           1           1
    Change in obligated balances:
73.10 Total new obligations.............           2           1           1
73.20 Total financing disbursements 
        (gross).........................          -2          -1          -1
87.00 Total financing disbursements 
        (gross).........................           2           1           1
    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.40     Interest repayments...........          -2          -1          -1
88.40     Principal repayments..........          -3          -1          -1
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........          -5          -2          -2
    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............          -2          -1          -1
90.00 Financing disbursements...........          -3          -1          -1
---------------------------------------------------------------------------

    Consistent with the Federal Credit Reform Act of 1990, the College 
Housing and Academic Facilities Loans Financing Account records all cash 
flows to and from the Government resulting from direct loans made in 
fiscal years 1992 and 1993. The amounts in this account are a means of 
financing, and are not incuded in the budget totals.

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4252-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
                                           ---------   ---------  ----------
1150    Total direct loan obligations...
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          25          22          21
1251  Repayments: Repayments and 
        prepayments.....................          -3          -1
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          22          21          21
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   91-4252-0-3-502    2002 actual    2003 actual     2004 est.      2005 est.
-----------------------------------------------------------------------------------------------
    ASSETS:
      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401    Direct loans receivable, gross..                         22
1402    Interest receivable.............                          1
1405    Allowance for subsidy cost (-)..                         -3
                                        ------------ --------------  ------------  -------------
1499      Net present value of assets 
            related to direct loans.....                         20
                                        ------------ --------------  ------------  -------------
1999    Total assets....................                         20
    LIABILITIES:
2103  Federal liabilities: Debt.........                         20
                                        ------------ --------------  ------------  -------------
2999    Total liabilities...............                         20
                                        ------------ --------------  ------------  -------------
4999  Total liabilities and net position                         20
-----------------------------------------------------------------------------------------------
    Note: Consistent with Government-wide practice, information for 2004 
and 2005 was not required to be collected.

                                

    College Housing and Academic Facilities Loans Liquidating Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0242-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.02 Interest paid to Treasury.........           8          10           9
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 43.0)...................           8          10           9
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           5           1
22.00 New budget authority (gross)......           9          10           9
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           3
22.40 Capital transfer to general fund..          -2
22.60 Portion applied to repay debt.....          -6          -1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......           9          10           9
23.95 Total new obligations.............          -8         -10          -9
24.40 Unobligated balance carried 
        forward, end of year............           1
    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................          16           3           3
60.47   Portion applied to repay debt...         -13
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................           3           3           3
69.00 Offsetting collections (cash).....          51          38          36
69.27 Capital transfer to general fund..          -2          -1         -22

[[Page 359]]

69.47 Portion applied to repay debt.....         -43         -30          -8
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................           6           7           6
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................           9          10           9
    Change in obligated balances:
72.40 Obligated balance, start of year..          12           4           4
73.10 Total new obligations.............           8          10           9
73.20 Total outlays (gross).............         -13         -10          -9
73.45 Recoveries of prior year 
        obligations.....................          -3
74.40 Obligated balance, end of year....           4           4           4
    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................           9          10           9
86.98 Outlays from mandatory balances...           4
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          13          10           9
    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.40     Repayments of principal.......         -37         -26         -25
88.40     Interest received on loans....         -14         -12         -11
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........         -51         -38         -36
    Net budget authority and outlays:
89.00 Budget authority..................         -42         -28         -27
90.00 Outlays...........................         -38         -28         -27
---------------------------------------------------------------------------

    As required by the Federal Credit Reform Act of 1990, the College 
Housing and Academic Facilities Loans Liquidating Account records all 
cash flows to and from the Government resulting from direct loans made 
prior to 1992. This account includes loans made under the College 
Housing and Academic Facilities Loans, College Housing Loans, and Higher 
Education Facilities Loans programs, which continue to be administered 
separately. 

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0242-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
          CHAFL LIQUIDATING
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........         109         100          97
1251  Repayments: Repayments and 
        prepayments.....................          -9          -3          -3
                                           ---------   ---------  ----------
1290    Outstanding, end of year........         100          97          94
----------------------------------------------------------------------------

          HIGHER EDUCATION FACILITIES 
              LOANS
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          22          20          19
1251  Repayments: Repayments and 
        prepayments.....................          -2          -1          -2
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          20          19          17
----------------------------------------------------------------------------

          COLLEGE HOUSING LOANS
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........         254         228         207
1251  Repayments: Repayments and 
        prepayments.....................         -26         -21         -20
                                           ---------   ---------  ----------
1290    Outstanding, end of year........         228         207         187
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   91-0242-0-1-502    2002 actual    2003 actual     2004 est.      2005 est.
-----------------------------------------------------------------------------------------------
    ASSETS:
      Net value of assets related to 
          pre-1992 direct loans 
          receivable and acquired 
          defaulted guaranteed loans 
          receivable:

1601    Direct loans, gross.............         385            348
1602    Interest receivable.............           6              5
                                        ------------ --------------  ------------  -------------
1699      Value of assets related to 
            direct loans................         391            353
                                        ------------ --------------  ------------  -------------
1999    Total assets....................         391            353
    LIABILITIES:
      Federal liabilities:

2103    Debt............................         192            130
2104    Resources payable to Treasury...         199            223
                                        ------------ --------------  ------------  -------------
2999    Total liabilities...............         391            353
                                        ------------ --------------  ------------  -------------
4999  Total liabilities and net position         391            353
-----------------------------------------------------------------------------------------------
    Note: Consistent with Government-wide practice, information for 2004 
and 2005 was not required to be collected.

                                

Historically Black College and University Capital Financing Direct Loan 
                            Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4255-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Direct Loan Awards................                     100          40
00.02 Interest paid to Treasury.........           2           5           6
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 43.0)...................           2         105          46
    Budgetary resources available for obligation:
22.00 New financing authority (gross)...          42         105          46
22.70 Balance of authority to borrow 
        withdrawn.......................         -40
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......           2         105          46
23.95 Total new obligations.............          -2        -105         -46
    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............          40         100          40
69.00 Offsetting collections (cash).....           3           7           8
69.47 Portion applied to repay debt.....          -1          -2          -2
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................           2           5           6
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................          42         105          46
    Change in obligated balances:
72.40 Obligated balance, start of year..          20           9          70
73.10 Total new obligations.............           2         105          46
73.20 Total financing disbursements 
        (gross).........................         -14         -44         -63
74.40 Obligated balance, end of year....           9          70          53
87.00 Total financing disbursements 
        (gross).........................          14          44          63
    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.40     Interest repayments...........          -2          -5          -6
88.40     Principal repayments..........          -1          -2          -2
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........          -3          -7          -8
    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............          39          98          38
90.00 Financing disbursements...........          11          37          55
---------------------------------------------------------------------------

    The Federal Financing Bank (FFB) purchases bonds issued by the HBCU 
Designated Bonding Authority. Under the policies governing Federal 
credit programs, bonds purchased by the FFB and supported by the 
Department of Education with a letter of credit create the equivalent of 
a Federal direct loan. HBCU bonds are also available for purchase by the 
private sector, and these will be treated as loan guarantees. However, 
the Department anticipates that all HBCU loans will be financed by the 
FFB.

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4255-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........         269         269         170
1142  Unobligated direct loan limitation 
        (-).............................        -269        -169        -130
                                           ---------   ---------  ----------
1150    Total direct loan obligations...                     100          40
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          69          79         116
1231  Disbursements: Direct loan 
        disbursements...................          11          38          57
1251  Repayments: Repayments and 
        prepayments.....................          -1          -1          -2
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          79         116         171
---------------------------------------------------------------------------

[[Page 360]]



                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   91-4255-0-3-502    2002 actual    2003 actual     2004 est.      2005 est.
-----------------------------------------------------------------------------------------------
    ASSETS:
1101  Federal assets: Fund balances with 
        Treasury........................                          9
      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401    Direct loans receivable, gross..                         79
1402    Interest receivable.............                          3
                                        ------------ --------------  ------------  -------------
1499      Net present value of assets 
            related to direct loans.....                         82
                                        ------------ --------------  ------------  -------------
1999    Total assets....................                         91
    LIABILITIES:
      Federal liabilities:

2102    Interest payable................                          3
2103    Debt............................                         79
2201  Non-Federal liabilities: 
        Undisbursed direct loans........                          9
                                        ------------ --------------  ------------  -------------
2999    Total liabilities...............                         91
                                        ------------ --------------  ------------  -------------
4999  Total liabilities and net position                         91
-----------------------------------------------------------------------------------------------
    Note: Consistent with Government-wide practice, information for 2004 
and 2005 was not required to be collected.

                                


 
                 OFFICE OF STUDENT FINANCIAL ASSISTANCE

                              Federal Funds

General and special funds:

                     [Student Financial Assistance]

    [For carrying out subparts 1, 3 and 4 of part A, part C and part E 
of title IV of the Higher Education Act of 1965, as amended, 
$14,090,430,000, which shall remain available through September 30, 
2005.
    The maximum Pell Grant for which a student shall be eligible during 
award year 2004-2005 shall be $4,050.] (Division E, H.R. 2673, 
Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0200-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Federal Pell grants:

01.01   Federal Pell grants.............      12,608      10,224       2,264
      Campus-based aid:

02.01   Federal supplemental educational 
          opportunity grants (SEOG).....         761         771
02.02   Federal work-study..............       1,011         999
02.03   Federal Perkins loans: Federal 
          capital contributions.........         102          99
02.05   Federal Perkins loans: Loan 
          cancellations.................          67          67
                                           ---------   ---------  ----------
02.91     Subtotal, Campus-based 
            activities..................       1,941       1,936
03.01 Leveraging educational assistance 
        program.........................          72          66
04.01 Loan forgiveness for child care 
        providers.......................                       1
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................      14,621      12,227       2,264
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       1,026          33       1,813
22.00 New budget authority (gross)......      13,363      14,007
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................         266
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      14,655      14,040       1,813
23.95 Total new obligations.............     -14,621     -12,227      -2,264
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
24.40 Unobligated balance carried 
        forward, end of year............          33       1,813        -451
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................      13,451      14,090
40.35   Appropriation permanently 
          reduced.......................         -87         -83
41.00   Transferred to other accounts...          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............      13,363      14,007
    Change in obligated balances:
72.40 Obligated balance, start of year..       8,226       8,479       6,335
73.10 Total new obligations.............      14,621      12,227       2,264
73.20 Total outlays (gross).............     -14,048     -14,371      -7,830
73.40 Adjustments in expired accounts 
        (net)...........................         -53
73.45 Recoveries of prior year 
        obligations.....................        -266
74.40 Obligated balance, end of year....       8,479       6,335         769
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       5,098       6,168
86.93 Outlays from discretionary 
        balances........................       8,950       8,203       7,830
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      14,048      14,371       7,830
    Net budget authority and outlays:
89.00 Budget authority..................      13,363      14,007
90.00 Outlays...........................      14,048      14,371       7,830
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Enacted/requested:
  Budget Authority..................      13,363      14,007
  Outlays...........................      14,048      14,371       7,830
Legislative proposal, not subject to 
    PAYGO:
  Budget Authority..................                              14,699
  Outlays...........................                               7,158
                                    ------------------------------------
Total:
  Budget Authority..................      13,363      14,007      14,699
  Outlays...........................      14,048      14,371      14,988
                                    ====================================

    Note: Includes in all years institutional matching share of 
defaulted notes assigned from institutions to the Education Department.

    The Administration is working with Congress to develop legislation 
reauthorizing programs included in the Higher Education Act. When new 
authorizing legislation is enacted, resources for the affected programs 
will be requested.

    Funding Tables.--The following tables display student aid funds 
available, the number of aid awards, average awards, and the 
unduplicated count of recipients from any Federal student aid program. 
The tables include the aid from programs in the Student Financial 
Assistance account, as well as aid from the Federal Family Education 
Loan (FFEL) program, and the William D. Ford Federal Direct Loan 
program. Loan amounts reflect the capital actually loaned, not the 
Federal cost of those loans. The data in these tables include the 
effects of matching funds wherever applicable. The 2005 data in these 
tables reflect the Administration's legislative proposals.

      AID FUNDS AVAILABLE FOR POSTSECONDARY EDUCATION AND TRAINING

                             [in thousands]

                                        2003         2004        2005
Pell grants:
  Regular program...................  12,680,295  13,042,280  12,803,320
  State Scholars pilot..............                              33,000
Student loans:
  Guaranteed student loans:
    Stafford loans..................  15,618,242  17,698,690  19,052,088
    Unsubsidized Stafford loans.....  14,185,510  16,406,054  18,012,122
    PLUS............................   3,987,072   4,873,629   5,523,922
  Direct student loans:
    Stafford loans..................   5,789,975   6,309,213   6,737,974
    Unsubsidized Stafford loans.....   4,518,826   4,962,978   5,395,837
    PLUS............................   1,659,964   1,947,252   2,195,405
  Consolidation:
    FFEL............................  34,935,100  25,604,812  22,048,423
    Direct Loans....................   6,657,328   6,276,200   6,320,042
      Student loans, subtotal.......  87,352,018  84,078,827  85,285,814
Work-study..........................   1,202,993   1,195,690   1,195,690
Supplemental educational opportunity 
grants..............................     962,061     975,260     975,260
Perkins loans.......................   1,201,367   1,262,882   1,136,684
Leveraging educational assistance 
partnership.........................     169,695     168,517
Loan forgiveness for child care 
providers...........................         994
                                    ------------------------------------
      Total aid available........... 103,569,423 100,723,456 101,396,768
                                    ====================================

[[Page 361]]



                          NUMBER OF AID AWARDS

                             [in thousands]

                                        2003         2004        2005
Pell grants:
  Regular program...................       5,141       5,344       5,336
  State Scholars pilot..............                                  36
Guaranteed student loans--Stafford 
loans...............................       3,723       4,200       4,473
Guaranteed student loans--
Unsubsidized Stafford loans.........       2,728       3,112       3,355
Guaranteed student loans--PLUS......         400         542         496
Guaranteed student loans--
Consolidation.......................       1,204         881         750
Direct student loans--Stafford loans       1,318       1,408       1,489
Direct student loans--Unsubsidized 
Stafford loans......................         915         966       1,035
Direct student loans--PLUS..........         181         198         213
Direct sudent loans--Consolidation..         297         269         260
Work-study..........................         863         858         858
Supplemental educational opportunity 
grants..............................       1,237       1,254       1,254
Perkins loans.......................         641         674         606
Leveraging Educational Assistance 
Partnership.........................         170         169           0
                                    ------------------------------------
      Total awards..................      18,817      19,875      20,123
                                    ====================================

                           AVERAGE AID AWARDS

                           [in whole dollars]

                                        2003         2004        2005
Pell grants:
  Regular program...................       2,467       2,441       2,399
  State Scholars pilot..............                                 916
Guaranteed student loans--Stafford 
loans...............................       3,420       3,435       3,473
Guaranteed student loans--
Unsubsidized Stafford loans.........       4,182       4,239       4,318
Guaranteed student loans--PLUS......       8,475       9,000       9,469
Guaranteed student loans--SLS.......           0           0           0
Guaranteed student loans--
Consolidation.......................      27,907      27,950      28,284
Direct student loans--Stafford loans       3,600       3,674       3,710
Direct student loans--Unsubsidized 
Stafford loans......................       4,040       4,199       4,265
Direct student loans--PLUS..........       7,889       8,461       8,878
Direct student loans--Consolidation.      22,319      23,209      24,183
Work-study..........................       1,394       1,394       1,394
Supplemental educational opportunity 
grants..............................         778         778         778
Perkins loans.......................       1,875       1,875       1,875
Leveraging Educational Assistance 
Partnership.........................       1,000       1,000           0

                        NUMBER OF STUDENTS AIDED

                             [in thousands]

Unduplicated student count..........       8,385       8,855       9,241

                 ADMINISTRATIVE PAYMENTS TO INSTITUTIONS

                        [in thousands of dollars]

                                        2003         2004        2005
Pell grants.........................      25,705      26,720      26,680
Work-study..........................      75,216      74,762      74,762
Supplemental educational opportunity 
grants..............................      38,482      39,010      39,010
Perkins loans.......................      48,055      50,515      45,467

    The following table displays the status of defaulted Perkins loans 
held by the Department and by institutions.

