Preserving the Federal Pell Grant Program. BHEF Policy Brief

The Federal Pell Grant Program is a critical source of grant aid for many low-and moderate-income college students. Over the past decade, the federal government has expanded the program to serve more students, increasing the maximum level of each award to $5,550 and better ensuring college access and success. However, the House 2012 budget proposal calls for drastic cuts to the program, reducing the maximum grant by as much as 45 percent to $3,040. These cuts are substantially disproportionate to other cuts in the federal budget, unduly affecting the most vulnerable students in the college pipeline. The future U.S. workforce will require higher levels of educational attainment to meet workforce demand, particularly in fields expected to fuel the innovation economy. Moreover, demographic trends show that an increasing number of low-income students, who traditionally have not attended college, will need to enroll in postsecondary education and earn baccalaureate degrees to meet this demand. Business-Higher Education Forum (BHEF) members are dedicated to protecting the sustainability of the Pell Grant Program for low-income students already forced to navigate rising tuition rates and significant reductions to state higher education budgets. In the event that reductions to the Pell Grant Program are unavoidable, BHEF urges the Administration to oppose disproportionate cuts to the Pell Grant Program, compared to other federal programs, or the elimination of other Title IV programs to save the Pell program. Significant cuts to student aid programs will encourage large numbers of low-income students, already challenged by the recession, to drop out of postsecondary education, to the detriment of America's long-term competitiveness. (Contains 5 figures and 8 endnotes.)