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


                     THE BUDGET FOR FISCAL YEAR 2008

[[Page 313]]

 
                         DEPARTMENT OF EDUCATION

              OFFICE OF ELEMENTARY AND SECONDARY EDUCATION

                              Federal 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, $16,139,090,000, of which $8,571,383,000 shall become available on 
July 1, 2008, and shall remain available through September 30, 2009, and 
of which $7,383,301,000 shall become available on October 1, 2008, and 
shall remain available through September 30, 2009 for academic year 
2008-2009: Provided, That $6,808,408,000 shall be for basic grants under 
section 1124: Provided further, That up to $4,000,000 of these funds 
shall be available to the Secretary of Education on October 1, 2007, 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 for concentration grants under section 1124A: Provided further, 
That $3,466,618,000 shall be for targeted grants under section 1125: 
Provided further, That $2,269,843,000 shall be for education finance 
incentive grants under section 1125A: Provided further, That 
$500,000,000 shall be for school improvement grants under section 
1003(g): Provided further, That $9,327,000 shall be to carry out part E 
of title I.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0900-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Grants to local educational 
        agencies........................      12,519      12,731      13,910
00.02 School improvement grants.........                                 500
00.03 Reading first State grants........       1,213       1,084       1,019
00.04 Early reading first...............         103         103         118
00.05 Striving readers..................          32          54         100
00.06 Even start........................         112         119
00.07 Literacy through school libraries.          19          19          19
00.08 State agency programs.............         431         447         430
00.09 Comprehensive school reform.......          10          10
00.10 Evaluation........................           9           9           9
00.11 Migrant education projects........          34          34          34
                                           ---------   ---------  ----------
10.00   Total new obligations...........      14,482      14,610      16,139
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         130         129
22.00 New budget authority (gross)......      14,481      14,481      16,139
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      14,612      14,610      16,139
23.95 Total new obligations.............     -14,482     -14,610     -16,139
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         129
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       7,244       7,098       8,756
40.35   Appropriation permanently 
          reduced.......................        -146
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       7,098       7,098       8,756
55.00   Advance appropriation...........       7,383       7,383       7,383
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................      14,481      14,481      16,139
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..      11,043      10,803      10,575
73.10 Total new obligations.............      14,482      14,610      16,139
73.20 Total outlays (gross).............     -14,696     -14,838     -14,523
73.40 Adjustments in expired accounts 
        (net)...........................         -25
73.45 Recoveries of prior year 
        obligations.....................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..      10,803      10,575      12,191
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       5,383       6,049       6,082
86.93 Outlays from discretionary 
        balances........................       9,313       8,789       8,441
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      14,696      14,838      14,523
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................      14,481      14,481      16,139
90.00 Outlays...........................      14,696      14,838      14,523
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2006 actual  2007 est.   2008 est.
Enacted/requested:
  Budget Authority............         14,481         14,481          16,139
  Outlays.....................         14,696         14,838          14,523
Legislative proposal, not subject to 
    PAYGO:
  Budget Authority............                                           550
  Outlays.....................                                            11

Total:
  Budget Authority............         14,481         14,481          16,689
  Outlays.....................         14,696         14,838          14,534

                        SUMMARY OF PROGRAM LEVEL

                        (in millions of dollars)

                                     2006-2007 
                                      Academic 
                                        Year      2007-2008 
                                                Academic Year 2008-2009 
                                                            Academic Year
New Budget Authority..........          7,098          7,098           8,756
Advance appropriation.........          7,383          7,383           7,383
                                    ------------------------------------
      Total program level.....         14,481         14,481          16,139
                                    ====================================
Change in advance 
appropriation from the 
previous year.................              0              0               0

    Note: Additional authorizing language is sought for $16,105,163,000 
in this account.

    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, mathematics, and science, 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 in reading and mathematics. 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 
are permitted to obtain supplemental educational services from a public- 
or private-sector provider. Schools that do not improve are subject to 
progressively stronger corrective actions and, after six years of not 
making adequate yearly progress, reconstitution under a restructuring 
plan. 2008 funds would be expended under a reauthorization proposal to 
expand the benefits of the program to more high school students, refine 
accountability systems, include science in accountability 
determinations, and give students in low-performing schools more 
options.

    School improvement grants.--Funds would support grants to States to 
assist schools and districts identified as in need

[[Page 314]]

of improvement because they have not met their student achievement goals 
for at least two consecutive years. Activities may include the 
development and implementation of school improvement plans, professional 
development for teachers and staff, corrective actions such as 
instituting a new curriculum, and the provision of public school choice 
and supplemental educational services.

    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 knowledge, pre-reading skills, and early language development of 
children ages three through five. For the reauthorization of ESEA, the 
Department is proposing to strengthen partnerships between preschool 
providers and institutions of higher education that provide professional 
development to early childhood educators.

    Striving readers.--Funds support 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 certified professional 
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 Act 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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
24.0  Printing and reproduction.........           2           2           2
25.1  Advisory and assistance services..           5           7           7
25.2  Other services....................          58          46          41
25.3  Other purchases of goods and 
        services from Government 
        accounts........................           3           4           5
25.7  Operation and maintenance of 
        equipment.......................           6
41.0  Grants, subsidies, and 
        contributions...................      14,408      14,551      16,084
                                           ---------   ---------  ----------
99.9    Total new obligations...........      14,482      14,610      16,139
---------------------------------------------------------------------------

                     Education for the Disadvantaged

              (Legislative proposal, not subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0900-2-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Math now for elementary school 
        students........................                                 125
00.02 Math now for middle school 
        students........................                                 125
00.03 Promise scholarships..............                                 250
00.04 Opportunity scholarships..........                                  50
                                           ---------   ---------  ----------
10.00   Total new obligations...........                                 550
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                 550
23.95 Total new obligations.............                                -550
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                                 550
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                 550
73.20 Total outlays (gross).............                                 -11
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                 539
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                                  11
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                                 550
90.00 Outlays...........................                                  11
---------------------------------------------------------------------------

    The resources in this schedule are proposed for later transmittal 
under proposed legislation to revise and reauthorize programs currently 
authorized under the Elementary and Secondary Education Act.

    Math now for elementary school students.--Funds would support 
competitive grants to improve instruction in mathematics for students in 
kindergarten through 6th grade through such activities as professional 
development, diagnostic assessments, and curriculum implementation.

    Math now for middle school students.--Funds would support 
competitive grants to improve mathematics instruction for middle school 
students whose achievement is significantly below grade level.

    Promise scholarships.--Funds would support formula grants to States 
for scholarships to enable low-income students enrolled in persistently 
low-performing schools to attend a private or out-of-district public 
school or to receive intensive, sustained tutoring assistance.

    Opportunity scholarships.--Funds would support competitive grants to 
support local efforts to enable low-income students enrolled in 
persistently low-performing schools to attend a private or out-of-
district public school or to receive intensive, sustained tutoring 
assistance.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0900-2-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.1  Advisory and assistance services..                                   3
25.2  Other services....................                                   1
41.0  Grants, subsidies, and 
        contributions...................                                 546
                                           ---------   ---------  ----------
99.9    Total new obligations...........                                 550
---------------------------------------------------------------------------

                                

                                Impact Aid

     For carrying out programs of financial assistance to federally 
affected schools authorized by title VIII of the Elementary and Sec

[[Page 315]]

ondary Education Act of 1965, $1,228,100,000, of which $1,091,867,000 
shall be for basic support payments under section 8003(b), $49,466,000 
shall be for payments for children with disabilities under section 
8003(d), $17,820,000 shall be for construction under section 8007(b) and 
shall remain available through September 30, 2009, $64,350,000 shall be 
for Federal property payments under section 8002, and $4,597,000, to 
remain available until expended, shall be for facilities maintenance 
under section 8008: Provided, That for purposes of computing the amount 
of a payment for an eligible local educational agency under section 
8003(a) for school year 2007-2008, children enrolled in a school of such 
agency that would otherwise be eligible for payment under section 
8003(a)(1)(B) of such Act, but due to the deployment of both parents or 
legal guardians, or a parent or legal guardian having sole custody of 
such children, or due to the death of a military parent or legal 
guardian while on active duty (so long as such children reside on 
Federal property as described in section 8003(a)(1)(B)), are no longer 
eligible under such section, shall be considered as eligible students 
under such section, provided such students remain in average daily 
attendance at a school in the same local educational agency they 
attended prior to their change in eligibility status.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0102-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Basic support payments............       1,092       1,092       1,092
00.02 Supplemental payments for children 
        with disabilities...............          49          49          49
                                           ---------   ---------  ----------
00.91   Subtotal, payments for federally 
          connected children............       1,141       1,141       1,141
01.01 Facilities maintenance............           5           5           5
02.01 Construction......................          47          47          18
03.01 Payments for Federal property.....          64          64          64
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................       1,257       1,257       1,228
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          35           7           7
22.00 New budget authority (gross)......       1,229       1,257       1,228
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,264       1,264       1,235
23.95 Total new obligations.............      -1,257      -1,257      -1,228
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           7           7           7
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       1,241       1,257       1,228
40.35   Appropriation permanently 
          reduced.......................         -12
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       1,229       1,257       1,228
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         264         379         164
73.10 Total new obligations.............       1,257       1,257       1,228
73.20 Total outlays (gross).............      -1,141      -1,472      -1,227
73.40 Adjustments in expired accounts 
        (net)...........................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         379         164         165
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       1,069       1,128       1,087
86.93 Outlays from discretionary 
        balances........................          72         344         140
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,141       1,472       1,227
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       1,229       1,257       1,228
90.00 Outlays...........................       1,141       1,472       1,227
---------------------------------------------------------------------------

    Note: Additional authorizing language is sought for all of the 
resources requested in this account.

    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 1.0 million federally connected students enrolled in about 
1,260 local educational agencies to assist them in meeting their 
operation and maintenance costs. Average per-student payments will be 
approximately $1,100.

    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 58,000 federally connected 
students with disabilities in about 900 local educational agencies. 
Average per-student payments will be approximately $850.

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

    Construction.--Approximately 20 construction grants will be awarded 
competitively to the highest need impact aid districts for emergency 
repairs and modernization of school facilities.

    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.

                                

                       School Improvement Programs

     For carrying out school improvement activities authorized by title 
II, part B of title IV, subpart 9 of part D of title V, and parts A and 
B of title VI 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; the Compact of Free 
Association Amendments Act of 2003; and the Civil Rights Act of 1964, 
$4,698,276,000, of which $3,158,151,000 shall become available on July 
1, 2008, and remain available through September 30, 2009, and of which 
$1,435,000,000 shall become available on October 1, 2008, and shall 
remain available through September 30, 2009, for academic year 2008-
2009: Provided, That $411,630,000 shall be for State assessments and 
related activities authorized under sections 6111 and 6112 of the ESEA: 
Provided further, That $56,256,000 shall be available to carry out 
section 203 of the Educational Technical Assistance Act of 2002: 
Provided further, That $23,755,000 shall be available to carry out part 
D of title V of the ESEA: Provided further, That no funds appropriated 
under this heading may be used to carry out section 5494 under the ESEA: 
Provided further, That $18,001,000 shall be available to carry out the 
Supplemental Education Grants program for the Federated States of 
Micronesia and for the Republic of the Marshall Islands: Provided 
further, That up to 5 percent of these amounts may be reserved by the 
Federated States of Micronesia and the Republic of the Marshall Islands 
to administer the Supplemental Education Grants programs and to obtain 
technical assistance, oversight and consultancy services in the 
administration of these grants and to reimburse the United States 
Departments of Labor, Health and Human Services, and Education for such 
services.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1000-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Improving teacher quality State 
        grants..........................       2,887       2,907       2,787
00.02 Early childhood educator 
        professional development........          15          15
00.03 Mathematics and science 
        partnerships....................         182         184         182
00.04 Educational technology State 
        grants..........................         273         279
00.05 21st Century community learning 
        centers.........................         981         991         981
00.06 State grants for innovative 
        programs........................          99          99

[[Page 316]]

00.07 Javits gifted and talented 
        education.......................          10          10
00.08 Foreign language assistance.......          22          22          24
00.09 State assessments.................         412         420         412
00.10 Education for homeless children 
        and youth.......................          62          62          62
00.11 Education for Native Hawaiians....          34          34
00.12 Alaska Native education equity....          34          34
00.13 Training and advisory services....           7           7           7
00.14 Rural education...................         169         169         169
00.15 Supplemental education grants.....          18          18          18
00.16 Comprehensive centers.............          56          56          56
00.17 Safe and drug-free schools and 
        communities national programs...           5           5
                                           ---------   ---------  ----------
10.00   Total new obligations...........       5,266       5,312       4,698
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          56          47
22.00 New budget authority (gross)......       5,256       5,265       4,698
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       5,313       5,312       4,698
23.95 Total new obligations.............      -5,266      -5,312      -4,698
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          47
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       3,874       3,830       3,263
40.35   Appropriation permanently 
          reduced.......................         -53
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       3,821       3,830       3,263
55.00   Advance appropriation...........       1,435       1,435       1,435
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       5,256       5,265       4,698
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       7,286       6,712       6,394
73.10 Total new obligations.............       5,266       5,312       4,698
73.20 Total outlays (gross).............      -5,797      -5,630      -5,253
73.40 Adjustments in expired accounts 
        (net)...........................         -42
73.45 Recoveries of prior year 
        obligations.....................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       6,712       6,394       5,839
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         760         966         955
86.93 Outlays from discretionary 
        balances........................       5,037       4,664       4,298
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       5,797       5,630       5,253
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       5,256       5,265       4,698
90.00 Outlays...........................       5,797       5,630       5,253
---------------------------------------------------------------------------

                        SUMMARY OF PROGRAM LEVEL

                        (in millions of dollars)

                                     2006-2007 
                                      Academic 
                                        Year      2007-2008 
                                                Academic Year 2008-2009 
                                                            Academic Year
New Budget Authority..........          3,820          3,825           3,263
Advance Appropriation.........          1,435          1,435           1,435
                                    ------------------------------------
      Total program level.....          5,255          5,260           4,698
                                    ====================================
Change in advance 
appropriation over previous 
year..........................              0              0               0

    Note: Additional authorizing language is sought for $4,614,906,000 
in this account.

    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.

    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. These efforts may include the integration of teaching 
methods based on scientifically-based research and technology into the 
curriculum.

    Other Activities:

    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.

    Foreign language assistance.--Funds support competitive grants to 
States and school districts to create innovative model programs 
providing for the establishment, improvement, or expansion of critical 
foreign language study for elementary and secondary school students.

    State assessments.--Funds support formula grants to States to 
develop and implement the assessments, and related accountability 
efforts, that States use to test children in reading, mathematics, and 
science.

    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.

    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. The 
Small, Rural Schools Achievement program provides rural local 
educational agencies with small enrollments with additional formula 
funds and flexibility in the use of other Federal formula funds. 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, which in turn allocate funds to 
eligible local educational agencies within the States.

    Supplemental education grants.--Funds support grants to the 
Federated States of Micronesia and to the Republic of the Marshall 
Islands in place of grant programs discontinued by the Compact of Free 
Association Amendments Act of 2003.

    Comprehensive centers.--Funds support 21 comprehensive centers that 
focus on building State capacity to help school districts and schools 
meet the requirements of the No Child Left Behind Act.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1000-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.1  Advisory and assistance services..          13          14          12
25.2  Other services....................          22          23          21
41.0  Grants, subsidies, and 
        contributions...................       5,231       5,275       4,665
                                           ---------   ---------  ----------
99.9    Total new obligations...........       5,266       5,312       4,698
---------------------------------------------------------------------------

                                

                             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, $118,683,000.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0101-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Grants to local educational 
        agencies........................          96          96          96

[[Page 317]]

00.02 Special programs for Indian 
        children........................          19          19          19
00.03 National activities...............           4           4           4
                                           ---------   ---------  ----------
10.00   Total new obligations...........         119         119         119
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......         119         119         119
23.95 Total new obligations.............        -119        -119        -119
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         120         119         119
40.35   Appropriation permanently 
          reduced.......................          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         119         119         119
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         146         140         138
73.10 Total new obligations.............         119         119         119
73.20 Total outlays (gross).............        -120        -121        -117
73.40 Adjustments in expired accounts 
        (net)...........................          -5
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         140         138         140
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           6           6           6
86.93 Outlays from discretionary 
        balances........................         114         115         111
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         120         121         117
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         119         119         119
90.00 Outlays...........................         120         121         117
---------------------------------------------------------------------------

    Note: Additional authorizing language is sought for all of the 
resources requested in this account.

    The Indian Education programs support 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 2006, the Department made 
1,196 formula grants to local educational agencies and tribal schools 
serving more than 469,000 students.

    Special programs for Indian Children.--The Department makes 
competitive awards for demonstration projects in early childhood 
education and college preparation, as well as professional development 
grants for training Native American teachers and administrators for 
employment 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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.1  Advisory and assistance services..           1           1           1
25.2  Other services....................           2           2           2
25.7  Operation and maintenance of 
        equipment.......................           1           1           1
41.0  Grants, subsidies, and 
        contributions...................         115         115         115
                                           ---------   ---------  ----------
99.9    Total new obligations...........         119         119         119
---------------------------------------------------------------------------

                                

                           Reading Excellence 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0011-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Change in obligated balances:
72.40 Obligated balance, start of year..          20           6
73.20 Total outlays (gross).............          -1          -6
73.40 Adjustments in expired accounts 
        (net)...........................         -13
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           6
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.93 Outlays from discretionary 
        balances........................           1           6
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................           1           6
---------------------------------------------------------------------------

    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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Change in obligated balances:
72.40 Obligated balance, start of year..          64           4
73.20 Total outlays (gross).............         -17          -4
73.40 Adjustments in expired accounts 
        (net)...........................         -43
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           4
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.93 Outlays from discretionary 
        balances........................          17           4
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................          17           4
---------------------------------------------------------------------------

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

                                


 
                  OFFICE OF INNOVATION AND IMPROVEMENT

                              Federal Funds

                        Innovation and Improvement

     For carrying out activities authorized by part G of title I, parts 
C and D of title II, and parts B, C, and D of title V of the Elementary 
and Secondary Education Act of 1965, $897,018,000: Provided, That from 
funds for subpart 4, part C of title II, up to 3 percent shall be 
available to the Secretary for technical assistance and dissemination of 
information: Provided further, That $36,611,000 shall be for subpart 2 
of part B of title V: Provided further, That $257,108,000 shall be 
available to carry out part D of title V of the ESEA, of which 
$199,000,000 of the funds for subpart 1 shall be for competitive grants 
to local educational agencies, including charter schools that are local 
educational agencies, or States, or partnerships of (1) a local 
educational agency, a State, or both and (2) at least one non-profit 
organization to develop and implement performance-based teacher and 
principal compensation systems in high-need schools: Provided further, 
That such performance-based compensation systems must consider gains in 
student academic achievement as well as classroom evaluations conducted 
multiple times during each school year among other factors and provide 
educators with incentives to take on additional responsibilities and 
leadership roles: Provided further, That up to five percent of such 
funds for competitive grants shall be available for technical 
assistance, training, peer review of applications, program outreach and 
evaluation activities.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0204-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:

[[Page 318]]

00.01 Teacher incentive fund............           4          98         199
00.02 Troops-to-teachers................          15          15          15
00.03 Transition to teaching............          44          44          44
00.04 National writing project..........          21          21
00.05 Teaching American history.........         120         120          50
00.06 School leadership.................          15          15
00.07 Advanced credentialing............          17          17
      School choice and flexibility:

00.08   Charter schools grants..........         215         215         215
00.09   Credit enhancement for charter 
          school facilities.............          37          37          37
00.10   Voluntary public school choice..          26          26          26
00.11   Magnet schools assistance.......         107         107         107
00.12 Advanced placement................          32          32         122
00.13 School dropout prevention.........           5           5
00.14 Close Up fellowships..............           1           1
00.15 Ready-to-learn-television.........          24          24          24
00.16 Academies for American history and 
        civics..........................           2           2
00.17 FIE programs of national 
        significance....................          12          12          33
00.18 Reading is fundamental/Inexpensive 
        book distribution...............          25          25          25
00.19 Star schools......................          15          15
00.20 Ready to teach....................          11          11
00.21 Exchanges with historic whaling 
        and trading partners............           9           9
00.22 Excellence in economic education..           1           1
00.23 Mental health integration in 
        schools.........................           5           5
00.24 Foundations for learning..........           1           1
00.25 Arts in education.................          35          35
00.26 Parental information and resource 
        centers.........................          39          39
00.27 Womens educational equity.........           3           3
                                           ---------   ---------  ----------
01.00   Total direct program............         841         935         897
09.01 DC School Choice..................          14          14          15
09.02 Reimbursable program..............           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........         856         949         912
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                      95           1
22.00 New budget authority (gross)......         952         855         912
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         952         950         913
23.95 Total new obligations.............        -856        -949        -912
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          95           1           1
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         946         841         897
40.35   Appropriation permanently 
          reduced.......................          -9
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         937         841         897
58.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).          15          14          15
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         952         855         912
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       1,595       1,535       1,196
73.10 Total new obligations.............         856         949         912
73.20 Total outlays (gross).............        -915      -1,288        -937
73.40 Adjustments in expired accounts 
        (net)...........................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       1,535       1,196       1,171
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          26          43          46
86.93 Outlays from discretionary 
        balances........................         889       1,245         891
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         915       1,288         937
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............          -1
88.40     Non-Federal sources...........         -14         -14         -15
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................         -15         -14         -15
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         937         841         897
90.00 Outlays...........................         900       1,274         922
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2006 actual  2007 est.   2008 est.
Enacted/requested:
  Budget Authority............            937            841             897
  Outlays.....................            900          1,274             922
Legislative proposal, not subject to 
    PAYGO:
  Budget Authority............                                            25
  Outlays.....................                                             1

Total:
  Budget Authority............            937            841             922
  Outlays.....................            900          1,274             923

    Note: Additional authorizing language is sought for all of the 
resources requested in this account.

