Spending Bill Proposed in House Would Cut 2011-12 Pell Awards

The 2011-12 maximum Pell Grant would be reduced from $5,550 to $4,705 under a continuing resolution (CR) introduced in the House by Republican leaders late Friday afternoon.  The $845 cut comes from discretionary Pell funding, reducing the previously set $4,860 discretionary maximum amount to $4,015.  The $690 mandatory funding add-on from the Healthcare and Education Reconciliation Act of 2010 (HCERA) will be added to $4,015 to bring the maximum award to $4,705.

The proposed CR would set spending levels for federal programs for the remainder of FY2011 (March 4 to Sept. 30); it would also eliminate the Federal Supplemental Educational Opportunity Grant (FSEOG) and the Leveraging Educational Assistance Partnership (LEAP) programs, while decreasing funding for the Gear-Up and TRIO programs. Federal Direct Stafford and PLUS loans and the Federal Work-Study program would not be impacted under the proposed bill. 

Overall, the bill would decrease education spending by more than 15 percent ($10.6 billion) from the current CR that is set to expire on March 4. The House is expected to vote on the bill as early as this week. 

Even if the proposed CR passes in the House, the bill has little chance of passing in the Democrat-controlled Senate.  If Congress cannot agree on a CR, is likely that another short-term resolution will be passed when the current CR expires on March 4, to provide more time for debate and negotiations.  

If the proposed legislation does become law, the Department of Education would need to issue revised 2011- 12 Pell Grant Payment and Disbursement Schedules to reflect cuts to the Pell program.  Thus, any financial aid packages already prepared for the 2011-12 year that include Pell Grant, FSEOG, and/or LEAP funds would be impacted.

NASFAA encourages you to act now to urge your representatives in Congress to oppose cuts to these vital student aid programs. 

"This legislation would have a devastating effect on students' ability to pay for college," said Justin Draeger, president of the National Association of Student Financial Aid Administrators. "Compounding the problem is the fact that some students and families have already received financial aid packages that would have to be revised if this measure is passed. Right now, millions of students are making critical decisions about attending college in the fall. Creating this type of uncertainty adds an additional barrier to higher education for low-income students and their families."