Magazine article Diverse Issues in Higher Education

With High Demand, Pell Grant Program Faces Challenges

Magazine article Diverse Issues in Higher Education

With High Demand, Pell Grant Program Faces Challenges

Article excerpt

Uncertainty about program funding comes as more students take advantage of Pell awards year round.

In a political climate rife with calls to limit federal spending, Pell Grants can pose an easy target. Federal funding for the program has doubled since 2008 to more than $30 billion, mainly due to heavy use in the recession and a pledge by lawmakers to increase the top grant for needy students.

Factor in a shortfall of $5.7 billion - caused by a major uptick in the number of eligible low-income students - and it's a situation that makes some higher education leaders nervous.

"Almost every day, the crisis gets worse," says Joel Packer, executive director of the Committee for Education Funding, a coalition of K- 12 and higher education organizations. "As the economy struggles, more students witñ greater need become eligible for Pell Grants."

The linchpin of the federal student aid system, Pell Grants served 7 million students in 2009-10, based on data from the web site www.finaid.org, a student aid information site. That represents an increase of 1.5 million students in just one year. While the program is not an entitlement such as Social Security, it operates in much the same manner, as all students who qualify receive aid based on tuition, need and part-time or full-time status.

The Pell program isn't funded like an entitlement, however, with Congress projecting estimated use on a yearly basis and earmarking funds in its appropriations bills. In recent years, those projections have fallen short of reality, creating the shortfall.

"Eventually it catches up to them," says Mark Kantrowitz, publisher of wwwilnaid.org. "This [shortfall] can only go on for so much time before Congress has to fund the shortfall or cut grants."

Many education organizations want Congress to pay off the growing shortfall and provide the program with solid funding through next fall. But Republicans taking control of the U.S. House of Representatives have pledged instead to cut domestic spending.

If Congress fails to address the shortfall, the maximum Pell Grant could fall by $850 next year - more than 15 percent of the current top grant of $5,550. "Failure to pay off the shortfall may result in devastating cuts," Kantrowitz says.

The issue is particularly acute at many minority-serving institutions. In 2008, 72 percent of students at United Negro College Fund institutions and 67 percent of all students at historically Black colleges received Pell Grant aid, says Dr. Tammy Mann, chief executive officer of the Patterson Research Institute.

Across all four-year public and private institutions, the percentage of students receiving aid was much lower - 42 percent. …

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