    Recruiting and training high quality teachers:

    Teacher incentive fund.--Funds support the development of 
performance-based teacher compensation systems that reward teachers and 
schools that are raising student achievement and closing the achievement 
gap.

    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 mid-career professionals and 
recent college graduates as teachers in high-need schools.

    Teaching American history.--Funds support competitive grants to 
school districts for activities to improve history instruction and 
provide professional development for teachers of American history.

    Other activities:

    Charter schools 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. A portion of the funding supports 
State efforts to assist charter schools in obtaining facilities.

    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.

    Voluntary public school choice.--Funds support competitive grants to 
State 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.

    Advanced placement.--Funds support competitive grants to State 
educational agencies, local educational agencies, and national nonprofit 
educational entities to expand access for low-income individuals to 
Advanced Placement (AP) or International Baccalaureate (IB) courses, and 
grants to States to pay test fees for low-income students who are 
enrolled in AP or IB courses.

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

    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.

[[Page 319]]

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

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0204-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
      Direct obligations:

25.1    Advisory and assistance services           2           3           5
25.2    Other services..................          53          52          53
41.0    Grants, subsidies, and 
          contributions.................         786         880         839
                                           ---------   ---------  ----------
99.0      Direct obligations............         841         935         897
99.0  Reimbursable obligations..........          15          14          15
                                           ---------   ---------  ----------
99.9    Total new obligations...........         856         949         912
---------------------------------------------------------------------------

                        Innovation and improvement

              (Legislative proposal, not subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0204-2-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Adjunct Teacher Corps.............                                  25
                                           ---------   ---------  ----------
01.00   Total direct program............                                  25
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                                  25
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                  25
23.95 Total new obligations.............                                 -25
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................                                  25
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                  25
73.20 Total outlays (gross).............                                  -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                  24
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................                                   1
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                                  25
90.00 Outlays...........................                                   1
---------------------------------------------------------------------------

    The resources in this schedule are proposed for later transmittal 
under proposed legislation to revise and reauthorize programs currently 
authorized under the Elementary and Secondary Education Act.

    Adjunct teacher corps.--Funds would 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 mathematics and 
science.

                                


 
                  OFFICE OF SAFE AND DRUG-FREE SCHOOLS

                              Federal Funds

                  Safe Schools and Citizenship Education

     For carrying out activities authorized by part A of title IV of the 
Elementary and Secondary Education Act of 1965, $324,248,000, of which 
$100,000,000 shall become available on July 1, 2008 and remain available 
through September 30, 2009: Provided, That $224,248,000 shall be 
available for subpart 2 of part A of title IV, of which $10,000,000, 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.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0203-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
      Safe and drug-free schools and communities:

00.01   State grants....................         346         355         100
        National programs:
00.02     National activities...........         138         171         224
00.03     Alcohol abuse reduction.......          32          32
00.04     Mentoring program.............          49          19
                                           ---------   ---------  ----------
00.91   Subtotal, Safe and drug-free 
          schools and communities.......         565         577         324
01.01 Character education...............          24          24
02.01 Elementary and secondary school 
        counseling......................          35          35
03.01 Physical education program........          73          73
04.01 Civic education...................          29          29
05.01 Literacy program for prisoners....           5
09.00 Reimbursable program..............          70          70          70
                                           ---------   ---------  ----------
10.00   Total new obligations...........         801         808         394
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           7           6
22.00 New budget authority (gross)......         800         802         394
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         807         808         394
23.95 Total new obligations.............        -801        -808        -394
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           6
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         737         732         324
40.35   Appropriation permanently 
          reduced.......................          -7
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         730         732         324
58.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).          70          70          70
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         800         802         394
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       1,291       1,255       1,202
73.10 Total new obligations.............         801         808         394
73.20 Total outlays (gross).............        -836        -861        -810
73.40 Adjustments in expired accounts 
        (net)...........................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       1,255       1,202         786
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          24          16           7
86.93 Outlays from discretionary 
        balances........................         812         845         803
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         836         861         810
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........         -70         -70         -70
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         730         732         324
90.00 Outlays...........................         766         791         740
---------------------------------------------------------------------------

    Note: Additional authorizing language is sought for all of the 
resources requested in this account.

    Safe and drug-free schools and communities:

    State grants.--Funds provide formula grants to State educational 
agencies to provide local educational agencies with training, technical 
assistance, and information regarding effective models for the creation 
of safe, healthy, drug-free, and secure schools.

    National programs.--Funds support programs and activities in the 
areas of (1) emergency management planning, (2) preventing violence and 
drug use, including student drug testing, (3) school culture and 
climate, including character education, and (4) other needs related to 
improving students' learning

[[Page 320]]

environment to enable those students to meet challenging academic 
standards.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0203-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
      Direct obligations:

25.1    Advisory and assistance services           6           7           7
25.2    Other services..................           9           9           9
25.3    Other purchases of goods and 
          services from Government 
          accounts......................           4           4           4
41.0    Grants, subsidies, and 
          contributions.................         712         718         304
                                           ---------   ---------  ----------
99.0      Direct obligations............         731         738         324
99.0  Reimbursable obligations..........          70          70          70
                                           ---------   ---------  ----------
99.9    Total new obligations...........         801         808         394
---------------------------------------------------------------------------

                                


 
                 OFFICE OF ENGLISH LANGUAGE ACQUISITION

                              Federal Funds

                       English Language Acquisition

     For carrying out part A of title III of the ESEA, $670,819,000, 
which shall become available on July 1, 2008, and shall remain available 
through September 30, 2009, except that 6.5 percent of such amount shall 
be available on October 1, 2007 and shall remain available through 
September 30, 2009, to carry out activities under section 3111(c)(1)(C).

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1300-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Language acquisition State grants.         671         678         671
                                           ---------   ---------  ----------
10.00   Total new obligations...........         671         678         671
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           9           7
22.00 New budget authority (gross)......         669         671         671
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         678         678         671
23.95 Total new obligations.............        -671        -678        -671
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           7
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         676         671         671
40.35   Appropriation permanently 
          reduced.......................          -7
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         669         671         671
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         937         983         805
73.10 Total new obligations.............         671         678         671
73.20 Total outlays (gross).............        -616        -856        -624
73.40 Adjustments in expired accounts 
        (net)...........................          -9
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         983         805         852
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           8          34          34
86.93 Outlays from discretionary 
        balances........................         608         822         590
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         616         856         624
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         669         671         671
90.00 Outlays...........................         616         856         624
---------------------------------------------------------------------------

    Note: Additional authorizing language is sought for all of the 
resources requested in this account.

    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.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1300-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.5  Research and development contracts           2           2           2
41.0  Grants, subsidies, and 
        contributions...................         669         676         669
                                           ---------   ---------  ----------
99.9    Total new obligations...........         671         678         671
---------------------------------------------------------------------------

                                


 
         OFFICE OF SPECIAL EDUCATION AND REHABILITATIVE SERVICES

                              Federal Funds

                            Special Education

     For carrying out the Individuals with Disabilities Education Act, 
$11,485,147,000, of which $5,080,559,000 shall become available on July 
1, 2008, and shall remain available through September 30, 2009, and of 
which $6,215,200,000 shall become available on October 1, 2008, and 
shall remain available through September 30, 2009, for academic year 
2008-2009: Provided, That the amount for section 611(b)(2) of the Act 
shall be equal to the lesser of the amount available for that activity 
during fiscal year 2007, increased by the amount of inflation as 
specified in section 619(d)(2)(B) of the Act, or the percentage increase 
in the funds appropriated under section 611(i) of the Act.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0300-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
      State grants:

00.01   Grants to States................      10,481      10,598       9,699
00.02   Preschool grants................         381         381         381
00.03   Grants for infants and families.         423         438         423
                                           ---------   ---------  ----------
00.91     Subtotal, State grants........      11,285      11,417      10,503
      National activities:

01.01   State personnel development.....          50          50          50
01.02   Technical assistance and 
          dissemination.................          49          49          49
01.03   Personnel preparation...........          90          90          90
01.04   Parent information centers......          26          26          26
01.05   Technology and media services...          38          38          25
                                           ---------   ---------  ----------
01.91     Subtotal, National activities.         253         253         240
                                           ---------   ---------  ----------
02.00   Total Direct Program............      11,538      11,670      10,743
                                           ---------   ---------  ----------
10.00   Total new obligations...........      11,538      11,670      10,743
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          67         170          49
22.00 New budget authority (gross)......      11,641      11,549      10,694
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      11,708      11,719      10,743
23.95 Total new obligations.............     -11,538     -11,670     -10,743
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         170          49
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       6,346       6,125       5,270
40.35   Appropriation permanently 
          reduced.......................        -118
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       6,228       6,125       5,270

[[Page 321]]

55.00   Advance appropriation...........       5,413       5,424       5,424
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................      11,641      11,549      10,694
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       9,532       9,212       9,345
73.10 Total new obligations.............      11,538      11,670      10,743
73.20 Total outlays (gross).............     -11,836     -11,537     -10,771
73.40 Adjustments in expired accounts 
        (net)...........................         -22
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       9,212       9,345       9,317
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       3,032       4,136       4,135
86.93 Outlays from discretionary 
        balances........................       8,804       7,401       6,636
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      11,836      11,537      10,771
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................      11,641      11,549      10,694
90.00 Outlays...........................      11,836      11,537      10,771
---------------------------------------------------------------------------

                SUMMARY OF GRANTS TO STATES PROGRAM LEVEL

                        [In millions of dollars]

                                      2006-2007   2007-2008   2008-2009
                                      academic 
                                        year    academic yeaacademic year
Current Budget Authority......         $5,159         $5,068           4,277
Advance appropriation.........          5,424          5,424           6,215
                                    ------------------------------------
    Total program level.......         10,583         10,492          10,492
                                    ====================================

Change in advance 
appropriation from the 
previous year.................            +11              0            +791

    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.

    Performance data related to program goals include:

                                     2002-2003 
                                       actual     2003-2004 
                                                    actual    2004-2005 
                                                                actual
     Status of Exiting Students
Percent of students with 
    disabilities aged 14-21 leaving 
    school:
  Graduated with a diploma....           51.9           54.2            54.4
  Graduated through 
    certification.............           12.7           13.1            15.5
  Dropped out of school/not 
    known to continue.........           33.6           30.9            28.3
  Reached maximum age for 
    services/other............            1.8            1.8             1.8


               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0300-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.2  Other services....................           4           4           4
41.0  Grants, subsidies, and 
        contributions...................      11,534      11,666      10,739
                                           ---------   ---------  ----------
99.9    Total new obligations...........      11,538      11,670      10,743
---------------------------------------------------------------------------

                                

             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, and 
the Helen Keller National Center Act, $3,184,263,000, of which 
$2,837,160,000 shall be for grants for vocational rehabilitation 
services under Title I of the Rehabilitation Act.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0301-0-1-506      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Vocational rehabilitation State 
        grants..........................       2,720       2,837       2,837
00.02 Client assistance State grants....          12          12          12
00.03 Training..........................          38          38          38
00.04 Demonstration and training 
        programs........................           8           7           7
00.05 Migrant and seasonal farmworkers..           2           2
00.06 Recreational programs.............           3           3
00.07 Protection and advocacy of 
        individual rights...............          16          16          16
00.08 Projects with industry............          20          20
00.09 Supported employment State grants.          30          30
00.10 Independent living................         130         130         130
00.11 Program improvement...............           1           1           1
00.12 Evaluation........................           1           1           2
00.13 Helen Keller National Center......           9           9           8
00.14 National Institute on Disability 
        and Rehabilitation Research.....         107         107         107
00.15 Assistive technology..............          29          30          26
                                           ---------   ---------  ----------
01.00   Total direct program............       3,126       3,243       3,184
09.01 Reimbursable program..............           2           2           2
                                           ---------   ---------  ----------
10.00   Total new obligations...........       3,128       3,245       3,186
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......       3,127       3,244       3,186
23.95 Total new obligations.............      -3,128      -3,245      -3,186
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         409         405         310
40.35   Appropriation permanently 
          reduced.......................          -4
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         405         405         310
        Spending authority from 
            offsetting collections:
58.00     Offsetting collections (cash).                       2           2
58.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........           2
                                           ---------   ---------  ----------
58.90     Spending authority from 
            offsetting collections 
            (total discretionary).......           2           2           2
      Mandatory:

60.00   Appropriation...................       2,720       2,837       2,874
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       3,127       3,244       3,186
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       1,393       1,396       1,086
73.10 Total new obligations.............       3,128       3,245       3,186
73.20 Total outlays (gross).............      -3,116      -3,555      -3,218
73.40 Adjustments in expired accounts 
        (net)...........................          -7
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................          -2
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       1,396       1,086       1,054
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          81         285         218
86.93 Outlays from discretionary 
        balances........................         356         422         142
86.97 Outlays from new mandatory 
        authority.......................       1,920       1,986       2,012

[[Page 322]]

86.98 Outlays from mandatory balances...         759         862         846
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       3,116       3,555       3,218
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

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

88.95   Change in uncollected customer 
          payments from Federal sources 
          (unexpired)...................          -2
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       3,125       3,242       3,184
90.00 Outlays...........................       3,116       3,553       3,216
---------------------------------------------------------------------------

    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.

    The program performance measures for this program are based on State 
VR agency performance indicators developed pursuant to Section 106 of 
the Rehabilitation Act. One of these indicators measures the percentage 
of general and combined State VR agencies that assist at least 55.8 
percent of individuals receiving services to achieve an employment 
outcome. In 2005, 71 percent of the agencies met this performance 
criterion. Another indicator measures the percentage of general and 
combined State VR agencies that assist at least 85 percent of 
individuals with employment outcomes to achieve competitive employment. 
In 2005, 95 percent of general and combined agencies met this 
performance criterion. This outcome data are based on the approximately 
356,229 individuals whose service records were closed in 2005 after 
receiving services.

    The 2008 Budget 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 eliminates funding for three programs (Supported Employment State 
Grants, Projects with Industry, and the Migrant and Seasonal Farmworkers 
program). The services provided by these programs can continue to be 
provided by the larger 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 and 
development 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.--Formula grants are made to States to 
implement comprehensive Statewide programs designed to maximize the 
ability of individuals with disabilities of all ages to obtain assistive 
technology. States conduct activities that include alternative financing 
programs, device reutilization programs, device loan programs, and 
device demonstrations. Funds also support national technical assistance 
activities.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0301-0-1-506      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
      Direct obligations:

25.1    Advisory and assistance services           9          10          11
25.2    Other services..................           1           1           1
41.0    Grants, subsidies, and 
          contributions.................       3,115       3,231       3,172
                                           ---------   ---------  ----------
99.0      Direct obligations............       3,125       3,242       3,184
99.0  Reimbursable obligations..........           2           2           2
99.5  Below reporting threshold.........           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........       3,128       3,245       3,186
---------------------------------------------------------------------------

                                

            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.), $17,573,000.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0600-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct program activity...........          18          18          18
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................          18          18          18
----------------------------------------------------------------------------

[[Page 323]]



    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          18          18          18
23.95 Total new obligations.............         -18         -18         -18
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          18          18          18
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           5           4           2
73.10 Total new obligations.............          18          18          18
73.20 Total outlays (gross).............         -19         -20         -18
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           4           2           2
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          14          17          17
86.93 Outlays from discretionary 
        balances........................           5           3           1
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          19          20          18
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          18          18          18
90.00 Outlays...........................          19          20          18
---------------------------------------------------------------------------

    The Federal appropriation supports the production and distribution 
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 2006, the portion of the Federal appropriation 
allocated to educational materials represented approximately 68.6 
percent of the Printing House's total sales. The full appropriation 
represented approximately 68.8 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.), $56,262,000, of which $913,000 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.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0601-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Operations........................          55          55          55
00.02 Construction......................           1           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................          56          56          56
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          56          56          56
23.95 Total new obligations.............         -56         -56         -56
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          57          56          56
40.35   Appropriation permanently 
          reduced.......................          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............          56          56          56
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           2           1           3
73.10 Total new obligations.............          56          56          56
73.20 Total outlays (gross).............         -57         -54         -56
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           1           3           3
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          55          52          53
86.93 Outlays from discretionary 
        balances........................           2           2           3
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          57          54          56
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          56          56          56
90.00 Outlays...........................          57          54          56
---------------------------------------------------------------------------

    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 2006, the Federal 
appropriation represented 80 percent of the Institute's operating 
budget. The request includes funds for a variety of construction 
projects. The request also includes funds for the Endowment Grant 
program.

