Obama proposes increase to Pell Grant funding

March 23, 2010 • Cassie Rains  
Filed under News

On February 1st, President Obama proposed his annual budget to the United States Congress. Obama’s projected budget includes an increase in Pell Grant funding by $17 billion.

The Pell Grant program gives financial aid to students whose family income and expected family contribution fall below a certain level. It is mostly based on the expected amount of family contribution, meaning how much one’s parents can contribute to help with paying tuition. Each person evaluated is given an EFC (expected family contribution) score. A person with a score of 0 is granted the full amount. From there, it is evaluated as to how much money one is eligible for. A person who is eligible for a Pell Grant and had a parent in the Armed Forces that was killed after 9/11 is granted the maximum amount automatically. Many people want to receive Pell Grants because they do not have to be repaid like a loan.

This, Obama’s second attempt to make the Pell Grant an entitlement to all qualified candidates, would make the total budget for the program roughly $35 billion. The last attempt was in February of last year, when Congress rejected the idea.

By making the Pell Grant an entitlement, Obama wants to be sure that everyone who qualifies receives the highest amount of money.

Expected family contribution is calculated by the Department of Education from a FAFSA (Free Application for Federal Student Aid). All students applying for financial aid must apply using the FAFSA form, available online at www.fafsa.ed.gov. It is recommended to apply by March 1st, but if that is not possible, one should still apply as early as possible.

In 2009, the maximum amount awarded to a student was $5,350. If Congress approves, the highest grant will be increased to $5,550 in 2010. In 2011, the maximum would reach 5,710. From then on, every year the amount would increase along with the consumer price index, plus 1%.

Carol Miller, financial aid director at UW- Whitewater, deals with financial aid statistics on a regular basis.

“This year at UW-Whitewater, we have about 9600 financial aid applicants.  To date, we have 2,449 students that are receiving Pell Grants this year.  That amounts to about 25% of all of our students receiving Pell Grants.  So you can see that not all students are eligible for Pell Grants,” Miller said.

The purpose of increasing the maximum amount revolves around making college affordable. It is believed that education is the key to helping our economy grow. With quickly rising tuition expenses, many find it hard to afford college for four or five years without assistance.

“America’s economic security depends on improving education. We have to educate our way to a better economy,” Secretary of Education Arne Duncan said.

The increase in grants is aimed at helping more people attend classes without much financial worry. One of Obama’s goals is to get people to start and finish their degrees so they can get better jobs. This may be the big break to becoming better prepared for global competition in our careers.

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