                         DEFAULTED PERKINS LOANS

                        (In millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Outstanding defaulted loans, 
    beginning of year:
  Assigned defaulted loans \1\......         321         325         320
  Unassigned defaulted loans \2\....         913         895         876
New defaulted loans.................         124         128         136
Collections on assigned loans.......         -25         -31         -37
Collections on unassigned loans.....        -107        -112        -117
Write-offs for assigned loans.......          -3          -4          -4
Write-offs for unassigned loans.....          -4          -5          -6
                                    ------------------------------------
Outstanding defaulted loans, end of 
year................................       1,219       1,196       1,168
                                    ====================================
    \1\ Permanently assigned to the Federal Government for collection.
    \2\ Unassigned loans at institutions.

                      Student Financial Assistance

              (Legislative proposal, not subject to PAYGO)

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0200-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........         321         325         320
1251  Repayments: Repayments and 
        prepayments.....................         -25         -31         -37
      Write-offs for default:

1263    Direct loans....................          -3          -4          -4
1264    Other adjustments, net..........          32          30          31
                                           ---------   ---------  ----------
1290    Outstanding, end of year........         325         320         310
---------------------------------------------------------------------------

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0200-2-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Federal Pell grants:

01.01   Federal Pell grants.............                              10,007
01.02   Enhanced Pell Grants for State 
          Scholars......................                                  26
                                           ---------   ---------  ----------
01.91     Direct Program by Activities--
            Subtotal (1 level)..........                              10,033
                                           ---------   ---------  ----------
01.92   Subtotal, Federal Pell Grants...                              10,033
      Campus-based aid:

02.01   Federal supplemental educational 
          opportunity grants (SEOG).....                                 770
02.02   Federal work-study..............                                 999
02.05   Federal Perkins loans: Loan 
          cancellations.................                                  67
                                           ---------   ---------  ----------
02.91     Subtotal, Campus-based 
            activities..................                               1,836
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                              11,869
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                              14,699
23.95 Total new obligations.............                             -11,869
24.40 Unobligated balance carried 
        forward, end of year............                               2,830
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                              14,699
    Change in obligated balances:
73.10 Total new obligations.............                              11,869
73.20 Total outlays (gross).............                              -7,158
74.40 Obligated balance, end of year....                               4,711
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                               7,158
    Net budget authority and outlays:
89.00 Budget authority..................                              14,699
90.00 Outlays...........................                               7,158
---------------------------------------------------------------------------

    The resources in this schedule are proposed for later transmittal 
under proposed legislation to reauthorize the Higher Education Act. 
Together with matching funds, this funding would provide nearly 8.3 
million awards totaling more than $16 billion in available aid.

    Federal Pell Grants.--Pell Grants are the single largest source of 
grant aid for postsecondary education. This year, more than five million 
undergraduates will receive up to $4,050 to help pay for postsecondary 
education. Undergraduate students establish eligibility for these grants 
under award and need determination rules set out in the authorizing 
statute and the annual appropriations act. The Administration proposes 
$12.830 billion for Pell Grants in the 2005 Budget. Based on current 
estimates, this should provide sufficient funding for every Pell Grant 
that will be awarded to students in the 2005-2006 school year.

    However, the Pell Grant program also has a $3.7 billion funding 
shortfall that requires it to borrow from the subsequent year's 
appropriation to pay for program costs. This shortfall is largely due to 
recent underfunding. For instance, in last year's budget the 
Administration requested $12.7 billion for Pell Grants to pay for both 
student awards in the 2004-2005 school year and part of the shortfall. 
The Congress, however, increased the cost of the Pell Grant program and 
provided less money than requested. We now expect the Pell Grant 
shortfall to increase to $3.7 billion this year, $1 billion more than 
the shortfall was in 2003 and $2.3 billion more than 2002. The 
Administration will work closely with the Congress to provide sufficient 
funding for Pell Grants in the 2005-2006 school year, and retire the 
shortfall.

    As part of the Administration's efforts to keep the Pell Grant 
program on a solid financial foundation, the budget also proposes to 
allow the Internal Revenue Service to match income data on student aid 
applications with the applicant's

[[Page 362]]

tax data to ensure that students do not receive awards that are higher 
or lower than the amount for which they are eligible. This is one 
component of the Administration's efforts to reduce erroneous payments 
governmentwide. This proposal is projected to save $50 million in Pell 
Grant costs in 2005. Savings are expected to grow substantially in 
future years when the Department of Education fully implements this 
match.

    Enhanced Pell Grants for State Scholars.--The Administration 
proposes to establish a $33 million pilot within the Pell Grant program 
to encourage students and States to participate in the State Scholars 
program. This pilot program would provide up to an additional $1,000 to 
students who complete the rigorous State Scholars curriculum in high 
school. Students who complete a rigorous curriculum--with at least three 
years of mathematics and science, as well as four years of English and 
social studies, and courses in foreign language--are more successful in 
pursuing and completing further education. Currently, thirteen states 
participate in the State Scholars program. Although this pilot will 
operate within the larger Pell Grant program, total funding will be 
capped at the $33 million level. If recipients qualify for more than 
this amount, a process will be developed to allocate awards within the 
available funding level.

    Campus-based programs.--The Federal Supplemental Educational 
Opportunity Grants, Federal Work-Study, and Federal Perkins Loan 
programs are called the ``campus-based'' programs because participating 
institutions are responsible for administering the programs on their own 
campuses. These programs provide aid administrators with considerable 
flexibility in the packaging of financial aid awards to best meet the 
needs of students.

    The allocation formula for the three campus-based programs has 
historically distributed a disproportionate share of funding to schools 
with a long history of program participation. The PART found that this 
statutory formula for allocating funding to schools fails to target aid 
to the neediest students. Beginning in 2005, the Administration proposes 
to phase-in a revised allocation formula under which funding 
distributions are based more directly on institutional need.

    Federal Supplemental Educational Opportunity Grants (SEOG).--Federal 
funds are awarded by formula to qualifying institutions, which use these 
funds to award grants to undergraduate students. While institutions have 
discretion in awarding these funds, they are required to give priority 
to Pell Grant recipients and other students with exceptional need. The 
Federal share of such grants may not exceed 75 percent of the total 
grant. The Administration proposes $770 million for the SEOG program in 
2005. This level of funding would provide approximately $975 million in 
aid to an estimated 1.3 million needy students.

    Federal Work Study.--Federal funds are awarded by formula to 
qualifying institutions, which provide part-time jobs to eligible 
undergraduate and graduate students. Hourly earnings under this program 
must be at least equal to the Federal minimum wage. Federal funding in 
most cases pays 75 percent of a student's hourly wages, with the 
remaining 25 percent paid by the employer. The Administration proposes 
$999 million for the Federal Work Study program, which will provide $1.2 
billion in aid to over one million students.

    The Federal Work Study program also requires participating 
institutions to use at least 7 percent of the total funds granted to 
compensate students employed in community service jobs. However, the 
PART found that, while institutions placed an average of 15 percent of 
their students in community service jobs, many institutions (including 
many ``elite'' colleges and universities) fail to meet even the 7 
percent requirement. To address this issue, the Administration proposes 
to replace the 7 percent community service requirement with a separate 
set-aside for community service equal to 20 percent of the Work Study 
appropriation. Schools would apply for these community service funds 
separate from their regular allocation.

    Perkins Loan Program.--Institutions award low-interest loans from 
Federal revolving funds held at institutions, which are comprised of 
Federal Capital Contributions, institutional matching funds, and student 
repayments on outstanding loans.

    The Administration proposes no new budget authority for the Perkins 
loan program in 2005. The PART found that the program is redundant and 
duplicative, given the broad availability of need-based, subsidized, 
relatively low interest loans available through the two larger student 
loan programs (Family Federal Education Loans and Direct Student Loans). 
Plus, repayments of existing Perkins loans into Federal revolving funds 
held at institutions will continue to support more than $1 billion in 
new Perkins loans in 2005.

    Perkins Loan Program--Cancellations.--The Department of Education 
reimburses Federal revolving funds held at institutions for cancelled 
Perkins loans. Under the Higher Education Act, borrowers are eligible to 
have some or all of their Perkins loan repayment obligation cancelled if 
they enter certain fields of public service after graduation. Perkins 
loan balances are also cancelled in the event of a borrower's death, or 
total and permanent disability. In general, the revolving funds are 
reimbursed for 100 percent of the principal and accrued interest of the 
loan cancelled. The Administration's budget proposal for Perkins Loan 
cancellations is $66.5 million.

                       Student Aid Administration

    For Federal administrative expenses (in addition to funds made 
available under section 458), to carry out part D of title I, and 
subparts 1, 3, and 4 of part A, and parts B, C, D and E of title IV of 
the Higher Education Act of 1965, as amended, [$118,010,000] 
$934,639,000, which shall remain available through September 30, 2006, 
of which not more than $195,000,000 shall be for account maintenance 
fees for fiscal year 2005 that are payable to guaranty agencies under 
part B and are calculated in accordance with section 458 of the Act. 
(Division E, H.R. 2673, Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0202-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Student aid administration........          79         117         935
                                           ---------   ---------  ----------
10.00   Total new obligations...........          79         117         935
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          79         117         935
23.95 Total new obligations.............         -79        -117        -935
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         105         117         935
41.00   Transferred to other accounts...         -26
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............          79         117         935
    Change in obligated balances:
72.40 Obligated balance, start of year..                      35          44
73.10 Total new obligations.............          79         117         935
73.20 Total outlays (gross).............         -44        -108        -637
74.40 Obligated balance, end of year....          35          44         342
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          44          82         607
86.93 Outlays from discretionary 
        balances........................                      26          30
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          44         108         637
    Net budget authority and outlays:
89.00 Budget authority..................          79         117         935
90.00 Outlays...........................          44         108         637
---------------------------------------------------------------------------



[[Page 363]]



    The Department of Education manages Federal student aid programs 
that will provide over $67 billion in Federal student aid grants and 
loans to over 9 million students and parents in 2005. Primary 
responsibility for administering these programs lies with the Office of 
Postsecondary Education and the performance-based Office of Federal 
Student Aid (FSA). FSA was created by Congress in 1998 with a mandate to 
improve service to students and other student aid program participants, 
reduce the cost of student aid administration, and improve 
accountability and program integrity.

    The Department's student aid administrative activities are funded 
from two main sources: (1) funds appropriated on a permanent basis under 
section 458 of the Higher Education Act and (2) a discretionary 
appropriation partially supporting student aid administrative 
activities. Student aid administrative funds for 2004 totaled $912 
million, $195 million of which supported the payment of account 
maintenance fees to FFEL guaranty agencies.

    The budget for 2005 includes $935 million for student aid 
administration. In order to improve accountability and simplify program 
oversight and operations, the Administration is proposing to consolidate 
funding for student aid administrative activities into a single 
discretionary account. Funding levels for this account will be based on 
a workload-based methodology consistent with the goals of the 
performance-based organization.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0202-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Personnel compensation:

11.1    Full-time permanent.............          23          43          94
11.5    Other personnel compensation....           1           2           3
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          24          45          97
12.1  Civilian personnel benefits.......           5          10          21
21.0  Travel and transportation of 
        persons.........................                                   4
23.1  Rental payments to GSA............           5           7          14
23.3  Communications, utilities, and 
        miscellaneous charges...........           3           7          26
24.0  Printing and reproduction.........           4           3           8
25.1  Advisory and assistance services..                                   5
25.2  Other services....................           1           2          27
25.3  Other purchases of goods and 
        services from Government 
        accounts........................           2           2          26
25.7  Operation and maintenance of 
        equipment.......................          34          38         507
26.0  Supplies and materials............                                   1
31.0  Equipment.........................           1           3           4
41.0  Grants, subsidies, and 
        contributions...................                                 195
                                           ---------   ---------  ----------
99.9    Total new obligations...........          79         117         935
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-0202-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................         313         533       1,140
---------------------------------------------------------------------------

                                

                    Federal Student Loan Reserve Fund

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4257-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
01.02 Obligations, non-federal..........       4,415       6,454       7,389
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 42.0)...................       4,415       6,454       7,389
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       1,169       1,107         918
22.00 New budget authority (gross)......       4,354       6,265       7,347
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       5,523       7,372       8,265
23.95 Total new obligations.............      -4,415      -6,454      -7,389
24.40 Unobligated balance carried 
        forward, end of year............       1,107         918         876
    New budget authority (gross), detail:
      Mandatory:

69.00   Offsetting collections (cash)...       4,354       6,265       7,347
    Change in obligated balances:
73.10 Total new obligations.............       4,415       6,454       7,389
73.20 Total outlays (gross).............      -4,416      -6,454      -7,389
    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................       4,354       6,265       7,347
86.98 Outlays from mandatory balances...          62         189          42
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       4,416       6,454       7,389
    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............      -4,031      -5,913      -6,950
88.40     Non-Federal sources...........        -323        -352        -397
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........      -4,354      -6,265      -7,347
    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................          62         189          42
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Enacted/requested:
  Budget Authority..................
  Outlays...........................          62         189          42
Legislative proposal, subject to 
    PAYGO:
  Budget Authority..................
  Outlays...........................                                -246
                                    ------------------------------------
Total:
  Budget Authority..................
  Outlays...........................          62         189        -204
                                    ====================================

    The Higher Education Amendments of 1998 clarified that reserve funds 
held by public and non-profit guaranty agencies participating in the 
Federal Family Education Loan (FFEL) program are Federal property. These 
reserves are used to pay default claims from FFEL lenders and fees to 
support agency efforts to successfully avert defaults. The Federal 
Government reimburses these reserves for default claim payments. The 
following schedules reflect the balances in these guaranty agency funds.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   91-4257-0-3-502    2002 actual    2003 actual     2004 est.      2005 est.
-----------------------------------------------------------------------------------------------
    ASSETS:
1101  Federal assets: Fund balances with 
        Treasury........................       1,169          1,107
                                        ------------ --------------  ------------  -------------
1999    Total assets....................       1,169          1,107
    NET POSITION:
3300  Cumulative results of operations..       1,169          1,107
                                        ------------ --------------  ------------  -------------
3999    Total net position..............       1,169          1,107
                                        ------------ --------------  ------------  -------------
4999  Total liabilities and net position       1,169          1,107
-----------------------------------------------------------------------------------------------

    Note: Consistent with Government-wide practice, information for 2004 
and 2005 was not required to be collected.

                                

                    Federal Student Loan Reserve Fund

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4257-4-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
01.02 Obligations, non-federal..........                                 251
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 42.0)...................                                 251
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                 497
23.95 Total new obligations.............                                -251

[[Page 364]]

24.40 Unobligated balance carried 
        forward, end of year............                                 246
    New budget authority (gross), detail:
      Mandatory:

69.00   Offsetting collections (cash)...                                 497
    Change in obligated balances:
73.10 Total new obligations.............                                 251
73.20 Total outlays (gross).............                                -251
    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                 251
    Offsets:
      Against gross budget authority and outlays:

88.40   Offsetting collections (cash) 
          from: Non-Federal sources.....                                -497
    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................                                -246
---------------------------------------------------------------------------

    A description of how the Administration's legislative proposal will 
affect the Federal Student Loan Reserve Fund is included under the 
Federal Direct Student Loan Program Account.