                                

                           Gallaudet University

     For the Kendall Demonstration Elementary School, the Model 
Secondary School for the Deaf, and the partial support of Gallaudet 
University and related activities under titles I and II of the Education 
of the Deaf Act of 1986 (20 U.S.C. 4301, et seq.), $106,998,000, of 
which $600,000 shall be for the Secretary of Education to carry out 
section 205 of the Act: Provided, That from the total amount available 
to the University, the University may at its discretion use funds for 
the endowment program as authorized under section 207.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0602-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Operations........................         107         107         106
00.02 Evaluation........................                                   1
                                           ---------   ---------  ----------
10.00   Total new obligations...........         107         107         107
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......         107         107         107
23.95 Total new obligations.............        -107        -107        -107
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         108         107         107
40.35   Appropriation permanently 
          reduced.......................          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         107         107         107
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                                   6
73.10 Total new obligations.............         107         107         107
73.20 Total outlays (gross).............        -107        -101        -107
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                       6           6
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         107         101         101
86.93 Outlays from discretionary 
        balances........................                                   6
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         107         101         107
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         107         107         107
90.00 Outlays...........................         107         101         107
---------------------------------------------------------------------------

    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 deaf from infancy through age 
15, and the Model Secondary

[[Page 324]]

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 2006, the appropriation for Gallaudet represented 63.3 percent of 
the total revenue for university-level programs and 97.8 percent of the 
revenue related to the elementary and secondary schools. In addition, 
the University receives other Federal funds such as student financial 
aid, vocational rehabilitation, Endowment Grant program income, and 
competitive grants and contracts. The request includes $600,000 for the 
Secretary of Education to conduct a study that is intended to assist 
Galluadet in improving its performance on key outcome measures. The 
request also includes funds for the Endowment Grant program.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0602-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.1  Advisory and assistance services..                                   1
41.0  Grants, subsidies, and 
        contributions...................         107         107         106
                                           ---------   ---------  ----------
99.9    Total new obligations...........         107         107         107
---------------------------------------------------------------------------

                                


 
                OFFICE OF VOCATIONAL AND ADULT EDUCATION

                              Federal Funds

                  Career, Technical, and Adult Education

     For carrying out, to the extent not otherwise provided, the Carl D. 
Perkins Career and Technical Education Act of 2006 and the Adult 
Education and Family Literacy Act, $1,197,174,000, of which 
$1,189,808,000 shall become available on July 1, 2008 and shall remain 
available through September 30, 2009: Provided, That of the amounts made 
available for the Carl D. Perkins Career and Technical Education Act of 
2006, $7,366,000 is for postsecondary career and technical institutions 
under section 117: Provided further, That of the amount provided for 
Adult Education State Grants, $67,896,000 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 United States Citizenship and Immigration Services 
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 
United States Citizenship and Immigration Services 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, $9,096,000 shall be for national leadership activities 
under section 243 and $6,638,000 shall be for the National Institute for 
Literacy under section 242.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0400-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
      Career and technical education:

00.01   State grants....................       1,183       1,182       1,391
00.02   National programs...............          11           9          11
00.03   Occupational and employment 
          information...................           1           1
00.04   Tech prep education State grants         105         105
00.05   Tech prep demonstration.........           5           5
00.06   Tribally controlled 
          postsecondary career and 
          technical institutions........                                   7
                                           ---------   ---------  ----------
00.91   Total, Career and technical 
          education.....................       1,305       1,302       1,409
      Adult education:

01.01   State grants....................         564         565         564
01.02   National leadership activities..           9           7           9
01.03   National Institute for Literacy.           6           9           7
                                           ---------   ---------  ----------
01.91   Total, adult education..........         579         581         580
02.01 Smaller learning communities......          90          94          90
03.01 State grants for incarcerated 
        youth offenders.................          23          23
                                           ---------   ---------  ----------
10.00   Total new obligations...........       1,997       2,000       2,079
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         136         131         128
22.00 New budget authority (gross)......       1,992       1,997       1,988
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       2,128       2,128       2,116
23.95 Total new obligations.............      -1,997      -2,000      -2,079
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         131         128          37
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       1,221       1,206       1,197
40.35   Appropriation permanently 
          reduced.......................         -20
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       1,201       1,206       1,197
55.00   Advance appropriation from prior 
          year..........................         791         791         791
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       1,992       1,997       1,988
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       1,755       1,762       1,670
73.10 Total new obligations.............       1,997       2,000       2,079
73.20 Total outlays (gross).............      -1,987      -2,092      -1,939
73.40 Adjustments in expired accounts 
        (net)...........................          -3
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       1,762       1,670       1,810
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         602         654         614
86.93 Outlays from discretionary 
        balances........................       1,385       1,438       1,325
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,987       2,092       1,939
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       1,992       1,997       1,988
90.00 Outlays...........................       1,987       2,092       1,939
---------------------------------------------------------------------------

    Career and technical education:

    State grants.--Funds support formula grants to States and localities 
to expand and improve their programs of career and technical education 
and promote equal opportunity in career and technical education programs 
for historically underserved populations.

    National programs.--Funds appropriated in 2007 will be used in 2008 
to support discretionary activities that contribute to knowledge of how 
to improve career and technical education nationally. Activities include 
a national evaluation, a national center for research and dissemination 
in career and technical education, and a program of discretionary 
research and development projects.

    Tribally controlled postsecondary career and technical 
institutions.--Funds support the operation and improvement of tribally 
controlled postsecondary career and technical institutions to help 
ensure continued and expanded educational opportunities for Indian 
students.

    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 or its equivalent, and to 
promote family literacy. A portion of the funds is reserved for formula 
grants to States to provide English literacy and civics education for 
immigrants and other limited English proficient adults.

[[Page 325]]

    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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
11.3  Personnel compensation: Other than 
        full-time permanent.............           1           1           1
23.1  Rental payments to GSA............           1
25.1  Advisory and assistance services..           2           6           7
25.2  Other services....................           4          12           8
25.3  Other purchases of goods and 
        services from Government 
        accounts........................          17          17           9
25.5  Research and development contracts          13           1           2
41.0  Grants, subsidies, and 
        contributions...................       1,958       1,962       2,051
                                           ---------   ---------  ----------
99.0    Direct obligations..............       1,996       1,999       2,078
99.5  Below reporting threshold.........           1           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........       1,997       2,000       2,079
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-0400-0-1-501      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................          13          16          16
---------------------------------------------------------------------------

                                


 
                    OFFICE OF POSTSECONDARY EDUCATION

                              Federal Funds

                             Higher Education

     For carrying out, to the extent not otherwise provided, titles III, 
IV, V, VI, and VII of the Higher Education Act of 1965 (``HEA''), as 
amended, the Mutual Educational and Cultural Exchange Act of 1961, 
$1,837,737,000: Provided, That $9,797,000, to remain available through 
September 30, 2009, shall be available to fund fellowships for academic 
year 2009-2010 under part A, subpart 1 of title VII of the HEA, under 
the terms and conditions of part A, subpart 1: Provided further, That 
$970,000 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 of the funds referred to in the 
preceding proviso, up to 1 percent may be used for program evaluation, 
national outreach, and information dissemination activities: Provided 
further, That $24,000,000 shall be for grants to institutions of higher 
education, in partnership with local educational agencies, to establish 
instructional programs at all educational levels in languages critical 
to U.S. national security.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0201-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Strengthening institutions........          79          79          79
00.02 Strengthening tribally controlled 
        colleges and universities.......          24          24          19
00.03 Strengthening Alaska Native and 
        Native Hawaiian-serving 
        institutions....................          12          12
00.04 Strengthening historically black 
        colleges and universities.......         238         238         238
00.05 Strengthening historically black 
        graduate institutions...........          58          58          58
00.06 Minority science and engineering 
        improvement.....................           9           9           9
                                           ---------   ---------  ----------
00.91   Subtotal, aid for institutional 
          development...................         420         420         403
      Other aid for institutions:

01.01   Developing Hispanic-serving 
          institutions..................          95          95          95
01.02   International education and 
          foreign language studies......         106         106         106
01.03   Fund for the Improvement of 
          Postsecondary Education.......          22          22          22
01.04   Demonstration projects to ensure 
          quality higher education for 
          students with disabilities....           7           7
01.05   Interest subsidy grants.........           4           4
01.06   Tribally controlled 
          postsecondary vocational and 
          technical institutions........           7           7
                                           ---------   ---------  ----------
01.91     Subtotal, other aid for 
            institutions................         241         241         223
      Assistance for students:

02.01   Federal TRIO programs...........         828         828         828
02.02   Gaining early awareness and 
          readiness for undergraduate 
          programs (GEAR UP)............         303         303         303
02.03   Byrd honors scholarships........          40          40
02.04   Javits fellowships..............          10          10          10
02.05   Graduate assistance in areas of 
          national need.................          30          30          30
02.06   Thurgood Marshall legal 
          educational opportunity.......           3           3
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....................       1,231       1,231       1,187
03.01 Teacher quality enhancement.......          60          60
04.01 Other higher education activities.           3           3           1
05.01 Advancing America through foreign 
        language partnerships...........                                  24
                                           ---------   ---------  ----------
10.00   Total new obligations...........       1,955       1,955       1,838
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          19          15          15
22.00 New budget authority (gross)......       1,951       1,955       1,837
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       1,970       1,970       1,852
23.95 Total new obligations.............      -1,955      -1,955      -1,838
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          15          15          14
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       1,971       1,955       1,837
40.35   Appropriation permanently 
          reduced.......................         -20
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............       1,951       1,955       1,837
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       2,870       2,746       2,602
73.10 Total new obligations.............       1,955       1,955       1,838
73.20 Total outlays (gross).............      -2,059      -2,099      -2,003
73.40 Adjustments in expired accounts 
        (net)...........................         -20
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       2,746       2,602       2,437
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          54         101          92
86.93 Outlays from discretionary 
        balances........................       2,005       1,998       1,911
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       2,059       2,099       2,003
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       1,951       1,955       1,837
90.00 Outlays...........................       2,059       2,099       2,003
---------------------------------------------------------------------------

    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.

[[Page 326]]

    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.--Balances from prior year appropriations 
meet mandatory interest subsidy costs of construction loan commitments 
made prior to 1974.

    Assistance for students:

    Federal TRIO programs.--Funds support postsecondary education 
outreach and support services to help disadvantaged adults 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.

    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.

    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 activities:

    Other higher education activities.--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.

    Advancing America through foreign language partnerships.--Funds 
support an initiative to establish fully articulated language programs 
of study in languages critical to U.S. national security through grants 
to institutions of higher education for partnerships with school 
districts for language learning from kindergarten through high school 
and into advanced language learning at the postsecondary education 
level.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0201-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.1  Advisory and assistance services..           4           4           4
25.2  Other services....................           4           3           5
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...................       1,944       1,945       1,826
                                           ---------   ---------  ----------
99.9    Total new obligations...........       1,955       1,955       1,838
---------------------------------------------------------------------------

                                

                            Howard University

     For partial support of Howard University (20 U.S.C. 121 et seq.), 
$233,866,000.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0603-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 General support...................         205         212         209
00.02 Howard University Hospital........          29          29          29
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................         234         241         238
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........           7          11           4
22.00 New budget authority (gross)......         238         234         234
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         245         245         238
23.95 Total new obligations.............        -234        -241        -238
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          11           4
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         240         234         234
40.35   Appropriation permanently 
          reduced.......................          -2
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         238         234         234
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                                  10
73.10 Total new obligations.............         234         241         238
73.20 Total outlays (gross).............        -234        -231        -234
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                      10          14
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         234         220         220
86.93 Outlays from discretionary 
        balances........................                      11          14
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         234         231         234
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         238         234         234
90.00 Outlays...........................         234         231         234
---------------------------------------------------------------------------

    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 2006, Federal funding represented approximately 
51 percent of the university's revenue.

                                

      College Housing and Academic Facilities Loans Program Account

     For Federal administrative expenses to carry out activities related 
to existing facility loans pursuant to section 121 of the Higher 
Education Act of 1965, as amended $481,000.

   Historically Black College and University Capital Financing Program 
                                 Account

     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, 
$188,000.


[[Page 327]]


    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0241-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct loan subsidy...............                     179
00.05 Reestimates of direct loan subsidy                      11
00.06 Interest on reestimates of direct 
        loan subsidy....................                       3
00.09 Federal administration............           1           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........           1         194           1
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......           1         194           1
23.95 Total new obligations.............          -1        -194          -1
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................           1         180           1
      Mandatory:

60.00   Appropriation...................                      14
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................           1         194           1
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............           1         194           1
73.20 Total outlays (gross).............          -1        -194          -1
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................           1         180           1
86.97 Outlays from new mandatory 
        authority.......................                      14
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........           1         194           1
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................           1         194           1
90.00 Outlays...........................           1         194           1
---------------------------------------------------------------------------

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

----------------------------------------------------------------------------
Identification code 91-0241-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115002Historically Black Colleges and 
        Universities....................          15          75
115003HBCU Hurricane Supplemental.......                     235
                                           ---------   ---------  ----------
115999Total direct loan levels..........          15         310
    Direct loan subsidy (in percent):
132002Historically Black Colleges and 
        Universities....................        0.00        0.00        0.00
132003HBCU Hurricane Supplemental.......        0.00       76.14        0.00
                                           ---------   ---------  ----------
132999Weighted average subsidy rate.....        0.00       57.72        0.00
    Direct loan subsidy budget authority:
133003HBCU Hurricane Supplemental.......                     179
                                           ---------   ---------  ----------
133999Total subsidy budget authority....                     179
    Direct loan subsidy outlays:
134003HBCU Hurricane Supplemental.......                     179
                                           ---------   ---------  ----------
134999Total subsidy outlays.............                     179
    Direct loan upward reestimates:
135002Historically Black Colleges and 
        Universities....................                      14
                                           ---------   ---------  ----------
135999Total upward reestimate budget 
        authority.......................                      14
----------------------------------------------------------------------------

    Administrative expense data:
3510  Budget authority..................           1           1           1
3590  Outlays from new authority........           1           1           1
---------------------------------------------------------------------------

    As required by the Federal Credit Reform Act of 1990, this account 
records the subsidy costs associated with the direct loans obligated and 
loan guarantees committed in 1992 and beyond, as well as any 
administrative expenses for the College Housing and Academic Facilities 
Loans Program and the Historically Black College and University Capital 
Financing Program. The subsidy amounts are estimated on a present value 
basis; the administrative expenses are estimated on a cash basis. These 
programs are administered separately but consolidated in the President's 
budget for presentation purposes.

    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. 
In 2006 P.L. 109-234, an emergency supplemental appropriation act, 
provided authority issue loans with more favorable terms to HBCUs 
affected by Hurricane Katrina. The Department estimates that it will 
guarantee $235 million of these loans in 2007, at a cost of $179 
million. The Department anticipates that the program will surpass the 
statutory loan cap of $375 million in principal and accrued interest in 
fiscal year 2007, at which point the Department will not have authority 
to make additional loan guarantees. The 2008 Budget provides funds for 
continuing Federal administrative activities only.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0241-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
41.0  Direct obligations: Grants, 
        subsidies, and contributions....                     193
99.5  Below reporting threshold.........           1           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........           1         194           1
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-0241-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................           5           4           4
---------------------------------------------------------------------------

                                

     College Housing and Academic Facilities Loans Financing Account 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4252-0-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.02 Interest paid to Treasury.........           1           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........           1           1           1
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New financing authority (gross)...           1           1           1
23.95 Total new obligations.............          -1          -1          -1
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).           2           2           2
69.47     Portion applied to repay debt.          -1          -1          -1
                                           ---------   ---------  ----------

[[Page 328]]


69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........           1           1           1
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............           1           1           1
73.20 Total financing disbursements 
        (gross).........................          -1          -1          -1
----------------------------------------------------------------------------

    Outlays (gross), detail:
87.00 Total financing disbursements 
        (gross).........................           1           1           1
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.40     Interest repayments...........          -1          -1          -1
88.40     Principal repayments..........          -1          -1          -1
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................          -2          -2          -2
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............          -1          -1          -1
90.00 Financing disbursements...........                      -1          -1
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4252-0-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          19          18          18
1251  Repayments: Repayments and 
        prepayments.....................          -1
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          18          18          18
---------------------------------------------------------------------------

    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 obligated in fiscal years 1992 and 1993. The 
amounts in this account are a means of financing and are not incuded in 
the budget totals.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code 91-4252-0-
3-502

2005 actual

2006 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401

Direct loans receivable, gross

19

19

1402

Interest receivable

1

1

1405

Allowance for subsidy cost (-)

-3

-3





1499

Net present value of assets related to direct loans

17

17





1999

Total assets

17

17

    LIABILITIES:
2103

Federal liabilities: Debt

17

17





2999

Total liabilities

17

17





4999

Total liabilities and net position

17

17

-----------------------------------------------------------------------------------------------

                                

    College Housing and Academic Facilities Loans Liquidating Account 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0242-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.02 Interest paid to Treasury.........           7           8           7
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 43.0)...................           7           8           7
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                       1
22.00 New budget authority (gross)......           8           8           7
22.40 Capital transfer to general fund..                      -1
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......           8           8           7
23.95 Total new obligations.............          -7          -8          -7
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           1
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................           3           2           2
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).          37          31          28
69.27     Capital transfer to general 
            fund........................         -25         -22         -20
69.47     Portion applied to repay debt.          -7          -3          -3
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........           5           6           5
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................           8           8           7
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..           1
73.10 Total new obligations.............           7           8           7
73.20 Total outlays (gross).............          -8          -8          -7
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................           8           8           7
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.40     Repayments of principal.......         -27         -21         -19
88.40     Interest received on loans....         -10         -10          -9
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................         -37         -31         -28
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         -29         -23         -21
90.00 Outlays...........................         -29         -23         -21
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0242-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          83          76          73
1251  Repayments: Repayments and 
        prepayments.....................          -7          -3          -3
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          76          73          70
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........          17          16          14
1251  Repayments: Repayments and 
        prepayments.....................          -1          -2          -2
                                           ---------   ---------  ----------
1290    Outstanding, end of year........          16          14          12
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........         182         163         147
1251  Repayments: Repayments and 
        prepayments.....................         -19         -16         -15
                                           ---------   ---------  ----------
1290    Outstanding, end of year........         163         147         132
---------------------------------------------------------------------------

    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 
obligated 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.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code 91-0242-0-
1-502

2005 actual

2006 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
1601

Direct loans, gross

282

255

1602

Interest receivable

6

6





1699

Value of assets related to direct loans

288

261





1999

Total assets

288

261

[[Page 329]]

    LIABILITIES:
      Federal liabilities:

2103

Debt

83

76

2104

Resources payable to Treasury

205

185





2999

Total liabilities

288

261





4999

Total liabilities and net position

288

261

-----------------------------------------------------------------------------------------------

                                

 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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct loan awards................          15         310
00.02 Interest paid to Treasury.........           7           7           7
                                           ---------   ---------  ----------
10.00   Total new obligations...........          22         317           7
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New financing authority (gross)...          22         317           7
23.95 Total new obligations.............         -22        -317          -7
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............          15         310
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).          20         205          12
69.47     Portion applied to repay debt.         -13        -198          -5
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........           7           7           7
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................          22         317           7
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          38          11         150
73.10 Total new obligations.............          22         317           7
73.20 Total financing disbursements 
        (gross).........................         -49        -178        -256
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          11         150         -99
----------------------------------------------------------------------------

    Outlays (gross), detail:
87.00 Total financing disbursements 
        (gross).........................          49         178         256
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............                    -193
88.40     Interest repayments...........          -7          -7          -7
88.40     Principal repayments..........         -13          -5          -5
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................         -20        -205         -12
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............           2         112          -5
90.00 Financing disbursements...........          29         -27         244
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4255-0-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........         208         216
1142  Unobligated direct loan limitation 
        (-).............................        -193          94
                                           ---------   ---------  ----------
1150    Total direct loan obligations...          15         310
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........         126         155         320
1231  Disbursements: Direct loan 
        disbursements...................          42         170         249
1251  Repayments: Repayments and 
        prepayments.....................         -13          -5          -5
                                           ---------   ---------  ----------
1290    Outstanding, end of year........         155         320         564
---------------------------------------------------------------------------

    As required by the Federal Credit Reform Act of 1990, this non-
budgetary account records all cash flows to and from the Federal 
Government resulting from direct loans obligated in fiscal year 1996 and 
beyond. 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. The amounts in this account are a means of financing and are not 
included in the budget totals.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code 91-4255-0-
3-502

2005 actual

2006 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
1101

Federal assets: Fund balances with Treasury

10

22

      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401

Direct loans receivable, gross

126

155

1402

Interest receivable

3

3





1499

Net present value of assets related to direct loans

129

158





1999

Total assets

139

180

    LIABILITIES:
      Federal liabilities:

2102

Interest payable

3

3

2103

Debt

126

155

2201

Non-Federal liabilities: Undisbursed direct loans

10

22





2999

Total liabilities

139

180





4999

Total liabilities and net position

139

180

-----------------------------------------------------------------------------------------------

                                


 
                      OFFICE OF FEDERAL STUDENT AID

                              Federal Funds

                       Student Financial Assistance

     For carrying out subpart 1 of part A, and part C of title IV of the 
Higher Education Act of 1965, as amended, $14,203,492,000, which shall 
remain available through September 30, 2009.
     The maximum Pell Grant for which a student shall be eligible during 
award year 2008-2009 shall be $4,050.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0200-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
01.01 Federal Pell grants...............      14,801      12,297      12,985
02.01 Federal supplemental educational 
        opportunity grants (SEOG).......         776         772
02.02 Federal work-study................       1,005         981         980
02.03 Federal Perkins loans: Fed. 
        capital contributions...........           5
02.04 Federal Perkins loans: Loan 
        cancellations...................          65          65
                                           ---------   ---------  ----------
02.91   Campus-based activities--
          Subtotal (1 level)............       1,851       1,818         980
03.01 Leveraging educational assistance 
        partnership.....................          65          65
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................      16,717      14,180      13,965
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          23       2,694       3,002
22.00 New budget authority (gross)......      19,255      14,488      14,203
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................         133
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      19,411      17,182      17,205
23.95 Total new obligations.............     -16,717     -14,180     -13,965
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........       2,694       3,002       3,240
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

[[Page 330]]

40.00   Appropriation...................      15,078      14,488      14,203
40.00   Appropriation...................
40.35   Appropriation permanently 
          reduced.......................        -151
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............      14,927      14,488      14,203
      Mandatory:

60.00   Appropriation...................       4,300
63.00   Reappropriation.................          28
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................      19,255      14,488      14,203
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       6,861       8,722       8,702
73.10 Total new obligations.............      16,717      14,180      13,965
73.20 Total outlays (gross).............     -14,710     -14,200     -14,244
73.40 Adjustments in expired accounts 
        (net)...........................         -13
73.45 Recoveries of prior year 
        obligations.....................        -133
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       8,722       8,702       8,423
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       8,011       3,216       2,997
86.93 Outlays from discretionary 
        balances........................       6,679      10,976      11,247
86.97 Outlays from new mandatory 
        authority.......................          20
86.98 Outlays from mandatory balances...                       8
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      14,710      14,200      14,244
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................      19,255      14,488      14,203
90.00 Outlays...........................      14,710      14,200      14,244
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2006 actual  2007 est.   2008 est.
Enacted/requested:
  Budget Authority............         19,254         14,488          14,203
  Outlays.....................         14,710         14,200          14,244
Legislative proposal, subject to 
    PAYGO:
  Budget Authority............                                         2,216
  Outlays.....................                                           532

Total:
  Budget Authority............         19,254         14,488          16,419
  Outlays.....................         14,710         14,200          14,776

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0200-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........         323         322         321
1251  Repayments: Repayments and 
        prepayments.....................         -26         -26         -26
      Write-offs for default:

1263    Direct loans....................         -14         -14         -14
1264    Other adjustments, net..........          39          39          39
                                           ---------   ---------  ----------
1290    Outstanding, end of year........         322         321         320
---------------------------------------------------------------------------

    Notes: Figures include, in all years, institutional matching share 
of defaulted notes assigned from institutions to the Education 
Department.

