Thousands of Students Cut from Pell Grant Program in Final Federal Budget
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Topic: Financial Woes

WASHINGTON -- November 23 -- Last-minute changes to the federal spending bill approved by Congress this weekend will cause 90,000 low-income students to lose their Pell Grant eligibility this upcoming year. More than 1 million other students face reductions in their Pell Grant awards under this change.

House Republicans, with the support of the Bush administration, struck a provision from the FY05 Senate appropriations bill that postpones changes in the Department of Education's federal financial aid formula that helps determine Pell Grant eligibility. The Pell Grant program is the country's largest source of federal aid for college students.

"Behind closed doors, Congress decided to pay for budget shortfalls out of the pockets of students," said Luke Swarthout, higher education associate for the State Public Interest Research Groups.

The federal spending bill that Congress passed this weekend left out language written by Senator Corzine to maintain current Pell Grant eligibility rules. The Department of Education claims that without such language they will be forced to change the formula used to calculate the expected family contribution (EFC) in financial aid forms. According to the American Council on Education, the new calculation will cut 90,000 college students out of the Pell Grant program, and reduce Pell awards for more than a million students.

Congress included language in last year's final federal spending bill to postpone changes to Pell Grant eligibility rules until the issue and its effect on students' aid packages was further examined. "By making this change, Congress is reneging on its promise to students and families," said Swarthout. The language was included in last year's spending bill with bipartisan support, and was included in this year's Senate appropriations bill until final negotiations between the House and Senate this week resulted in the provision being stripped from the bill.

The change comes as students are already struggling with skyrocketing college costs and declining grant funding. Students are facing tuitions that are 10.5 percent higher at four-year public institutions this year,
according to a recent report by the College Board. The FY05 budget also freezes funding for the maximum Pell Grant at $4,050, and level funds numerous other higher education programs.

Pell Grant article