                                

Credit accounts:

          Federal Direct Student Loan Program, Program Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.05 Upward Restimate Principal........       3,721       2,102
00.06 Interest on Upward Reestimate.....         870         627
00.09 Administrative expenses...........         791         795
                                           ---------   ---------  ----------
10.00   Total new obligations...........       5,381       3,524
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          14          26
22.00 New budget authority (gross)......       5,387       3,524
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           7
22.40 Capital transfer to general fund..                     -26
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       5,408       3,524
23.95 Total new obligations.............      -5,381      -3,524
24.40 Unobligated balance carried 
        forward, end of year............          26
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                                -795
      Mandatory:

60.00   Appropriation...................         795         795         795
60.00   Appropriation (indefinite)--
          Upward reestimate.............       4,591       2,729
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................       5,386       3,524         795
69.00 Offsetting collections (cash)--
        negative subsidy................         366         245         492
69.00 Offsetting collections (cash)--
        downward reestimate, principal..                      97
69.00 Offsetting collections (cash)--
        downward reestimate,interest....                       6
69.10 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................           1
69.27 Capital transfer to general fund..        -366        -348        -492
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................           1
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       5,387       3,524
    Change in obligated balances:
72.40 Obligated balance, start of year..         302         255         323
73.10 Total new obligations.............       5,381       3,524
73.20 Total outlays (gross).............      -5,421      -3,456        -208
73.45 Recoveries of prior year 
        obligations.....................          -7
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -1
74.40 Obligated balance, end of year....         255         323         116
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                                -515
86.97 Outlays from new mandatory 
        authority.......................       5,165       3,242         515
86.98 Outlays from mandatory balances...         256         214         208
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       5,421       3,456         208
    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........        -366        -348        -492
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -1
    Net budget authority and outlays:
89.00 Budget authority..................       5,020       3,176        -492
90.00 Outlays...........................       5,054       3,108        -284
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Enacted/requested:
  Budget Authority..................       5,020       3,176        -492
  Outlays...........................       5,055       3,108        -284
Legislative proposal, subject to 
    PAYGO:
  Budget Authority..................
  Outlays...........................
                                    ------------------------------------
Total:
  Budget Authority..................       5,020       3,176        -492
  Outlays...........................       5,055       3,108        -284
                                    ====================================

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in 
                            millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115001Stafford..........................       6,613       6,962       7,370
115002Unsubsidized Stafford.............       5,497       5,648       6,115
115003PLUS..............................       1,732       2,049       2,309
115004Consolidation.....................       7,363       6,354       6,385
                                           ---------   ---------  ----------
115901Total direct loan levels..........      21,205      21,013      22,179
    Direct loan subsidy (in percent):
132001Stafford..........................        3.63        4.03        3.06
132002Unsubsidized Stafford.............       -6.20       -5.48       -8.58
132003PLUS..............................       -6.53       -6.68       -8.96
132004Consolidation.....................       -1.42       -1.33       -2.16
                                           ---------   ---------  ----------
132901Weighted average subsidy rate.....       -1.50       -1.19       -2.90
    Direct loan subsidy budget authority:
133001Stafford..........................         240         281         226
133002Unsubsidized Stafford.............        -341        -309        -525
133003PLUS..............................        -113        -137        -207
133004Consolidation.....................        -104         -85        -138
                                           ---------   ---------  ----------
133901Total subsidy budget authority....        -318        -250        -644
    Direct loan subsidy outlays:
134001Stafford..........................         213         245         221
134002Unsubsidized Stafford.............        -369        -284        -402
134003PLUS..............................        -109        -122        -175
134004Consolidation.....................        -102         -84        -136
                                           ---------   ---------  ----------
134901Total subsidy outlays.............        -367        -245        -492
    Direct loan upward reestimate subsidy budget 
                authority:
135001Stafford..........................       1,538       1,180
135002Unsubsidized Stafford.............       3,141       1,305
135003PLUS..............................         603         241
135004Consolidation.....................          73         619
                                           ---------   ---------  ----------
135901Total upward reestimate budget 
        authority.......................       5,355       3,345
    Direct loan downward reestimate subsidy budget 
                authority:
137001Stafford..........................         -32         -88
137003PLUS..............................                     -17
137004Consolidation.....................        -732        -613
                                           ---------   ---------  ----------
137901Total downward reestimate budget 
        authority.......................        -764        -718
----------------------------------------------------------------------------

    Student loan administrative expense data:
351001Budget authority..................         795         795
359001Outlays...........................         830         727         208
---------------------------------------------------------------------------

    The Federal Government operates two major student loan programs: the 
Federal Family Education Loan (FFEL) pro

[[Page 365]]

gram--formerly the Guaranteed Student Loan (GSL) program--and the 
William D. Ford Federal Direct Loan (Direct Loan) program. For 2005, the 
President is committed to improving the efficiency of both programs and 
allowing individual institutions to choose which of these two programs 
best meets their needs and the needs of their students.

    This summary section outlines the structure of these two programs, 
highlights their differences and similarities, and provides text tables 
displaying program cost data; loan volume, subsidy, default, and 
interest rates; and other descriptive information. As part of his 2005 
budget, the President is proposing a package of policy proposals related 
to the reauthorization of the Higher Education Act (HEA). These 
proposals, which will expand student benefits and improve program 
efficiency, are discussed as part of this program description.

    From its inception in 1965 through 2003, the FFEL program has 
provided over $467 billion in loans to postsecondary students and their 
parents. Since July 1, 1994, the Direct Loan program has provided $135 
billion in new and consolidation loans to students and parents. Taken 
together, the FFEL and Direct Loan programs will make more than $52 
billion in new loans available in 2004. Because funding for these two 
programs is provided on a permanent indefinite basis, for budget 
purposes they are considered separately from other Federal student 
financial assistance programs. The FFEL and Direct Loan programs should 
be viewed in combination with these other programs, however as part of 
the overall Federal effort to ensure access to higher education.

    Loan capital in the FFEL program is provided by private lenders. 
State and private nonprofit guaranty agencies act as agents of the 
Federal Government, providing a variety of services including collection 
of some defaulted loans, default avoidance activities, and counseling to 
schools, students, and lenders. The Government provides substantial 
payments to these guaranty agencies. The Government also pays interest 
subsidies to lenders for certain borrowers, as well as most costs 
associated with loan defaults and other write-offs.

    The Direct Loan program was created by the Student Loan Reform Act 
of 1993. Under this program, the Federal Government provides loan funds 
to postsecondary institutions directly or through an alternative 
originator. The Direct Loan program began operation in academic year 
1994-1995 with 7 percent of overall loan volume and is expected to 
account for 25 percent in academic year 2004-2005. All eligible 
institutions are free to participate in either the Direct Loan or FFEL 
program.

    The Direct Loan and FFEL programs share many basic elements. Each 
program offers four types of loans: Stafford, Unsubsidized Stafford, 
PLUS for parents, and Consolidation. Evidence of financial need is 
required for a student to receive a subsidized Stafford loan. The other 
three loan programs are available to borrowers at all income levels. 
Loans can be used only to meet qualified educational expenses.

    Annual and aggregate loan limits are the same across the two 
programs. In order to help students meet increasing higher education 
costs, the Administration is proposing to increase loan limits for 
first-year students from $2,625 to $3,000. This limit has not been 
raised since 1986 and, when taking origination fees into account, has 
essentially remained unchanged since the early 1970's. This proposal 
will increase FFEL and Direct Loan costs by $775 million over 2005-2014.

    The borrower interest rate for new Stafford Loans equals the 91-day 
Treasury bill rate plus 1.7 percent during in-school, grace, and 
deferment periods, and the 91-day Treasury bill plus 2.3 percent at all 
other times, with a cap of 8.25 percent, adjusted annually. Interest 
payments for these loans are fully subsidized by the Government while a 
student is in school and during grace and deferment periods. 
Unsubsidized Stafford loans carry the same borrower interest rate as 
Stafford loans, but have no interest subsidy. For new PLUS loans, the 
borrower interest rate equals the 91-day Treasury bill rate plus 3.1 
percent, with a cap of 9 percent and no interest subsidy.

    The borrower rate on Stafford and Unsubsidized Stafford Loans is 
scheduled to be fixed at 6.8 percent for new loans beginning July 1, 
2006. Under current interest rate projections, this would result in a 
substantial increase in interest rates for most borrowers. The 
Administration is proposing to eliminate the scheduled change and 
maintain the current variable interest rate formula, at a cost of $1.8 
billion over 2006-2014.

    In the FFEL program, lenders may receive an interest subsidy, called 
a special allowance, from the Government to ensure a guaranteed rate of 
return on their loans. Special allowance payments vary by loan type, are 
determined quarterly, and are based on current borrower interest rates 
and market-yield formulas. For new Stafford and Unsubsidized Stafford 
loans, for example, the Federal Government must pay lenders a special 
allowance if the average 3-month commercial paper rate for a given 
quarter plus 2.34 percent--or 1.74 percent during in-school, grace, or 
deferment periods--is higher than the current interest rate charged 
borrowers.

    Loans funded with the proceeds of tax-exempt securities originally 
issued before October 1, 1993, receive substantially higher special 
allowance payments than are currently paid on other types of loans. Loan 
holders are currently able to retain these higher benefits indefinitely 
by refinancing the underlying securities. The Administration is 
proposing to eliminate this refinancing provision, reducing special 
allowance payments by $4.9 billion over 2005-2014.

    Consolidation loans allow borrowers to combine loans made under 
Title IV of the Higher Education Act--FFEL, Direct Loans, and Perkins 
Loans--as well as some loans made under the Public Health Service Act. 
The interest rate for new FFEL and Direct Consolidation loans equals the 
weighted average of the interest rate on the loans consolidated, rounded 
up to the nearest one-eighth of one percent. Lenders may choose to offer 
a lower rate. Interest rates for all new FFEL and Direct Consolidation 
Loans are capped at 8.25 percent.

    FFEL borrowers pay an origination fee to the Government equal to 3 
percent of principal, and are also liable for a guaranty agency 
insurance premium of up to 1 percent of principal. Guaranty agencies 
have the option of waiving this premium and FFEL lenders have the option 
of paying some or all of a borrower's origination fee for Stafford Loan 
borrowers. In order to assure equal terms for FFEL borrowers, as well as 
strengthen the financial stability of the guaranty agency system, the 
Administration is proposing that agencies be required to collect the 1 
percent insurance premium on all loans guaranteed or disbursed after 
October 1, 2004. This change will increase the Federal Student Loan 
Reserve Fund account by $3.8 billion over 2005-2014.

    Direct Loan borrowers are charged an origination fee equal to 3 
percent of principal, which partially offsets Federal program operation 
costs. Borrowers in both programs may be offered financial incentives to 
encourage prompt repayment.

    Loan limits are also identical across the two programs. In addition, 
loans made under both programs are discharged when borrowers die, are 
totally and permanently disabled, or, under some circumstances, declare 
bankruptcy.

    Under both programs, new borrowers after October 1, 1998, who are 
employed as teachers in schools serving low-income populations for five 
consecutive, complete school years, qualify for up to $5,000 in loan 
forgiveness. The Administration is proposing to increase this benefit to 
a maximum of $17,500 for mathematics, science, and special education 
teachers considered highly qualified under criteria established in the 
No Child Left Behind Act of 2001.

[[Page 366]]

    Borrowers under Direct Loans may choose from among five repayment 
plans including income-contingent repayment (``pay-as-you-can''), under 
which annual repayment amounts vary based on the income of the borrower 
and the amount borrowed, and payments can be made over 25 years. 
Borrowers may switch between repayment plans at any time. (Income-
contingent repayment is not available to Direct PLUS borrowers).

    FFEL borrowers may choose from among four repayment plans. Repayment 
periods under standard, graduated, and income-sensitive repayment may 
not exceed 10 years. An extended repayment plan of up to 25 years is 
available for new borrowers with outstanding loans totalling more than 
$30,000. FFEL borrowers may change repayment plans annually.

    To standardize loan terms and help borrowers manage their debt, the 
Administration is proposing to standardize extended repayment terms in 
the FFEL and Direct Loan programs. Under this proposal, the repayment 
term for borrowers in both programs would be up to: 12 years for 
balances between $7,500 and $10,000; 15 years between $10,000 and 
$20,000; 20 years between $20,000 and $40,000; 25 years between $40,000 
and $60,000; and 30 years in excess of $60,000. This change will cost $1 
billion over 2005-2014.

    Beyond the proposals discussed above, the Budget provides $3 billion 
over 10 years for additional student benefits. These additional 
proposals--which could include reduced fees, default prevention 
activities, or additional loan limit increases--will be developed in 
consultation with Congress as part of the HEA reauthorization process. 
The Budget allocates this $3 billion over 10 years across three 
accounts: (i) Approximately $400 million in the Direct Loan account; 
(ii) approximately $1.2 billion in the FFEL account; and (iii) 
approximately $1.4 billion in the Federal Student Loan Reserve Fund 
account (which realizes increased revenues through the universal 
imposition of the 1 percent insurance premium). Under the current budget 
structure, student benefits funded in the Federal Student Loan Reserve 
Fund account do not affect subsidy calculations in the FFEL and DL 
accounts. If the Administration's negotiations with Congress result in 
some or all of the $1.4 billion in student benefits being shifted into 
the FFEL and/or DL accounts, the FFEL and/or DL subsidy rates would 
change. However, any such shift will not affect the net budgetary effect 
of the Administration's HEA proposals.

    The Administration also proposes to reinstate two expired provisions 
affecting institutions with cohort default rates of less than 10 percent 
for the three most recent fiscal years. This proposal would exempt these 
institutions from the requirement that loans to first-year students be 
delayed for 30 days prior to disbursement. It would also exempt these 
schools from the requirement that loans be issued in at least two 
separate disbursements.

    Finally, the Administration proposes to clarify a current provision 
under which student aid applicants who have been convicted of a drug-
related offense are ineligible for Federal student aid. Under this 
proposal, the current provision would only affect students who commit a 
drug-related offense while enrolled in higher education; offenses that 
occur prior to enrollment would not be subject to this provision.

    Student loan program administration activities are supported from 
two sources, including a permanent appropriation authorized under 
Section 458 of the Higher Education Act and a discretionary student aid 
administration appropriation. In order to improve accountability and 
simplify the funding process for these administrative activities, the 
President is proposing to combine all funding in the discretionary 
Student Aid Administration account.

    The following tables display performance indicators and program 
data; including projected overall Direct Loan and FFEL costs; loan 
volume, number of loans, and average loan amount; descriptive data, and 
program activity under the President's budget and legislative request.

                  Funding Levels (in thousands of dollars)

----------------------------------------------------------------------------
                                         2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
Program Cost:
FFEL:
  Liquidating \1\.......................   (755,570)   (953,905)   (816,743)
  Program:
    Regular.............................   3,769,228   4,093,939   4,266,168
    Consolidation.......................   2,632,419   2,075,121     729,635
    Reestimate of Prior Year Costs...... (2,979,866)           0           0
    Non-Contractual Modifications \2\...           0           0           0
                                           ---------   ---------  ----------
      Subtotal, Program.................   3,421,781   6,169,060   4,995,803
                                           ---------   ---------  ----------
        Total FFEL......................   2,666,210   5,215,155   4,179,059
Direct Loans:
  Program:
    Regular.............................   (679,331)   (979,690) (1,167,196)
    Consolidation.......................     191,199      69,623   (246,814)
    Reestimate of Prior Year Costs......   4,590,922           0           0
    Non-Contractual Modifications \2\...           0           0           0
        Total, Direct Loans.............   4,102,790   (910,067) (1,414,010)
Student Aid Administration \3\..........           0           0           0
        Total, FFEL and Direct Loans....   6,769,001   4,305,087   2,765,049
          Program Cost Outlays:

FFEL:
  Liquidating \1\....................... (1,700,833)   (897,374)   (816,743)
  Program:
    Regular.............................   3,161,836   3,505,515   3,690,099
    Consolidation.......................   2,596,007   2,049,157     721,633
    Reestimate of Prior Year Costs......  (2,979,866           0           0
    Non-Contractual Modifications \2\...           0           0           0
                                           ---------   ---------  ----------
      Subtotal, Program.................   2,777,976   5,554,672   4,411,732
                                           ---------   ---------  ----------
        Total, FFEL.....................   1,077,143   4,657,298   3,594,988
Direct Loans:
  Program:
    Regular.............................   (679,331)   (979,690) (1,167,196)
    Consolidation.......................     191,199      69,623   (246,814)
    Reestimate of Prior Year Costs......   4,590,922           0           0
    Non-Contractual Modifications \2\...           0           0           0
                                           ---------   ---------  ----------
        Total, Direct Loans.............   4,102,790   (910,067) (1,414,010)
Student Aid Administration \3\..........           0           0           0
        Total, FFEL and Direct Loans....   5,179,933   3,747,230   2,180,978
---------------------------------------------------------------------------
    \1\ Liquidating account reflects loans made prior to 1992.
    \2\ Reflects the cost or savings associated with policy changes that 
would affect the terms of existing loans.
    \3\ Supports account maintenance fee payments to FFEL guaranty agencies, 
Direct Loan origination and servicing, and a range of administrative 
activities such as application printing, mailing, and processing that are 
common to all Federal student financial assistance programs.

