Many people worry about the future of the Pell Grant program, which is operated under the Department of Education, in light of President Donald Trump’s plans to shut down the federal agency or remove some of its responsibilities.
While the Trump administration is unlikely to eliminate the Pell Grant, its funding is running out. Without extra funding, students may receive reduced aid — or none at all — over the next decade.
The federal government paid out $27.2 billion in the academic year 2022-2023, Statista reported, but that funding level appears to be no longer sustainable.
“The Pell Grant Program is now expected to run out of reserves by the end of this year and is expected to face a $71 billion to $111 billion 10-year shortfall, based on new data from the Congressional Budget Office (CBO),” according to the Committee for a Responsible Federal Budget.
The Roots of the Pell Grant
The first federal program aimed to help college students graduate can be traced back to the 1940s with the passage of the GI Bill, which gave veterans and their family members money to help cover the cost of tuition for school or training.
Then, in the 1950s, the federal government created its first student loan and loan forgiveness program. Almost a decade later, Congress passed the Higher Education Act of 1965, a program initially meant to provide grants to low-income students to help pay for college. It was later renamed Pell Grants.
According to a report from the Education Data Initiative, “African-Americans receive 57% of Pell Grant funding, followed by American Indians with 51%, Hispanics with 46%, Pacific Islanders with 35%, Whites with 31%, and Asians with 30%.”
While the Pell Grant is a powerful resource for helping low-income students afford college, the funding does not have the same impact as it did when it was created.
A Change in Value Over the Years
The maximum Pell grant amount for the 2024-2025 school year is $7,395 based on a parent’s expected family contribution (EFC), and the minimum amount granted is $740.
The average cost of tuition is $11,610 per year at public in-state schools; $30,780 for public out-of-state schools and $43,350 for private four-year colleges, according to a 2024 report from the College Board, a nonprofit organization that helps students prepare for college. It is known for the Scholastic Assessment Test (SAT) and Advanced Placement (AP) classes.
“The Pell Grant, for decades now in this country, has been used as a critical federally funded tool to create more affordable pathways for higher education in the United States,” said Jorge Burmicky, Ph.D., an assistant professor of Higher Education Leadership and Policy Studies at Howard University.
“So obviously, the biggest problem that we have right now as it relates to equity is that the value of the Pell is no longer as much as it used to be, compared to the cost of college today.”
A Push to #DoublePell and #DoTheFAFSA
Several organizations — including the National Association of Student Financial Aid Administrators (NASFAA) — are urging Congress to #DoublePell and raise the maximum award to $13,000.
“At its peak, the maximum grant covered three-quarters of the cost of attending a four-year public college,” NASFAA and its partners wrote in a joint letter to Congress.
“Now, it covers less than one-third of that cost,” they said. “Students … are in critical need of additional grant aid to pay for college. Doubling the maximum Pell Grant — and permanently indexing the grant to inflation to ensure its value doesn’t diminish over time — will boost college enrollment, improve graduation rates, and honor the history and value of these grants as the keystone federal investment in college affordability.”
Another pressing issue is the decline in completing the Free Application for Federal Student Aid (FAFSA) — the form students must submit to qualify for Pell.
“FAFSA completions for the class of 2024 have not caught up with previous enrollment cycles and while the gap in recent weeks has been closing, completion rates are still down 24.3% compared to the previous academic year,” according to a report from the National College Attainment Network (NCAN), a nonprofit organization aiming to increase equity in postsecondary education access.
NCAN has several initiatives to raise FAFSA competitions compared to previous years, said Simone Pringle, a program associate.
“NCAN offers members working at all levels across the country best practice approaches to driving FAFSA completion rates,” Pringle said. “In previous years, we’ve spearheaded a nationwide direct-to-student #DoTheFAFSA campaign, and we continue to release data on high school seniors’ FAFSA completion rates through our FAFSA Tracker dashboard.”
While the Pell Grant won’t be affected by the future downsizing of the federal Department of Education, it needs to be restructured to continue easing the financial burden students face with access to postsecondary education.
Tcherika Petit-Frere is an education reporter for HUNewsService.com.
