Making the Case for Pell

With Congressional talks over next year's spending package having just begun, higher education groups are zeroing in on a stronger Pell Grant as a key demand for this funding cycle.

But while student aid advocates want major new investments in the primary form of grant-based aid for low-income college students, they expect only modest gains to happen before an update to the Higher Education Act, the law overseeing federal financial aid.

The groups are looking to build on successful efforts to raise the maximum value of the Pell Grant in the spending bill passed by Congress in March, which boosted the maximum grant award by 3 percent to $6,095.

Observers say a similar increase is possible this year. But longer-term goals for the program, such as significantly increasing the purchasing power of the grant or even pegging its maximum value to inflation, are viewed as more likely objectives for a comprehensive higher ed bill. Likewise, work-force training proponents view Pell eligibility for short-term programs -- a top priority of business groups -- as better suited for reauthorization of the Higher Education Act, although they also would welcome the change in a spending deal.

Yet over all, higher education advocates may find themselves fighting for more of the same.

“I’m cautiously optimistic,” said Justin Draeger, president and CEO of the National Association of Student Financial Aid Administrators, of another grant increase this year.

That’s partly because a February budget deal lifted broad spending caps that had been in place for close to a decade, giving lawmakers more wiggle room for priorities like boosting the Pell Grant. But after automatic annual increases to the program expired last year, advocates will have to scratch out another increase for the program in each appropriations cycle. Boosting the grant each year is critical for students, several groups said, because otherwise inflation will erode the value of the grant over time. 

“If it’s not keeping pace with inflation, it's in effect a cut because students’ purchasing power went down,” Draeger said.

Mamie Voight, vice president of public policy research at the Institute for Higher Education Policy, told members of the U.S. House of Representatives' appropriations committee last month that the grant covers the lowest proportion of college expenses in its 50-year history. However, the institute's recommendations to Congress reflect a defensive approach to Pell -- keeping up with inflation, continuing support of year-round grants and opposing efforts to reduce or rescind the grant. 

“Pell is the foundation of our financial aid system and it’s really well-targeted aid,” she said in an interview. “There’s certainly a big push from the higher-ed community to make sure the maximum award can keep pace at least with inflation.”

A spokeswoman for Rep. Tom Cole, the Oklahoma Republican who chairs the appropriations subcommittee overseeing education funding, said the committee does not comment on policy items that may or may not be included in future legislation. 

But Rep. Rosa DeLauro, a Connecticut Democrat and ranking Democrat on the House appropriations subcommittee overseeing education funding, said she she will push to increase the grant in the next round of appropriations. 

"Financial aid is not keeping pace with rising college costs, resulting in students having to bear more of the burden," she said. "At the same time, we know that the majority of jobs are requiring at least some education or training beyond high school. Affordability is more important than ever. That is why I will continue to fight tooth and nail to increase the maximum grant threshold to build on the progress we made in last year’s funding bill. It is an important investment in our next generation and the future of our country.” 

Higher-education organizations also have proposed a less incremental approach to the program. In a recent letter to Congressional appropriators, the National College Access Network requested a 12-percent increase for the maximum grant in fiscal year 2019-20 -- the first step in what would be an ambitious multi-year process to raise the value of the grant to 50 percent of the annual cost of attending a four-year public institution, or just under $14,000.

Kim Cook, NCAN's executive director, noted that the grant originally covered 79 percent of the cost of attending a four-year public college. In the current academic year, it covered only 18 percent of the cost.

Yet the proposal from NCAN has as much to do with shaping discussions of a broader higher education bill as it does in seeking to influence the spending bill for next year.

“I think we may hold the same number or perhaps increase it a bit to keep track with inflation,” Cook said. “The bigger conversations around Pell, I imagine, are coming in a year or two when we get into reauthorization of the Higher Education Act.”

Other Long-Term Changes

While traditional higher-ed advocates are calling for a grant that goes further for the typical low-income college student, business and work-force groups have sought to open up Pell eligibility to more short-term programs that are designed to quickly train students in new skills and land them a higher-paying job.

Dane Linn, vice president at the Business Roundtable, said those so-called work-force grants are important to job training that is needed to fill vacancies at member companies.

“We would support funding for workforce Pell grants in the appropriations bill," he said via email. "However, we strongly encourage Congress to focus their efforts on reauthorizing the Higher Education Act."

The Trump administration, which released a report on apprenticeships last week that was sharply critical of higher ed, has also called for opening Pell to short-term programs.

The National Skills Coalition, like the Business Roundtable, isn’t actively pushing for eligibility for short-term programs as part of a spending deal, said Kermit Kaleba, the coalition's federal policy director. But they aren't taking the issue off the table, either.

“The challenge would be whether you can reach some sort of consensus around which version of short-term Pell you’re talking about,” he said.

In the Senate, Virginia Democrat Tim Kaine and Ohio Republican Rob Portman have offered one proposal for short-term programs to get access to Pell funding -- a sign of growing bipartisan interest in a major shift in the program. And last year the PROSPER Act, House Republicans’ bid to reauthorize the federal higher education law, included its own version of Pell for short-term programs.

Traditional higher-ed advocates likely will require some convincing, though, as any change to the Pell program will have ramifications for its traditional uses. Those groups are also concerned about quality controls for new programs and potential uses of the grant that would eat into a student’s lifetime grant eligibility, without getting them closer to a degree.

“We’re watching those conversations carefully and specifically watching for the details of proposals,” Cook said. “Right now we have more questions than answers.”