   Summary of Loans Available (net commitments in millions of dollars) \1\

----------------------------------------------------------------------------
                                           2003 est.   2004 est.   2005 est.
----------------------------------------------------------------------------
FFEL:
  Stafford..............................      15,618      17,699      19,052
  Unsubsidized Stafford.................      14,186      16,406      18,012
  PLUS..................................       3,987       4,874       5,524
                                           ---------   ---------  ----------
    Subtotal............................      33,791      38,978      42,588
  Consolidation.........................      34,935      25,605      22,048
                                           ---------   ---------  ----------
    Total, FFEL.........................      68,726      64,583      64,637
Direct Loans:
  Stafford..............................       5,790       6,309       6,738
  Unsubsidized Stafford.................       4,519       4,963       5,396
  PLUS..................................       1,660       1,947       2,195
                                           ---------   ---------  ----------
    Subtotal............................      11,969      13,219      14,329
  Consolidation.........................       6,657       6,276       6,320
                                           ---------   ---------  ----------
    Total, Direct Loans.................      18,626      19,496      20,649
    Total, All Loans....................      87,352      84,079      85,286
---------------------------------------------------------------------------
    \1\ Net commitments equal gross commitments minus loan cancellations.

[[Page 367]]

                       Number of Loans (in thousands)

----------------------------------------------------------------------------
                                           2003 est.   2004 est.   2005 est.
----------------------------------------------------------------------------
FFEL:
  Stafford..............................       4,566       5,152       5,486
  Unsubsidized Stafford.................       3,392       3,871       4,172
  PLUS..................................         470         542         583
                                           ---------   ---------  ----------
    Subtotal............................       8,429       9,564      10,241
  Consolidation.........................       1,252         916         780
                                           ---------   ---------  ----------
    Total, FFEL.........................       9,681      10,480      11,021
Direct Loans:
  Stafford..............................       1,608       1,717       1,816
  Unsubsidized Stafford.................       1,119       1,182       1,265
  PLUS..................................         210         230         247
                                           ---------   ---------  ----------
    Subtotal............................       2,937       3,129       3,328
  Consolidation.........................         298         270         261
                                           ---------   ---------  ----------
    Total, Direct Loans.................       3,236       3,400       3,590
    Total, All Loans....................      12,917      13,880      14,611
---------------------------------------------------------------------------

                    Average Loan Size (in whole dollars)

----------------------------------------------------------------------------
                                           2003 est.   2004 est.   2005 est.
----------------------------------------------------------------------------
FFEL:
  Stafford..............................       3,420       3,435       3,473
  Unsubsidized Stafford.................       4,182       4,239       4,318
  PLUS..................................       8,475       9,000       9,469
                                           ---------   ---------  ----------
    Weighted Average, without 
      Consolidations....................       4,009       4,076       4,158
                                           ---------   ---------  ----------
  Consolidation.........................      27,907      27,950      28,284
                                           ---------   ---------  ----------
    Weighted Average, FFEL..............       7,099       6,162       5,865
Direct Loans:
  Stafford..............................       3,600       3,674       3,710
  Unsubsidized Stafford.................       4,040       4,199       4,265
  PLUS..................................       7,889       8,461       8,878
                                           ---------   ---------  ----------
    Weighted Average, without 
      Consolidations....................       4,075       4,224       4,305
                                           ---------   ---------  ----------
  Consolidation.........................      22,319      23,209      24,183
                                           ---------   ---------  ----------
    Weighted Average, Direct Loans......       5,757       5,734       5,752
    Weighted Average, All Loans.........       6,763       6,058       5,837
---------------------------------------------------------------------------

               Summary of Subsidy, Default and Interest Rates

----------------------------------------------------------------------------
                                           2003 est.   2004 est.   2005 est.
----------------------------------------------------------------------------

     Subsidy Rates (in percent) \1\

FFEL:
  Stafford..............................      13.84%      15.51%      16.37%
  Unsubsidized Stafford.................       3.91%       4.19%       3.38%
  PLUS..................................       1.95%       1.76%       1.43%
  Consolidation.........................       6.11%       9.54%      10.82%
    Weighted Average, FFEL..............       7.22%       9.19%       9.49%
Direct Loans:
  Stafford..............................       7.96%       4.03%       3.05%
  Unsubsidized Stafford.................       0.08%      -5.48%      -8.68%
  PLUS..................................      -1.95%      -6.68%      -9.07%
  Consolidation.........................      -8.16%      -1.33%      -2.14%
    Weighted Average, Direct Loans......      -0.36%      -1.19%      -2.93%
     Default Rates (in percent) \2\

FFEL:
  Stafford..............................       12.80       12.93       13.09
  Unsubsidized Stafford.................       12.17       12.31       12.41
  PLUS..................................        6.44        6.44        6.44
  Consolidation.........................       15.46       15.33       15.60
    Weighted Average, FFEL..............       13.65       13.23       13.19
Direct Loans:
  Stafford..............................       11.47       11.56       11.69
  Unsubsidized Stafford.................       11.58       11.55       11.65
  PLUS..................................        5.57        5.61        5.63
  Consolidation.........................       30.91       28.50       26.63
    Weighted Average, Direct Loans......       17.92       16.42       15.61
Borrower Interest Rates (in percent) \3\

FFEL:
  Stafford..............................        6.50        6.72        6.79
  Unsubsidized Stafford.................        6.50        6.72        6.79
  PLUS..................................        5.54        5.88        6.39
  Consolidation (reflects Sub and Unsub 
    Stafford only)......................        4.58        4.06        4.34
Direct Loans:
  Stafford..............................        6.50        6.72        6.79
  Unsubsidized Stafford.................        6.50        6.72        6.79
  PLUS..................................        5.54        5.88        6.39
  Consolidation (reflects Sub and Unsub 
    Stafford only)......................        4.99        4.53        4.84
---------------------------------------------------------------------------
    \1\ Subsidy rates represent the Federal portion of non-administrative 
costs--principally interest subsidies and defaults--associated with each 
borrowed dollar. For example, a $1,000 loan with Federal subsidy costs of 
$100 would have a subsidy rate of 10 percent.
    \2\ Default rates displayed in this table, which reflect projected 
defaults over the life of a loan cohort, are used in developing program cost 
estimates. The Department uses other rates based on defaults occurring in 
the first two years of repayment to determine institutional eligibility to 
participate in Federal loan programs. These two-year rates tend to be lower 
than those included in this table.
    \3\ These represent average borrower interest rates during repayment for 
a typical borrower under standard repayment over the life of the loan.

      Selected Program Costs and Offsets \1\ (in thousands of dollars)

----------------------------------------------------------------------------
                                         2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
FFEL:
Interest costs:
Interest benefits:
  FFEL Liquidating......................      27,478           0           0
  FFEL Program..........................   1,196,434   1,009,011   1,253,472
                                           ---------   ---------  ----------
    Total...............................   1,223,913   1,009,011   1,253,472
Special allowance
  FFEL Liquidating......................       2,776           0         181
  FFEL Program..........................     449,325     783,549   2,542,307
                                           ---------   ---------  ----------
    Total...............................     452,101     783,549   2,542,487
Default costs and offsets:
Default claims:
  FFEL Liquidating......................     121,969           0           0
  FFEL Program..........................   2,751,692   3,845,840   4,369,511
                                           ---------   ---------  ----------
    Total...............................   2,873,661   3,845,840   4,369,511
Net default collections:
  FFEL Liquidating......................   1,950,621           0           0
  FFEL Program..........................   2,021,970   2,338,724   2,805,257
                                           ---------   ---------  ----------
    Total...............................   3,972,591   2,338,724   2,805,257
Contract collection costs:
  FFEL Liquidating......................     112,140           0           0
  FFEL Program..........................      60,196      52,705      61,159
                                           ---------   ---------  ----------
    Total...............................     172,336      52,705      61,159
Death, disability, and bankruptcy costs:
    FFEL Liquidating....................      35,048           0           0
    FFEL Program........................     599,056     723,247     851,032
                                           ---------   ---------  ----------
    Total...............................     634,104     723,247     851,032
Fees:
  Borrower origination fees.............     933,028   1,123,335   1,246,185
  Lender origination fee................     327,447     315,365     317,964
  Sallie Mae offset fee.................      44,546      43,400       5,307
  Consolidation loan holder fees........     743,337     914,630   1,022,085
Direct Loans:
  Borrower repayments...................  16,003,203           0           0
  Borrower origination fees.............     365,493     402,675     442,105
  Net default Collections...............     518,616   1,819,669   2,099,480
  Contact Collection Costs..............      88,664      90,605     122,288
Administrative Costs: \2\
  Student Aid Administration............           0           0           0
Guaranty agency administrative payments:
    Account Maintenance Fee (included in 
      Student Aid Administration).......     195,000     195,000     195,000
  Loan Processing and Issuance Fee......     173,366     179,433     196,180
---------------------------------------------------------------------------
    Details may not sum to totals due to rounding.
    \1\ This table represents explicit cash flows in the FFEL and Direct 
Loan financing accounts. Examples of these flows would include payments of 
FFEL interest benefits, default claims, and discharge claims, or collections 
on FFEL or Direct Loan defaults, all of which involve explicit events that 
are reflected in the Department's financial systems as they occur. Non-
events, such as Direct Loan interest benefits, defaults, or discharges, 
involve payments that are not received, and hence not recorded in the 
Department's financial systems in the same way. For that reason, these non-
events are not included in this table.
    \2\ For 2005, no funds are requested for loan administration, as these 
costs would be part of the proposed discretionary Student Aid Administration 
account.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Personnel compensation:

11.1    Full-time permanent.............          45          49
11.3    Other than full-time permanent..           1
11.5    Other personnel compensation....           1           2
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          47          51

[[Page 368]]

12.1  Civilian personnel benefits.......          11          11
21.0  Travel and transportation of 
        persons.........................           3           3
23.1  Rental payments to GSA............           7           7
23.3  Communications, utilities, and 
        miscellaneous charges...........          41          18
24.0  Printing and reproduction.........           6           5
25.1  Advisory and assistance services..           6           6
25.2  Other services....................          20          24
25.3  Other purchases of goods and 
        services from Government 
        accounts........................          12          13
25.6  Training..........................           3           3
25.7  Operation and maintenance of 
        equipment.......................         437         455
31.0  Equipment.........................           2           3
32.0  Land and structures...............                       1
41.0  Grants, subsidies, and 
        contributions...................       4,786       2,924
                                           ---------   ---------  ----------
99.9    Total new obligations...........       5,381       3,524
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................         589         607
---------------------------------------------------------------------------

                                

          Federal Direct Student Loan Program, Program Account

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0243-4-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.03 Loan modifications................                                   5
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                                   5
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                   5
23.95 Total new obligations.............                                  -5
    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                                   5
69.00 Offsetting collections (cash)--
        negative subsidy................                                   5
69.27 Capital transfer to general fund..                                  -5
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................                                   5
    Change in obligated balances:
73.10 Total new obligations.............                                   5
73.20 Total outlays (gross).............                                  -5
    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                   5
    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........                                  -5
    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................
---------------------------------------------------------------------------

    A description of how the Administration's legislative proposal will 
affect the Direct Loan program is included in the preceding discussion 
under the Federal Direct Student Loan Program Account.

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in 
                            millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0243-4-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115001Stafford..........................                                  67
115002Unsubsidized Stafford.............                                  26
115003PLUS..............................                                   2
115004Consolidation.....................                                  13
                                           ---------   ---------  ----------
115901Total direct loan levels..........                                 108
    Direct loan subsidy (in percent):
132001Stafford..........................                               -0.01
132002Unsubsidized Stafford.............                               -0.10
132003PLUS..............................                               -0.11
132004Consolidation.....................                                0.02
                                           ---------   ---------  ----------
132901Weighted average subsidy rate.....                               -3.70
    Direct loan subsidy budget authority:
133001Stafford..........................                                   1
133002Unsubsidized Stafford.............                                  -8
133003PLUS..............................                                  -3
133004Consolidation.....................                                   1
133005subsidy for loan modifications....                                   5
                                           ---------   ---------  ----------
133901Total subsidy budget authority....                                  -4
    Direct loan subsidy outlays:
134001Stafford..........................                                   1
134002Unsubsidized Stafford.............                                  -5
134003PLUS..............................                                  -2
134004Consolidation.....................                                   1
134005Subsidy outlays for loan 
        modification....................                                   5
                                           ---------   ---------  ----------
134901Total subsidy outlays.............
                                           ---------   ---------  ----------
135901Total upward reestimate budget 
        authority.......................
                                           ---------   ---------  ----------
137901Total downward reestimate budget 
        authority.......................
---------------------------------------------------------------------------

         Federal Direct Student Loan Program, Financing Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4253-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Direct loans:

01.01   Stafford........................       6,776       6,962       7,370
01.02   Unsubsidized Stafford...........       5,381       5,648       6,115
01.03   PLUS............................       1,901       2,049       2,309
01.04   Consolidated....................       6,450       6,354       6,385
                                           ---------   ---------  ----------
01.91     Subtotal, direct loans 
            obligations.................      20,508      21,013      22,179
      Payment for consolidations:

02.01   Interest rate rebate, Stafford..          84          92          99
02.02   Interest rate rebate, 
          Unsubsidized Stafford.........          67          72          79
02.03   Interest rate rebate, PLUS......          24          28          32
                                           ---------   ---------  ----------
02.91   Direct Program by Activities--
          Subtotal (1 level)............         175         192         210
03.01 Consolidation loans-Payment of 
        Orig. Services..................          19          18          17
04.01 Payment of contract collections...          89          91         114
05.01 Interest payment to Treasury......       6,030       5,198       5,639
      Other obligations:

08.01   Obligation of negative subsidy..         318         250         644
08.02   Payment of downward reestimate 
          to program account............                     103
                                           ---------   ---------  ----------
08.91   Direct Program by Activities--
          Subtotal (1 level)............         318         353         644
                                           ---------   ---------  ----------
10.00   Total new obligations...........      27,139      26,865      28,803
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         499         503
22.00 New financing authority (gross)...      27,845      26,865      28,803
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................         264       1,365       2,380
22.60 Portion applied to repay debt.....        -912        -452
22.70 Balance of authority to borrow 
        withdrawn.......................         -54      -1,416      -2,380
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      27,642      26,865      28,803
23.95 Total new obligations.............     -27,139     -26,865     -28,803
24.40 Unobligated balance carried 
        forward, end of year............         503
    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............      21,726      21,366      22,823
69.00 Offsetting collections (cash).....      22,554      19,566      16,616

[[Page 369]]