    The Administration's student aid policy proposals, including funding 
levels for programs in the Student Financial Assistance account, are 
discussed under the Federal Direct Student Loan Program account. 
Authorizing legislation to implement these policies, which will be 
proposed for later transmittal, will provide substantial mandatory 
funding resources that will allow the maximum Pell Grant level to be 
increased to $4,600, $550 above the level shown in the above 
appropriations language. When these mandatory funds are taken into 
account, funding from the Student Financial Assistance account and 
related matching funds would provide nearly 6.3 million awards totaling 
over $16.4 billion in available aid in award year 2008-2009.

    Federal Pell Grants.--Pell Grants are the single largest source of 
grant aid for postsecondary education. In 2007, more than 5 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.

    Federal Work Study.--This program provides aid administrators with 
considerable flexibility in packaging financial aid awards to best meet 
student needs. 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 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.

    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 aid from programs in the Student Financial Assistance 
account, as well as aid from the Academic Competitiveness/SMART Grant, 
Federal Family Education Loan, and William D. Ford Direct Student Loan 
programs. Loan amounts reflect the capital actually loaned, not the 
Federal cost of these loans. The data in these tables include matching 
funds wherever appropriate. The 2008 data in these tables reflect the 
Administration's legislative proposals.

      AID FUNDS AVAILABLE FOR POSTSECONDARY EDUCATION AND TRAINING

                             [in thousands]

                                        2006         2007        2008
Pell grants...................     12,880,787     12,954,395      15,175,820
Academic Competitiveness 
Grants........................        340,000        420,000         830,000
SMART grants..................        310,000        310,000         350,000
Student loans:
  Guaranteed student loans:
    Stafford loans............     19,856,009     21,410,043      23,721,725
    Unsubsidized Stafford 
      loans...................     20,067,865     21,784,501      23,912,997
    PLUS......................      7,382,849      9,207,694      10,210,395
  Direct student loans:
    Stafford loans............      5,604,411      5,943,987       6,637,369
    Unsubsidized Stafford 
      loans...................      4,784,107      5,158,934       5,649,747
    PLUS......................      2,288,328      2,493,366       2,762,814
  Consolidation:
    FFEL......................     72,009,607     26,852,938      31,882,248
    Direct Loans..............     19,347,290      4,465,821       4,996,000
  Perkins loans...............      1,134,733      1,104,497               0
      Student loans, subtotal.    152,475,199     98,421,781     112,783,271
Work study....................      1,174,800      1,174,970       1,174,970
Supplemental educational 
opportunity grants............        975,864        975,432               0
Leveraging educational 
assistance partnerships.......        164,960        164,960               0
                                    ------------------------------------
      Total aid available.....    168,321,610    114,421,538     127,304,154

                          NUMBER OF AID AWARDS

                             [in thousands]

                                        2006         2007        2008
    Pell grants...............          5,165          5,274           5,478
    Academic competitiveness 
      grants..................            400            497             662
    SMART grants..............             80             82              93
    Guaranteed student loans--
      Stafford loans..........          5,706          5,913           6,090
    Guaranteed student loans--
      Unsubsidized Stafford 
      loans...................          4,585          4,786           4,976
    Guaranteed student loans--
      PLUS....................            691            797             840
    Guaranteed student loans--
      Consolidation...........          2,622            992           1,137
    Direct student loans--
      Stafford loans..........          1,153          1,503           1,547
    Direct student loans--
      Unsubsidized Stafford 
      loans...................          1,091          1,094           1,133
    Direct student loans--PLUS            237            242             255
    Direct student loans--
      Consolidation...........            756            200             200
    Perkins loans.............            514            501               0
    Work-study................            880            880             880
    Supplemental educational 
      opportunity grants......          1,291          1,290               0
    Leveraging eduational 
      assistance partnerships.            165            165               0
                                    ------------------------------------
      Total awards............         25,696         24,216          23,291


[[Page 331]]



                           AVERAGE AID AWARDS

                           [in whole dollars]

                                        2006         2007        2008
    Pell grants...............          2,494          2,456           2,770
    Academic competitiveness..            850            845           1,254
    SMART Grants..............          3,875          3,780           3,763
    Guaranteed student loans--
      Stafford loans..........          3,480          3,621           3,895
    Guaranteed student loans--
      Unsubsidized Stafford 
      loans...................          4,377          4,552           4,806
    Guaranteed student loans--
      PLUS....................         10,678         11,557          12,152
    Guaranteed student loans--
      Consolidation...........         27,465         27,075          28,040
    Direct student loans--
      Stafford loans..........          3,704          3,954           4,290
    Direct student loans--
      Unsubsidized Stafford 
      loans...................          4,386          4,715           4,987
    Direct student loans--PLUS          9,675         10,300          10,834
    Direct student loans--
      Consolidation...........         25,607         22,292          22,673
    Perkins loans.............          2,206          2,206               0
    Work-study................          1,335          1,335           1,335
    Supplemental educational 
      opportunity grants......            756            756               0
    Leveraging educational 
      assistance partnerships.          1,000          1,000               0

                        NUMBER OF STUDENTS AIDED

                             [in thousands]

Unduplicated student count....         10,409         10,766          11,076

                 ADMINISTRATIVE PAYMENTS TO INSTITUTIONS

                        [in thousands of dollars]

                                        2006         2007        2008
Pell grants...................         25,827         26,372          27,389
Work-study....................         73,445         73,456          73,445
Supplemental educational 
opportunity grants............         39,035         39,017               0
Perkins loans.................         45,389         44,180               0


                       Student financial assistance

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0200-4-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
01.01 Federal Pell Grants...............                               1,640
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                               1,640
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                               2,216
23.95 Total new obligations.............                              -1,640
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........                                 576
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                               2,216
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                               1,640
73.20 Total outlays (gross).............                                -532
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                               1,108
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                 532
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                               2,216
90.00 Outlays...........................                                 532
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0200-4-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........
1251  Repayments: Repayments and 
        prepayments.....................                                  26
      Write-offs for default:

1263    Direct loans....................                                  14
1264    Other adjustments, net..........                                -360
                                           ---------   ---------  ----------
1290    Outstanding, end of year........                                -320
---------------------------------------------------------------------------


                                

              Academic Competitiveness/SMART Grant Program 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0205-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct program activity...........          47       1,187         850
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................          47       1,187         850
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......         790         850         920
22.30 Expired unobligated balance 
        transfer to unexpired account...                     743         406
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         790       1,593       1,326
23.95 Total new obligations.............         -47      -1,187        -850
23.98 Unobligated balance expiring or 
        withdrawn.......................        -743        -406        -476
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................         790         850         920
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                       3         323
73.10 Total new obligations.............          47       1,187         850
73.20 Total outlays (gross).............         -44        -867        -771
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..           3         323         402
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................          44         140         211
86.98 Outlays from mandatory balances...                     727         560
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          44         867         771
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         790         850         920
90.00 Outlays...........................          44         867         771
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2006 actual  2007 est.   2008 est.
Enacted/requested:
  Budget Authority............            790            850             920
  Outlays.....................             44            867             771
Legislative proposal, subject to 
    PAYGO:
  Budget Authority............                                           260
  Outlays.....................                                            72

Total:
  Budget Authority............            790            850           1,180
  Outlays.....................             44            867             843

    These need-based programs provide grants to U.S citizens who attend 
school on a full-time basis. Students receiving grants must be eligible 
to receive a Pell Grant and, for second-, third-, and fourth-year 
students, must maintain at least a 3.0 grade point average.

    Academic Competitiveness Grants (ACG). These grants are awarded to 
first-year and second-year students who have completed a rigorous course 
of study in high school. Grant levels are $750 for first-year students 
and $1,300 for second-year students.

    Science and Mathematics Access to Retain Talent (SMART) Grants. 
These grants are awarded to third-year and fourth-year students pursuing 
a major in mathematics, science, or a foreign language deemed critical 
to national security. Grant levels are $4,000 for both third- and 
fourth-year students

     Taken together with other Federal student aid, grants cannot exceed 
a student's cost of attendance. Program funding in excess of the amount 
needed to fund grants in a given year can be carried over for use in 
subsequent years; if the mandatory funding level is insufficient to fund 
program grants, grant levels are reduced.

[[Page 332]]

    The Administration's student aid policy proposals, including those 
related to the ACG/SMART Grants, are discussed under the Federal Direct 
Student Loan Program Account.

              Academic Competitiveness/SMART Grant Program

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0205-4-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct program activity...........                                 240
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                                 240
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                 260
23.95 Total new obligations.............                                -240
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........                                  20
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                                 260
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                 240
73.20 Total outlays (gross).............                                 -72
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                 168
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                  72
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                                 260
90.00 Outlays...........................                                  72
---------------------------------------------------------------------------


                                

                           Perkins Loan Assets

    The 2008 Budget proposes to eliminate the Perkins Loan program and 
to recall the entire Federal portion of revolving funds held by 
participating institutions. This proposal is discussed, as part of a 
broader review of student aid policy proposals, under the Federal Direct 
Student Loan Program Account. The Perkins Loan account records amounts 
recalled from Perkins Loan institutions and subsequent repayments on 
outstanding Perkins Loans, as well as reimbursements of institutional 
funds to participating schools.

                           Perkins loan assets

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0219-4-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
01.01 Institutional Share of Perkins 
        Collections.....................                                  87
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                                  87
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                  87
23.95 Total new obligations.............                                 -87
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).                                 506
69.27     Capital transfer to general 
            fund........................                                -419
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........                                  87
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                  87
73.20 Total outlays (gross).............                                 -87
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                  87
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.40   Offsetting collections (cash) 
          from: Non-Federal sources.....                                -506
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                                -419
90.00 Outlays...........................                                -419
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0219-4-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........
1251  Repayments: Repayments and 
        prepayments.....................                                -506
      Write-offs for default:

1263    Direct loans....................                                 -54
1264    Other adjustments, net..........                               8,000
                                           ---------   ---------  ----------
1290    Outstanding, end of year........                               7,440
---------------------------------------------------------------------------


                                

                        Student Aid Administration

     For Federal administrative expenses 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, $708,216,000, which 
shall remain available until expended.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0202-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Student aid administration........         119         718         708
                                           ---------   ---------  ----------
10.00   Total new obligations...........         119         718         708
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......         119         718         708
23.95 Total new obligations.............        -119        -718        -708
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         120         718         708
40.35   Appropriation permanently 
          reduced.......................          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         119         718         708
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          36          45         324
73.10 Total new obligations.............         119         718         708
73.20 Total outlays (gross).............        -110        -439        -622
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          45         324         410
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          82         409         406
86.93 Outlays from discretionary 
        balances........................          28          30         216
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         110         439         622
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         119         718         708
90.00 Outlays...........................         110         439         622
---------------------------------------------------------------------------

    The Department of Education manages Federal student aid programs 
that will provide $127.3 billion in Federal student aid grants and loans 
to 11.1 million students and parents in 2008. Primary responsibility for 
administering these programs lies with the Office of Postsecondary 
Education and

[[Page 333]]

the performance-based Federal Student Aid (FSA), which are both overseen 
by the Office of the Under Secretary. FSA was created by Congress in 
1998 with a mandate to improve service to students and other student aid 
program participants, reduce student aid administration costs, and 
improve accountability and program integrity.

    Prior to 2007, student aid administrative activities were funded 
from two main sources: (1) funds appropriated on a permanent basis under 
section 458 of the Higher Education Act (which included an amount--$220 
million in 2006--for account maintenance fee payments to Federal Family 
Education Loan guaranty agencies); and (2) a discretionary appropriation 
partially supporting student aid administrative activities. Under the 
Higher Education Reconciliation Act of 2005, student aid administrative 
funds for 2007 and subsequent years are funded from a single 
discretionary account. (Account maintenance fees payments for these 
years are paid from the FFEL Program Account.)

    The Budget for 2008 includes $708 million for student aid 
administration. Most of these funds support systems maintained by 
private contractors to process student aid applications; provide and 
track aid awards to students, parents, and schools; and service the 
over-$100 billion portfolio of William D. Ford Direct Student Loans.

    Consistent with Section 484(q) of the Higher Education Act and 
Section 6103(c) of the Internal Revenue Code, the Department of 
Education and the Internal Revenue Service intend to implement a process 
to verify students' (and their parents') income, tax and certain 
household information appearing on their income tax return that they 
provided as part of their application for Federal student aid. This 
process is part of ongoing efforts to ensure students receive the 
correct amount of Federal student aid, and is a key component of the 
Administration's efforts to reduce erroneous payments government-wide.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0202-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
      Personnel compensation:

11.1    Full-time permanent.............          42         104         108
11.3    Other than full-time permanent..           2
11.5    Other personnel compensation....           1           2           2
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          45         106         110
12.1  Civilian personnel benefits.......          12          27          29
21.0  Travel and transportation of 
        persons.........................                       4           4
23.1  Rental payments to GSA............           5          15          14
23.3  Communications, utilities, and 
        miscellaneous charges...........           4           7           7
24.0  Printing and reproduction.........           2           7           8
25.1  Advisory and assistance services..                       3           3
25.2  Other services....................           1          35          37
25.3  Other purchases of goods and 
        services from Government 
        accounts........................           6          13          13
25.7  Operation and maintenance of 
        equipment.......................          43         496         480
26.0  Supplies and materials............                       1           1
31.0  Equipment.........................           1           2           1
32.0  Land and structures...............                       2           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........         119         718         708
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-0202-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................         505       1,132       1,132
---------------------------------------------------------------------------

                                

                    Federal Student Loan Reserve Fund 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4257-0-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
01.02 Obligations, non-federal..........       5,385       6,198       6,812
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 42.0)...................       5,385       6,198       6,812
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         888         579         747
22.00 New budget authority (gross)......       5,356       6,461       7,099
22.40 Capital transfer to general fund..        -280         -95
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       5,964       6,945       7,846
23.95 Total new obligations.............      -5,385      -6,198      -6,812
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         579         747       1,034
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

69.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).       5,356       6,461       7,099
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............       5,385       6,198       6,812
73.20 Total outlays (gross).............      -5,386      -6,198      -6,812
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................       5,210       5,854       6,419
86.98 Outlays from mandatory balances...         176         344         393
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       5,386       6,198       6,812
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.00     Federal sources...............      -5,210      -5,854      -6,419
88.40     Non-Federal sources...........        -146        -607        -680
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................      -5,356      -6,461      -7,099
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................          30        -263        -287
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2006 actual  2007 est.   2008 est.
Enacted/requested:
  Budget Authority............
  Outlays.....................             30           -263            -287
Legislative proposal, subject to 
    PAYGO:
  Budget Authority............
  Outlays.....................                                            -5

Total:
  Budget Authority............
  Outlays.....................             30           -263            -292

    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 avert defaults. The Federal Government 
reimburses these reserves for default claim payments.

    The following schedule reflects the balances in these guaranty 
agency funds. During 2007, OMB, Treasury and the Department plan to 
review the budgetary and financial presentation of these funds in the 
context of relevant laws and guidance.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code 91-4257-0-
3-502

2005 actual

2006 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
1101

Federal assets: Fund balances with Treasury

1,040

579





1999

Total assets

1,040

579

    NET POSITION:
3300

Cumulative results of operations

1,040

579





3999

Total net position

1,040

579





4999

Total liabilities and net position

1,040

579

-----------------------------------------------------------------------------------------------

[[Page 334]]



                    Federal Student Loan Reserve Fund

                (Legislative proposal, subject to PAYGO)

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4257-4-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
01.02 Obligations, non-federal..........                                -133
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 42.0)...................                                -133
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                -128
23.95 Total new obligations.............                                 133
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........                                   5
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

69.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).                                -128
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                -133
73.20 Total outlays (gross).............                                 133
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                -128
86.98 Outlays from mandatory balances...                                  -5
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........                                -133
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........                                 128
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................
90.00 Outlays...........................                                  -5
---------------------------------------------------------------------------


                                

           Federal Direct Student Loan Program Program Account 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct Loan Subsidy...............       1,807         474         500
00.03 Subsidy modification, upward......           7
00.05 Upward Reestimate.................       3,327       3,614
00.06 Interest on Upward Reestimate.....       1,573       1,088
00.09 Administrative expenses...........         828
                                           ---------   ---------  ----------
10.00   Total new obligations...........       7,542       5,176         500
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          27          28          28
22.00 New budget authority (gross)......       7,534       5,176         500
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           9
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......       7,570       5,204         528
23.95 Total new obligations.............      -7,542      -5,176        -500
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          28          28          28
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         600
      Mandatory:

60.00   Appropriation -federal 
          administration................         220
60.00   Appropriation (indefinite)--loan 
          subsidy.......................       1,807         474         500
60.00   Appropriation--upward 
          modification..................           7
60.00   Appropriation (indefinite)--
          Upward reestimate.............       4,900       4,702
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................       6,934       5,176         500
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections 
            (cash)--negative subsidy....
69.00     Offsetting collections 
            (cash)--downward reestimate.         501
69.00     Offsetting collections 
            (cash)--downward reestimate, 
            interest....................          22
69.00     Offsetting collections 
            (cash)--admin...............
69.27     Capital transfer to general 
            fund........................        -523
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................       7,534       5,176         500
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         361         517         164
73.10 Total new obligations.............       7,542       5,176         500
73.20 Total outlays (gross).............      -7,365      -5,529        -525
73.40 Adjustments in expired accounts 
        (net)...........................         -12
73.45 Recoveries of prior year 
        obligations.....................          -9
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         517         164         139
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         288
86.93 Outlays from discretionary 
        balances........................         296         234          65
86.97 Outlays from new mandatory 
        authority.......................       6,759       5,112         413
86.98 Outlays from mandatory balances...          22         183          47
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       7,365       5,529         525
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........        -523
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       7,011       5,176         500
90.00 Outlays...........................       6,842       5,529         525
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2006 actual  2007 est.   2008 est.
Enacted/requested:
  Budget Authority............          7,011          5,176             500
  Outlays.....................          6,842          5,529             525
Legislative proposal, subject to 
    PAYGO:
  Budget Authority............                                             9
  Outlays.....................                                             6

Total:
  Budget Authority............          7,011          5,176             509
  Outlays.....................          6,842          5,529             531

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

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115001Stafford..........................       6,174       6,557       6,975
115002Unsubsidized Stafford.............       5,497       5,812       6,226
115003PLUS..............................       2,416       2,606       2,888
115004Consolidation.....................      22,218       4,528       5,014
                                           ---------   ---------  ----------
115999Total direct loan levels..........      36,305      19,503      21,103
    Direct loan subsidy (in percent):
132001Stafford..........................       10.65       11.06       11.56
132002Unsubsidized Stafford.............       -7.56       -7.60       -7.12
132003PLUS..............................       -6.05       -4.91       -4.90
132004Consolidation.....................        7.70        7.04        5.56
                                           ---------   ---------  ----------
132999Weighted average subsidy rate.....        4.98        2.43        2.37
    Direct loan subsidy budget authority:
133001Stafford..........................         658         725         806
133002Unsubsidized Stafford.............        -416        -442        -443
133003PLUS..............................        -146        -128        -142
133004Consolidation.....................       1,711         319         279
                                           ---------   ---------  ----------
133999Total subsidy budget authority....       1,807         474         500
    Direct loan subsidy outlays:
134001Stafford..........................         553         630         710
134002Unsubsidized Stafford.............        -343        -382        -394
134003PLUS..............................        -118        -129        -130
134004Consolidation.....................       1,695         321         275
                                           ---------   ---------  ----------
134999Total subsidy outlays.............       1,787         440         461
    Direct loan upward reestimates:
135001Stafford..........................       1,785         382
135002Unsubsidized Stafford.............         129         732
135003PLUS..............................          33         166

[[Page 335]]

135004Consolidation.....................       3,124       3,571
                                           ---------   ---------  ----------
135999Total upward reestimate budget 
        authority.......................       5,071       4,851
    Direct loan downward reestimates:
137001Stafford..........................         -51        -157
137002Unsubsidized Stafford.............        -245         -45
137003PLUS..............................         -76         -61
137004Consolidation.....................        -322        -870
                                           ---------   ---------  ----------
137999Total downward reestimate budget 
        authority.......................        -694      -1,133
---------------------------------------------------------------------------

    The Federal Government operates two major student loan programs: the 
Federal Family Education Loan (FFEL) program and the William D. Ford 
Federal Direct Loan (Direct Loan) program. For 2008, 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. This section also 
concludes with a comprehensive discussion of the Administration's policy 
proposals for the Federal student financial aid programs.

