A Pell Grant is money the federal government provides for students who need it to pay for college. Federal Pell Grants are limited to students with financial need, who have not earned their first bachelor's degree or who are not enrolled in certain post-baccalaureate programs, through participating institutions.
The Pell Grant is named after U.S. Senator Claiborne Pell, Democrat of Rhode Island, and was originally known as the Basic Educational Opportunity Grant. A Pell Grant is generally considered to be the foundation of a student's financial aid package, to which other forms of aid are added.
The Federal Pell Grant program is sponsored by the United States Department of Education which determines the student's financial need. The U.S Department of Education uses a standard formula to evaluate financial information reported on the Free Application for Federal Student Aid (FAFSA) to determine the student's expected family contribution (EFC).
The Pell Grant is covered by legislation titled the Higher Education Act of 1965 (HEA), Title IV, Part A, Subpart 1; 20 U.S.C. 1070a. These federal funded grants are not like loans and do not have to be repaid. Students may use their grants at any one of approximately 5,400 participating postsecondary institutions. These federally funded grants help about 5.4 million full-time and part-time college and vocational school students nationally.
Here's news about the cutting of the Pell Grants:
An EXCERPT From US News & World Report, March 2, 2011
The Pell Grant Program, widely considered to be the backbone of financial aid to the country's most needy students, was subject to a decrease in funding as part of a Continuing Resolution (H.R. 1), which cleared the House last month and cut about $60 billion from the federal budget. Lawmakers levied a $5.7 billion cut to the Pell Grant Program, which grants aid to low- and moderate-income students based on a formula that considers annual income and school cost, among other factors. The changes would take effect for the 2011-12 school year, decreasing the maximum amount of aid for the most needy students from $5,550 to $4,705, a difference of $845. Plus, about 1.7 million students who receive smaller Pell Grants would become ineligible for the program.
Approval of the cuts is far from guaranteed, since the Pell Grant Program has long received bipartisan support in the Senate. But the House's cut represents a struggling economy's fix to a program that was "absolutely" unsustainable, according to Rep. Virginia Foxx, a Republican from North Carolina who chairs the Congressional Subcommittee on Higher Education and Workforce Training. "It's hardly a devastating cut when you are cutting such a small amount," she says, citing a sharp rise in the program's cost over the last few years. "We're cutting entire programs in lots of cases."
The Pell Grant Program was injected with about $17 billion over two years as part of the American Recovery and Reinvestment Act of 2009, but the extra money did not match the needs of the skyrocketing numbers of students enrolling in college and qualifying for aid through the recession. (About 27 percent of U.S. college students currently receive some amount of Pell funding.) This confluence of events has put pressure on the long-term sustainability of the program, says Justin Draeger, president of the National Association of Student Financial Aid Administrators. The program, which was fully funded for 2011-12 before H.R. 1 was passed in the House, will face a budget shortfall of about $20 billion in 2012 if no long-term changes are made.
From the same article:
"Pell Grants were to be for the most needy students—most needy students," Foxx stressed. "The poverty rate in this country is about 15 percent right now; 27 percent of all college students are getting Pell Grants. It appears to me that the program has gone way beyond its scope."
But it is these most needy students, advocates of full Pell Grant funding for 2011-12 say, who would be in most jeopardy if the House bill is approved, since H.R. 1 lowers the maximum amount of funding for the lowest-income students by about $800.
"These are the students…who are already receiving quite a bit of loans to the point where a lot of students can't just pick up $845 working an extra shift at their work or getting another loan," says Rich Williams, higher education advocate at the U.S. Public Interest Research Group, a nonprofit, non-partisan organization. "These students tend to be maxed out in everything."
While full-funding proponents such as Williams acknowledge the program faces long-term sustainability issues, some contend that cuts for the 2011-12 school year are ill timed. By law, the U.S. Department of Education published federal funding tables for financial aid administrators on Feb. 1, indicating that Congressional funding was adequate to sustain the Pell Grant Program at last year's rates. Because financial aid advisers have had more than a month to deliver aid offers to future students, the House cuts, if approved by the Senate, could muddle the plans of financial aid offices across the country.
But Pell Grants are supposed to be only one portion of a student's fees - there are scholarships, and there are student loans (now, from the goverment). And let us not forget that a Grant is not a loan. A Grant is free money.
Yes, it goes toward someone getting an education so they can get a good job...but it is still money that doesn't have to be paid back.
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