69.47 Portion applied to repay debt.....     -16,435     -14,067     -10,636
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................       6,119       5,499       5,980
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................      27,845      26,865      28,803
    Change in obligated balances:
72.40 Obligated balance, start of year..       5,404       7,459       8,117
73.10 Total new obligations.............      27,139      26,865      28,803
73.20 Total financing disbursements 
        (gross).........................     -24,821     -24,841     -26,765
73.45 Recoveries of prior year 
        obligations.....................        -264      -1,365      -2,380
74.40 Obligated balance, end of year....       7,459       8,117       7,775
87.00 Total financing disbursements 
        (gross).........................      24,821      24,841      26,765
    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
          Payments from program account:
88.00       Upward reestimate...........      -3,721      -2,102
88.00       Upward reestimate, interest.        -870        -627
88.25     Interest on uninvested funds..      -1,076
          Stafford loans:
88.40       Repayment of principal, 
              Stafford..................      -5,719      -4,719      -4,315
88.40       Interest received on loans, 
              Stafford..................        -419        -525        -600
88.40       Origination Fees, Stafford..        -176        -185        -198
88.40       Other fees, Stafford........         -18
88.40       Repayment of principal, 
              Unsubsidized Stafford.....      -4,251      -3,741      -3,488
88.40       Interest received on loans, 
              Unsubsidized Stafford.....        -413        -350        -411
88.40       Origination Fees, 
              Unsubsidized Stafford.....        -140        -144        -158
88.40       Other fees, Unsubsidized 
              Stafford..................          -9
88.40       Repayment of principal, PLUS      -1,379      -1,185      -1,188
88.40       Interest received on loans, 
              PLUS......................        -180        -197        -245
88.40       Origination Fees, PLUS......         -49         -74         -85
88.40       Other fees, PLUS............          -2
88.40       Payment of principal, 
              Consolidation.............      -3,236      -3,418      -3,440
88.40       Interest received on loans, 
              Consolidation.............        -880      -2,299      -2,488
88.40       Origination / Other fees, 
              Consolidation.............         -16
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........     -22,554     -19,566     -16,616
    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............       5,291       7,299      12,187
90.00 Financing disbursements...........       2,266       5,275      10,149
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4253-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
          STAFFORD
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................       6,776       6,962       7,370
                                           ---------   ---------  ----------
1150    Total direct loan obligations...       6,776       6,962       7,370
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........      27,470      27,420      28,792
1231  Disbursements: Direct loan 
        disbursements...................       5,663       6,151       6,594
1251  Repayments: Repayments and 
        prepayments.....................      -5,720      -4,719      -4,315
1261  Adjustments: Capitalized interest.         108
1264  Write-offs for default: Other 
        adjustments, net................        -101         -60         -65
                                           ---------   ---------  ----------
1290    Outstanding, end of year........      27,420      28,792      31,006
----------------------------------------------------------------------------

          UNSUBSIDIZED STAFFORD
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................       5,381       5,648       6,115
                                           ---------   ---------  ----------
1150    Total direct loan obligations...
                                           ---------   ---------  ----------
1150    Total direct loan obligations...       5,381       5,648       6,115
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........      18,515      19,098      20,523
1231  Disbursements: Direct loan 
        disbursements...................       4,497       4,806       5,268
1251  Repayments: Repayments and 
        prepayments.....................      -4,251      -3,741      -3,488
1261  Adjustments: Capitalized interest.         407         410         381
1264  Write-offs for default: Other 
        adjustments, net................         -70         -50         -56
                                           ---------   ---------  ----------
1290    Outstanding, end of year........      19,098      20,523      22,628
----------------------------------------------------------------------------

          PLUS
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................       1,901       2,049       2,309
                                           ---------   ---------  ----------
1150    Total direct loan obligations...
                                           ---------   ---------  ----------
1150    Total direct loan obligations...       1,901       2,049       2,309
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........       4,279       4,495       5,119
1231  Disbursements: Direct loan 
        disbursements...................       1,589       1,849       2,124
1251  Repayments: Repayments and 
        prepayments.....................      -1,378      -1,185      -1,188
1261  Adjustments: Capitalized interest.          23
1264  Write-offs for default: Other 
        adjustments, net................         -18         -40         -46
                                           ---------   ---------  ----------
1290    Outstanding, end of year........       4,495       5,119       6,009
----------------------------------------------------------------------------

          CONSOLIDATION
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................       6,450       6,354       6,385
                                           ---------   ---------  ----------
1150    Total direct loan obligations...
                                           ---------   ---------  ----------
1150    Total direct loan obligations...       6,450       6,354       6,385
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........      29,807      33,507      36,224
1231  Disbursements: Direct loan 
        disbursements...................       6,673       6,290       6,307
1251  Repayments: Repayments and 
        prepayments.....................      -3,236      -3,418      -3,440
1261  Adjustments: Capitalized interest.         386
1264  Write-offs for default: Other 
        adjustments, net................        -123        -155        -175
                                           ---------   ---------  ----------
1290    Outstanding, end of year........      33,507      36,224      38,916
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   91-4253-0-3-502    2002 actual    2003 actual     2004 est.      2005 est.
-----------------------------------------------------------------------------------------------
    ASSETS:
1101  Federal assets: Fund balances with 
        Treasury........................         970            992
      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401    Direct loans receivable, gross..      80,070         84,520
1402    Interest receivable.............       2,661          2,771
1405    Allowance for subsidy cost (-)..       2,115           -657
                                        ------------ --------------  ------------  -------------
1499      Net present value of assets 
            related to direct loans.....      84,846         86,634
1901  Other Federal assets: Other assets       3,769          4,223
                                        ------------ --------------  ------------  -------------
1999    Total assets....................      89,585         91,849
    LIABILITIES:
      Federal liabilities:

2101    Accounts payable................          87             62
2103    Debt............................      89,498         91,787
                                        ------------ --------------  ------------  -------------
2999    Total liabilities...............      89,585         91,849
    NET POSITION:
                                        ------------ --------------  ------------  -------------
3999    Total net position..............
                                        ------------ --------------  ------------  -------------
4999  Total liabilities and net position      89,585         91,849
-----------------------------------------------------------------------------------------------
    Note: Consistent with Government-wide practice, information for 2004 
and 2005 was not required to be collected.

    As required by the Federal Credit Reform Act of 1990, this non-
budgetary account records all cash flows to and from the Government 
resulting from Direct Loans. The amounts in this account are a means of 
financing and are not included in the budget totals.

                                

          Federal Direct Student Loan Program Financing Account

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4253-4-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Direct loans:

01.01   Stafford........................                                  67

[[Page 370]]

01.02   Unsubsidized Stafford...........                                  26
01.03   PLUS............................                                   2
01.04   Consolidated....................                                  13
                                           ---------   ---------  ----------
01.91     Subtotal, direct loans 
            obligations.................                                 108
      Payment for consolidations:

02.01   Interest rate rebate, Stafford..                                   1
05.01 Interest payment to Treasury......                                   1
      Other obligations:

08.01   Obligation of negative subsidy..                                   9
                                           ---------   ---------  ----------
10.00   Total new obligations...........                                 119
    Budgetary resources available for obligation:
22.00 New financing authority (gross)...                                 118
23.95 Total new obligations.............                                -119
    New financing authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                                   1
67.10   Authority to borrow.............                                 117
69.00 Offsetting collections (cash).....                                   8
69.47 Portion applied to repay debt.....                                  -8
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................                                 118
    Change in obligated balances:
73.10 Total new obligations.............                                 119
73.20 Total financing disbursements 
        (gross).........................                                 -62
74.40 Obligated balance, end of year....                                  57
87.00 Total financing disbursements 
        (gross).........................                                  62
    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
          Payments from program account:
88.00       Non-Contractual Modification                                  -5
          Stafford loans:
88.40       Origination Fees, Stafford..                                  -1
88.40       Payment of principal, 
              Consolidation.............                                  -2
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........                                  -8
    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............                                 110
90.00 Financing disbursements...........                                  54
---------------------------------------------------------------------------

                                

              Federal Family Education Loan Program Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0231-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.02 Guaranteed Loan Net Subsidy.......       6,411       6,501       7,146
00.07 Upward reestimate, principal......                     216
00.08 Upward reestimate, interest.......                     129
      Administrative expenses:

00.09   Administrative expenses.........          12
                                           ---------   ---------  ----------
10.00   Total new obligations...........       6,423       6,846       7,146
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......       6,423       6,846       7,146
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................         413         465         540
22.40 Capital transfer to general fund..        -413        -465        -540
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       6,423       6,846       7,146
23.95 Total new obligations.............      -6,423      -6,846      -7,146
    New budget authority (gross), detail:
      Discretionary:

42.00   Transferred from other accounts.          12
      Mandatory:

60.00   Appropriation...................       6,411       6,846       7,146
69.00 Offsetting collections (cash)--
        downward reestimate.............       2,980       3,966
69.27 Capital transfer to general fund..      -2,980      -3,966
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       6,423       6,846       7,146
    Change in obligated balances:
72.40 Obligated balance, start of year..       1,393       1,506       1,733
73.10 Total new obligations.............       6,423       6,846       7,146
73.20 Total outlays (gross).............      -5,897      -6,154      -6,327
73.45 Recoveries of prior year 
        obligations.....................        -413        -465        -540
74.40 Obligated balance, end of year....       1,506       1,733       2,012
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          12
86.93 Outlays from discretionary 
        balances........................          12           3
86.97 Outlays from new mandatory 
        authority.......................       4,909       5,114       5,135
86.98 Outlays from mandatory balances...         964       1,037       1,192
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       5,897       6,154       6,327
    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........      -2,980      -3,966
    Net budget authority and outlays:
89.00 Budget authority..................       3,443       2,880       7,146
90.00 Outlays...........................       2,917       2,188       6,327
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Enacted/requested:
  Budget Authority..................       3,443       2,880       7,146
  Outlays...........................       2,917       2,188       6,327
Legislative proposal, subject to 
    PAYGO:
  Budget Authority..................                                 -96
  Outlays...........................                                  57
                                    ------------------------------------
Total:
  Budget Authority..................       3,443       2,880       7,050
  Outlays...........................       2,917       2,188       6,384
                                    ====================================

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in 
                            millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0231-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Guaranteed loan levels supportable by subsidy 
                budget authority:
215001Stafford..........................      16,534      20,186      21,542
215002Unsubsidized Stafford.............      15,584      19,125      20,937
215003PLUS..............................       4,004       5,547       6,285
215004Consolidation.....................      30,854      25,902      22,297
                                           ---------   ---------  ----------
215901Total loan guarantee levels.......      66,976      70,760      71,061
    Guaranteed loan subsidy (in percent):
232001Stafford..........................       14.74       15.51       17.38
232002Unsubsidized Stafford.............        6.02        4.19        4.24
232003PLUS..............................        3.78        1.76        1.72
232004Consolidation.....................        9.35        9.54       10.79
                                           ---------   ---------  ----------
232901Weighted average subsidy rate.....        9.57        9.19       10.06
    Guaranteed loan subsidy budget authority:
233001Stafford..........................       2,437       3,131       3,744
233002Unsubsidized Stafford.............         938         801         888
233003PLUS..............................         151          98         108
233004Consolidation.....................       2,885       2,471       2,406
                                           ---------   ---------  ----------
233901Total subsidy budget authority....       6,411       6,501       7,146
    Guaranteed loan subsidy outlays:
234001Stafford..........................       2,112       2,536       3,117
234002Unsubsidized Stafford.............         769         724         740
234003PLUS..............................         138         104          92
234004Consolidation.....................       2,854       2,442       2,378
                                           ---------   ---------  ----------
234901Total subsidy outlays.............       5,873       5,806       6,327
    Guaranteed loan upward reestimate subsidy 
                budget authority:
235001Stafford..........................                   1,464
235002Unsubsidized Stafford.............         343
235003PLUS..............................          80           2
235004Consolidation.....................          32         634
                                           ---------   ---------  ----------
235901Total upward reestimate budget 
        authority.......................         455       2,100
    Guaranteed loan downward reestimate subsidy 
                budget authority:
237001Stafford..........................      -2,643        -364

[[Page 371]]

237002Unsubsidized Stafford.............        -207      -2,691
237003PLUS..............................          -5        -625
237004Consolidation.....................        -509      -1,542
237005SLS...............................         -71        -499
                                           ---------   ---------  ----------
237901Total downward reestimate subsidy 
        budget authority................      -3,435      -5,721
----------------------------------------------------------------------------

    Administrative expense data:
351001Budget authority..................          12
359001Outlays...........................          24           3
---------------------------------------------------------------------------

                                                                


                                                                


    As required by the Federal Credit Reform Act of 1990, this program 
account records the subsidy costs associated with Federal Family 
Education Loans (FFEL), formerly guaranteed student loans (GSL), 
committed in 1992 and beyond, as well as certain administrative expenses 
of the program. Administrative expenses include discretionary expenses 
for salaries, expenses and overhead of employees working directly on the 
program. Consistent with the Administration's proposal to consolidate 
student aid administrative activities in a single discretionary account, 
these expenses are not reflected for 2004 and 2005. For a discussion of 
this proposal, see the narrative description above in the Student Aid 
Administration account. Beginning with the 1993 cohort, mandatory 
administrative costs, specifically contract collection costs, are 
included in the FFEL subsidy estimates of each year's cohort. Subsidy 
amounts are estimated on a net present value basis.

    A description of the FFEL program and accompanying tables are 
included under the Federal Direct Student Loan program account.

      

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0231-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
11.1  Personnel compensation: Full-time 
        permanent.......................          10
12.1  Civilian personnel benefits.......           2
41.0  Grants, subsidies, and 
        contributions...................       6,411       6,846       7,146
                                           ---------   ---------  ----------
99.9    Total new obligations...........       6,423       6,846       7,146
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-0231-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................         129
---------------------------------------------------------------------------

                                

              Federal Family Education Loan Program Account

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0231-4-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.02 Guaranteed Loan Net Subsidy.......                                 -96
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                                 -96
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                 -96
23.95 Total new obligations.............                                  96
    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                                 -96
    Change in obligated balances:
73.10 Total new obligations.............                                 -96
73.20 Total outlays (gross).............                                 -57
74.40 Obligated balance, end of year....                                -153
    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                  57
    Net budget authority and outlays:
89.00 Budget authority..................                                 -96
90.00 Outlays...........................                                  57
---------------------------------------------------------------------------

    A description of how the Administration's legislative proposal will 
affect the Federal Family Education Loan program is included under the 
Federal Direct Student Loan Program Account.

Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in 
                            millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0231-4-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Guaranteed loan levels supportable by subsidy 
                budget authority:
215001Stafford..........................                                 204
215002Unsubsidized Stafford.............                                  72
215003PLUS..............................                                   5
215004Consolidation.....................                                   7
                                           ---------   ---------  ----------
215901Total loan guarantee levels.......                                 288
    Guaranteed loan subsidy (in percent):
232001Stafford..........................                               -1.01
232002Unsubsidized Stafford.............                               -0.86
232003PLUS..............................                               -0.29
232004Consolidation.....................                               -0.03
                                           ---------   ---------  ----------
232901Weighted average subsidy rate.....                              -33.33
    Guaranteed loan subsidy budget authority:
233001Stafford..........................                                -184
233002Unsubsidized Stafford.............                                -178
233003PLUS..............................                                 -18
233004Consolidation.....................                                   7
233005Subsidy due to modification.......                                 277
                                           ---------   ---------  ----------
233901Total subsidy budget authority....                                 -96
    Guaranteed loan subsidy outlays:
234001Stafford..........................                                -114
234002Unsubsidized Stafford.............                                -103
234003PLUS..............................                                 -10
234004Consolidation.....................                                   7
234005Subsidy outlays due to 
        modification....................                                 277
                                           ---------   ---------  ----------
234901Total subsidy outlays.............                                  57
                                           ---------   ---------  ----------
235901Total upward reestimate budget 
        authority.......................
                                           ---------   ---------  ----------
237901Total downward reestimate subsidy 
        budget authority................
---------------------------------------------------------------------------

                                

        Federal Family Education Loan Program, Financing Account

    Note.--The financing account includes all cash flows to and from the 
Government from guaranteed student loans committed after 1991.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4251-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Stafford loans:

01.01   Interest benefits...............       1,063       1,168       1,438
01.02   Special allowance...............         333         407         868
01.03   Default claims..................       1,123       1,439       1,504
01.04   Death, disability, and 
          bankruptcy claims.............         168         146         157
01.05   Teacher loan forgiveness, other 
          write-offs....................           3           4           6
01.07   Contract collection costs.......          40          29          32
01.08   Loan Processing Fee.............          81          81          86
01.09   Voluntary flexible agreement 
          performance fee...............         138
                                           ---------   ---------  ----------
01.91     Subtotal, Stafford loans......       2,949       3,274       4,091
      Unsubsidized Stafford loans:

02.02   Special allowance...............          40         293         707
02.03   Default claims..................         745       1,006       1,131
02.04   Death, disability, and 
          bankruptcy claims.............         122         126         146
02.05   Teacher loan forgiveness, other 
          write-offs....................           3           4           6
02.07   Contract collection costs.......           2           9          11
02.08   Loan Processing Fee.............          73          76          84
02.09   Voluntary flexible agreement 
          performance fee...............          43
                                           ---------   ---------  ----------
02.91     Subtotal, Unsubsidized 
            Stafford loans..............       1,028       1,514       2,085
      PLUS loans:

03.02   Special allowance...............          16          16          18
03.03   Default claims..................         228         149         170
03.04   Death, disability, and 
          bankruptcy claims.............          71          92         107
03.07   Contract Collection Costs.......           2           1           1
03.08   Loan Processing Fee.............          19          22          25
03.09   Voluntary flexible agreement 
          performance fee...............           6
                                           ---------   ---------  ----------

[[Page 372]]


03.91     Subtotal, PLUS loans..........         342         280         321
      SLS loans:

04.03   Default claims..................          53          16          10
04.04   Death, disability and bankruptcy 
          claims........................          10           3           3
04.07   Contract collection costs.......          10           4           4
04.08   Voluntary flexible agreement 
          performance fee...............           4
                                           ---------   ---------  ----------
04.91     Subtotal, SLS loans...........          77          23          17
      Consolidation loans:

05.01   Interest benefit................         134         215         229
05.02   Special allowance...............          61          68         476
05.03   Default claims..................         603       1,342       1,647
05.04   Death, disability, and 
          bankruptcy claims.............         228         362         443
05.07   Contract collection costs.......           6          10          12
05.08   Voluntary flexible agreement 
          performance fee...............          41
                                           ---------   ---------  ----------
05.91     Subtotal, Consolidations loans       1,073       1,997       2,807
08.02 Payment of downward reestimate to 
        Program accnt...................       2,206       3,494
08.04 Interest on downward reestimate...         774         472
                                           ---------   ---------  ----------
08.91   Downward Reestimate- Subtotal (1 
          level)........................       2,980       3,966
                                           ---------   ---------  ----------
10.00   Total new obligations...........       8,449      11,054       9,321
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       7,305       9,262      10,260
22.00 New financing authority (gross)...      10,400      11,509      12,483
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           5
22.22 Unobligated balance transferred 
        from other accounts.............                     543
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      17,710      21,314      22,743
23.95 Total new obligations.............      -8,449     -11,054      -9,321
24.40 Unobligated balance carried 
        forward, end of year............       9,262      10,260      13,422
    New financing authority (gross), detail:
      Mandatory:

69.00   Offsetting collections (cash)...      10,400      11,509      12,483
    Change in obligated balances:
72.40 Obligated balance, start of year..       1,382         931       1,218
73.10 Total new obligations.............       8,449      11,054       9,321
73.20 Total financing disbursements 
        (gross).........................      -8,895     -10,767      -9,512
73.45 Recoveries of prior year 
        obligations.....................          -5
74.40 Obligated balance, end of year....         931       1,218       1,027
87.00 Total financing disbursements 
        (gross).........................       8,895      10,767       9,512
    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
          Payments from program account:
88.00       Stafford loans..............      -2,112      -2,536      -3,117
88.00       Unsubsidized Stafford.......        -769        -724        -740
88.00       PLUS loans..................        -138        -104         -92
88.00       Consolidated loans..........      -2,854      -2,442      -2,378
88.00       Upward reestimate...........                    -345
88.25     Interest on uninvested funds..        -458        -629        -734
          Student Loans: Stafford, 
              Unsubsidized Stafford, 
              PLUS, SLS & Consolidation:
88.40       Stafford recoveries on 
              defaults..................      -1,143      -1,153      -1,302
88.40       Stafford origination fees...        -506        -599        -650
88.40       Stafford other fees.........         -14
88.40       Stafford Sallie mae offset 
              fee.......................         -23          -8          -2
88.40       Unsubsidized Stafford 
              recoveries on defaults....        -416        -508        -635
88.40       Unsubsidized Stafford 
              origination fees..........        -458        -552        -613
88.40       Unsubsidized Stafford other 
              fees......................          -5
88.40       Unsubsidized Stafford Sallie 
              mae fees..................         -15          -6          -2
88.40       PLUS recoveries on defaults.         -74         -86        -100
88.40       PLUS origination fees.......        -121        -160        -185
88.40       PLUS other fees.............          -1
88.40       PLUS Sallie Mae offset fees.          -4          -4          -1
88.40       SLS recoveries on defaults..         -91        -111        -104
88.40       SLS other fees..............          -1
88.40       SLS Sallie mae offset fee...          -1
88.40       Consolidation recoveries on 
              defaults..................        -273        -489        -687
88.40       Consolidation origination 
              fees......................        -176        -128        -110
88.40       Consolidation loan holders 
              fee.......................        -743        -925      -1,031
88.40       Consolidation loan other 
              fees......................          -4
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........     -10,400     -11,509     -12,483
    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............
90.00 Financing disbursements...........      -1,506        -742      -2,971
---------------------------------------------------------------------------


                                                                

             Status of Guaranteed Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4251-0-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
          STAFFORD
    Position with respect to appropriations act 
                limitation on commitments:
2111  Limitation on guaranteed loans 
        made by private lenders.........
2131  Guaranteed loan commitments exempt 
        from limitation.................      16,534      20,186      21,542
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................      16,534      20,186      21,542
2199  Guaranteed amount of guaranteed 
        loan commitments................      16,534      20,186      21,542
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........      70,862      69,011      73,046
2231  Disbursements of new guaranteed 
        loans...........................      10,732      17,116      18,574
2251  Repayments and prepayments........     -10,069     -11,515     -10,132
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....      -1,061      -1,416      -1,520
2263    Terminations for default that 
          result in claim payments......        -168        -146        -157
2264    Other adjustments, net..........      -1,285          -4          -6
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      69,011      73,046      79,805
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      69,011      73,046      79,805
----------------------------------------------------------------------------

    Addendum:
      Cumulative balance of defaulted guaranteed 
          loans that result in loans receivable:

2310    Outstanding, start of year......       2,668       2,714       2,943
2331    Disbursements for guaranteed 
          loan claims...................       1,061       1,416       1,520
2351    Repayments of loans receivable..      -1,025      -1,153      -1,302
2361    Write-offs of loans receivable..         -31         -34         -36
2364    Other adjustments, net..........          41
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       2,714       2,943       3,125
----------------------------------------------------------------------------

          UNSUBSIDIZED STAFFORD
    Position with respect to appropriations act 
                limitation on commitments:
2111  Limitation on guaranteed loans 
        made by private lenders.........
2131  Guaranteed loan commitments exempt 
        from limitation.................      15,584      19,125      20,937
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................      15,584      19,125      20,937
2199  Guaranteed amount of guaranteed 
        loan commitments................      15,584      19,125      20,937
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........      47,090      50,194      54,982
2231  Disbursements of new guaranteed 
        loans...........................       9,847      15,758      17,514
2251  Repayments and prepayments........      -5,908      -9,857      -9,372
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....        -713        -983      -1,132
2263    Terminations for default that 
          result in claim payments......        -122        -126        -146
2264    Other adjustments, net..........                      -4          -6
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      50,194      54,982      61,840
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      50,194      54,982      61,840
----------------------------------------------------------------------------

    Addendum:
      Cumulative balance of defaulted guaranteed 
          loans that result in loans receivable:

2310    Outstanding, start of year......       1,264       1,608       2,071
2331    Disbursements for guaranteed 
          loan claims...................         713         983       1,132
2351    Repayments of loans receivable..        -383        -507        -635
2361    Write-offs of loans receivable..         -10         -13         -15
2364    Other adjustments, net..........          24
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       1,608       2,071       2,553
----------------------------------------------------------------------------

[[Page 373]]


          PLUS
    Position with respect to appropriations act 
                limitation on commitments:
2111  Limitation on guaranteed loans 
        made by private lenders.........
2131  Guaranteed loan commitments exempt 
        from limitation.................       4,004       5,548       6,285
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................       4,004       5,548       6,285
2199  Guaranteed amount of guaranteed 
        loan commitments................       4,004       5,548       6,285
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........      10,529      10,739      12,150
2231  Disbursements of new guaranteed 
        loans...........................       2,617       4,572       5,293
2251  Repayments and prepayments........      -1,906      -2,906      -2,975
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....        -245        -164        -170
2263    Terminations for default that 
          result in claim payments......         -71         -91        -107
2264    Other adjustments, net..........        -185
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      10,739      12,150      14,191
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      10,739      12,150      14,191
----------------------------------------------------------------------------

    Addendum:
      Cumulative balance of defaulted guaranteed 
          loans that result in loans receivable:

2310    Outstanding, start of year......         209         389         460
2331    Disbursements for guaranteed 
          loan claims...................         245         164         170
2351    Repayments of loans receivable..         -64         -86        -100
2361    Write-offs of loans receivable..          -6          -7          -7
2364    Other adjustments, net..........           5
                                           ---------   ---------  ----------
2390      Outstanding, end of year......         389         460         523
----------------------------------------------------------------------------

          SLS
    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........       1,276         511         395
2251  Repayments and prepayments........        -227         -91        -106
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....         -52         -22         -11
2263    Terminations for default that 
          result in claim payments......         -10          -3          -3
2264    Other adjustments, net..........        -476
                                           ---------   ---------  ----------
2290    Outstanding, end of year........         511         395         275
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..         511         395         275
----------------------------------------------------------------------------

    Addendum:
      Cumulative balance of defaulted guaranteed 
          loans that result in loans receivable:

2310    Outstanding, start of year......         555         538         446
2331    Disbursements for guaranteed 
          loan claims...................          52          22          11
2351    Repayments of loans receivable..         -74        -111        -104
2361    Write-offs of loans receivable..          -4          -3          -3
2364    Other adjustments, net..........           9
                                           ---------   ---------  ----------
2390      Outstanding, end of year......         538         446         350
----------------------------------------------------------------------------

          CONSOLIDATED
    Position with respect to appropriations act 
                limitation on commitments:
2111  Limitation on guaranteed loans 
        made by private lenders.........
2131  Guaranteed loan commitments exempt 
        from limitation.................      30,853      25,902      22,298
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................      30,853      25,902      22,298
2199  Guaranteed amount of guaranteed 
        loan commitments................      30,853      25,902      22,298
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........      49,434      79,017      94,372
2231  Disbursements of new guaranteed 
        loans...........................      34,958      25,631      22,047
2251  Repayments and prepayments........      -4,465      -8,661      -9,942
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....        -682      -1,253      -1,629
2263    Terminations for default that 
          result in claim payments......        -228        -362        -443
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      79,017      94,372     104,405
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      79,017      94,372     104,405
----------------------------------------------------------------------------

    Addendum:
      Cumulative balance of defaulted guaranteed 
          loans that result in loans receivable:

2310    Outstanding, start of year......       1,402       1,870       2,616
2331    Disbursements for guaranteed 
          loan claims...................         682       1,253       1,629
2351    Repayments of loans receivable..        -230        -490        -687
2361    Write-offs of loans receivable..         -12         -17         -23
2364    Other adjustments, net..........          28
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       1,870       2,616       3,535
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   91-4251-0-3-502    2002 actual    2003 actual     2004 est.      2005 est.
-----------------------------------------------------------------------------------------------
    ASSETS:
1101  Federal assets: Fund balances with 
        Treasury........................       8,687         10,193
      Net value of assets related to 
          post-1991 acquired defaulted 
          guaranteed loans receivable:

1501    Defaulted guaranteed loans 
          receivable, gross.............       6,098          7,119
1502    Interest receivable.............       1,732          1,553
1505    Allowance for subsidy cost (-)..      -2,580         -1,312
                                        ------------ --------------  ------------  -------------
1599      Net present value of assets 
            related to defaulted 
            guaranteed loans............       5,250          7,360
1901  Other Federal assets: Other assets         339          1,034
                                        ------------ --------------  ------------  -------------
1999    Total assets....................      14,276         18,587
    LIABILITIES:
2101  Federal liabilities: Accounts 
        payable.........................       2,706          3,277
2204  Non-Federal liabilities: 
        Liabilities for loan guarantees.      11,570         15,310
                                        ------------ --------------  ------------  -------------
2999    Total liabilities...............      14,276         18,587
                                        ------------ --------------  ------------  -------------
4999  Total liabilities and net position      14,276         18,587
-----------------------------------------------------------------------------------------------

    Note: Consistent with Government-wide practice, information for 2004 
and 2005 was not required to be collected.

    As required by the Federal Credit Reform Act of 1990, this 
nonbudgetary account records all cash flows to and from the Government 
resulting from Federal Family Education Loans (FFEL), formerly 
guaranteed student loans (GSL), committed in 1992 and beyond. The 
amounts in this account are a means of financing and are not included in 
the budget totals.

                                

         Federal Family Education Loan Program Financing Account

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4251-4-3-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
      Stafford loans:

01.01   Interest benefits...............                                   1
01.02   Special allowance...............                                 -27
01.05   Teacher loan forgiveness, other 
          write-offs....................                                   1
01.08   Loan Processing Fee.............                                   1
                                           ---------   ---------  ----------
01.91     Subtotal, Stafford loans......                                 -24
      Unsubsidized Stafford loans:

02.02   Special allowance...............                                 -22
02.05   Teacher loan forgiveness, other 
          write-offs....................                                   1
                                           ---------   ---------  ----------
02.91     Subtotal, Unsubsidized 
            Stafford loans..............                                 -21
      PLUS loans:

03.02   Special allowance...............                                  -2
      Consolidation loans:

05.01   Interest benefit................                                  -3
05.02   Special allowance...............                                  -8
05.03   Default claims..................                                 -93
05.04   Death, disability, and 
          bankruptcy claims.............                                  -5
                                           ---------   ---------  ----------
05.91     Subtotal, Consolidations loans                                -109
                                           ---------   ---------  ----------
10.00   Total new obligations...........                                -156

[[Page 374]]

    Budgetary resources available for obligation:
22.00 New financing authority (gross)...                                  36
23.95 Total new obligations.............                                 156
24.40 Unobligated balance carried 
        forward, end of year............                                 192
    New financing authority (gross), detail:
      Mandatory:

69.00   Offsetting collections (cash)...                                  36
    Change in obligated balances:
73.10 Total new obligations.............                                -156
73.20 Total financing disbursements 
        (gross).........................                                 138
74.40 Obligated balance, end of year....                                 -17
87.00 Total financing disbursements 
        (gross).........................                                -138
    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
          Payments from program account:
88.00       Stafford loans..............                                 114
88.00       Unsubsidized Stafford.......                                 103
88.00       PLUS loans..................                                  10
88.00       Consolidated loans..........                                  -7
88.00       Noncontractual modifications                                -277
88.25     Interest on uninvested funds..                                  -4
          Student Loans: Stafford, 
              Unsubsidized Stafford, 
              PLUS, SLS & Consolidation:
88.40       Stafford origination fees...                                  -3
88.40       Unsubsidized Stafford 
              origination fees..........                                  -1
88.40       PLUS origination fees.......                                  -2
88.40       Consolidation recoveries on 
              defaults..................                                  23
88.40       Consolidation loan holders 
              fee.......................                                   8
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........                                 -36
    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............
90.00 Financing disbursements...........                                -174
---------------------------------------------------------------------------

                                

