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Archive for Friday, October 9, 2009

Obama seeks $40B boost to Pell grants

October 9, 2009

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— After three years of major increases in federal Pell grants for needy college students, President Barack Obama aims to boost the aid further with $40 billion in funding over the next decade. But even that influx might not ensure that the grants will recover and sustain the purchasing power they once held.

Experts agree on the reason: soaring college costs.

In the late 1970s, the maximum Pell award covered more than two-thirds of tuition and fees for a public four-year university. In the 1980s, it covered roughly half of such expenses. In the last school year, it covered about a third.

“There is an increasing gap that students have to cover on their own,” said Sandy Baum, a senior policy analyst for the College Board, in New York. “It’s obviously a problem for students. They’re working more; they’re borrowing more.”

Through grant increases, lawmakers have sought to ease the burden for millions of students such as Linda Abdulle. She faces higher tuition in her fourth year at Trinity Washington University than when she first enrolled. The bill is up 9 percent, to $19,360. But Abdulle’s Pell grant has risen 32 percent in that time, to $5,350.

The larger Pell grants have helped Abdulle, 20, and her mother, a manager at a fast-food restaurant, who rely on an assortment of scholarships and loans to pay for the private Washington school. Abdulle’s contribution has dwindled from about $400 a semester to $200. “Every little penny that you get really counts,” she said.

U.S. Rep. George Miller, D-Calif., chairman of the Education and Labor Committee, said that a student aid bill the House passed last month would strengthen the Pell program with $40 billion in additional funding, indexing it for the first time to inflation, but that it would not erase questions about spiraling tuition and fees.

“This is a very important round of resources to be made available to students and families,” Miller said. “But clearly, for a host of reasons, the costs continue to rise faster than families and the federal government can keep up with them. ... We’ve arrived at a point where we have to, in a most serious vein, ask about what’s the future for financing higher education in this country.”

The grants, launched in 1973 and named for Claiborne Pell, a longtime Democratic senator from Rhode Island, have become the bedrock of undergraduate aid. Coupled with state and school awards, Pell grants determine how much needy students must work or borrow to pay bills.

This school year, according to the Obama administration, about 7 million students from low- and moderate-income households will qualify for the grants through the Free Application for Federal Student Aid. The average award will be $3,611, and the maximum, $5,350. The total federal outlay: $25 billion.

The maximum Pell award has jumped since 2006 after it was frozen for several years at $4,050.

Skeptics say the grants give schools an excuse to raise tuition and fees, often at a rate well beyond inflation, at a time when state revenue shortages and endowment losses are squeezing universities.

“When you look at the overall trend, it is very clear that colleges and universities eat up all of this money, eventually,” said Neal McCluskey of the Cato Institute, a public policy research foundation. “It sort of gives them a constantly increasing budget.”

Comments

SettingTheRecordStraight 4 years, 6 months ago

The actual cost to send one student to the University of Kansas for one year is over $21,000. And how much do in-state students pay for tuition?

Therein lies the problem.

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