    From its inception in 1965 through 2006, the FFEL program has 
provided $636 billion in loans to postsecondary students and their 
parents. Since July 1, 1994, the Direct Loan program has provided $176 
billion in new and consolidation loans to students and parents. Taken 
together, the FFEL and Direct Loan programs will make nearly $67 billion 
in new loans available in 2007. 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 expand 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. The Direct Loan program began 
operation in academic year 1994-1995 with 7 percent of overall loan 
volume and is expected to account for 20 percent in academic year 2008-
2009. 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, 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.

    For Stafford Loans made on or after July 1, 2006, the borrower 
interest rate is fixed at 6.8 percent. For most loans made immediately 
prior to July 1, 2006, the borrower interest rate 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 most PLUS loans made 
prior to July 1, 2006, 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 fixed borrower interest rate on PLUS loans made on 
or after July 1, 2006, is 7.9 percent for Direct Loans and 8.5 percent 
for FFEL.

    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. For periods when the borrower interest rate exceeds the 
special allowance rate on loans made on or after April 1, 2006, lenders 
remit the difference to the government.

    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. The Higher Education Reconciliation 
Act of 2005 eliminated the practice of in-school loan consolidation and 
revised the circumstances under which a FFEL borrower could obtain a 
Direct Consolidation Loan.

    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. Direct Loan borrowers are charged an origination fee equal to 
3 percent of principal. The Higher Education Reconciliation Act of 2005 
includes phased reductions that eliminate FFEL origination fees by July 
1, 2010, and lowers Direct Loan fees to 1 percent by the same date; the 
Act also requires guaranty agencies to collect the insurance premium. 
Borrowers in both programs may be offered financial incentives to 
encourage prompt repayment.

    Loan limits are also identical across the two programs. 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; this benefit is increased to $17,500 for mathematics, 
science, and special education teachers considered highly qualified 
under criteria established in the No Child Left Behind Act of 2001.

    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 ex

[[Page 336]]

tended 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.

    Student Aid Policy Proposals. There is a broad national consensus, 
highlighted in the recent report of the Secretary of Education's 
Commission on the Future of Higher Education, that rapidly rising 
college costs are a growing barrier to higher education for many 
students and families. The President proposes a package of reforms to 
address this problem by substantially increasing need-based grant and 
loan assistance, streamlining Federal student aid programs to make them 
simpler for students and parents to negotiate and schools to administer, 
and restructuring the student loan programs to increase efficiency and 
eliminate excessive or unnecessary subsidies. These proposals will raise 
the maximum Pell Grant to $5,400 over five years, expand the Academic 
Competitiveness/SMART Grant program, and increase student loan limits. 
This comprehensive package of proposals is budget neutral.

    Federal Pell Grants. The centerpiece of the Administration's budget 
and reauthorization proposal is designed to address the financial need 
of low-income students pursuing a postsecondary education. The 
Administration proposes to assist these students by investing $19.8 
billion in new mandatory funding for the Pell Grant program from 2008-
2017. These funds would be used to increase the maximum grant award by 
$550 in 2008 and $200 a year for the next four years, to $5,400 in award 
year 2012-13. The Administration proposes to fund this proposal through 
mandatory savings generated by other student aid policy proposals. The 
cost of operating the Pell Grant program at the current maximum award 
level of $4,050, together with program changes discussed below, would 
continue to be funded through discretionary appropriations. While Pell 
Grants have been very successful in ensuring access to postsecondary 
education for low-income students, the Administration is proposing 
several changes to increase the program's effectiveness and improve its 
overall operation. Pell Grants would be made available year-round at 
eligible two- and four-year degree granting institutions, giving 
students a more convenient option for accelerating their studies and 
promptly completing their educations. As a further incentive for timely 
completion, Pell Grant eligibility would be limited to the equivalent of 
16 semesters. Lastly, the Administration proposes to eliminate the Pell 
Grant award rule related to tuition sensitivity. This rule limits the 
amount of support that students with greatest need receive while 
attending low-cost institutions.

    Academic Competitiveness/SMART Grants. Currently, needy students who 
have completed a rigorous program of study in high school and meet other 
eligibility criteria are eligible for Academic Competitiveness Grants 
(ACG) of up to $750 and $1,300 in their first and second years of 
college, respectively. The Administration proposes to increase these 
amounts by 50 percent, to $1,125 and $1,950, at a mandatory cost of $260 
million in 2008 and $1.0 billion over 2008-2012. Congress provided that 
ACG/SMART sunsets at the academic year 2010-11 (June 30, 2011). The 
Administration is dedicated to continue providing grants to students 
served by these programs. Program evaluations and PART assessments of 
these new programs, which only began operation on July 1, 2006, are 
needed to inform how best to serve these students going forward from 
2010-11.

    Campus-Based Programs. The Secretary of Education's Commission on 
the Future of Higher Education found that the Federal student aid 
programs were needlessly complex and duplicative. Accordingly, the 
Administration proposes eliminating the duplicative and poorly allocated 
Supplemental Educational Opportunity Grant (SEOG) and Perkins Loan 
programs. No funds are included for the Leveraging Educational 
Assistance Partnership program. The Administration believes it would be 
most effective to consolidate Federal grant efforts in the more 
equitably distributed and far larger Pell Grant program.

    The Federal portion of Perkins Loan revolving funds held by 
participating institutions would also be recalled. With the number of 
Perkins Loan institutions declining from 3,338 in academic year 1983-84 
to 1,315 in 2004-05 and with less than 3 percent of students enrolled in 
postsecondary education receiving Perkins Loans each year, the 
Administration also believes the federal share of funds held by this 
small group of institutions would better serve students if invested in 
Pell Grants. Institutions would retain their own contributions into 
Perkins Loan revolving funds. Recalling the federal portion of the 
Perkins Loan funds, less amounts needed to support statutory loan 
forgiveness benefits, will provide $3.2 billion in savings. These 
savings would help offset the cost of increases in need-based aid and 
higher loan limits which are available to eligible students regardless 
of the institutions they attend.

    The 2008 Budget includes $980 million for Work-Study, which would 
generate $1.2 billion in new aid to over 880,000 students.

    Student Loans. The student loan programs currently provide subsidies 
that are higher than needed to ensure lender participation in the FFEL 
program, and that loans are available to all eligible students under the 
current structure, while exposing lenders and other intermediaries to 
minimal financial risk. Operational efficiencies that have benefited 
these participants have not been matched by comparable reductions in 
Federal subsidies. The 2008 Budget includes a comprehensive package of 
proposals to make student loan programs more efficient, cost-effective 
vehicles for helping students finance their postsecondary educations. 
Savings generated from these proposals would in large part be reinvested 
in benefits for students in the Pell Grant, ACG/SMART Grant, and student 
loan programs. To help students meet rising higher education costs, the 
Administration is proposing to increase annual subsidized loan limits by 
$2,000 for third- and fourth-year students, as well as increases in 
overall aggregate loan limits. The Administration also proposes to 
standardize PLUS Loan interest rates, which were inadvertantly set at 
different levels for FFEL and Direct Loans in the Higher Education 
Reconciliation Act of 2005, at a fixed rate of 8.3 percent.

    The Administration proposes to reduce lender interest subsidy 
payments by 50 basis points and increase the lender origination fee paid 
on new consolidation loans to 1 percent from .5 percent; both these 
changes would recapture excess earnings resulting from the basic program 
structure. To encourage lenders to continue to strengthen default 
prevention efforts and in recognition of the strong repayment record 
associated with student loans today, the Administration proposes to 
reduce the amount of loan principal insured against default from 97 
percent to 95 percent, as well as reduce the amount insured for lenders 
identified as exceptional performers from 99 percent to 97 percent. 
Proposals affecting lenders will reduce Federal costs by $14.9 billion 
over 2008-2012.

    The Administration expects guaranty agencies to operate more 
efficiently in the future; to better capture the benefits of this 
increased efficiency, the basis for agency account maintenance fee 
payments would be shifted from the balance of loans guaranteed to a 
cost-per-unit formula. The Administration would also reduce the amount 
guaranty agencies may retain from collections on most defaulted loans 
from 23 percent to 16 percent, roughly the average paid by the 
Department of Education to private collection agents. Overall, changes 
to the guaranty agency system would reduce Federal costs by a combined 
$3.9 billion over 2008-2012.

[[Page 337]]

    In total, the Administration proposes redirecting $18.8 billion from 
the loan programs to grant aid for needy students over the same period.

    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 assuming passage of the President's budget and 
legislative request.

                             Funding Levels

                        (in thousands of dollars)

                                        2006         2007        2008
Program Cost:
FFEL:
  Liquidating\1\ .............      (553,562)      (747,495)       (690,939)
  Program:
    Regular...................      4,629,364      4,452,007       4,444,345
    Consolidation.............     12,644,425      1,408,255       (582,961)
    Net Reestimate of Prior 
      Year Costs..............      9,084,333    (3,159,611)               0
    Net Modification\2\ ......      1,709,540              0       2,804,433
                                    ------------------------------------
      Subtotal, Program.......     28,067,662      2,700,651       1,056,951
                                    ------------------------------------
        Total FFEL.................27,514,100      1,953,156         366,012
Direct Loans:
  Program:
    Regular...................         95,790        155,452         222,001
    Consolidation.............      1,710,786        318,770         287,248
    Net Reestimate of Prior 
      Year Costs..............      4,377,453      3,717,563               0
    Net Modification\2\ ......          7,291              0               0
                                    ------------------------------------
      Total, Direct Loans.....      6,191,320      4,157,808         509,249
      Total, FFEL and Direct 
        Loans.................     33,705,420      6,144,941         875,261
Program Cost Outlays:
FFEL:
  Liquidating\1\ .............      (825,314)      (747,495)       (690,939)
  Program:
    Regular...................      3,876,499      3,862,234       3,849,169
    Consolidation.............     12,461,466      1,444,229       (575,839)
    Net Reestimate of Prior 
      Year Costs..............      9,084,333    (3,159,611)               0
    Net Modification\2\ ......      1,709,540              0     (2,804,433)
                                    ------------------------------------
      Subtotal, Program.......     27,131,838      2,146,852         468,897
                                    ------------------------------------
        Total, FFEL................26,306,524      1,399,357       (222,042)
Direct Loans:
  Program:
    Regular...................         92,105        119,513         183,029
    Consolidation.............      1,695,374        320,732         283,359
    Net Reestimate of Prior 
      Year Costs..............      4,377,453      3,717,563               0
    Net Modification\2\ ......          7,291              0               0
                                    ------------------------------------
      Total, Direct Loans.....      6,172,223      4,791,479         466,388
      Total, FFEL and Direct 
        Loans.................     32,478,747      5,557,165         244,346
    \1\ Liquidating account reflects loans made prior to 1992.
    \2\ Reflects the cost or savings associated with policy changes, 
including those contained in the Higher Education Reconciliation Act of 
2006, that would affect the terms of existing loans.

                       Summary of Loans Available

              (net commitments in millions of dollars)\1\ 

                                     2006 actual  2007 est.   2008 est.
FFEL:
  Stafford....................         19,856         21,410          23,722
  Unsubsidized Stafford.......         20,068         21,785          23,913
  PLUS........................          7,383          9,208          10,210
                                    ------------------------------------
    Subtotal..................         47,307         52,402          57,845
  Consolidation...............         72,010         26,853          31,882
                                    ------------------------------------
    Total, FFEL...............        119,316         79,255          89,727
Direct Loans:
  Stafford....................          5,604          5,944           6,637
  Unsubsidized Stafford.......          4,784          5,159           5,650
  PLUS........................          2,288          2,493           2,763
                                    ------------------------------------
    Subtotal..................         12,677         13,596          15,050
  Consolidation...............         19,347          4,466           4,996
                                    ------------------------------------
    Total, Direct Loans.......         32,024         18,062          20,046
    Total, All Loans..........        151,340         97,317         109,773
    \1\ Net commitments equal gross commitments minus loan cancellations.

                             Number of Loans

                             (in thousands)

                                     2006 actual  2007 est.   2008 est.
FFEL:
  Stafford....................          5,706          5,913           6,090
  Unsubsidized Stafford.......          4,585          4,786           4,976
  PLUS........................            691            797             840
                                    ------------------------------------
    Subtotal..................         10,982         11,496          11,906
  Consolidation...............          2,622            992           1,137
                                    ------------------------------------
    Total, FFEL...............         13,604         12,487          13,043
Direct Loans:
  Stafford....................          1,513          1,503           1,547
  Unsubsidized Stafford.......          1,091          1,094           1,133
  PLUS........................            237            242             255
                                    ------------------------------------
    Subtotal..................          2,841          2,839           2,935
  Consolidation...............            756            200             220
                                    ------------------------------------
    Total, Direct Loans.......          3,596          3,040           3,155
    Total, All Loans..........         17,200         15,527          16,198

                  Average Loan Size (in whole dollars)

                                     2006 actual  2007 est.   2008 est.
FFEL:
  Stafford....................          3,480          3,621           3,895
  Unsubsidized Stafford.......          4.377          4,552           4,806
  PLUS........................         10,678         11,557          12,152
                                    ------------------------------------
    Weighted Average, without 
      Consolidations..........          4,308          4,558           4,858
                                    ------------------------------------
  Consolidation...............         27,465         27,075          28,040
                                    ------------------------------------
    Weighted Average, FFEL....          8,771          6,347           6,879
Direct Loans:
  Stafford....................          3,704          3,954           4,290
  Unsubsidized Stafford.......          4,386          4,715           4,987
  PLUS........................          9,675         10,300          10,834
                                    ------------------------------------
    Weighted Average, without 
      Consolidations..........          4,463          4,788           5,128
                                    ------------------------------------
  Consolidation...............         25,607         22,292          22,673
                                    ------------------------------------
    Weighted Average, Direct 
      Loans...................          8,905          5,942           6,353
    Weighted Average, All 
      Loans...................          8,799          6,268           6,777

                  Summary of Subsidy and Default Rates

                                     2006 actual  2007 est.   2008 est.
Subsidy Rates (in percent)\1\ 
FFEL:
  Stafford....................          17.99          18.03           17.33
  Unsubsidized Stafford.......           0.90           0.01           -0.95
  PLUS........................           0.10          -0.28           -0.55
  Consolidation...............          17.07           5.22           -1.82
    Weighted Average, FFEL....          13.12           6.65            3.88
Direct Loans:
  Stafford....................           8.80          11.06           11.46
  Unsubsidized Stafford.......          -9.07          -7.60           -7.13
  PLUS........................          -5.88          -4.91           -5.66
  Consolidation...............           4.45           7.04            5.67
    Weighted Average, Direct 
      Loans...................           2.35           2.43            2.35
Default Rates (in percent)\2\ 
FFEL:
  Stafford....................          12.30          12.45           12.67
  Unsubsidized Stafford.......          11.13          11.02           10.92
  PLUS........................           5.20           5.22            5.22
  Consolidation...............          13.31          13.87           13.75
    Weighted Average, FFEL....          12.27          11.70           11.74
Direct Loans:
  Stafford....................          12.35          12.73           12.84
  Unsubsidized Stafford.......          12.41          12.49           12.40
  PLUS........................           5.49           5.50            5.50
  Consolidation...............          13.57          32.90           32.55
    Weighted Average, Direct 
      Loans...................          12.60          16.65           16.62
    \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.

    FFEL program payments are made to lenders (interest subsidies, loan 
defaults and discharges) and guaranty agencies (default collection 
costs, administrative services). These pay

[[Page 338]]

ments are partially offset by borrower origination fees and lender fees 
for originations and an annual consolidation loan holder fee. In Direct 
Loans, cash outflows are primarily payments to Treasury. Cash inflows 
include principal and interest payments on outstanding Direct Loans.

    The following table shows government payments to and from lenders, 
guaranty agencies, and borrowers for specific years, regardless of when 
loans were originated. These flows do not reflect long-term costs to the 
government, nor the value of outstanding loan assets: these are 
reflected in credit reform subsidy estimates. For example, collections 
on defaulted FFEL loans due to Consolidation produce a current-year cash 
inflow and a long-term cost associated with re-default risk and future 
lender interest subsidy payments.

    The Federal Credit Reform Act of 1990 accounts for differences in 
the amount and timing of cash flows among direct and guaranteed loan 
programs to make cost estimates for these programs comparable with each 
other and other federal programs.

                   Selected Program Costs and Offsets

                        (in thousands of dollars)

                                     2006 actual  2007 est.   2008 est.
FFEL:
Payments to lenders
  Interest benefits...........      2,654,526      3,381,876       3,988,301
  Special allowance payments..      7,343,620      7,271,748       6,653,173
  Default claims..............      4,624,153      5,556,555       6,045,496
  Loan discharges.............        989,333      1,450,053       1,592,778
  Teacher loan forgiveness....         31,179         24,044         139,734

Administrative payments to 
guaranty agencies.............        708,192      1,008,592         846,131

Fees paid to the Department of 
    Education
  Borrower origination fees...    (1,301,986)    (1,091,978)       (870,819)
  Lender origination fees.....      (561,699)      (390,696)       (575,235)
  Loan holder fees............    (1,848,638)    (2,249,586)     (2,415,140)
Other Major Transactions
  Net default collections.....    (3,896,378)    (4,653,022)     (5,300,446)
  Contract collection costs...        135,318         78,828          76,813
  Federal administrative costs        227,643        225,101         221,884
Net Cash Flow, FFEL...........      9,105,262     10,611,516      10,402,670
Direct Loans
  Loan disbursements to 
    borrowers.................     32,219,339     17,842,953      19,750,927
  Borrower interest payments..    (2,302,134)    (2,821,412)     (2,932,800)
  Borrower principal payments.   (30,141,890)   (10,596,025)    (11,426,266)
  Borrower origination fees...      (392,799)      (409,917)       (408,546)
  Net default collections.....      (750,166)    (1,741,039)     (1,984,007)
  Contract collection costs...        127,402        150,821         160,004
  Federal administrative costs        375,284        355,565         353,161
  Net Operating Cash Flows....      (864,964)      2,810,946       3,512,474
  Loan capital borrowings from 
    Teasury...................   (32,219,339)   (17,872,953)    (19,750,927)
  Net interest payments to 
    Treasury..................      4,579,074      5,596,934       5,981,416
  Principal payments to 
    Treasury..................     22,775,795      9,613,663      10,379,899
  Subtotal Treasury activity..    (4,864,471)    (2,662,356)     (3,389,612)
Net Cash Flow, Direct Loans...    (5,729,434)        148,589         122,862
    Details may not sum to total due to rounding.

