March 31, 2010

Pell Me More

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One of the least inspiring aspects of the newly passed Health Care and Education Reconciliation Act of 2010 is its treatment of Pell Grants, the federal need-based grant program that enables many prospective students from lower socioeconomic backgrounds to actually attend college. The first number usually touted by lawmakers looks pretty good: The act adds $40 billion to the program.

Lawmakers must be commended for acknowledging the increasing burden of attending college and acting quickly, but $40 billion, quite simply, is not enough. On an individual student level, the White House estimates that the maximum Pell Grant will increase from the current $5,500 to $5,975 by 2017. Every little bit helps, but this act must not be the last boost to the Pell Grant program in the upcoming years. College tuition is skyrocketing, rising faster than the inflation rate, and the Pell Grants will not keep up with either. If the government is serious about increasing college affordability and graduation rates, it must return to the Pell Grant program with additional legislation and funding.

More encouragingly, over the next decade, more than 800,000 additional Pell awards will be added to the program, which currently gives grants to 7.3 million of the 14.6 million students who apply. This nearly 11-percent increase in the number of grants obviously means that the available funds will be distributed amongst more students, resulting in less grant money. However, it is more important to boost the number of students receiving grants. If the grant money was concentrated in a smaller pool of students, more would be able to attend pricier colleges. But, wider distribution will allow more students to attend college to begin with, which is not only socially just, but beneficial to the nation’s long-term economic health.

The boost to Pell Grants is watered down from the bill that the House of Representatives passed in 2009 with the Student Aid and Fiscal Responsibility Act. The Pell Grant program’s yearly increases will be tied, after a five-year freeze, to the consumer price index; the initial act passed by the House called for Pell Grants to be increased by the consumer price index plus one percentage point. Obviously the scaled back program is not ideal, but it might be fortunate that Pell Grants received any aid at all. Less than two weeks before the bill was passed, lawmakers were considering cutting the additional funds altogether. The Health Care and Education Reconciliation Act of 2010 fixes a number of problems with financial aid for higher education, but to keep college affordable, Congress must quickly revisit the funding for the Pell Grant program.