In his budget for the fiscal year 2005, President George Bush proposed to eliminate the $3.7 billion deficit in the federal Pell Grant program, which provides need-based financial aid to low-income college students.
While eliminating the deficit is imperative, financial-aid officials and lobbyists are unhappy about the other proposals in the 2005 budget, including one that keeps the maximum award of Pell Grants at $4,050 for the third year in a row.
“We are committed to working with Congress to retire the shortfall without cutting student awards, and [we] will work to strengthen and enhance the Pell Grant program for the future,” Education Department assistant secretary Sally Stroup said in a statement released last week.
The Pell Grant was introduced to cover 60 percent of college costs for students who receive the grant. At the University of Wisconsin, all expenses for an instate student total $14,000. Sixty percent of that amount is $8,400, more than double the amount of the maximum Pell Grant.
“Thirty-seven hundred UW students are Pell Grant recipients, which means we get $8.9 million through the program, and that’s only a small percentage of our students,” UW director of student financial services Steve Van Ess said.
The Pell Grant program is an entitlement program, in which every student who qualifies for a grant will get one, depending on need. Each fiscal year Congress estimates the amount that will be needed to fund the program, but Stroup said they have misjudged the amount the past several years.
“If Congress follows the president’s lead and fully meets its obligations to students each year, we will prevent the past funding shortfalls from worsening in the future,” Stroup said.
According to the fiscal year 2005 budget, the Pell Grant program has not been very successful in achieving its goals for its main student-aid programs.
Other than freezing the maximum grant amount at $4,050 and allocation at $3.7 billion to curtail the program’s shortfall, the administration is proposing to change the way lawmakers set the maximum grant each year and change how Congress estimates the amount the Education Department needs to fund the program. The proposal aims to prevent lawmakers from allocating less money than is needed to cover the program’s funding, but also gives less flexibility in changing the amount of the maximum grant, which could keep it from increasing.
The presidential administration is concerned with eliminating the shortfall, even if it means not increasing the grant amount while tuition increases.
Other related proposals up for legislation include other ways for students to receive aid. A spin off of the Pell Grant program called the “Pell Grants Plus Act” was recently introduced to Congress and awards up to $1,000 to students, but factors include academic performance along with need.
“They should just fund it, not change it,” Van Ess said. “They don’t need to come up with extra criteria; they need to allocate more money for needy students.”
