Academic Competitiveness Grants: Background, Description, and Selected Issues

Academic Competitiveness Grants: Background, Description, and Selected Issues

Order Code RL33457
CRS Report for Congress
Received through the CRS Web
Academic Competitiveness Grants:
Background, Description, and Selected Issues
August 18, 2006
Charmaine Mercer
Analyst in Social Legislation
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

Academic Competitiveness Grants:
Background, Description, and Selected Issues
Summary
The Deficit Reduction Act of 2005 (DRA) (P.L. 109-171) established the
Academic Competitiveness grant program (AC grant). AC grants are intended to
provide funding for eligible students who qualify for need-based federal student aid,
and who complete a rigorous secondary school program, to assist them with paying
for college expenses. This report describes the AC grant program, including the
eligibility criteria and the various ways of satisfying the rigorous secondary school
program requirement. It also includes a discussion of the funding levels for the
program. Finally, the report concludes with a discussion of selected policy issues
related to the AC grant program. This report will be updated as warranted by major
legislative or other relevant developments.

Contents
Eligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Rigorous Secondary Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Grant Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Expanding the Federal Role? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Alternative Education Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Academic Competitiveness Grants:
Background, Description,
and Selected Issues
Recent data show that slightly less than one-third (31%) of all public high
school students are prepared for postsecondary education, as demonstrated by the
academic courses pursued.1 Partly in response to statistics such as these, Congress
included a provision in the Deficit Reduction Act of 2005 (DRA) (P.L. 109-171),
enacted February 8, 2006, that established the Academic Competitiveness grant
program (AC grant).2 AC grants are intended to provide funding for eligible students
who qualify for need-based federal student aid, and who complete a rigorous
secondary school program, to assist them with paying for college expenses.3
This report describes the AC grant program, including the eligibility criteria and
the various ways of satisfying the rigorous secondary school program requirement.
It also includes a discussion of the funding levels for the program. Finally, the report
concludes with a discussion of selected policy issues related to the AC grant
program.
Eligibility
Academic Competitiveness grants are available to Pell Grant-eligible students
who are enrolled full time in either a two-year or four-year degree-granting institution
of higher education (IHE). The grants are limited to students who are in either their
1 U.S. Department of Education. National Center for Education Statistics. The Digest of
Education Statistics, 2005. Table 135, “Percentage of public high school graduates earning
minimum credits in selected combination of academic courses, by sex and race/ethnicity:
Selected years, 1982 through 2000.”
2 In addition, P.L. 109-171 also established the Science and Mathematics Access to Retain
Talent” (SMART) Grant program, which shares funding with the AC grant program. For
additional information about the SMART grant program, see CRS Report RL33434,
Science, Technology, Engineering, Math Education Issues and Legislative Options, by
Jeffrey J. Kuenzi, Christine M. Matthews, and Bonnie F. Mangan.
3 As a result of the close proximity between the establishment of the AC grant program and
the beginning of the 2006-2007 award year, the Secretary of Education initially issued
program guidance in the form of Dear Colleague letters. Most recently the Secretary
released interim final regulations (Federal Register, July 3, 2006, Volume 71, No. 127, pp.
37990-38012). The regulations can be accessed at [http://www.ifap.ed.gov/fregisters/
FR07032006.html].

