The recently introduced Senate Reconciliation bill contains far less detrimental changes to the Pell Grant program than the House version. The Senate version does not modify current
enrollment requirements, which has allowed students and aid administrators to breathe a sigh of relief for now. However, the Senate version contains a modification that seems to target and punish a very limited number of students. The provision indicates
that: “a student shall not be eligible for a Federal Pell Grant under subsection (b) during any period for which the student receives grant aid from sources other than under this title, including other Federal sources, States, institutions
of higher education, or private sources, in an amount that equals or exceeds the student’s cost of attendance for such period.” The good news here is that there are very few student aid packages issued every year that contain grant aid equal to a
student’s full cost of attendance. The baffling issue with this is that the Pell Grant program is an entitlement program and if the student meets all federal aid eligibility requirements, the student should receive the funds.
Perhaps the quirkiest modification that accompanies this change is this: “the maximum period during which a student may receive Federal Pell Grants under paragraph (5)(A) shall be reduced by any period during which a student is not eligible for a Federal
Pell Grant under subparagraph (A).’’ In other words, the student’s lifetime eligibility would be reduced for each term their cost of attendance was covered, but they were ineligible to use their Pell Grant. This is a most perplexing concept that will
leave aid administrators and students with puzzled looks.
Institutions consider the Pell Grant program as the cornerstone of financial aid packages for students who qualify. Colleges’ packaging strategies are designed to build upon a student’s federal and state aid eligibility before adding institutional funds
so that no aid package exceeds the cost of attendance. Therefore, this proposed change would have little if any impact on most Pell eligible students. Students that receive a full athletic scholarship for Division 1 or 2 colleges may be most impacted
if any of those students are Pell eligible. Current regulations do allow
Pell eligible students to utilize their Pell Grant in addition to the athletic scholarship and that total can exceed the cost of attendance. Often full scholarship athletes may have limited work opportunities so utilizing Pell Grant funds for low-income
students is a much-needed option for these students. Cost savings for this group would be very limited.
The Senate and House agree on adding foreign income to AGI (adjusted gross income) and eliminating the reporting of small business and family farm assets when calculating Pell eligibility. Both chambers also recommend eliminating Pell Grant eligibility
to students who may have qualified using the Poverty Chart method but have an SAI (student aid index) that is larger than twice the maximum Pell Grant for that year. This provision will help ensure that these grant dollars are awarded to students
with significant financial need.
Now the process begins to negotiate the final version for reconciliation. The National College Attainment Network (NCAN) will continue to advocate for changes that support students receiving the most impactful financial aid dollars to meet their cost
of college.
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