    The following chart compares total FFEL and Direct Loan costs on a 
subsidy rate basis: program costs calculated under the Federal Credit 
Reform Act of 1990 and comparably projected estimates of Federal 
administrative costs, including expenses related to FFEL program 
oversight and servicing the Direct Loan portfolio. In 2006, Federal 
administrative costs include account maintenance fees payable to 
guaranty agencies; under the Higher Education Reconciliation Act of 
2005, starting in 2007, these payments are part of FFEL program payments 
and will be reflected in the program subsidy rates. As with any long-
term projection, the comparison is based on assumed future interest 
rates, borrower characteristics, administrative costs, and other factors 
over the life of the loan cohort. To the degree actual conditions differ 
from projections, estimated subsidy rates will change.

 Student Loan Program Costs: Comparative Analysis Including Program and 
                        Administrative Activities

                       (expressed as percentages)

                                     2006 actual  2007 est.   2008 est.
FFEL
  Program costs:\1\ 
    Interest subsidies........          14.68           7.21            4.65
    Net defaults..............           0.90           0.60            0.27
    Fees......................          -5.83          -4.18           -4.10
    Other.....................           3.37           3.03            3.05
                                    ------------------------------------
      Total...................          13.12           6.65            3.88
  Federal administrative costs           0.69           0.37            0.37
                                    ------------------------------------
      Total...................          13.81           7.02            4.25
Direct Loans
  Program costs:\1\ 
    Interest subsidies and 
      income, net.............          -5.02          -5.67           -6.21
    Net defaults..............           2.68           3.46            3.46
    Fees......................          -1.31          -2.36           -2.04
    Other.....................           6.01           7.01            7.13
                                    ------------------------------------
      Total...................           2.35           2.43            2.35
  Federal administrative costs           1.50           1.50            1.50
                                    ------------------------------------
      Total adjusted cost.....           3.85           3.93            3.85
    \1\ Fees primarily reflect borrower origination fees and, in FFEL, 
lender origination and consolidation loan holder fees. Other primarily 
reflects loan discharges due to death, disability, or bankruptcy.
    Totals may not add due to rounding.

    The Federal Credit Reform Act of 1990 requires the cost of existing 
loan cohorts to be reestimated to reflect changes in actual and assumed 
borrower behavior, interest rates, and other factors. The following 
table shows the impact of these reestimates in FFEL and Direct Loans.

                  Loan Disbursement and Subsidy Costs

                    Total Subsidy Costs--1992-2007

                                              FFEL       Direct Loans
Original Subsidy Costs..................    +$71.6 bil       +$0.4 bil
Cumulative Reestimates..................     +$1.2 bil      +$10.7 bil
Net Subsidy Costs.......................    +$72.8 bil      +$11.1 bil
 Total Disbursements....................    $627.0 bil      $205.6 bil

    Changes in interest rate projections are a significant factor in 
FFEL and Direct Loan reestimates; recent declines in interest rates 
below historical averages have accordingly been a major driver in 
changes to program costs. Changes in borrower behavior (notably, 
prepayment of loans through consolidation and reduction in defaults) 
have also contributed to these reestimates. The average lifetime subsidy 
rate for all outstanding FFEL loans after the most recent reestimate is 
11.60; the comparable Direct Loan rate is 5.42. For the oldest loan 
cohorts, many of the subsidy costs have been expended (e.g., in-school 
interest subsidies).

    In 2006, the Administration implemented probabilistic scoring for 
the FFEL and Direct Loan programs. Before the 2007 Midsession Review, 
estimates for both the FFEL and Direct Loan programs were developed 
using point estimates of the Budget estimate of future interest rates. 
The updated method factors in the probability that interest rate 
scenarios may differ from current economic projections. In 2006, the 
FFEL program recognized a $1.8 billion upward reestimate to reflect the 
new methodology, while the Direct Loan program recognized a $0.2 billion 
upward reestimate. Changes to special allowance formulas in the Higher 
Education Reconciliation Act of 2005, and other changes to borrower 
interest rates, mitigated interest rate risk in future cohorts, negating 
the impact of the probabilistic method for those cohorts.

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
      Personnel compensation:

11.1    Full-time permanent.............          49
11.3    Other than full-time permanent..           3

[[Page 339]]

11.5    Other personnel compensation....           1
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          53
12.1  Civilian personnel benefits.......          13
21.0  Travel and transportation of 
        persons.........................           3
23.1  Rental payments to GSA............           7
23.3  Communications, utilities, and 
        miscellaneous charges...........           4
24.0  Printing and reproduction.........           6
25.1  Advisory and assistance services..           5
25.2  Other services....................          18
25.3  Other purchases of goods and 
        services from Government 
        accounts........................           9
25.6  Training..........................           3
25.7  Operation and maintenance of 
        equipment.......................         476
26.0  Supplies and materials............           1
31.0  Equipment.........................           8
32.0  Land and structures...............           2
41.0  Grants, subsidies, and 
        contributions...................       6,934       5,176         500
                                           ---------   ---------  ----------
99.9    Total new obligations...........       7,542       5,176         500
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-0243-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................         578
---------------------------------------------------------------------------

           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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct Loan Subsidy...............                                   9
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                                   9
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                                   9
23.95 Total new obligations.............                                  -9
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation -federal 
          administration................
60.00   Appropriation (indefinite)--loan 
          subsidy.......................                                   9
60.00   Appropriation--upward 
          modification..................
60.00   Appropriation (indefinite)--
          Upward reestimate.............
                                           ---------   ---------  ----------
62.50     Appropriation (total 
            mandatory)..................                                   9
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                   9
73.20 Total outlays (gross).............                                  -6
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                   3
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                                   6
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                                   9
90.00 Outlays...........................                                   6
---------------------------------------------------------------------------

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

----------------------------------------------------------------------------
Identification code 91-0243-4-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct loan levels supportable by subsidy 
                budget authority:
115001Stafford..........................                                 347
115002Unsubsidized Stafford.............                                 134
115004Consolidation.....................                                  52
                                           ---------   ---------  ----------
115999Total direct loan levels..........                                 533
    Direct loan subsidy (in percent):
132001Stafford..........................                               -0.10
132002Unsubsidized Stafford.............                               -0.01
132003PLUS..............................                               -0.76
132004Consolidation.....................                                0.11
                                           ---------   ---------  ----------
132999Weighted average subsidy rate.....                               -0.02
    Direct loan subsidy budget authority:
133001Stafford..........................                                  33
133002Unsubsidized Stafford.............                                 -10
133003PLUS..............................                                 -22
133004Consolidation.....................                                   8
                                           ---------   ---------  ----------
133999Total subsidy budget authority....                                   9
    Direct loan subsidy outlays:
134001Stafford..........................                                  15
134002Unsubsidized Stafford.............                                  -5
134003PLUS..............................                                 -13
134004Consolidation.....................                                   9
                                           ---------   ---------  ----------
134999Total subsidy outlays.............                                   6
---------------------------------------------------------------------------


                                

          Federal Direct Student Loan Program Financing Account 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4253-0-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct Loan Obligations...........      36,305      19,503      21,103
00.02 Interest payment to Treasury......       6,505       5,597       5,974
                                           ---------   ---------  ----------
00.91   Direct Program by Activities--
          Subtotal (1 level)............      42,810      25,100      27,077
02.01 Interest rate rebate, Stafford....          82          86          94
02.02 Interest rate rebate, Unsubsidized 
        Stafford........................          70          75          81
02.03 Interest rate rebate, PLUS........          33          36          40
                                           ---------   ---------  ----------
02.91   Direct Program by Activities--
          Subtotal (1 level)............         185         197         215
03.01 Consolidation loans-Payment of 
        Orig. Services..................          26          10          12
04.01 Payment of contract collections...         127         150         160
08.02 Payment of downward reestimate to 
        receipt account (fy07)..........         501         940
08.04 Interest on downward reestimate...          22          45
                                           ---------   ---------  ----------
08.91   Direct Program by Activities--
          Subtotal (1 level)............         523         985
                                           ---------   ---------  ----------
10.00   Total new obligations...........      43,671      26,442      27,464
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........       1,697       6,479
22.00 New financing authority (gross)...      49,593      26,442      27,464
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................       3,396       4,015       5,029
22.60 Portion applied to repay debt.....      -4,536      -5,926
22.70 Balance of authority to borrow 
        withdrawn.......................                  -4,568      -5,029
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      50,150      26,442      27,464
23.95 Total new obligations.............     -43,671     -26,442     -27,464
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........       6,479
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............      35,073      20,030      20,627
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).      42,208      20,711      17,205
69.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........          -4          17          15
69.47     Portion applied to repay debt.     -27,684     -14,316     -10,383
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........      14,520       6,412       6,837
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................      49,593      26,442      27,464
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       8,658       9,379       7,174
73.10 Total new obligations.............      43,671      26,442      27,464
73.20 Total financing disbursements 
        (gross).........................     -39,558     -24,615     -25,610
73.45 Recoveries of prior year 
        obligations.....................      -3,396      -4,015      -5,029
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................           4         -17         -15
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       9,379       7,174       3,984
----------------------------------------------------------------------------

    Outlays (gross), detail:
87.00 Total financing disbursements 
        (gross).........................      39,558      24,615      25,610
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

[[Page 340]]

        Offsetting collections (cash) 
            from:
88.00     Direct Loan Subsidy...........      -1,788        -440        -461
88.00     Upward reestimate.............      -3,327      -3,614
88.00     Upward reestimate, interest...      -1,573      -1,088
88.00     Upward Modification...........          -7
88.25     Interest on uninvested funds..      -1,926
88.40     Repayment of principal, 
            Stafford....................      -8,060      -3,495      -3,756
88.40     Interest received on loans, 
            Stafford....................        -481        -482        -502
88.40     Origination Fees, Stafford....        -175        -168        -159
88.40     Other fees, Stafford..........         -41
88.40     Repayment of principal, 
            Unsubsidized Stafford.......      -6,462      -2,843      -3,211
88.40     Interest received on loans, 
            Unsubsidized Stafford.......        -535        -381        -412
88.40     Origination Fees, Unsubsidized 
            Stafford....................        -149        -146        -138
88.40     Other fees, Unsubsidized 
            Stafford....................          -3
88.40     Repayment of principal, PLUS..      -2,384      -1,401      -1,662
88.40     Interest received on loans, 
            PLUS........................        -265        -286        -340
88.40     Origination Fees, PLUS........         -70         -96        -106
88.40     Other fees, PLUS..............          -4
88.40     Payment of principal, 
            Consolidation...............     -13,638      -4,172      -4,289
88.40     Interest received on loans, 
            Consolidation...............      -1,289      -2,099      -2,169
88.40     Other fees, Consolidation.....         -31
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................     -42,208     -20,711     -17,205
      Against gross financing authority only:

88.95   Change in receivables from 
          program accounts..............           4         -17         -15
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............       7,389       5,714      10,244
90.00 Financing disbursements...........      -2,650       3,904       8,405
---------------------------------------------------------------------------

               Status of Direct Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4253-0-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    STAFFORD
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................       6,174       6,557       6,975
                                           ---------   ---------  ----------
1150    Total direct loan obligations...       6,174       6,557       6,975
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........      24,928      22,524      24,724
1231  Disbursements: Direct loan 
        disbursements...................       5,509       5,767       6,234
1251  Repayments: Repayments and 
        prepayments.....................      -8,059      -3,495      -3,756
1261  Adjustments: Capitalized interest.         122
1264  Write-offs for default: Other 
        adjustments, net................          24         -72         -94
                                           ---------   ---------  ----------
1290    Outstanding, end of year........      22,524      24,724      27,108
----------------------------------------------------------------------------

    UNSUBSIDIZED STAFFORD
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................       5,497       5,812       6,226
                                           ---------   ---------  ----------
1150    Total direct loan obligations...
                                           ---------   ---------  ----------
1150    Total direct loan obligations...       5,497       5,812       6,226
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........      17,829      16,361      18,746
1231  Disbursements: Direct loan 
        disbursements...................       4,687       4,987       5,415
1251  Repayments: Repayments and 
        prepayments.....................      -6,461      -2,843      -3,211
1261  Adjustments: Capitalized interest.         288         307         494
1264  Write-offs for default: Other 
        adjustments, net................          18         -66         -85
                                           ---------   ---------  ----------
1290    Outstanding, end of year........      16,361      18,746      21,359
----------------------------------------------------------------------------

    PLUS
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................       2,416       2,606       2,888
                                           ---------   ---------  ----------
1150    Total direct loan obligations...
                                           ---------   ---------  ----------
1150    Total direct loan obligations...       2,416       2,606       2,888
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........       4,922       4,765       5,702
1231  Disbursements: Direct loan 
        disbursements...................       2,191       2,399       2,658
1251  Repayments: Repayments and 
        prepayments.....................      -2,384      -1,401      -1,662
1261  Adjustments: Capitalized interest.          31           1           7
1264  Write-offs for default: Other 
        adjustments, net................           5         -62         -68
                                           ---------   ---------  ----------
1290    Outstanding, end of year........       4,765       5,702       6,637
----------------------------------------------------------------------------

    CONSOLIDATION
    Position with respect to appropriations act 
                limitation on obligations:
1111  Limitation on direct loans........
1131  Direct loan obligations exempt 
        from limitation.................      22,218       4,528       5,014
                                           ---------   ---------  ----------
1150    Total direct loan obligations...
                                           ---------   ---------  ----------
1150    Total direct loan obligations...      22,218       4,528       5,014
----------------------------------------------------------------------------

    Cumulative balance of direct loans 
                outstanding:
1210  Outstanding, start of year........      47,027      53,657      53,709
1231  Disbursements: Direct loan 
        disbursements...................      19,647       4,523       4,942
1251  Repayments: Repayments and 
        prepayments.....................     -13,638      -4,172      -4,289
1261  Adjustments: Capitalized interest.         563
1264  Write-offs for default: Other 
        adjustments, net................          58        -299        -305
                                           ---------   ---------  ----------
1290    Outstanding, end of year........      53,657      53,709      54,057
---------------------------------------------------------------------------

    The Balance Sheet, above, provides information on program assets, 
liabilities, and net position consistent with the audited financial 
statements.

    Receivables, line 1106, are primarily upward reestimates prepared 
for financial statements; an identical offsetting amount is recorded in 
the Allowance for Subsidy, line 1405. The value of total Department 
assets is unchanged but will be reduced when reestimates developed for 
this budget are executed. Differences between reestimates prepared for 
financial statements and for this budget result from updated economic 
(interest rates) and technical assumptions. Revised assumptions may 
significantly change reestimate amounts; differences will be reflected 
in subsequent financial statements.

    Direct Loans receivable, line 1401 reflects the nominal unpaid 
principal balance, including capitalized interest. Interest Receivable, 
line 1402, includes only non-capitalized interest. A positive Allowance 
for Subsidy, line 1405, indicates the outstanding portfolio (including 
the Financial Statements' reestimates) has a negative subsidy, 
increasing the portfolio's net present value; the 2004 negative value 
represents the reverse.

    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.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code 91-4253-0-
3-502

2005 actual

2006 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Federal assets:

1101

Fund balances with Treasury

4,913

8,621

        Investments in US securities:
1106

Receivables, net

4,150

4,631

      Net value of assets related to 
          post-1991 direct loans 
          receivable:

1401

Direct loans receivable, gross

94,707

97,307

1402

Interest receivable

3,121

3,702

1405

Allowance for subsidy cost (-)

-2,132

-8,405





1499

Net present value of assets related to direct loans

95,696

92,604





1999

Total assets

104,759

105,856

    LIABILITIES:
      Federal liabilities:

2101

Accounts payable

388

426

2103

Debt

104,371

105,430





2999

Total liabilities

104,759

105,856





4999

Total liabilities and net position

104,759

105,856

-----------------------------------------------------------------------------------------------

[[Page 341]]



          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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Direct Loan Obligations...........                                 533
00.02 Interest payment to Treasury......                                   7
                                           ---------   ---------  ----------
00.91   Direct Program by Activities--
          Subtotal (1 level)............                                 540
02.01 Interest rate rebate, Stafford....                                   3
02.02 Interest rate rebate, Unsubsidized 
        Stafford........................                                   1
                                           ---------   ---------  ----------
02.91   Direct Program by Activities--
          Subtotal (1 level)............                                   4
                                           ---------   ---------  ----------
10.00   Total new obligations...........                                 544
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New financing authority (gross)...                                 544
23.95 Total new obligations.............                                -544
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

67.10   Authority to borrow.............                                 525
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).                                  13
69.10     Change in uncollected customer 
            payments from Federal 
            sources (unexpired).........                                   3
69.47     Portion applied to repay debt.                                   3
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........                                  19
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................                                 544
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                                 544
73.20 Total financing disbursements 
        (gross).........................                                -294
74.00 Change in uncollected customer 
        payments from Federal sources 
        (unexpired).....................                                  -3
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                 247
----------------------------------------------------------------------------

    Outlays (gross), detail:
87.00 Total financing disbursements 
        (gross).........................                                 294
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.00     Direct Loan Subsidy...........                                  -6
88.40     Repayment of principal, 
            Stafford....................
88.40     Interest received on loans, 
            Stafford....................
88.40     Origination Fees, Stafford....                                  -4
88.40     Other fees, Stafford..........
88.40     Repayment of principal, 
            Unsubsidized Stafford.......
88.40     Interest received on loans, 
            Unsubsidized Stafford.......
88.40     Origination Fees, Unsubsidized 
            Stafford....................                                  -1
88.40     Other fees, Unsubsidized 
            Stafford....................
88.40     Repayment of principal, PLUS..
88.40     Interest received on loans, 
            PLUS........................
88.40     Origination Fees, PLUS........
88.40     Other fees, PLUS..............
88.40     Payment of principal, 
            Consolidation...............                                  -1
88.40     Interest received on loans, 
            Consolidation...............                                  -1
88.40     Other fees, Consolidation.....
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................                                 -13
      Against gross financing authority only:

88.95   Change in receivables from 
          program accounts..............                                  -3
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............                                 528
90.00 Financing disbursements...........                                 281
---------------------------------------------------------------------------


                                

              Federal Family Education Loan Program Account

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0231-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.02 Guaranteed loan subsidy...........      17,274       5,860       5,078
00.04 Modification subsidy, upward......       1,724
00.07 Upward reestimate, principal......       6,998         183
00.08 Upward reestimate, interest.......       2,375         372
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................      28,371       6,415       5,078
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......      28,371       6,415       5,078
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................         632         802         622
22.40 Capital transfer to general fund..        -632        -802        -622
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      28,371       6,415       5,078
23.95 Total new obligations.............     -28,371      -6,415      -5,078
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................      28,371       6,415       5,078
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections 
            (cash)--downward reestimate.         303
69.00     Offsetting collections (cash).
69.27     Capital transfer to general 
            fund........................        -303
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................      28,371       6,415       5,078
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       1,944       2,247       1,999
73.10 Total new obligations.............      28,371       6,415       5,078
73.20 Total outlays (gross).............     -27,435      -5,861      -4,307
73.40 Adjustments in expired accounts 
        (net)...........................          -1
73.45 Recoveries of prior year 
        obligations.....................        -632        -802        -622
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       2,247       1,999       2,148
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................      26,125       4,417       2,931
86.98 Outlays from mandatory balances...       1,310       1,444       1,376
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........      27,435       5,861       4,307
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........        -303
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................      28,068       6,415       5,078
90.00 Outlays...........................      27,132       5,861       4,307
---------------------------------------------------------------------------

                 Summary of Budget Authority and Outlays

                        (in millions of dollars)

                                     2006 actual  2007 est.   2008 est.
Enacted/requested:
  Budget Authority............         28,068          6,415           5,078
  Outlays.....................         27,132          5,861           4,307
Legislative proposal, subject to 
    PAYGO:
  Budget Authority............                                        -1,208
  Outlays.....................                                        -1,025

Total:
  Budget Authority............         28,068          6,415           3,870
  Outlays.....................         27,132          5,861           3,282

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

----------------------------------------------------------------------------
Identification code 91-0231-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Guaranteed loan levels supportable by subsidy 
                budget authority:
215001Stafford..........................      22,728      24,840      26,863
215002Unsubsidized Stafford.............      23,702      25,819      28,031
215003PLUS..............................       7,358      10,425      11,560
215004Consolidation.....................      81,788      26,978      32,014
                                           ---------   ---------  ----------

[[Page 342]]


215999Total loan guarantee levels.......     135,576      88,062      98,468
    Guaranteed loan subsidy (in percent):
232001Stafford..........................       18.55       18.03       18.14
232002Unsubsidized Stafford.............        1.66        0.01       -0.01
232003PLUS..............................        0.27       -0.28        0.00
232004Consolidation.....................       15.46        5.22        0.65
                                           ---------   ---------  ----------
232999Weighted average subsidy rate.....       12.74        6.65        5.16
    Guaranteed loan subsidy budget authority:
233001Stafford..........................       4,216       4,479       4,873
233002Unsubsidized Stafford.............         393           2          -3
233003PLUS..............................          20         -29
233004Consolidation.....................      12,645       1,408         208
                                           ---------   ---------  ----------
233999Total subsidy budget authority....      17,274       5,860       5,078
    Guaranteed loan subsidy outlays:
234001Stafford..........................       3,425       3,755       4,108
234002Unsubsidized Stafford.............         410         116          -1
234003PLUS..............................          41          -9         -10
234004Consolidation.....................      12,461       1,444         210
                                           ---------   ---------  ----------
234999Total subsidy outlays.............      16,337       5,306       4,307
    Guaranteed loan upward reestimates:
235001Stafford..........................       1,458         114
235002Unsubsidized Stafford.............         945
235003PLUS..............................         104
235004Consolidation.....................       7,362       3,350
235005SLS...............................          19          83
                                           ---------   ---------  ----------
235999Total upward reestimate budget 
        authority.......................       9,888       3,547
    Guaranteed loan downward reestimates:
237001Stafford..........................        -280      -3,669
237002Unsubsidized Stafford.............         -94      -2,590
237003PLUS..............................         -44        -252
237004Consolidation.....................        -386        -192
237005SLS...............................                      -4
                                           ---------   ---------  ----------
237999Total downward reestimate subsidy 
        budget authority................        -804      -6,707
---------------------------------------------------------------------------

    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. 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.