            Federal Family Education Loan Liquidating Account

    Note.--The following tables display the liquidating account, which 
includes all cash flows to and from the Government from guaranteed 
student loan commitments prior to 1992.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0230-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
01.01 Interest benefits, net of 
        origination fees................          27          13           7
01.02 Special allowance net of 
        origination fees................           3           2           3
01.03 Default claims....................         100          96          65
01.04 Death, disability, and bankruptcy 
        claims..........................          26          20          14
01.05 Contract collection costs.........          92          62          51
01.06 Voluntary flexible agreements.....          15
                                           ---------   ---------  ----------
01.91   Subtotal, Stafford loans........         263         193         140
02.01 Default claims....................          22          13           9
02.02 Death, disability, and bankruptcy 
        claims..........................          10           8           5
02.05 Contract collection costs.........          20          12          10
02.06 Voluntary flexible agreements.....           4
                                           ---------   ---------  ----------
02.91   Subtotal, PLUS/SLS loans........          56          33          24
                                           ---------   ---------  ----------
10.00   Total new obligations...........         319         226         164
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       1,032         887
22.00 New budget authority (gross)......       1,202         226         164
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           4
22.21 Unobligated balance transferred to 
        other accounts..................                    -543
22.40 Capital transfer to general fund..      -1,032        -344
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,206         226         164
23.95 Total new obligations.............        -319        -226        -164
24.40 Unobligated balance carried 
        forward, end of year............         887
    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                      50
69.00 Offsetting collections (cash).....       1,957       1,180         981
69.27 Capital transfer to general fund..        -755      -1,004        -817
                                           ---------   ---------  ----------
69.90   Spending authority from 
          offsetting collections (total 
          mandatory)....................       1,202         176         164
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       1,202         226         164
    Change in obligated balances:
72.40 Obligated balance, start of year..          -2          57
73.10 Total new obligations.............         319         226         164
73.20 Total outlays (gross).............        -256        -283        -164
73.45 Recoveries of prior year 
        obligations.....................          -4
74.40 Obligated balance, end of year....          57
    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................         258         226         164
86.98 Outlays from mandatory balances...          -2          57
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         256         283         164
    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.40     Fed collections on defaulted 
            loans, Stafford.............        -272        -372        -310
88.40     Federal collections on 
            bankruptcies, Stafford......          -5          -5          -4
88.40     Offsets against Federal tax 
            refunds,Stafford............        -395        -281        -234
88.40     Reimbursements from guaranty 
            agencies, Stafford..........        -914        -301        -250
88.40     Other collections/ fees, 
            Stafford....................        -131         -36         -30
88.40     Sallie Mae offset fee.........          -1
88.40     Federal collections on 
            defaulted loans, PLUS/SLS...         -50         -87         -72
88.40     Federal collections on 
            bankruptcies, PLUS/SLS......          -1          -1          -1
88.40     Offsets against Federal tax 
            refunds, PLUS/SLS...........         -27         -21         -17
          PLUS/SLS loans:
88.40       Reimbursements from guaranty 
              agencies, PLUS/SLS........        -161         -76         -63
                                           ---------   ---------  ----------
88.90       Total, offsetting 
              collections (cash)........      -1,957      -1,180        -981
    Net budget authority and outlays:
89.00 Budget authority..................        -755        -954        -817
90.00 Outlays...........................      -1,701        -897        -817
---------------------------------------------------------------------------

             Status of Guaranteed Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0230-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
          STAFFORD LOANS
    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........       2,052       2,431       1,933
2251  Repayments and prepayments........        -782        -378        -178
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....        -100        -100         -72
2263    Terminations for default that 
          result in claim payments......         -26         -20         -14
2264    Other adjustments, net..........       1,287
                                           ---------   ---------  ----------
2290    Outstanding, end of year........       2,431       1,933       1,669
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..       2,431       1,933       1,669
----------------------------------------------------------------------------

    Addendum:
      Cumulative balance of defaulted guaranteed 
          loans that result in loans receivable:

2310    Outstanding, start of year......      10,887       8,864       8,270
2331    Disbursements for guaranteed 
          loan claims...................         100         100          72
2351    Repayments of loans receivable..        -911        -528        -440
2361    Write-offs of loans receivable..        -128        -104         -97
2364    Other adjustments, net..........      -1,084         -62         -51
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       8,864       8,270       7,754
----------------------------------------------------------------------------

          PLUS/SLS LOANS
    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........         672       1,252       1,126
2251  Repayments and prepayments........         -51        -104        -104
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....         -22         -15         -10
2263    Terminations for default that 
          result in claim payments......          -9          -7          -5

[[Page 375]]

2264    Other adjustments, net..........         662
                                           ---------   ---------  ----------
2290    Outstanding, end of year........       1,252       1,126       1,007
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..       1,252       1,126       1,007
----------------------------------------------------------------------------

    Addendum:
      Cumulative balance of defaulted guaranteed 
          loans that result in loans receivable:

2310    Outstanding, start of year......       2,041       1,692       1,575
2331    Disbursements for guaranteed 
          loan claims...................          22          15          10
2351    Repayments of loans receivable..        -143         -99         -82
2361    Write-offs of loans receivable..         -22         -18         -17
2364    Other adjustments, net..........        -206         -15         -12
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       1,692       1,575       1,474
---------------------------------------------------------------------------

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code   91-0230-0-1-502    2002 actual    2003 actual     2004 est.      2005 est.
-----------------------------------------------------------------------------------------------
    ASSETS:
1101  Federal assets: Fund balances with 
        Treasury........................       1,031            944
      Net value of assets related to 
          pre-1992 direct loans 
          receivable and acquired 
          defaulted guaranteed loans 
          receivable:

1701    Defaulted guaranteed loans, 
          gross.........................      12,928         10,555
1702    Interest receivable.............       1,284          1,144
1703    Allowance for estimated 
          uncollectible loans and 
          interest (-)..................     -13,175         -8,273
                                        ------------ --------------  ------------  -------------
1704      Defaulted guaranteed loans and 
            interest receivable, net....       1,037          3,426
                                        ------------ --------------  ------------  -------------
1799      Value of assets related to 
            loan guarantees.............       1,037          3,426
1901  Other Federal assets: Other assets          62             56
                                        ------------ --------------  ------------  -------------
1999    Total assets....................       2,130          4,426
    LIABILITIES:
2104  Federal liabilities: Resources 
        payable to Treasury.............       2,007          3,761
      Non-Federal liabilities:

2201    Accounts payable................          14            543
2204    Liabilities for loan guarantees.         109            122
                                        ------------ --------------  ------------  -------------
2999    Total liabilities...............       2,130          4,426
                                        ------------ --------------  ------------  -------------
4999  Total liabilities and net position       2,130          4,426
-----------------------------------------------------------------------------------------------
    Note: Consistent with Government-wide practice, information for 2004 
and 2005 was not required to be collected.
    \1\ Excludes interest and premium collections on insured loans.

    As required by the Federal Credit Reform Act of 1990, this 
liquidating account records, for this program, all cash flows to and 
from the Government resulting from guaranteed student loans committed 
prior to 1992. This account is shown on a cash basis. All new loan 
activity in this program for 1992 and beyond is recorded in 
corresponding program and financing accounts. 

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0230-0-1-502      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
25.2  Other services....................         113          74          61
33.0  Investments and loans.............         122         109          74
41.0  Grants, subsidies, and 
        contributions...................          49          16          10
42.0  Insurance claims and indemnities..          35          27          19
                                           ---------   ---------  ----------
99.9    Total new obligations...........         319         226         164
---------------------------------------------------------------------------

                                


 
                     INSTITUTE OF EDUCATION SCIENCES

                              Federal Funds

General and special funds:

                     Institute of Education Sciences

    For carrying out activities authorized by Public Law 107-279, 
[$478,717,000] $371,496,000: Provided, That, of the amount appropriated, 
[$166,500,000] $185,000,000 shall be available for obligation through 
September 30, [2005: Provided further, That of the amount provided to 
carry out title I, parts B and D of Public Law 107-279, not less than 
$24,362,000 shall be for the national research and development centers 
authorized under section 133(c): Provided further, That $4,968,000 shall 
be available to extend for one additional year the contract for the 
Eisenhower National Clearinghouse for Mathematics and Science Education 
authorized under section 2102(a)(2) of the Elementary and Secondary 
Education Act of 1965, prior to its amendment by the No Child Left 
Behind Act of 2001, Public Law 107-110] 2006. (Division E, H.R. 2673, 
Consolidated Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1100-0-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Direct program:
      Obligations by program activity:

        Research and statistics:
00.01     Research, development, and 
            dissemination...............         138         165         185
00.02     Statistics....................          89          91          91
00.03   Regional educational 
          laboratories..................          67          67
00.04   Assessment......................          95          95          95
        Technical assistance providers:
00.05     Regional technology in 
            education consortia.........          10          10
00.06     Comprehensive regional 
            assistance centers..........          28          28
00.07     Eisenhower regional 
            mathematics and science 
            education consortia.........          15          15
00.08     Eisenhower National 
            Clearinghouse for 
            Mathematics and Science 
            Education...................           5           5
                                           ---------   ---------  ----------
01.00 Total direct program..............         447         476         371
09.01 Reimbursable program..............           5           5           5
                                           ---------   ---------  ----------
10.00 Total new obligations.............         452         481         376
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......         453         481         376
23.95 Total new obligations.............        -452        -481        -376
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         451         479         371
40.35   Appropriation permanently 
          reduced.......................          -3          -3
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         448         476         371
      Spending authority from offsetting 
          collections:

68.00   Offsetting collections (cash)...           1           1           1
68.10   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................           4           4           4
                                           ---------   ---------  ----------
68.90     Spending authority from 
            offsetting collections 
            (total discretionary).......           5           5           5
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         453         481         376
    Change in obligated balances:
72.40 Obligated balance, start of year..         683         575         449
73.10 Total new obligations.............         452         481         376
73.20 Total outlays (gross).............        -586        -603        -453
73.40 Adjustments in expired accounts 
        (net)...........................          24
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -4          -4          -4
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................           6
74.40 Obligated balance, end of year....         575         449         368
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         108         115          96
86.93 Outlays from discretionary 
        balances........................         478         488         357
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         586         603         453
    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........         -34          -5          -1
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -4          -4          -4
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............          33           4
    Net budget authority and outlays:
89.00 Budget authority..................         448         476         371
90.00 Outlays...........................         552         598         452
---------------------------------------------------------------------------
    Note.--Excludes $28 million in budget authority in 2005 for 
activities transferred to Department of Education School Improvement 
Programs. Comparable amounts for 2003 ($58 million) and 2004 ($57 
million) are included above.


[[Page 376]]



                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2003 actual  2004 est.   2005 est.
Enacted/requested:
  Budget Authority..................         448         476         371
  Outlays...........................         552         598         452
Legislative proposal, not subject to 
    PAYGO:
  Budget Authority..................                                  78
  Outlays...........................                                  20
                                    ------------------------------------
Total:
  Budget Authority..................         448         476         449
  Outlays...........................         552         598         472
                                    ====================================

    Research and Statistics.--
        Research, development, and dissemination.--Funds support the 
    National Center for Education Research, which oversees a diverse 
    portfolio of directed research, field-initiated studies, research 
    and development centers, and interagency initiatives. Funds also 
    support dissemination activities that provide parents, teachers, and 
    schools with valid information on effective educational practice.
        Statistics.--Funds support the Department's statistical data 
    collection activities, which are conducted by the National Center 
    for Education Statistics (NCES). NCES collects, analyzes, and 
    disseminates statistics on education at all levels, from preschool 
    through postsecondary and adult education, including statistics on 
    international education activities.

    Assessment.--Funds support the National Assessment of Educational 
Progress (NAEP). NAEP administers assessments to samples of students in 
order to gather reliable information about educational attainment in 
important academic areas. Funds support collection and reporting of 
national, State, and long-term trend information, including the conduct 
of biennial State NAEP in reading and mathematics at grades 4 and 8.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1100-0-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........           1           1           1
11.3      Other than full-time permanent                       1           1
                                           ---------   ---------  ----------
11.9        Total personnel compensation           1           2           2
24.0    Printing and reproduction.......           1           1           1
25.1    Advisory and assistance services           2           3           3
25.2    Other services..................         183         185         179
25.3    Other purchases of goods and 
          services from Government 
          accounts......................          18          14          14
25.5    Research and development 
          contracts.....................          86          72           6
25.7    Operation and maintenance of 
          equipment.....................           3           3           3
41.0    Grants, subsidies, and 
          contributions.................         152         196         163
                                           ---------   ---------  ----------
99.0      Direct obligations............         446         476         371
99.0  Reimbursable obligations..........           5           5           5
99.5  Below reporting threshold.........           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........         452         481         376
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-1100-0-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................          12          15          15
---------------------------------------------------------------------------

                     Institute of Education Sciences

              (Legislative proposal, not subject to PAYGO)

    Pending legislation would transfer the authority for research in 
special education from the Individuals with Disabilities Education Act 
to the Education Sciences Reform Act of 2002 and create a National 
Center for Special Education Research within the Institute of Education 
Sciences.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1100-2-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
    Direct program:
      Obligations by program activity:

00.09   Research and innovation in 
          special education.............                                  78
                                           ---------   ---------  ----------
10.00 Total new obligations.............                                  78
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                  78
23.95 Total new obligations.............                                 -78
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                                  78
    Change in obligated balances:
73.10 Total new obligations.............                                  78
73.20 Total outlays (gross).............                                 -20
74.40 Obligated balance, end of year....                                  58
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                                  20
    Net budget authority and outlays:
89.00 Budget authority..................                                  78
90.00 Outlays...........................                                  20
---------------------------------------------------------------------------
    Note: Includes $78 million in budget authority for Research and 
Innovation in Special Education previously financed from the Department 
of Education:

                        (in millions of dollars)
 
                                            2003 actual      2004 est.
 
Office of Special Education and                       77              78
 Rehabilitative Services, Special
 Education..............................
 


    Research and innovation in special education.--Funds support 
research and dissemination activities to address gaps in scientific 
knowledge in order to improve special education and early intervention 
services and results for infants, toddlers, and children with 
disabilities.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1100-2-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
25.2  Other services....................                                   3
25.3  Other purchases of goods and 
        services from Government 
        accounts........................                                   5
41.0  Grants, subsidies, and 
        contributions...................                                  70
                                           ---------   ---------  ----------
99.9    Total new obligations...........                                  78
---------------------------------------------------------------------------

                                


 
                         DEPARTMENTAL MANAGEMENT

                              Federal Funds

General and special funds:

                         Program Administration

    For carrying out, to the extent not otherwise provided, the 
Department of Education Organization Act, including rental of conference 
rooms in the District of Columbia and hire of three passenger motor 
vehicles, [$425,000,000, of which $13,644,000, to remain available until 
expended, shall be for building alterations and related expenses for the 
relocation of Department staff to Potomac Center Plaza in Washington, 
D.C.] $429,568,000. (Division E, H.R. 2673, Consolidated Appropriations 
Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0800-0-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Program administration............         418         425         430
09.01 Reimbursable program..............           3           3           3
                                           ---------   ---------  ----------
10.00   Total new obligations...........         422         428         433
    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                       5

[[Page 377]]

22.00 New budget authority (gross)......         427         423         433
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         427         428         433
23.95 Total new obligations.............        -422        -428        -433
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
24.40 Unobligated balance carried 
        forward, end of year............           5
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         413         425         430
40.35   Appropriation permanently 
          reduced.......................          -3          -5
42.00   Transferred from other accounts.          14
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         424         420         430
      Spending authority from offsetting 
          collections:

68.00   Offsetting collections (cash)...                       1           1
68.10   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................           3           2           2
                                           ---------   ---------  ----------
68.90     Spending authority from 
            offsetting collections 
            (total discretionary).......           3           3           3
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         427         423         433
    Change in obligated balances:
72.40 Obligated balance, start of year..         122         113         146
73.10 Total new obligations.............         422         428         433
73.20 Total outlays (gross).............        -429        -394        -425
73.40 Adjustments in expired accounts 
        (net)...........................          -2
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -3          -2          -2
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................           3
74.40 Obligated balance, end of year....         113         146         152
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         335         316         329
86.93 Outlays from discretionary 
        balances........................          94          78          96
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         429         394         425
    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........          -6          -1          -1
      Against gross budget authority only:

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -3          -2          -2
88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           5
    Net budget authority and outlays:
89.00 Budget authority..................         424         420         430
90.00 Outlays...........................         424         393         424
---------------------------------------------------------------------------

    The Program Administration account includes the direct Federal costs 
of providing grants and administering elementary and secondary 
education, Indian education, English language acquisition, higher 
education, technical and adult education, special education programs, 
and programs for persons with disabilities. It also supports assessment, 
statistics, and research activities.

    In addition, this account includes the cost of providing centralized 
support and administrative services, overall policy development, and 
strategic planning for the Department. Included in the centralized 
activities are rent and mail services; telecommunications; contractual 
services; financial management and accounting, including payments to 
schools, education agencies and other grant recipients, and preparation 
of auditable financial statements; information technology services; 
personnel management; personnel security; budget formulation and 
execution; program evaluation; legal services; congressional and public 
relations; and intergovernmental affairs.

    Also included in this account are contributions from the public. 
Activities supported include receptions for Blue Ribbon Schools, 
Historically Black Colleges and Universities, and School Recognition. 
Contributions not designated for a specific purpose are in the account's 
Gifts and Bequests Miscellaneous Fund.