CRS-2
first year or second year of undergraduate education,4 and who are enrolled in a
degree program. Recipients cannot have previously enrolled in an undergraduate
program (unless they are in their second year of undergraduate education). In
addition, students who are in their second year of undergraduate study must also have
a 3.0 grade point average in their first year of undergraduate course work. Finally,
unlike the Pell Grant program, which is open to eligible non-citizens, the AC grant
program is limited to U.S. citizens.5
Rigorous Secondary Program. In addition to these requirements, in order
to receive an AC grant, a student must have completed “a rigorous secondary school
program of study.” A rigorous program is statutorily defined as a program that is
“established by a State or local educational agency and recognized as such by the
Secretary (401A(c)(3)(A)(i)).” The Secretary is required to recognize at least one
rigorous program per state. In light of the approaching start date of the 2006-2007
award year (July 1, 2006), the Secretary has decided to recognize any existing state
Advanced or Honors diploma programs. In a Dear Colleague letter dated May 2,
2006, the Secretary indicated that there are 19 existing Advanced or Honors diploma
programs that will be immediately acknowledged.6 Thus, any student who graduates
with one of the selected diplomas will be considered eligible for an AC grant,
assuming all of the other eligibility criteria are satisfied. The letter specifies that if
a state would like to establish an Honors or Advanced diploma program for the 2006-
2007 award year, or if a state or program is not currently listed, the program of study
should be submitted to the Secretary for recognition.7
For students who attend a high school in a state that does not offer an Advanced
or Honors diploma program, as well as students graduating from private or home
schools, there are three alternate options to satisfy the “rigorous secondary” program:
4 For award year 2006-2007, first-year students must have completed high school after Jan.
1, 2006. Second-year students must have completed high school after Jan. 1, 2005.
5 For additional information about the AC grant program, see [http://ifap.ed.gov/
FSACounselors/clcf/AcademicGrants.html].
6 The 19 states and their programs are Alabama, Advanced Academic Endorsement;
Arkansas, College Preparatory Curriculum; California, Golden State Seal Merit Diploma;
Delaware, Distinguished Achievement Diploma; Georgia, College Preparatory with
Distinction Diploma; Indiana, Academic Honors Diploma; Kentucky, Commonwealth
Diploma; Louisiana, Academic Endorsement to the Standard Diploma; Massachusetts,
Certificate of Mastery; Missouri, College Preparatory Studies Certificate; Nevada,
Advanced Diploma; New York, Regents Diploma with Honors or Advanced Designation;
Ohio, Honors Diploma; Oklahoma, Certificate of Distinction; Pennsylvania, Certificate of
Distinction; Texas, Distinguished Achievement Diploma; Virginia, Advanced Studies
Diploma; Washington, Scholar Designation; and Wyoming, Advanced Endorsement
Diploma.
7 According to the Dear Colleague letter, if a state education agency wanted to establish a
rigorous secondary school program and have that program recognized for the 2006-2007
award year, the agency was required to submit the proposal to the Secretary no later than
June 1, 2006. The full notice can be accessed at [http://www.ifap.ed.gov/dpcletters/
attachments/GEN0608Attach.pdf].

CRS-3
! Completion of the State Scholars Initiative (SSI) requirements. This
program, supported by Congress, requires high school students to
take a program of study that consists of the following courses: 4
years of English, 3 years of math, 3 years of science, 3.5 years of
social studies, and 2 years of a language other than English. There
are currently 22 states that support the SSI standards.8
! Completion of a set of courses that are similar to the SSI program.
The student must receive passing grades in all courses.9
! The Advanced Placement (AP) course and examination or the
International Baccalaureate (IB) course and examination. If a
student has taken two or more of these courses and received a
passing score on the exam, this will satisfy the rigorous program
requirement. Students must receive a 3 or higher on the AP exam or
a 4 or higher on the IB exam to qualify.
For the 2006-2007 award year, ED will notify each applicant of his or her potential
eligibility for the program. The notification will provide information about a website
that will help the applicant determine whether he or she completed a rigorous
secondary school program of study recognized by the Secretary.10 The applicant will
self-identify his or her eligibility for an AC grant by identifying the rigorous
secondary school program completed. After the student has identified the rigorous
secondary school program completed, ED will notify the IHE that the applicant may
qualify for an AC grant. The IHE then determines if the student meets all of the
remaining eligibility requirements.
Funding
The funding for the AC grant program and the Science and Mathematics Access
to Retain Talent (SMART) grant program11 is not subject to the annual appropriations
8 According to the State Scholars’ program website, the 22 participating states are Arizona,
Arkansas, Colorado, Connecticut, Indiana, Kentucky, Louisiana, Maryland, Massachusetts,
Michigan, Mississippi, Nebraska, New Jersey, New Mexico, North Carolina, Oklahoma,
Rhode Island, Tennessee, Utah, Virginia, Washington, and West Virginia. The website is
[http://www.wiche.edu/statescholars/].
9 The program of study must include four years of English, three years of math (including
Algebra I and a higher-level course such as Algebra II, Geometry, or Data Analysis and
Statistics), three years of science (including at least two courses from biology, chemistry,
or physics), three years of social studies, and one year of a foreign language.
10 According to guidance issued by ED, the department expects the website to be functional
by July 1, 2006. The guidance further states that ED is developing an alternative process
for students who do not have Web access. The full notice can be accessed at
[http://ifap.ed.gov/dpcletters/GEN0604.html].
11 SMART grants are available during the third and fourth years of undergraduate study for
students who are full time, eligible for a Pell grant, and majoring in physical, life, or
computer sciences; mathematics, technology, or engineering; or in a foreign language
determined to be critical to national security. For additional information about the SMART
program, see [http://studentaid.ed.gov/PORTALSWebApp/students/english/SmartGrants.
(continued...)

