The government shutdown began on January 20th, 2018 at midnight after the Senate was unable to strike a deal.
With the last government shutdown, the future of financial aid such as grants and federal student loans for certain institutions and individuals may be in doubt. However, this is only the case if this shutdown extends for a significant amount of time.
For many in schools across the country, the good news is that if the shutdown is only a few days, the effects will be minimal. This is because academics and institutions that have already been awarded money, or have received grants from research agencies, will not be affected by this shutdown. However, most Pell Grants and federal student loans are considered mandatory spending, so they would be unaffected by the shutdown. But what is affected?
The Department of Education has cut 90% of their staff during the shutdown, which means application approvals will grind to a trickle, and other programs may be greatly effective if the shutdown is extended. These slowdowns include any grant-making work that involves Title III Funds, TRIO and GEAR UP Programs as well as graduate fellowships. Furthermore, the Department of Education will immediately cease site reviews and many other civil rights activities that they currently do to defend students that are studying.
A couple of things to note is that the National Science Foundation will honor the grants already awarded, but no new payments will be completed. As well, no new grant will be awarded and peer-review panels will not meet during the shutdown. Further to this, the National Institutes of health will continue patient care for those who are in clinical trials at their hospitals.
So, what does this mean for those who are holding student loans, or are looking to finalise funding? Well for those with student loans already approved, the funding is already on its way. They'll be able to pay for college.
For those who have not had their grants approved, it might be a long wait, depending on the length of the shutdown. The issue is that the Department of Education is not an essential service and is now down to roughly 6% of staff in their offices during this turmoil. Naturally, your grant applications and fellowships will be approved, but at a slower pace. Further to this, as noted, if you are dealing with the civil rights section of the department, they are essentially shut down.
Although this could be rectified within the week, the real threat to students is if this shutdown stretches out for a significant amount of time. It could affect student loan funding for the next academic year, and those looking to secure grants will find it difficult to get their applications approved. It could lead to people relying on high-interest private student loans, or it could blockade students from attending college at all.
For the sake of conjecture, one could surmise that a very long government shutdown would impact policy greatly. For instance, future policy would not be able to develop or change. For example, the actions and discussion on renewing Pell Grant funding would not have been possible while the government shutdown was in play.
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