The $13,000 Pell Grant almost fully covers the average annual cost of attendance for today’s community college students. Students at public four-year institutions will pay more than half of tuition, fees, room and board.
That’s what President Biden called for in his latest budget proposal last month: doubling the Pell Grant ceiling by 2029. While unlikely to pass, affordability advocates say they hope the president’s ambitious proposal will expand important conversations about the federal government’s student aid program.
For 50 years, Pell Grants have helped low-income students pay for college. But Biden and senior advocates say it’s not doing the job as well as it can.
Biden cites a startling statistic: In 1980, the top Pell Award paid for nearly 80 percent of tuition, fees, room and board at a four-year public university. In 2020, it paid less than 30%.
Congress recently tried to bring Pell Grants in line with inflation by adding small increases of $100 and $200 to the top award. In the latest comprehensive spending plan passed in March, lawmakers approved a $400 increase, the largest single boost to Pell in more than a decade. The maximum Pell Grant increased from $6,495 to $6,895, and the minimum award increased from $650 to $690.
The Pell Grant program has long enjoyed bipartisan support. Republicans love it because it’s a voucher program that puts money in the hands of students who decide how and where to spend it; Terry W. Ha, senior vice president for government relations and public affairs, American Board of Education Democrats like it because it focuses so much on low-income students, Terry W. Hartle said.
For now, a major hurdle is cost: While some Democratic members of Congress are pushing for an increase in Pell Grants, Republicans say they are wary of any new government spending with rising inflation. At last year’s hearing, Republicans on the House Education and Labor Committee also said they didn’t think doubling Pell Grants would actually make college more affordable, and suggested colleges simply increase tuition in response.
Affordability advocates say supporting the Pell plan is one of the most effective ways to fight inequality in higher education because it targets the students most in need.
According to the National Association of Student Financial Aid Administrators, adding Pell is closely tied to racial and social justice. In the 2015-16 academic year, 58 percent of black undergraduates and 47 percent of Hispanic undergraduates received federal Pell Grants, compared with 32 percent of white undergraduates. In 2017-18, more than 80 percent of Pell recipients had annual household incomes of less than $40,000.
“When we’re talking about how to make sure we distribute financial aid fairly, Pell is really the best way to do it,” said Rachel Gentry, the association’s director of government relations. “It’s also not that we have to start and start a new program. The Pell Grant program already exists and already provides aid to the lowest-income students.”
For now, though, the maximum Pell Grant doesn’t even cover the average in-state tuition at four-year public colleges, let alone other costs. While low-income students often receive state and institutional aid on top of the Pell Award, this is not always sufficient.
According to the American Board of Education, Pell Grant recipients are more than twice as likely to take out student loans as other students.
“If low-income students are fully qualified and eligible to attend a four-year college, and they want to attend a four-year college, they should be able to do so without not only having to take out the full loan, but also by Ray Ray, associate director of research at the New American Education Policy Project. Chel Fishman says:
“I would like to see,” Fishman continued, “that funding for this program reaches at least a level where access and opportunity to earn a four-year degree is no longer limited to middle-class and high-income Americans.”
According to the National University Achievement Network, in the 2018-19 academic year, less than a quarter of students who received Pell Grants were at affordable four-year public institutions. Across these institutions, the average unmet financial need of Pell recipients was $2,524.
Likewise, only 41% of two-year public institutions are affordable for Pell recipients, with an average unmet financial need of $855. (The organization calculates affordability by determining a college’s total cost and whether the $300 emergency fee will be covered by all available student aid, federal work-study, and expected sources of family contributions.)
“The program has been underfunded for a long time,” Fishman said, “and tuition and related fees have grown so rapidly that many students are still far behind when Pell Grants end.”
support the program
Some policy experts are skeptical of claims that the Pell Grant program has not kept pace with rising college costs. Funding from all sources, including Pell, nearly doubled from the 1980s to the 2010s, offsetting the $100 million in Much of the increase in tuition and fees during this period. The real problem, Delisle wrote, is the rising cost of student housing.
Although lawmakers’ willingness to spend federal money has declined since the early spending spree of the pandemic, Fishman believes that shouldn’t be a barrier to propping up Pell Grants. Crises like the pandemic have exacerbated inequality in college affordability, she said.
“For me, the timing is even more critical,” said Kim Cook, chief executive of the National Network for College Achievement (NCAN). “This has been a pre-pandemic policy objective of NCAN, but if there is any lesson from the pandemic, it is that this is really about exacerbating affordability inequalities and the need to really consider which programs and proposals best meet those needs and Support these students in the best possible way.”
Some progressive lawmakers insist they will keep pushing for Pell if it doesn’t double in the next budget cycle. But its future may depend on whether cost-conscious Republicans take control of one or both houses of Congress in the upcoming midterm elections. In the past, Republicans have supported increasing Pell’s budget as part of a much smaller federal budget, Hartle of the American Board of Education said.
Some Republicans also doubt that doubling the Pell would be best for students. Rep. Greg Murphy, a Republican on the North Carolina Board of Education, argues that colleges, not students, are the primary beneficiaries of the grant program. “In the long run, an overhaul of the HEA Accountability Network will help students more than putting money into a failing system,” he told the hearing, referring to the Higher Education Act. Research on the idea has been inconclusive, his argument that increasing student aid would lead to higher tuition fees.
Hartle said that while a doubling of the Pell cap is likely in the near future, having Biden make the goal a policy priority has injected energy into the higher education community. ACE and other higher education advocates are cautiously optimistic.
“You have to start somewhere,” Hartle said, “and that’s an indispensable first step toward those goals.”