Experts Pitch Lawmakers On Ways To Cut Pell Grant Costs

The Pell grant is a federally funded grant that is intended to allow low-income students to receive a post secondary education.
Photo courtesy of Whitman College

Photo courtesy of Whitman College

By MARISSA HIGDON

(TRNS) — Experts on higher education lending urged House lawmakers today to adopt a series of fixes for the Pell grant system.

The Pell grant is federal money that is intended to provide low-income students with a chance to go to college. Eligible students can receive a maximum of $5,635 per year, which covers about 35 percent of their annual college costs.

The grant currently serves nine million students, according to National Association of Student Financial Aid Administrators President and CEO Justin Draeger, who testified at a hearing held by a House Education and the Workforce Subcommittee.

Draeger said the program cost the federal government $33 billion dollars from 2011 to 2012. To save taxpayers money, Draeger suggested creating partnerships between colleges and high schools to motivate students to consider going to college from a young age, thereby creating more potential more scholarships and less public aid.

Draeger also recommended to policymakers providing students more flexibility with their Pell funds, and rewarding students who are on track to graduate on time. Doing both, he said, would save the Pell program money.

Education Trust Director of Higher Education and Education Finance Policy Michael Dannenberg agreed with Draeger, and said that because college fees have been steadily rising, the Pell grant program will experience a large funding gap over the next decade.

“Just to maintain the current maximum grant, the Pell Grant program is projected to confront a funding gap of more than $40 billion over the next 10 years at current discretionary spending levels,” he said.

All those who testified said that the Pell program must be changed to more efficiently provide for low-income students that require federal aid to pay for a college education, but they had varying opinions on how to do that.

John W. Pope Center for Higher Education Policy Director of Outreach Jenna Robinson suggested limiting the number of students who are eligible for the grants.

“In order to use federal dollars effectively, eligibility requirements should be tightened so that only very low-income students receive Pell grants,” Robinson said.

She also suggested that only students that meet certain academic requirements should be eligible to apply for and receive government funding.

Others disagreed with her recommendation, saying that underprivileged students still badly need the program, and that the U.S. economy is also badly in need of more future college graduates.

“The demand for college educated workers is growing,” said Dannenberg, who pointed to a recent Georgetown University study that shows that America’s economy will be short about three million college-educated workers beginning in 2018.

“To thrive, our nation needs more young people to earn postsecondary certificates and degrees,” he said. “We will not be competitive with other nations unless our large and growing population of low-income students and students of color enrolls in and completes postsecondary certificate and degree-granting programs at much higher levels.”

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