              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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.02 Guaranteed loan subsidy...........                              -1,217
00.04 Modification, upward..............                                   9
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................                              -1,208
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......                              -1,208
23.95 Total new obligations.............                               1,208
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                              -1,208
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                              -1,208
73.20 Total outlays (gross).............                               1,025
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                -183
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................                              -1,025
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................                              -1,208
90.00 Outlays...........................                              -1,025
---------------------------------------------------------------------------

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

----------------------------------------------------------------------------
Identification code 91-0231-4-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Guaranteed loan levels supportable by subsidy 
                budget authority:
215001Stafford..........................                                 702
215002Unsubsidized Stafford.............                                 294
215004Consolidation.....................                                  17
                                           ---------   ---------  ----------
215999Total loan guarantee levels.......                               1,013
    Guaranteed loan subsidy (in percent):
232001Stafford..........................                               -0.81
232002Unsubsidized Stafford.............                               -0.94
232003PLUS..............................                               -0.55
232004Consolidation.....................                               -2.47
                                           ---------   ---------  ----------
232999Weighted average subsidy rate.....                               -1.28
    Guaranteed loan subsidy budget authority:
233001Stafford..........................                                 -96
233002Unsubsidized Stafford.............                                -266
233003PLUS..............................                                 -64
233004Consolidation.....................                                -791
                                           ---------   ---------  ----------
233999Total subsidy budget authority....                              -1,217
    Guaranteed loan subsidy outlays:
234001Stafford..........................                                 -68
234002Unsubsidized Stafford.............                                -146
234003PLUS..............................                                 -34
234004Consolidation.....................                                -786
                                           ---------   ---------  ----------
234999Total subsidy outlays.............                              -1,034
---------------------------------------------------------------------------


                                

         Federal Family Education Loan Program Financing Account 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4251-0-3-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
01.01 Default claims....................       1,600       1,741       1,805
01.02 Special allowance.................       1,094         315         267
01.03 Interest benefits.................       2,014       2,908       3,455
01.04 Death, disability, and bankruptcy 
        claims..........................         177         183         197
01.05 Teacher loan forgiveness, other 
        write-offs......................          21          13          78
01.07 Contract collection costs.........          36          12          15
01.08 Guaranty Agency Administrative 
        Fees............................          76         146         173
01.09 Voluntary flexible agreement 
        performance fee.................         105         128
                                           ---------   ---------  ----------
01.91   Subtotal, Stafford loans........       5,123       5,446       5,990
02.02 Default claims....................       1,142       1,368       1,462
02.03 Special allowance.................         890         281         246
02.04 Death, disability, and bankruptcy 
        claims..........................         151         194         220
02.05 Teacher loan forgiveness, other 
        write-offs......................          10          10          61
02.07 Contract collection costs.........          18           3           4
02.08 Guaranty Agency Administrative 
        Fees............................          76         137         165
02.09 Voluntary flexible agreement 
        performance fee.................          69          40
                                           ---------   ---------  ----------
02.91   Subtotal, Unsubsidized Stafford 
          loans.........................       2,356       2,033       2,158
03.01 Default claims....................         144         157         200
03.03 Special allowance.................          53           2         -35
03.04 Death, disability, and bankruptcy 
        claims..........................          63         149         173
03.07 Contract Collection Costs.........           3           1           1
03.08 Guaranty Agency Administrative Fee          23          54          66
03.09 Voluntary flexible agreement 
        performance fee.................          11           6
                                           ---------   ---------  ----------
03.91   Subtotal, PLUS loans............         297         369         405
04.03 Default claims....................          27          18          12
04.04 Death, disability and bankruptcy 
        claims..........................           6           1
04.07 Contract collection costs.........           9           3           3
04.08 Voluntary flexible agreement 
        performance fee.................           3           3
                                           ---------   ---------  ----------
04.91   Subtotal, SLS loans.............          45          25          15
05.01 Default claims....................       1,619       2,205       2,611
05.02 Special allowance.................       5,297       6,671       6,206
05.03 Interest benefits.................         633         468         523

[[Page 343]]

05.04 Death, disability, and bankruptcy 
        claims..........................         575         906         989
05.05 Teacher loan forgiveness, other 
        write-offs......................           9
05.07 Contract collection costs.........           9           4           4
05.08 Voluntary flexible agreement 
        performance fee.................         150          38
05.10 Guaranty Agency Administrative Fee                     262         286
                                           ---------   ---------  ----------
05.91   Subtotal, Consolidations loans..       8,292      10,554      10,619
08.02 Payment of downward reestimate to 
        Prog / receipt account..........         162       3,582
08.04 Interest on downward reestimate...         127         133
08.05 Downward Modification.............          14
                                           ---------   ---------  ----------
08.91   Downward Reestimate- Subtotal (1 
          level)........................         303       3,715
                                           ---------   ---------  ----------
10.00   Total new obligations...........      16,416      22,142      19,187
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........      21,120      40,011      33,356
22.00 New financing authority (gross)...      35,253      15,487      14,254
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................          54
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......      56,427      55,498      47,610
23.95 Total new obligations.............     -16,416     -22,142     -19,187
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........      40,011      33,356      28,423
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

60.00   Appropriation...................         105
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).      35,159      15,487      14,254
69.27     Capital transfer to general 
            fund........................         -11
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........      35,148      15,487      14,254
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................      35,253      15,487      14,254
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..       2,071       3,531       4,763
73.10 Total new obligations.............      16,416      22,142      19,187
73.20 Total financing disbursements 
        (gross).........................     -14,902     -20,910     -19,822
73.45 Recoveries of prior year 
        obligations.....................         -54
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..       3,531       4,763       4,128
----------------------------------------------------------------------------

    Outlays (gross), detail:
87.00 Total financing disbursements 
        (gross).........................      14,902      20,910      19,822
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
88.00     Stafford loans................      -3,425      -3,755      -4,108
88.00     Unsubsidized Stafford.........        -410        -116           1
88.00     PLUS loans....................         -41           9          10
88.00     Consolidated loans............     -12,461      -1,444        -210
88.00     Upward reestimate.............      -9,374        -555
88.00     Modification..................      -1,724
88.25     Interest on uninvested funds..      -1,110      -2,143      -1,873
88.40     Stafford recoveries on 
            defaults....................      -1,146      -1,575      -1,725
88.40     Stafford origination fees.....        -661        -554        -445
88.40     Stafford other fees...........         -38
88.40     Unsubsidized Stafford 
            recoveries on default.......        -647        -962      -1,125
88.40     Unsubsidized Stafford 
            origination fees............        -659        -562        -472
88.40     Unsubsidized Stafford other 
            fees........................         -19
88.40     PLUS recoveries on defaults...         -93        -115        -132
88.40     PLUS origination fees.........        -206        -231        -203
88.40     PLUS other fees...............          -5
88.40     SLS recoveries on defaults....         -64         -77         -70
88.40     SLS other fees................          -2
88.40     Consolidation recoveries on 
            defaults....................        -866      -1,022      -1,328
88.40     Consolidation origination fees        -337        -135        -159
88.40     Consolidation loan holders fee      -1,849      -2,250      -2,415
88.40     Consolidation other fees......         -22
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................     -35,159     -15,487     -14,254
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............          94
90.00 Financing disbursements...........     -20,257       5,423       5,568
---------------------------------------------------------------------------

             Status of Guaranteed Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-4251-0-3-502      2006 actual   2007 est.   2008 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.................      22,728      24,840      26,863
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................      22,728      24,840      26,863
2199  Guaranteed amount of guaranteed 
        loan commitments................      22,728      24,591      26,594
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........      74,601      59,099      69,611
2231  Disbursements of new guaranteed 
        loans...........................      19,505      20,729      22,695
2251  Repayments and prepayments........     -33,209      -8,272     -10,528
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....      -1,600      -1,749      -1,826
2263    Terminations for default that 
          result in claim payments......        -177        -183        -197
2264    Other adjustments, net..........         -21         -13         -78
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      59,099      69,611      79,677
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      59,099      68,915      78,880
----------------------------------------------------------------------------

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

2310    Outstanding, start of year......       2,454       3,046       3,034
2331    Disbursements for guaranteed 
          loan claims...................       1,600       1,749       1,826
2351    Repayments of loans receivable..      -1,004      -1,574      -1,725
2361    Write-offs of loans receivable..        -177        -187        -182
2364    Other adjustments, net..........         173
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       3,046       3,034       2,953
----------------------------------------------------------------------------

    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.................      23,702      25,819      28,031
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................      23,702      25,819      28,031
2199  Guaranteed amount of guaranteed 
        loan commitments................      23,702      25,561      27,751
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........      59,179      49,928      61,187
2231  Disbursements of new guaranteed 
        loans...........................      19,563      21,099      23,065
2251  Repayments and prepayments........     -27,511      -8,278     -11,368
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....      -1,142      -1,357      -1,473
2263    Terminations for default that 
          result in claim payments......        -151        -194        -220
2264    Other adjustments, net..........         -10         -11         -61
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      49,928      61,187      71,130
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      49,928      60,575      70,419
----------------------------------------------------------------------------

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

2310    Outstanding, start of year......       1,740       2,293       2,513
2331    Disbursements for guaranteed 
          loan claims...................       1,142       1,357       1,473
2351    Repayments of loans receivable..        -569        -962      -1,125
2361    Write-offs of loans receivable..        -151        -175        -187
2364    Other adjustments, net..........         131
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       2,293       2,513       2,674
----------------------------------------------------------------------------

    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.................       7,358      10,425      11,560
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................       7,358      10,425      11,560
2199  Guaranteed amount of guaranteed 
        loan commitments................       7,358      10,321      11,444
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........      14,611      10,469      14,958

[[Page 344]]

2231  Disbursements of new guaranteed 
        loans...........................       6,753       8,608       9,823
2251  Repayments and prepayments........     -10,687      -3,812      -4,929
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....        -145        -158        -196
2263    Terminations for default that 
          result in claim payments......         -63        -149        -173
                                           ---------   ---------  ----------
2290    Outstanding, end of year........      10,469      14,958      19,483
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..      10,469      14,809      19,288
----------------------------------------------------------------------------

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

2310    Outstanding, start of year......         291         312         292
2331    Disbursements for guaranteed 
          loan claims...................         145         158         196
2351    Repayments of loans receivable..         -79        -115        -132
2361    Write-offs of loans receivable..         -63         -63         -63
2364    Other adjustments, net..........          18
                                           ---------   ---------  ----------
2390      Outstanding, end of year......         312         292         293
----------------------------------------------------------------------------

    SLS
    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........         276         201         143
2251  Repayments and prepayments........         -42         -37         -22
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....         -27         -20         -14
2263    Terminations for default that 
          result in claim payments......          -6          -1
                                           ---------   ---------  ----------
2290    Outstanding, end of year........         201         143         107
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..         201         141         106
----------------------------------------------------------------------------

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

2310    Outstanding, start of year......         385         375         314
2331    Disbursements for guaranteed 
          loan claims...................          27          20          14
2351    Repayments of loans receivable..         -53         -76         -70
2361    Write-offs of loans receivable..          -6          -5          -5
2364    Other adjustments, net..........          22
                                           ---------   ---------  ----------
2390      Outstanding, end of year......         375         314         253
----------------------------------------------------------------------------

    CONSOLIDATION
    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.................      81,788      26,978      32,014
                                           ---------   ---------  ----------
2150    Total guaranteed loan 
          commitments...................      81,788      26,978      32,014
2199  Guaranteed amount of guaranteed 
        loan commitments................      81,788      26,708      31,693
----------------------------------------------------------------------------

    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........     138,457     203,604     213,935
2231  Disbursements of new guaranteed 
        loans...........................      72,036      27,021      31,845
2251  Repayments and prepayments........      -4,686     -13,630     -15,189
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....      -1,619      -2,154      -2,594
2263    Terminations for default that 
          result in claim payments......        -575        -906        -989
2264    Other adjustments, net..........          -9
                                           ---------   ---------  ----------
2290    Outstanding, end of year........     203,604     213,935     227,008
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..     203,604     211,796     224,738
----------------------------------------------------------------------------

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

2310    Outstanding, start of year......       3,696       4,237       4,694
2331    Disbursements for guaranteed 
          loan claims...................       1,619       2,154       2,594
2351    Repayments of loans receivable..        -746      -1,022      -1,329
2361    Write-offs of loans receivable..        -575        -675        -750
2364    Other adjustments, net..........         243
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       4,237       4,694       5,209
---------------------------------------------------------------------------

    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.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code 91-4251-0-
3-502

2005 actual

2006 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
      Federal assets:

1101

Fund balances with Treasury

23,191

43,542

        Investments in US securities:
1106

Receivables, net

524

551

      Net value of assets related to 
          post-1991 acquired defaulted 
          guaranteed loans receivable:

1501

Defaulted guaranteed loans receivable, gross

8,566

10,263

1502

Interest receivable

1,691

1,823

1505

Allowance for subsidy cost (-)

-1,711

-2,847





1599

Net present value of assets related to defaulted guaranteed loans

8,546

9,239





1999

Total assets

32,261

53,332

    LIABILITIES:
2101

Federal liabilities: Accounts payable

1,761

951

      Non-Federal liabilities:

2201

Accounts payable



31

2204

Liabilities for loan guarantees

30,500

52,350





2999

Total liabilities

32,261

53,332





4999

Total liabilities and net position

32,261

53,332

-----------------------------------------------------------------------------------------------

         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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
      Stafford loans:

01.01   Default claims, Stafford........                                 -28
01.02   Special allowance...............                                  -7
01.03   Interest benefits...............                                   5
01.08   Guaranty Agency Administrative 
          Fees..........................                                 109
                                           ---------   ---------  ----------
01.91     Subtotal, Stafford loans......                                  79
      Unsubsidized Stafford loans:

02.02   Default claims, Unsubsidized 
          Stafford......................                                 -23
02.03   Special allowance...............                                  -7
02.08   Guaranty Agency Administrative 
          Fees..........................                                  62
                                           ---------   ---------  ----------
02.91     Subtotal, Unsubsidized 
            Stafford loans..............                                  32
03.01 Default claims, PLUS..............                                  -3
      PLUS loans:

03.09   Guaranty Agency Administrative 
          Fees, PLUS....................                                  -7
                                           ---------   ---------  ----------
03.91     Direct Program by Activities--
            Subtotal (1 level)..........                                 -10
      Consolidation loans:

05.01   Default claims, Consolidation...                                 -41
05.02   Special allowance...............                                 -19
05.09   Guaranty Agency Administrative 
          Fees..........................                                -203
                                           ---------   ---------  ----------
05.91     Subtotal, Consolidations loans                                -263
08.05 Downward Modification.............                               2,813
                                           ---------   ---------  ----------
10.00   Total new obligations...........                               2,651
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New financing authority (gross)...                                -947

[[Page 345]]

23.95 Total new obligations.............                              -2,651
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........                              -3,598
----------------------------------------------------------------------------

    New financing authority (gross), detail:
      Mandatory:

60.00   Appropriation...................                                  12
        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).                                -823
69.27     Capital transfer to general 
            fund........................                                -136
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........                                -959
                                           ---------   ---------  ----------
70.00   Total new financing authority 
          (gross).......................                                -947
----------------------------------------------------------------------------

    Change in obligated balances:
73.10 Total new obligations.............                               2,651
73.20 Total financing disbursements 
        (gross).........................                              -2,081
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..                                 570
----------------------------------------------------------------------------

    Outlays (gross), detail:
87.00 Total financing disbursements 
        (gross).........................                               2,081
----------------------------------------------------------------------------

    Offsets:
      Against gross financing authority and 
          financing disbursements:

        Offsetting collections (cash) 
            from:
          Payments from program account:
88.00     Stafford loans................                                  68
88.00     Unsubsidized Stafford.........                                 146
88.00     PLUS loans....................                                  34
88.00     Consolidated loans............                                 786
88.00     Upward reestimate.............
88.00     Modification, Upward..........                                  -9
88.25     Interest on uninvested funds..                                  72
          Student Loans: Stafford, 
              Unsubsidized Stafford, 
              PLUS, SLS & Consolidation:
88.40     Stafford recoveries on 
            defaults....................                                 -40
88.40     Stafford origination fees.....                                  -6
88.40     Unsubsidized Stafford 
            recoveries on default.......                                 -27
88.40     Unsubsidized Stafford 
            origination fees............                                  -3
88.40     PLUS recoveries on defaults...                                  -3
88.40     SLS recoveries on defaults....                                  -1
88.40     Consolidation recoveries on 
            defaults....................                                 -35
88.40     Consolidation origination fees                                -159
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................                                 823
----------------------------------------------------------------------------

    Net financing authority and financing 
        disbursements:
89.00 Financing authority...............                                -124
90.00 Financing disbursements...........                               2,904
---------------------------------------------------------------------------


                                

            Federal Family Education Loan Liquidating Account 

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0230-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
01.01 Interest benefits, net of 
        origination fees................           8           7           4
01.02 Special allowance net of 
        origination fees................           4           2           2
01.03 Default claims....................          82          59          46
01.04 Death, disability, and bankruptcy 
        claims..........................          13          13          10
01.05 Contract collection costs.........          53          47          43
01.06 Voluntary flexible agreements.....           5           4
                                           ---------   ---------  ----------
01.91   Subtotal, Stafford loans........         165         132         105
02.01 Default claims....................           9           8           6
02.02 Death, disability, and bankruptcy 
        claims..........................           5           5           4
02.05 Contract collection costs.........           9           9           8
02.06 Special allowance net of 
        origination fees................           5
02.07 Voluntary flexible agreements.....           7           1
                                           ---------   ---------  ----------
02.91   Subtotal, PLUS/SLS loans........          35          23          18
                                           ---------   ---------  ----------
10.00   Total new obligations...........         200         155         123
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........         339         243
22.00 New budget authority (gross)......         441         155         123
22.10 Resources available from 
        recoveries of prior year 
        obligations.....................           2
22.40 Capital transfer to general fund..        -339        -243
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         443         155         123
23.95 Total new obligations.............        -200        -155        -123
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........         243
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Mandatory:

        Spending authority from 
            offsetting collections:
69.00     Offsetting collections (cash).         995         902         814
69.27     Capital transfer to general 
            fund........................        -554        -747        -691
                                           ---------   ---------  ----------
69.90     Spending authority from 
            offsetting collections 
            (total mandatory)...........         441         155         123
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          23          51          51
73.10 Total new obligations.............         200         155         123
73.20 Total outlays (gross).............        -170        -155        -123
73.45 Recoveries of prior year 
        obligations.....................          -2
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          51          51          51
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.97 Outlays from new mandatory 
        authority.......................         170         155         123
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

        Offsetting collections (cash) 
            from:
88.40     Fed collections on defaulted 
            loans, Stafford.............        -255        -285        -257
88.40     Federal collections on 
            bankruptcies, Stafford......          -3          -3          -3
88.40     Offsets against Federal tax 
            refunds,Stafford............        -245        -215        -194
88.40     Reimbursements from guaranty 
            agencies, Stafford..........        -316        -231        -208
88.40     Other collections/ fees, 
            Stafford....................         -53         -27         -25
88.40     Federal collections on 
            defaulted loans, PLUS/SLS...         -55         -66         -60
88.40     Federal collections on 
            bankruptcies, PLUS/SLS......          -1          -1          -1
88.40     Offsets against Federal tax 
            refunds, PLUS/SLS...........         -19         -16         -14
88.40     Reimbursements from guaranty 
            agencies, PLUS/SLS..........         -48         -58         -52
                                           ---------   ---------  ----------
88.90     Total, offsetting collections 
            (cash)......................        -995        -902        -814
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................        -554        -747        -691
90.00 Outlays...........................        -825        -747        -691
---------------------------------------------------------------------------

             Status of Guaranteed Loans (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0230-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    STAFFORD LOANS
    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........       1,276         978         800
2251  Repayments and prepayments........        -203        -100         -41
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....         -82         -65         -50
2263    Terminations for default that 
          result in claim payments......         -13         -13         -10
                                           ---------   ---------  ----------
2290    Outstanding, end of year........         978         800         699
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..         978         800         699
----------------------------------------------------------------------------

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

2310    Outstanding, start of year......       8,005       7,511       7,113
2331    Disbursements for guaranteed 
          loan claims...................          82          65          50
2351    Repayments of loans receivable..        -415        -404        -365
2361    Write-offs of loans receivable..         -13         -12         -11
2364    Other adjustments, net..........        -148         -47         -43
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       7,511       7,113       6,744
----------------------------------------------------------------------------

    PLUS/SLS LOANS
    Cumulative balance of guaranteed loans 
                outstanding:
2210  Outstanding, start of year........         793         648         569
2251  Repayments and prepayments........        -131         -66         -26
      Adjustments:

2261    Terminations for default that 
          result in loans receivable....          -9          -8          -7

[[Page 346]]

2263    Terminations for default that 
          result in claim payments......          -5          -5          -4
                                           ---------   ---------  ----------
2290    Outstanding, end of year........         648         569         532
----------------------------------------------------------------------------

    Memorandum:
2299  Guaranteed amount of guaranteed 
        loans outstanding, end of year..         648         569         532
----------------------------------------------------------------------------

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

2310    Outstanding, start of year......       1,301       1,220       1,137
2331    Disbursements for guaranteed 
          loan claims...................           9           8           7
2351    Repayments of loans receivable..         -61         -76         -69
2361    Write-offs of loans receivable..          -5          -4          -4
2364    Other adjustments, net..........         -24         -11         -10
                                           ---------   ---------  ----------
2390      Outstanding, end of year......       1,220       1,137       1,061
---------------------------------------------------------------------------

    \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.

                             Balance Sheet (in millions of dollars)

-----------------------------------------------------------------------------------------------
Identification code 91-0230-0-
1-502

2005 actual

2006 actual

-----------------------------------------------------------------------------------------------
    ASSETS:
1101

Federal assets: Fund balances with Treasury

362

295

1701

Defaulted guaranteed loans, gross

9,306

8,730

1702

Interest receivable

595

336

1703

Allowance for estimated uncollectible loans and interest (-)

-6,736

-4,718





1704

Defaulted guaranteed loans and interest receivable, net

3,165

4,348





1799

Value of assets related to loan guarantees

3,165

4,348





1999

Total assets

3,527

4,643

    LIABILITIES:
2104

Federal liabilities: Resources payable to Treasury

3,412

4,555

      Non-Federal liabilities:

2201

Accounts payable

4

-15

2204

Liabilities for loan guarantees

111

103





2999

Total liabilities

3,527

4,643





4999

Total liabilities and net position

3,527

4,643

-----------------------------------------------------------------------------------------------

               Object Classification (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0230-0-1-502      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
25.2  Other services....................          62          57          51
33.0  Investments and loans.............          91          67          52
41.0  Grants, subsidies, and 
        contributions...................          29          14           6
42.0  Insurance claims and indemnities..          18          17          14
                                           ---------   ---------  ----------
99.9    Total new obligations...........         200         155         123
---------------------------------------------------------------------------

                                


 
                     INSTITUTE OF EDUCATION SCIENCES

                              Federal Funds

                     Institute of Education Sciences

     For carrying out activities authorized by the Education Sciences 
Reform Act of 2002, as amended, the National Assessment of Educational 
Progress Authorization Act, section 208 of the Educational Technical 
Assistance Act of 2002, and section 664 of the Individuals with 
Disabilities Education Act, $594,262,000, of which $293,144,000 shall be 
available until September 30, 2009.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1100-0-1-503      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Research, development, and 
        dissemination...................         162         163         163
00.02 Statistics........................          90          90         119
00.03 Regional educational laboratories.          65          65          65
00.04 Assessment........................          93          93         116
00.05 Research in special education.....          72          72          72
00.06 Statewide data systems............          49          49          49
00.07 Special education studies and 
        evaluations.....................          10          10          10
                                           ---------   ---------  ----------
01.00   Total direct program............         541         542         594
09.01 Reimbursable program..............           2           2           2
                                           ---------   ---------  ----------
10.00   Total new obligations...........         543         544         596
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........          25           2           2
22.00 New budget authority (gross)......         520         544         596
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         545         546         598
23.95 Total new obligations.............        -543        -544        -596
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........           2           2           2
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         523         542         594
40.35   Appropriation permanently 
          reduced.......................          -5
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         518         542         594
58.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).           2           2           2
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         520         544         596
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         621         758         520
73.10 Total new obligations.............         543         544         596
73.20 Total outlays (gross).............        -393        -782        -564
73.40 Adjustments in expired accounts 
        (net)...........................         -13
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         758         520         552
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          90         139         152
86.93 Outlays from discretionary 
        balances........................         303         643         412
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         393         782         564
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

88.00   Offsetting collections (cash) 
          from: Federal sources.........          -2          -2          -2
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         518         542         594
90.00 Outlays...........................         391         780         562
---------------------------------------------------------------------------

    Research and Statistics:

    Research, development, and dissemination.--Funds support the 
National Center for Education Research, which oversees a diverse 
portfolio of directed research, evaluation studies, research and 
development centers, and 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. In 2008, funds will also support a higher 
education unit record pilot. The pilot will modify several components of 
the Integrated

[[Page 347]]

Postsecondary Education Data System (IPEDS) to implement a privacy-
protected system that would allow interested parties to follow students 
as they move from one institution to another, thus allowing better 
understanding of student attendance, graduation and transfer rates, 
academic outcomes, and the costs of higher education.

    Regional educational laboratories.--Funds support a network of 10 
regional laboratories that provide expert advice, including training and 
technical assistance, to help States and school districts apply proven 
research findings in their school improvement efforts. Funds would be 
used for the third year of 5-year contracts for the laboratories.

    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. In 
2008, funds will also support costs of expanding State NAEP to grade 12 
in 2009.

    Research in special education.--Funds support research 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.

    Statewide data systems.--Funds support competitive awards to State 
educational agencies to foster the design, development, and 
implementation of longitudinal data systems.

    Special education studies and evaluations.--Funds support objective 
studies, evaluations, and assessments related to the implementation of 
the Individuals with Disabilities Education Act 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 91-1100-0-1-503      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........           1           1           1
11.3      Other than full-time permanent           1           1           1
                                           ---------   ---------  ----------
11.9      Total personnel compensation..           2           2           2
24.0    Printing and reproduction.......           1           1           1
25.1    Advisory and assistance services           4           3           4
25.2    Other services..................         167         167         194
25.3    Other purchases of goods and 
          services from Government 
          accounts......................          15          15          15
25.5    Research and development 
          contracts.....................          99          99          99
41.0    Grants, subsidies, and 
          contributions.................         253         253         277
                                           ---------   ---------  ----------
99.0      Direct obligations............         541         540         592
99.0  Reimbursable obligations..........           2           2           2
99.5  Below reporting threshold.........                       2           2
                                           ---------   ---------  ----------
99.9    Total new obligations...........         543         544         596
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-1100-0-1-503      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................          13          14          14
---------------------------------------------------------------------------

                                


 
                         DEPARTMENTAL MANAGEMENT

                              Federal 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, $446,934,000, of which $17,303,000, to remain available until 
expended, shall be for building alterations and related expenses for the 
move of Department staff to the Mary E. Switzer building in Washington, 
D.C.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0800-0-1-503      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Program administration............         410         411         447
00.02 Trust Fund........................          36          24
09.01 Reimbursable program..............           1           1           1
                                           ---------   ---------  ----------
10.00   Total new obligations...........         447         436         448
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
21.40 Unobligated balance carried 
        forward, start of year..........                      24
22.00 New budget authority (gross)......         472         412         448
                                           ---------   ---------  ----------
23.90   Total budgetary resources 
          available for obligation......         472         436         448
23.95 Total new obligations.............        -447        -436        -448
23.98 Unobligated balance expiring or 
        withdrawn.......................          -1
                                           ---------   ---------  ----------
24.40   Unobligated balance carried 
          forward, end of year..........          24
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................         415         411         447
40.35   Appropriation permanently 
          reduced.......................          -4
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............         411         411         447
58.00   Spending authority from 
          offsetting collections: 
          Offsetting collections (cash).                       1           1
      Mandatory:

60.00   Appropriation...................          61
                                           ---------   ---------  ----------
70.00   Total new budget authority 
          (gross).......................         472         412         448
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..         125         144         127
73.10 Total new obligations.............         447         436         448
73.20 Total outlays (gross).............        -422        -453        -429
73.40 Adjustments in expired accounts 
        (net)...........................          -4
74.10 Change in uncollected customer 
        payments from Federal sources 
        (expired).......................          -2
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         144         127         146
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................         337         322         338
86.93 Outlays from discretionary 
        balances........................          85          71          91
86.98 Outlays from mandatory balances...                      60
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........         422         453         429
----------------------------------------------------------------------------

    Offsets:
      Against gross budget authority and outlays:

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

88.96   Portion of offsetting 
          collections (cash) credited to 
          expired accounts..............           2
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................         472         411         447
90.00 Outlays...........................         420         452         428
---------------------------------------------------------------------------

    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

[[Page 348]]

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.

    Included in this account is the Department of Education's cost to 
renovate and upgrade the Mary E. Switzer building in order to 
consolidate staff located in various buildings in Washington, D.C.

    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. In 
2006, this account received a transfer from the Department of State of 
$61 million. These funds came from foreign countries in support of the 
Department of Education's efforts to assist educational programs and 
entities affected by Hurricane Katrina. 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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
      Direct obligations:

        Personnel compensation:
11.1      Full-time permanent...........         167         193         201
11.3      Other than full-time permanent          30           9          10
11.5      Other personnel compensation..           4           3           4
                                           ---------   ---------  ----------
11.9      Total personnel compensation..         201         205         215
12.1    Civilian personnel benefits.....          49          51          54
13.0    Benefits for former personnel...           1
21.0    Travel and transportation of 
          persons.......................           5           5           5
23.1    Rental payments to GSA..........          36          36          38
23.3    Communications, utilities, and 
          miscellaneous charges.........          11           9          11
24.0    Printing and reproduction.......           3           4           4
25.1    Advisory and assistance services           5           3           2
25.2    Other services..................          24          19          20
25.3    Other purchases of goods and 
          services from Government 
          accounts......................          20          17          16
25.7    Operation and maintenance of 
          equipment.....................          44          48          51
26.0    Supplies and materials..........           2           2           2
31.0    Equipment.......................           9          12          24
32.0    Land and structures.............           1                       5
41.0    Grants, subsidies, and 
          contributions.................          35          24
                                           ---------   ---------  ----------
99.0      Direct obligations............         446         435         447
99.0  Reimbursable obligations..........           1           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........         447         436         448
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-0800-0-1-503      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................       2,121       2,103       2,113
---------------------------------------------------------------------------

                                

                         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, $93,771,000.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0700-0-1-751      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Civil rights......................          90          90          94
                                           ---------   ---------  ----------
10.00   Total new obligations...........          90          90          94
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          91          90          94
23.95 Total new obligations.............         -90         -90         -94
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          92          90          94
40.35   Appropriation permanently 
          reduced.......................          -1
                                           ---------   ---------  ----------
43.00     Appropriation (total 
            discretionary)..............          91          90          94
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          22          20          16
73.10 Total new obligations.............          90          90          94
73.20 Total outlays (gross).............         -91         -94         -93
73.40 Adjustments in expired accounts 
        (net)...........................          -1
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          20          16          17
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          75          77          80
86.93 Outlays from discretionary 
        balances........................          16          17          13
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          91          94          93
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          91          90          94
90.00 Outlays...........................          91          94          93
---------------------------------------------------------------------------

    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 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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
      Personnel compensation:

11.1    Full-time permanent.............          51          53          55
11.3    Other than full-time permanent..           2           2           3
11.5    Other personnel compensation....           1           1           1
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          54          56          59
12.1  Civilian personnel benefits.......          13          14          14
21.0  Travel and transportation of 
        persons.........................           1           1           1
23.1  Rental payments to GSA............           7           7           7
23.3  Communications, utilities, and 
        miscellaneous charges...........           2           1           1
25.2  Other services....................           4           2           2
25.3  Other purchases of goods and 
        services from Government 
        accounts........................           2           3           3
25.7  Operation and maintenance of 
        equipment.......................           5           4           5
31.0  Equipment.........................                       1           1
                                           ---------   ---------  ----------
99.0    Direct obligations..............          88          89          93
99.5  Below reporting threshold.........           2           1           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........          90          90          94
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-0700-0-1-751      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................         630         629         629
---------------------------------------------------------------------------

[[Page 349]]



                                

                     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, $53,239,000.

    Note.--A regular 2007 appropriation for this account had not been 
enacted at the time the budget was prepared; therefore, this account is 
operating under a continuing resolution (P.L. 109-289, Division B, as 
amended). The amounts included for 2007 in this budget reflect the 
levels provided by the continuing resolution.

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-1400-0-1-751      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Inspector General.................          49          48          53
                                           ---------   ---------  ----------
10.00   Total new obligations...........          49          48          53
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......          49          48          53
23.95 Total new obligations.............         -49         -48         -53
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................          49          48          53
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..          11          13          13
73.10 Total new obligations.............          49          48          53
73.20 Total outlays (gross).............         -47         -48         -52
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..          13          13          14
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................          41          40          44
86.93 Outlays from discretionary 
        balances........................           6           8           8
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........          47          48          52
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................          49          48          53
90.00 Outlays...........................          47          48          52
---------------------------------------------------------------------------

    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      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct obligations:
      Personnel compensation:

11.1    Full-time permanent.............          23          25          27
11.3    Other than full-time permanent..           1           1
11.5    Other personnel compensation....           2
                                           ---------   ---------  ----------
11.9      Total personnel compensation..          26          26          27
12.1  Civilian personnel benefits.......           8           8           9
21.0  Travel and transportation of 
        persons.........................           2           2           2
23.1  Rental payments to GSA............           4           4           5
23.3  Communications, utilities, and 
        miscellaneous charges...........           1           1           1
25.1  Advisory and assistance services..           2           2           3
25.2  Other services....................           1           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
32.0  Land and structures...............                       1
                                           ---------   ---------  ----------
99.0    Direct obligations..............          48          48          53
99.5  Below reporting threshold.........           1
                                           ---------   ---------  ----------
99.9    Total new obligations...........          49          48          53
---------------------------------------------------------------------------

                             Employment Summary

----------------------------------------------------------------------------
Identification code 91-1400-0-1-751      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Direct:
1001  Civilian full-time equivalent 
        employment......................         288         279         293
---------------------------------------------------------------------------

                                


 
                      HURRICANE EDUCATION RECOVERY

                              Federal Funds

                       Hurricane Education Recovery

               Program and Financing (in millions of dollars)

----------------------------------------------------------------------------
Identification code 91-0013-0-1-500      2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
    Obligations by program activity:
00.01 Programs to restart school 
        operations......................         750
00.02 Assistance for homeless children 
        and youth.......................           5
00.03 Temporary emergency impact aid for 
        displaced students..............         878
                                           ---------   ---------  ----------
00.91   Subtotal, Aid for elementary and 
          secondary education...........       1,633
01.01 Aid for institutions of higher 
        education.......................         200
01.02 Aid for recovering institutions...          50
                                           ---------   ---------  ----------
01.91   Subtotal, Postsecondary 
          institutional assistance......         250
                                           ---------   ---------  ----------
10.00   Total new obligations (object 
          class 41.0)...................       1,883
----------------------------------------------------------------------------

    Budgetary resources available for obligation:
22.00 New budget authority (gross)......       1,885
23.95 Total new obligations.............      -1,883
23.98 Unobligated balance expiring or 
        withdrawn.......................          -2
----------------------------------------------------------------------------

    New budget authority (gross), detail:
      Discretionary:

40.00   Appropriation...................       1,885
----------------------------------------------------------------------------

    Change in obligated balances:
72.40 Obligated balance, start of year..                     743
73.10 Total new obligations.............       1,883
73.20 Total outlays (gross).............      -1,140        -743
                                           ---------   ---------  ----------
74.40   Obligated balance, end of year..         743
----------------------------------------------------------------------------

    Outlays (gross), detail:
86.90 Outlays from new discretionary 
        authority.......................       1,140
86.93 Outlays from discretionary 
        balances........................                     743
                                           ---------   ---------  ----------
87.00   Total outlays (gross)...........       1,140         743
----------------------------------------------------------------------------

    Net budget authority and outlays:
89.00 Budget authority..................       1,885
90.00 Outlays...........................       1,140         743
---------------------------------------------------------------------------

    Amounts in this schedule reflect balances that are spending out from 
prior-year appropriations.

                                



 
                     GENERAL FUND RECEIPT ACCOUNTS 

                           (in millions of dollars)

----------------------------------------------------------------------------
                                         2006 actual   2007 est.   2008 est.
----------------------------------------------------------------------------
Offsetting receipts from the public:
  91-143500  General fund proprietary 
    interest receipts, not otherwise 
    classified..........................          18          20          20
  91-271810  Federal family education 
    loan program, negative subsidies....                               2,813
  91-271830  Federal family education 
    loan program, Downward reestimates 
    of subsidies........................                   3,715
  91-278130  Federal direct student loan 
    program, downward reestimates of 
    subsidies...........................                     985
  91-291500  Repayment of loans, capital 
    contributions, higher education 
    activities..........................          51          42          42
  91-322000  All other general fund 
    proprietary receipts including 
    budget clearing accounts............          68          47          47
General Fund Offsetting receipts from 
 the public.............................         137       4,809       2,922
----------------------------------------------------------------------------

[[Page 350]]


Intragovernmental payments:.............
  91-388500  Undistributed 
    intragovernmental payments and 
    receivables from cancelled accounts.           7           4           4
                                           ---------   ---------  ----------
General Fund Intragovernmental payments.           7           4           4
---------------------------------------------------------------------------


                                


 
                           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 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 in 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.

                                
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