CRS-4
process for award years 2006-2007 through 2010-2011. The funding level for each
year for both programs combined is below:
2006-2007
$790 million
2007-2008
$850 million
2008-2009
$920 million
2009-2010
$960 million
2010-2011
$1.01 billion
Any funds that are not spent in a given award year are carried forward to the next
award year.
Grant Amount. Eligible students can receive up to $750 in their first year of
undergraduate education and a maximum of $1,300 during their second year of study.
Although students must be eligible for a Pell Grant, the amount of the AC grant is not
influenced by the amount of the recipient’s Pell Grant award. The Pell Grant is still
considered to be the foundation to which other assistance is added. However, the
amount of the AC grant, other student aid and resources, and the amount of the
expected family contribution combined cannot exceed the recipient’s total cost of
attendance.12 Furthermore, in the event that the aggregate amount students are
eligible to receive exceeds the appropriation, the amount of the awards shall be
ratably reduced.
Policy Issues
In the weeks following the enactment of the Deficit Reduction Act of 2005 and
the establishment of the Academic Competitiveness grant program, many
policymakers and education officials criticized the program. Many argued that
authorizing the Secretary to determine what was deemed “rigorous” significantly
expanded the federal role in high school curriculum and policymaking. In addition
to this issue, many supporters of alternative education programs, such as vocational
education programs and home-schooling, were opposed to any program eligibility
criteria that would disqualify these students simply because the Secretary did not
recognize the program as being rigorous. The following section presents a brief
analysis of each of these issues.
Expanding the Federal Role? There has been considerable concern
expressed regarding the possible expansion of the federal role in high school
11 (...continued)
jsp?tab=funding].
12 For additional information about the federal student aid need analysis system, including
the expected family contribution and cost of attendance, see CRS Report RL33266, Federal
Student Aid Need Analysis System: Background, Description, and Legislative Action, by
Charmaine Mercer.

CRS-5
curriculum and policymaking.13 Specifically, many policymakers and education
officials have expressed concern about the Secretary’s authority to recognize rigorous
secondary school curriculum. Many policy groups contend that allowing the
Secretary to determine what constitutes rigor is essentially granting the federal
government the authority to evaluate the curricular decisions of state and local
officials.14 Several governors reportedly responded by writing a letter to the
Secretary expressing their support for the new program; however, they cautioned the
Secretary against overextending the federal role. “Governors will be concerned if
any regulations or attempts are made to federalize high-school curricula, including
the creation of a federal definition of rigor.”15 In response to concerns about the
program, Representative Boehner and Senator Enzi wrote a letter to Secretary
Spellings, stating
Some concern has arisen that this initiative will allow the Secretary to become
involved in establishing high school curriculum. We want to be very clear this
was neither the intention nor the effect of the language in this bill. The
Secretary’s only role in this process is to recognize that states or local
educational agencies or other schools, including private, charter and home
schools, have, in fact, established what they consider to be a rigorous coursework
requirement. Not only does the language in this bill not give the Secretary any
authority to establish curriculum, we assert that federal law prohibits this.16
Section 103 of the Department of Education Organization Act specifically
prohibits the Secretary from exercising “direction, supervision or control” over the
curriculum of any educational institution, school or school system. As previously
discussed, in the Dear Colleague letter dated May 2, 2006, the Secretary issued
guidance stating that she has no intention of determining what constitutes a rigorous
high school program. “In recognizing these programs, I will respect the authority of
each individual State to set graduation requirements, and I will follow the law’s
directive prohibiting the Department from mandating, directing or controlling State
or local curricula, programs of instruction, academic achievement standards or
assessments. I will conduct a thorough and transparent review and will be consulting
with external stakeholders to aid me in this process.”17
Alternative Education Programs. Many supporters of alternative
education programs such as vocational education, concurrent enrollment, and home
schooling are apprehensive about the policy guidance being developed for the AC
grant program. Most of the concern stems from these programs being viewed as non-
rigorous because they are alternatives to traditional high school curriculum.
13 See Anne K. Walters and Stephen Burd, “Education Department Races to Set up a Student
Grant Program Without a Clear Mandate,” Chronicle of Higher Education, Apr. 21, 2006.
14 See “The Gift Colleges Don’t Want,” Doug Lederman, InsideHigherEd.com. The article
is available at [http://insidehighered.com/news/2006/01/24/smart].
15 Ibid. As cited.
16 The full text of the letter is available at [http://www.house.gov/ed_workforce/press/
press109/second/02feb/edletter020106.htm].
17 For the full text of the letter, see [http://www.ifap.ed.gov/dpcletters/attachments/
GEN0608Attach.pdf].

