Pell Grants may be reduced next year, subsequent years

Notwithstanding. It’s a word used countless times in House Resolution 1, the Full-Year Continuing Appropriations Act, which would fund the federal government for the remainder of the 2011 fiscal year ending Sept. 30. The question remains if higher education and the economy will withstand the provisions put forth by the resolution.Among many other program cuts, the resolution would cut the maximum Pell Grant award of $5,550 by $845 and lower the average award by $785.

“That’s about all I get,” said Tyler Johnson, junior turf grass management major. “It’s sort of hard to swallow.”

More than 4,000 Tech students received a Pell Grant during the 2010-11 academic year, with an average award amount of $3,788. About 15.4 million dollars has been given out, and Financial Aid expects to make some additional awards to those taking summer courses, according to Lester McKenzie, Financial Aid director.

“I believe this cut could have a devastating effect on our student population,” McKenzie said. “The University will adapt and adjust, just as it has for 100 years, but the immediate concern is for the students currently enrolled and who may be enrolling in the near future.”

Hundreds of thousands of students across the nation would lose access to the grant entirely, and by 2017, students would see a $2,090 cut to the currently projected maximum award of $6,105.

The resolution passed through the House last week by a 235 to 189 vote, with 9 present/not voting. It still has to make it through the Senate and be signed by the president before taking effect.

“We are placed in the inevitable position of possibly rescinding award offers based on legislation passage,” McKenzie said.

Hal Rogers, House Appropriations chairman, said Feb. 15 on the House floor, “The resolution represents the largest reduction in non-security discretionary spending in the history of the nation. Never before has Congress undertaken a task of this magnitude, but never before have we been faced with a deficit crisis of this scale.”

The United States borrows around 40 cents for every dollar it spends, much of this money coming from China.

Jess Hill, senior earth science major, said, “It’s horrible. America is shooting itself in the foot. Why don’t they cut funding to the war and deal with the problems here? Everyone acts like that’s not the problem with the budget, but it is.”

Rogers said, “This bill is about shared commitments and shared sacrifice. These cuts are the result of difficult work by our subcommittees to make the smartest and fairest reductions possible. No stones were left unturned, and no programs were held sacred.”

Shadi Saeed, freshman Mechanical Engineering major, asked, “Why us? Go take it from the employers, people who are working. I really do not like this bill. I’ll have to work for the rest [of the money previously provided by Pell].”

McKenzie said, “I think anyone who has benefitted from one of the federal aid programs should take some time this week to write letters-go on the senator’s web pages and submit your position on this resolution.”

McKenzie did so himself, sending a letter to Sen. Lamar Alexander after the resolution passed in the House. He also created a Facebook page for Financial Aid Administrators because of this resolution.

Rogers said, “Our subcommittees scoured the budget for wasteful activities and cleaned out excessive and unnecessary spending, while prioritizing the most essential and effective programs.”

Mathew Collins, freshman mechanical engineering major, said, “I really don’t see the benefit. In the long run, more individuals across the country will go into debt.”

The Pell Grant reduction would essentially reverse recently passed legislation that would increase aid to $64 billion during the next decade. Nearly $33 billion was allotted for the program during the 2009-10 fiscal year, however, an additional $5.7 billion was awarded. The Pell shortfall was factored into the next year’s budget.

Rodgers said, “Even if we all agree a program is efficient and needed, we can’t spend money we don’t have. The more the government borrows, spends and regulates, the harder it is for business to access capital, grow and create jobs.”

Eighty percent of the fastest growing jobs in America demand training above a high school level. Current estimates show America needs 22 million more degrees by 2018, however, we are on pace to be three million short because of high college costs. Rising cost will prevent more than three million college-qualified students from low and moderate-income backgrounds from getting a degree this decade.

Norman Frese, freshman Mechanical Engineering major, said, “The idea should be to look at what’s driving the increased cost of education. If I look at it selfishly, I’d be upset that they’re taking my money, but it’s not the government’s responsibility to give me money. If I value my education, it’s my responsibility to pay for it.”

Collins said, “It doesn’t seem fair to me that because the economy is low now that students are being punished. Pell benefits low income people. I don’t understand their logic on that.”

About 44 percent of higher-education students, or around 8.5 million people, received a Pell Grant last year. Nearly 160,000 Tennessee students received Pell funding during the 2009-10 fiscal year, amounting to more than $585.6 million, according to the National Association of Independent Colleges and Universities.

The Pell Grant maximum award amount has only been lowered three times in the 40-year history of the program, but the cost of the program has gone up 196 percent in the last five years. Between the 2008-09 and the 2009-10 fiscal years, the number of grants increased 26 percent, and the average amount awarded increased 25 percent. Overall, the cost of the program went up 58 percent in that one year. These numbers should be kept in perspective, however.

A $500 temporary increase was created as part of the economic stimulus law in early 2009. Shortly after, the bank-based student loan program was eliminated, and Federal Direct Lending became the standard. Because of the money this was projected to save the government, the temporary increase was made permanent, and the maximum award amount was to increase as much as the Consumer Price Index plus one percent every year for the next 10 years.

It was estimated this would amount to a maximum award amount of $7,250 by 2020. However, by the time this measure passed, loan savings had decreased from the projected amount, and the cost of the Pell Grant program had risen, due to more people making use of the funds. Additionally, part of the loan savings was marked for use in healthcare reform.

The current funding measure will expire on March 4.

Sen. Alexander was unavailable for comment before deadline.

Rich Williams, higher education advocate for uspirg.org contributed to this report.