Stimulus Package Ensures Pell Grants

With a 61-37 vote, the Senate passed its version of President Barack Obama’s stimulus package on Feb. 10 with $14 billion for Pell Grants still in place. Although smaller than the House’s suggestion of $16 billion for Pell Grants, the Senate’s smaller allocation would still be the largest single increase to the Pell Grant program since its inception.
Pell Grants are given to students on the basis of financial need and do not have to be repaid. They are given by the federal government and are awarded to students who show the greatest financial need and have completed their financial aid application.
Financial aid counselor Stacey Choi stated that people who are eligible for Pell Grants need to be “full or half-time undergraduate students in a degree program and U.S. citizens or eligible non-citizens, which include permanent residents.”
Choi also explained that students can apply for the Pell Grant by filing out the Free Application for Federal Student Aid (FAFSA).
The awards are determined based on financial eligibility and students are given the Pell Grant to help them pay for an education according to Choi.
The award amounts vary from $400 to $4,731. These amounts are based on the Federal Payment Schedule.
“The government is supposed to increase the Pell Grant each year,” Choi said.
Although the amount of money toward the Pell Grants is increasing, education funding as a whole is a lesser priority under the Senate’s version of the bill. The Senate lowered the House’s suggestion of a $150 billion allocation for higher education and public schools to a meager $83 billion in the Senate.
The Senate’s version of the bill did not include $16 billion for new educational building projects, yet almost $40 billion is set to fund state-sponsored education and an increase of $490 million for federal work study.
President Obama has demonstrated that he wants those funds reinstated. During a televised news conference, he appeared confused by lawmakers who argued that states are in charge of school construction instead of the federal government.
Secretary of Education Arne Duncan pointed out the same issue when he visited a high school that is in need of repairs in Arlington, VA. Duncan also warned that nearly 600,000 education jobs are at risk unless a stimulus package is passed and that the Senate’s idea of $39 billion in state aid for schools will not be helpful.
State governors are continuously lobbying lawmakers to enact the levels of education spending proposed in the House’s bill. Gov. Ted Strickland of Ohio warns that the Senate measure will result in higher tuition for 40 percent of public college students and the loss of thousands of state and local government jobs. At least 40 states are running deficits this year, and school districts in those states could be affected tremendously. For the most part, states use up about one third of all their revenue on education.
Republican lawmakers and some education experts are reluctant about the benefits of more money for schools in a final stimulus bill. In an article for the National Review Online, Rick Hess, director of Education Policy at the American Enterprise Institute, stated that federal aid to schools should owe the government money.
“When it comes to education, conservatives can identify the conditions under which they might view the proposed aid more warmly by focusing on incentives, cost-effectiveness, and fiscal restraint,” Hess said. “States and localities would have to demonstrate that they were reallocating dollars from less effective programs and services to more effective ones. Federal aid would be conditioned on its recipients’ pursuing a course back to financial sustainability by unwinding unaffordable promises of benefits and pensions, as has been the case with Detroit’s automakers.”
Even if Congress chooses the Senate’s version of the stimulus bill without the school construction funding and the additional aid to states, it will still account for a large federal investment in education. The Department of Education currently provides $59.2 billion for education programs.
There are some students on campus who are unaware of the Pell Grant and whom it benefits. Tra Truong, a third-year biology major at UCI, is currently supported by financial aid, by both the Cal Grant as well as a UCI grant. However she is not informed about the Pell Grant situation.
“I don’t know what the Pell Grant is and what it’s for,” Truong said.
Choi believes that the money used toward education should not be cut, because in doing so, the amount of money toward education may lead to students taking out more loans.
“Students needing to take out more loans will lead to an increase of students in community colleges, UCs and CSUs over the smaller private schools,” Choi said.