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Sequestration Update: Reduction amount is now 6.0% for TEACH Grants

ED has provided yet a third update on guidance related to the effects of sequestration that took place effective March 1, 2013. In the announcement that ED made on Friday, May 31, 2013, schools are informed that the most recent estimates by the Office of Management and Budget (OMB) shows that the effect of sequestration will result in a less than previously announced reduction in the award amounts for TEACH Grants.

In the last sequestration announcement on April 26, 2013, ED stated that the TEACH Grant amounts would have to be reduced by 7.1% for any TEACH Grant first disbursed after March 1, 2013. This required reduction amount has now been lowered yet again to 6.0% for any TEACH Grants first disbursed after March 1, 2013. Although this may create some revisions to awards that schools have already made, it is important that schools ensure that students receive all the award amounts for which they are entitled.

Also, it is important to note that there were no further reductions in the previously announced sequestration effect on the Iraq-Afghanistan Service Grant (IASG) awards. The sequestration reduction amount required for any IASG awards disbursed after March 1, 2013 remains at a reduction of 10.0%, as announced in the last update on sequestration from ED dated April 26, 2013.

If you have any questions regarding this information, please contact your Customer Service Representatives via

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