Obtaining financial aid may become more difficult next year as
the federal government struggles to provide adequate funding for
eligible applicants.
The federal budget proposal for 2005, released by the Bush
administration last week, asked for an $856 million increase for
the Pell Grant program, but this amount may not be sufficient to
keep up with the recent rises in tuition and Pell Grant
applicants.
Pell Grants, the primary source of federal grant money, are
distributed to low- and middle-income students on the basis of the
applicants’ and their families’ financial
circumstances.
The budget proposal would maintain the maximum award amount of
$4,050, but the average grant amount would decrease $42 from 2004
to $2,399. Both the number of recipients and the amount of aid
available to students would decrease.
The budget figures were developed on the assumption that the
surge in the number of Pell Grant applicants over the past few
years would shrink back down over next two years to come into line
with historical numbers.
“It’s a very disappointing proposal,” said
Daniel Kaufman, a spokesman for the National Education
Association.
“It used to be that Pell Grants would pay for your
education. Now a $4,000 grant would barely pay for tuition for a
year,” Kaufman said.
He believes the Bush administration has forced students to take
out high loans by not providing sufficient funding for Pell
Grants.
“Three-quarters of assistance is in the form of loans,
which creates an enormous debt burden,” Kaufman said.
To keep pace with rising tuition prices, the Pell Grant award
should be about $6,000, said Ronald Johnson, director of financial
aid at UCLA. But instead, the maximum award has stalled at about
$4,000 for several years.
Due to the rising costs associated with the program, the total
amount of Pell Grant aid available to students would drop by nearly
$240 million. Many higher education organizations believe this
decrease could have a impact on students.
“The students with high need ““ low-income students
““ will be hurt the most,” said Rich Harpel, director of
federal relations for the National Association of State
Universities and Land-Grant Colleges.
Students applying for financial aid in the coming years
potentially face severe changes in the Pell Grant program.
According to the budget proposal, unexpected applicant growth
and insufficient appropriations will produce a funding shortfall of
$3.7 billion by next year.
The proposal states, “This shortfall poses a serious
threat to the long-term stability of the Pell Grant
program.”
But the program’s popularity provides the political
impetus for Congress to ensure the Pell Grant program does not
disappear.
“I believe that the Pell Grant program is to higher
education as social security is to the general population and I
don’t believe Congress would ever let the program go
bankrupt,” Harpel said.
While the possible overhaul of the Pell Grant program is in
question, short-term changes are already in the works.
“The budget includes a provision in there that would
actually cut Pell Grants or cut other programs if more students
than predicted apply,” Kaufman said.
“It’s a sneaky way to cut a program that a lot of
families rely on to pay for tuition,” he added.