President Bush’s 2004 budget proposal increases overall funding for the Pell Grant program, but fails to increase the maximum annual award of the grant.
Pell grants are gift awards from the federal government, targeted for undergraduate students in dire need of financial assistance. Unlike student loans, they do not need to be paid back.
“Eligibility for the grant is determined by a complicated formula that primarily takes into account the family’s income, the number of people in the household and the number of children in college,” said Tally Hart, director of student financial aid at Ohio State.
While campaigning, Bush promised to raise the maximum annual Pell grant award to $5,100 per recipient. However, this has yet to happen, and the maximum award remains frozen at $4,000.
“A frozen Pell grant award would not be so significant if the costs of tuition were frozen, but we all know that is not the case,” Hart said. “More students have become eligible for the grant in recent years and it is definitely lacking in terms of purchasing power. This is a really critical policy issue.”
Bush’s 2004 education budget proposal includes a $1.9-billion increase in funding for the Pell Grant program, allowing nearly 1 million more students to receive the grant than when he took office.
Yet, this keeps the maximum award frozen at $4,000 per year, said Jane Glickman of the Department of Education.
The budget proposal brings Pell grant funding to an all-time high of $12.7 billion, enabling nearly 4.9 million students to receive financial assistance, but some believe the frozen awards do not provide enough financial assistance.
“We are dealing with the baby boom’s echo and have seen significant increases in the number of college students nationwide. The additional $1.9 billion in funding is appreciated since it will allow more students to receive the grant, but the maximum award of $4,000 is simply not enough to cover the rising costs of tuition at many universities,” said Melanie Corrigan, the assistant director of policy analysis for the American Council on Education.
In 1976, the Pell grant’s purchasing power covered 84 percent of the cost at a public university, but today the grant covers only 40 percent. Moreover, it would take a $7,000 maximum annual award to restore the purchasing power levels of 1976, according to the Democratic National Committee.
9,284 Pell grant recipients attend OSU, receiving just under $20 million per year. If students cannot cover the cost of college with the Pell grant awards, they must secure funding from either the state — which is unlikely — the university or their families, Hart said.
