Good News for Federal Financial Aid
According to a report released earlier this month by the Congressional Budget Office, the Pell Grant, contrary to economic prediction over the past year, is going to remain on strong financial footing for 2014. Still, however, the debate continues over how the program should be handled.
While the program was predicted to have a $5.7 billion deficit, it is actually running a $9.2 billion surplus, raising questions as to the necessity of drastic cuts made to Pell Grant eligibility last year and possibly increasing the program’s sustainability, protecting it from those ready to make more damaging cuts to funding.
The program has been under constant scrutiny and budget reducing manipulations over the past few years, despite President Obama’s devotion to fund higher education. Students in for profit colleges no longer receive Pell Grant money, nor are students able to receive funds from the program during summer.
Pell Grant spending has risen by millions over the last few years. According to Education Department data, the program has seen an increase of almost 2 million recipients from 2007 to 2010. This is due in part to an economic downturn that produces more low income students, and increased the number of people returning to school; and in part because of changes to the program that brought expansion to eligibility. For example, in order to qualify for zero expected family contribution, a family must have an income of $30,000 a year instead of $20,000.
While a crisis of funding in the Pell Grant program has been avoided for at least one, maybe two more years, and will be exempt from sequestration cuts coming to many Federal programs in March, advocates of the Pell Grant are still pushing for ways to make it more sustainable and avoid crises in the near future.
There has been constant debate over the past few years over the effectiveness of the Pell Grant program, for various reasons. Champions of the increases to eligibility say that it is allowing a greater number of people to graduate college, which is the goal of the program. However, others claim that they will eventually overload the program, preventing the neediest students from receiving the money they need.
Fortunately, funding higher education is normally an issue both sides of the aisle can agree upon, making it likely that on at least this one issue, Congress may reach a solution on what changes can make the Pell Grant most effective, without implementing drastic cuts.