Pell Grant Program in Peril

While Senators managed to save the Pell Grant program—the nation’s most robust financial aid program for university students—Congressional Democrats and university administrators are worried that Republicans will use their new House majority to slash the program’s funding. On December 21, the Senate’s Appropriations Committee reached a budget deal that, among other things, would maintain funding increases for the Pell Grant program. Last March, Congress allotted the program an additional $36 million over the next decade and raised the maximum allotment available from $4,050 up to $5,550. The budget deal, only intended to last until March 4, is good news for students and universities for now. However the program may still be in danger because the newly empowered Republicans hope to curb government spending to reduce the national deficit. University administrators, including those at The New School, are worried that Republicans will cut funding to the Pell program.

“It is possible that a new majority in the House will target Pell, among other programs, to reduce the federal deficit,” said Eileen Doyle, Assistant Vice President for Student Financial Services. “We are keeping a watchful eye on the situation in Washington.”

In what could be good news for Pell proponents, on January 4, The New York Times reported that House Republicans have signaled they will back off their campaign pledge of cutting $100 billion from the deficit.

“I think they woke up to the reality that this will have a direct negative impact on people’s lives,” Representative Chris Van Hollen, the senior Democrat on the Appropriations Committee, who helped craft the December 21 deal, told The Times. “You know, it’s easy to talk about these things in the abstract. It’s another thing when you start taking away people’s college loans and Pell Grants or cutting early education programs.”

Despite the news that Republicans may be backing down on their pledge to cut spending, many financial aid experts are still worried that Republicans may continue to block any funding increases. Experts have noticed an explosion in need, leaving the Pell program underfunded by at least $8 billion for 2012. The recession, and the rise in university enrollment which has accompanied it, have only exacerbated the programs funding woes.

“Next year, there will be 8.7 million Pell recipients, and the cost of the program will be about $34 billion,” Terry Hartle, senior vice president at the American Council on Education, told The Times in an article on December 18. “It’s more than doubled in five years. Congress has two choices now: they can add $5.7 billion more and keep the maximum award, or they cannot provide it and let the Pell for next year fall.”

Doyle, The New School administrator, said that roughly 1,700 New School students receive some sort of financial support through the Pell program, but couldn’t say how they or the university would be affected by cuts.

“It's simply too early for us to know how a potential cut will affect financial aid in the coming years,” she said.

While much of the discussion about the program has centered around students, the Southeast Missourian, a daily newspaper serving Missouri, has also pointed out that universities will be put in a difficult position without the federal funding. Many universities have already determined their budgets on the increase in federal aid, they may be forced to increase tuition and implement more student fees in order to make up for the shortfall in financing.