Policy Insights | What State Policymakers Should Know About Federal Higher Education Policy

Despite the mantra that education is primarily the states’ responsibility, the federal government is an important and influential player when it comes to providing higher education to the nation’s students. The federal government invests roughly $25 billion annually in higher education excluding loans that are ultimately repaid, military benefits that are earned, and tax credits. State policymakers need to understand the nature of this federal investment and the rationale behind it if they are to gain the maximum advantage from their state investments. Then, they can begin to harmonize state and federal policies so that they complement each other to the extent that this is possible and to design state policies in ways that maximize the take-up of federal dollars in the state, both to benefit students and to relieve state fiscal pressures.