CRS-6
However, with the exception of concurrent enrollment programs (discussed below),
the program guidance does not appear to disqualify students who pursue either
vocational education or those who are home-schooled from being eligible for an AC
grant, as long as they complete the course work for an Advanced or Honors diploma
or pursue one of the options previously discussed. Students who live in a state that
does not offer an Advanced or Honors diploma program and does not participate in
the SSI program, or who do not complete either AP or IB courses (and the respective
exam), could demonstrate their completion of a rigorous secondary school program
by completing a set of courses that are comparable to the SSI program to become
eligible to receive the AC grant.
Concurrent Enrollment Programs. Concurrent enrollment programs are
programs that enable high school-aged students who have not received a high school
diploma to take college-level courses and receive college credit.18 In many of these
programs, the students are also enrolled in high school and seeking a high school
diploma — thus the phrase “concurrent enrollment.”19 The eligibility criteria for the
AC grant program do not permit students who have previously enrolled in an
undergraduate program to receive a grant. Thus, under the guidance issued, students
who are concurrently enrolled in both a high school and college program may not be
eligible for an AC grant. However, supporters of these programs, including the
National Governors Association (NGA), disagree with this interpretation of the act.
They maintain that the purpose of the AC grant program is to encourage students to
pursue rigorous courses that prepare them for college, which is the same purpose of
concurrent enrollment programs. In a letter to the Secretary, the NGA wrote
Governors are deeply concerned that the U.S. Department of Education has
indicated that for legal reasons “dual enrollees” or “dual credit students” will not
be eligible for AC grants. This interpretation is contradictory and inconsistent
with the basic intent of the program. Dual enrollees are public, private, or home
school high school students who are pursuing a rigorous secondary program of
study, while obtaining college-level credit that also counts towards high school
graduation. Dual enrollment programs offer students an opportunity to pursue
challenging courses that may not be available at their high school or for those
without access to Advanced Placement or International Baccalaureate courses.
Lastly, many dual enrollees do not pay tuition to the institution of higher
education, nor are these students enrolled in a program of undergraduate
education or degree granting program.20
David Bergeron, Director of Policy and Budget Development, Office of
Postsecondary Education, indicated that taking a “few classes” would be permissible;
however, the student could not be admitted into an undergraduate program and be
18 Concurrent enrollment programs are also frequently referred to as dual enrollment and/or
dual credit programs.
19 For additional information about concurrent enrollment programs, see CRS Report
RS21898, Concurrent Enrollment Programs, by Charmaine Mercer.
20 The full text of the letter is available at [http://www.nga.org/portal/site/nga/menuitem.
cb6e7818b34088d18a278110501010a0/?vgnextoid=fef0611fcfe3b010VgnVCM1000001
a01010aRCRD].

CRS-7
eligible for an AC grant.21 Because concurrent enrollment programs are diverse in
their makeup, it appears as though concurrent enrollment programs that do not
require students to be admitted into a postsecondary academic program could be
recognized as rigorous programs. The guidance issued by the Secretary indicated that
if a state wanted to establish an alternative rigorous program to be recognized by the
Secretary, the program needed to be submitted by June 1, 2006, for the 2006-2007
award year.22
21 The comments were made at a webinar (web-based seminar) hosted by the American
Association of Collegiate Registrars and Admissions Officers on May 11, 2006. The
archive of the presentation is available at [http://webinar.aacrao.org/].
22 The plan should describe how completion of the program will ensure that students will
be exposed to a rigorous secondary program that will prepare them for college. In addition,
it should also contain evidence that a state university in the state’s system will consider
students college-ready if they complete the program. Finally, the program must be reviewed
by the Governor, state educational agency, and other higher education officials. States
desiring to submit plans for the 2007-2008 award year should submit plans to the Secretary
no later than Nov. 1, 2006.