    Reimbursable program.--Reimbursements to this account are for 
providing administrative services to other agencies, recycling 
activities, and in-kind travel.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0800-0-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........         171         195         199
11.3      Other than full-time permanent          29           5           6
11.5      Other personnel compensation..           4           4           4
                                           ---------   ---------  ----------
11.9        Total personnel compensation         204         204         209
12.1    Civilian personnel benefits.....          44          43          44
13.0    Benefits for former personnel...           1
21.0    Travel and transportation of 
          persons.......................           5           6           6
23.1    Rental payments to GSA..........          31          37          41
23.3    Communications, utilities, and 
          miscellaneous charges.........          10          13          12
24.0    Printing and reproduction.......           4           4           5
25.1    Advisory and assistance services           5           4           3
25.2    Other services..................          29          24          27
25.3    Other purchases of goods and 
          services from Government 
          accounts......................          15          13          12
25.7    Operation and maintenance of 
          equipment.....................          52          58          57
26.0    Supplies and materials..........           2           2           2
31.0    Equipment.......................          14          12          11
32.0    Land and structures.............           2           4           1
                                           ---------   ---------  ----------
99.0      Direct obligations............         418         424         430
99.0  Reimbursable obligations..........           3           3           3
99.5  Below reporting threshold.........           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........         422         428         433
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-0800-0-1-503      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................       2,461       2,358       2,351
---------------------------------------------------------------------------

                                

                         Office for Civil Rights

    For expenses necessary for the Office for Civil Rights, as 
authorized by section 203 of the Department of Education Organization 
Act, [$89,275,000] $92,801,000. (Division E, H.R. 2673, Consolidated 
Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0700-0-1-751      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Civil rights......................          84          88          93
                                           ---------   ---------  ----------
10.00   Total new obligations...........          84          88          93
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          84          88          93
23.95 Total new obligations.............         -84         -88         -93
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          86          89          93
40.35   Appropriation permanently 
          reduced.......................          -1          -1
41.00   Transferred to other accounts...          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............          84          88          93
    Change in obligated balances:
72.40 Obligated balance, start of year..          15          16          19
73.10 Total new obligations.............          84          88          93
73.20 Total outlays (gross).............         -83         -85         -88
74.40 Obligated balance, end of year....          16          19          22
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          74          72          75
86.93 Outlays from discretionary 
        balances........................           9          13          13
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          83          85          88
    Net budget authority and outlays:
89.00 Budget authority..................          84          88          93
90.00 Outlays...........................          83          85          88
---------------------------------------------------------------------------

    The Office for Civil Rights is responsible for ensuring that no 
person is unlawfully discriminated against on the basis of race, color, 
national origin, sex, disability, or age in the

[[Page 378]]

delivery of services or the provision of benefits in programs or 
activities of schools and institutions receiving financial assistance 
from the Department of Education. The authorities under which the Office 
for Civil Rights operates are Title VI of the Civil Rights Act of 1964 
(racial and ethnic discrimination), Title IX of the Education Amendments 
of 1972 (sex discrimination), section 504 of the Rehabilitation Act of 
1973 (discrimination against individuals with a disability), the Age 
Discrimination Act of 1975, the Americans with Disabilities Act of 1990 
and the Boy Scouts of America Equal Access Act of 2002.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0700-0-1-751      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........          47          49          50
11.3      Other than full-time permanent           2           2           3
                                           ---------   ---------  ----------
11.9        Total personnel compensation          49          51          53
12.1    Civilian personnel benefits.....          11          11          11
21.0    Travel and transportation of 
          persons.......................           1           1           1
23.1    Rental payments to GSA..........           6           8          10
23.3    Communications, utilities, and 
          miscellaneous charges.........           2           2           2
25.2    Other services..................           1           1           2
25.3    Other purchases of goods and 
          services from Government 
          accounts......................           2           2           2
25.7    Operation and maintenance of 
          equipment.....................           9           7           7
31.0    Equipment.......................           1           1           1
                                           ---------   ---------  ----------
99.0      Direct obligations............          82          84          89
99.5  Below reporting threshold.........           2           4           4
                                           ---------   ---------  ----------
99.9    Total new obligations...........          84          88          93
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-0700-0-1-751      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................         672         663         663
---------------------------------------------------------------------------

                                

                     Office of the Inspector General

    For expenses necessary for the Office of the Inspector General, as 
authorized by section 212 of the Department of Education Organization 
Act, [$47,137,000] $50,576,000. (Division E, H.R. 2673, Consolidated 
Appropriations Bill, FY 2004.)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1400-0-1-751      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

    Obligations by program activity:
00.01 Inspector General.................          41          47          51
                                           ---------   ---------  ----------
10.00   Total new obligations...........          41          47          51
    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          41          47          51
23.95 Total new obligations.............         -41         -47         -51
    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          41          47          51
    Change in obligated balances:
72.40 Obligated balance, start of year..           9           7          10
73.10 Total new obligations.............          41          47          51
73.20 Total outlays (gross).............         -42         -44         -48
74.40 Obligated balance, end of year....           7          10          13
    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          35          37          41
86.93 Outlays from discretionary 
        balances........................           7           7           7
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          42          44          48
    Net budget authority and outlays:
89.00 Budget authority..................          41          47          51
90.00 Outlays...........................          42          44          48
---------------------------------------------------------------------------

    The Inspector General is responsible for the quality, coverage, and 
coordination of audit and investigation functions relating to Federal 
education activities. The Inspector General has the authority to inquire 
into all activities of the Department, including those performed under 
Federal education contracts, grants, or other agreements. Under the 
Chief Financial Officers Act of 1990, the Inspector General is also 
responsible for internal reviews of the Department's financial systems 
and audits of its financial statements.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1400-0-1-751      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------

      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........          20          23          25
11.3      Other than full-time permanent           1           1           2
11.5      Other personnel compensation..           1
                                           ---------   ---------  ----------
11.9        Total personnel compensation          22          24          27
12.1    Civilian personnel benefits.....           6           6           7
21.0    Travel and transportation of 
          persons.......................           2           1           2
23.1    Rental payments to GSA..........           3           4           4
23.3    Communications, utilities, and 
          miscellaneous charges.........           1           1           1
25.1    Advisory and assistance services           2           4           4
25.2    Other services..................                       1           1
25.3    Other purchases of goods and 
          services from Government 
          accounts......................           1           1           1
25.7    Operation and maintenance of 
          equipment.....................           2           2           3
31.0    Equipment.......................                       1           1
                                           ---------   ---------  ----------
99.0      Direct obligations............          39          45          51
99.5  Below reporting threshold.........           2           2
                                           ---------   ---------  ----------
99.9    Total new obligations...........          41          47          51
---------------------------------------------------------------------------

                              Personnel Summary

----------------------------------------------------------------------------
Identification code 91-1400-0-1-751      2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
1001  Total compensable workyears: 
        Civilian full-time equivalent 
        employment......................         281         285         302
---------------------------------------------------------------------------

                                


 
                      GENERAL FUND RECEIPT ACCOUNTS

                           (in millions of dollars)

----------------------------------------------------------------------------
                                         2003 actual   2004 est.   2005 est.
----------------------------------------------------------------------------
Offsetting receipts from the public:
  91-291500  Repayment of loans, capital 
    contributions, higher education 
    activities..........................          44          50          50
                                           ---------   ---------  ----------
General Fund Offsetting receipts from 
 the public.............................          44          50          50
---------------------------------------------------------------------------

                                


 
                           GENERAL PROVISIONS

    Sec. 301. No funds appropriated in this Act may be used for the 
transportation of students or teachers (or for the purchase of equipment 
for such transportation) in order to overcome racial imbalance in any 
school or school system, or for the transportation of students or 
teachers (or for the purchase of equipment for such transportation) in 
order to carry out a plan of racial desegregation of any school or 
school system.
    Sec. 302. None of the funds contained in this Act shall be used to 
require, directly or indirectly, the transportation of any student to a 
school other than the school which is nearest the student's home, except 
for a student requiring special education, to the school offering such 
special education, in order to comply with title VI of the Civil Rights 
Act of 1964. For the purpose of this section an indirect requirement of 
transportation of students includes the transportation of students to 
carry out a plan involving the reorganization

[[Page 379]]

of the grade structure of schools, the pairing of schools, or the 
clustering of schools, or any combination of grade restructuring, 
pairing or clustering. The prohibition described in this section does 
not include the establishment of magnet schools.
    Sec. 303. No funds appropriated under this Act may be used to 
prevent the implementation of programs of voluntary prayer and 
meditation in the public schools.

                           (transfer of funds)

    Sec. 304. Not to exceed 1 percent of any discretionary funds 
(pursuant to the Balanced Budget and Emergency Deficit Control Act of 
1985, as amended) which are appropriated for the Department of Education 
in this Act may be transferred between appropriations, but no such 
appropriation shall be increased by more than 3 percent by any such 
transfer: Provided, That the Appropriations Committees of both Houses of 
Congress are notified at least 15 days in advance of any transfer.
    [Sec. 305. Special Study of Simplification of Need Analysis and 
Application for Title IV Aid. (a) Study Required.--The Advisory 
Committee on Student Financial Assistance established by section 491 of 
the Higher Education Act of 1965 (20 U.S.C. 1098), hereafter in this 
section referred to as ``the Advisory Committee'', shall conduct a 
thorough study of the feasibility of simplifying the need analysis 
methodology for all Federal student financial assistance programs and 
the process of applying for such assistance.
    (b) Required Subjects of Study.--In performing the study, the 
Advisory Committee shall, at a minimum, examine the following:
        (1) whether the methodology used to calculate the expected 
    family contribution can be simplified without significant adverse 
    effects on program intent, costs, integrity, delivery, and 
    distribution of awards;
        (2) whether the number of data elements, and, accordingly, the 
    number and complexity of questions asked of students and families, 
    used to calculate the expected family contribution can be reduced 
    without such adverse effects;
        (3) whether the procedures for determining such data elements, 
    including determining and updating offsets and allowances, is the 
    most efficient, effective, and fair means to determine a family's 
    available income and assets;
        (4) whether the methodology used to calculate the expected 
    family contribution, specifically the consideration of income earned 
    by a dependent student and its effect on Pell grant eligibility, is 
    an effective and fair means to determine a family's available income 
    and a student's need;
        (5) whether the nature and timing of the application required in 
    section 483(a)(1) of the Higher Education Act of 1965 (20 U.S.C. 
    1090(a)(1)), eligibility and award determination, financial aid 
    processing, and funds delivery can be streamlined further for 
    students and families, institutions, and States;
        (6) whether it is feasible to allow students to complete only 
    those limited sections of the financial aid application that apply 
    to their specific circumstances and the State in which they reside;
        (7) whether a widely disseminated printed form, or the use of an 
    Internet or other electronic means, can be developed to notify 
    individuals of an estimation of their approximate eligibility for 
    grant, work-study, and loan assistance upon completion and 
    verification of the simplified application form;
        (8) whether information provided on other Federal forms (such as 
    the form applying for supplemental security income under title XVI 
    of the Social Security Act, the form for applying for food stamps 
    under the Food Stamp Act of 1977, and the schedule for applying for 
    the earned income tax credit under section 32 of the Internal 
    Revenue Code of 1986) that are designed to determine eligibility for 
    various Federal need-based assistance programs could be used to 
    qualify potential students for the simplified needs test; and
        (9) whether any proposed changes to data elements collected, in 
    addition to those used to calculate expected family contribution, or 
    any proposed changes to the form's design or the process of applying 
    for aid, may have adverse effects on program costs, integrity, 
    delivery, or distribution of awards, as well as, application 
    development or application processing.
    (c) Additional Considerations.--In conducting the feasibility study, 
the Advisory Committee's primary objective under this subsection shall 
be simplifying the financial aid application forms and process and 
obtaining a substantial reduction in the number of required data items. 
In carrying out that objective, the Advisory Committee shall pay special 
attention to the needs of low-income and moderate-income students and 
families.
    (d) Consultation.--
        (1) In general.--The Advisory Committee shall consult with a 
    broad range of interested parties in higher education, including 
    parents and students, high school guidance counselors, financial aid 
    and other campus administrators, appropriate State administrators, 
    administrators of intervention and outreach programs, and 
    appropriate officials from the Department of Education.
        (2) Forms design expert.--With the goal of making significant 
    changes to the form to make the questions more easily 
    understandable, the Advisory Committee shall consult a forms design 
    expert to ensure that its recommendations for revision of the 
    application form would assist in making the form easily readable and 
    understood by parents, students, and other members of the public.
        (3) Congressional consultation.--The Advisory Committee shall 
    consult on a regular basis with the Committee on Education and the 
    Workforce of the House of Representatives and the Committee on 
    Health, Education, Labor, and Pensions of the Senate in carrying out 
    the feasibility study required by this subsection.
        (4) Departmental consultation.--The Secretary of Education shall 
    provide such assistance to the Advisory Committee as is requested 
    and practicable in conducting the study required by this subsection.
    (e) Reports.--
        (1) Interim report.--The Advisory Committee shall, not later 
    than six months after the date of enactment of this Act, prepare and 
    submit an interim report containing any such legislative changes as 
    the Advisory Committee recommends to reform and simplify the needs 
    analysis under part F of title IV of the Higher Education Act of 
    1965 (20 U.S.C. 1087kk et seq.) and forms and other requirements 
    under such title to the Committee on Education and the Workforce of 
    the House of Representatives, the Committee on Health, Education, 
    Labor, and Pensions of the Senate, and the Secretary of Education.
        (2) Final report.--The Advisory Committee shall, not later than 
    one year after the date of enactment of this Act, prepare and submit 
    a full final report on the study, including recommendations for 
    regulatory and administrative changes required by this section, to 
    the Committee on Education and the Workforce of the House of 
    Representatives, the Committee on Health, Education, Labor, and 
    Pensions of the Senate, and the Secretary of Education.
    (f) Implementation.--The Secretary of Education shall consult with 
the Committee on Education and the Workforce of the House of 
Representatives and the Committee on Health, Education, Labor, and 
Pensions of the Senate and shall subsequently initiate a redesign of the 
form required by section 483 of the Higher Education Act of 1965 (20 
U.S.C. 1090). Such redesign shall include the testing of alternative 
simplified versions of the free federal form. The Secretary shall keep 
the Committee on Education and the Workforce of the House of 
Representatives and the Committee on Health, Education, Labor, and 
Pensions of the Senate fully and currently informed on the progress of 
these efforts.
    (g) Postponement of Tax Table Update Pending Report and 
Implementation.--The Secretary of Education shall not implement or 
enforce for the award year 2004-2005 the annual update to the allowances 
for State and other taxes in the tables used in the Federal needs 
analysis methodology, as prescribed by the Secretary on May 30, 2003 (68 
Fed. Reg. 32473).]
    [Sec. 306. The Secretary of Education shall treat as timely filed an 
application under section 8003 of the Elementary and Secondary Education 
Act of 1965 from the local educational agency for Hydaburg, Alaska, for 
a payment for fiscal year 2004, and shall process such application for 
payment, if the Secretary has received the fiscal year 2004 application 
not later than 30 days after the date of enactment of this Act.]
    Sec. 305. (a) Discretionary Funding.--Section 458(a)(1) of the 
Higher Education Act of 1965 (20 U.S.C. 1087h(a)(1)), is amended--

[[Page 380]]

        (1) in the matter preceding subparagraph (A), by striking 
    ``there shall be available to the Secretary, from funds not 
    otherwise appropriated, funds to be obligated for--'' and inserting 
    in lieu thereof, ``there are authorized to be appropriated to carry 
    out this section such sums as may be necessary, for--'';
        (2) in subparagraph (B), by striking the comma at the end 
    thereof and inserting in lieu thereof a period; and
        (3) by striking the flush language at the end thereof.
    (b) Effective Date.--The amendments made by subsection (a) shall be 
effective for fiscal year 2005 and succeeding fiscal years. (Division E, 
H.R. 2673, Consolidated Appropriations Bill, FY 2004.)
    Note: Section 167, Division H, H.R. 2673, Consolidated 
Appropriations Bill, 2004, appropriates additional amounts for the 
Department of Education for 2004. The language is presented with the 
government-wide general provisions.
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