Higher Ed Consortium Recommends Ways To Improve Pell

By Brittany Hackett, Communications Staff 

In an effort to help more low-income students and families afford higher education, a consortium of higher education groups on Thursday issued a proposal that would keep payments and borrowing at no more than 10 percent of a family’s income each year for college.

The proposal is outlined in the Reimagining Aid Design and Delivery (RADD) Consortium for Higher Education Grants and Work-Study Reform’s “Beyond Pell: A Next-Generation Design for Federal Financial Aid.” The Consortium -- funded by the Bill & Melinda Gates Foundation as part of the RADD project -- is comprised of the American Association of State Colleges and Universities (AASCU), Young Invincibles, New America Foundation, and The Education Trust.

Over the last 40 years, the Pell Grant Program has “lost buying power in terms of helping students afford, pursue, and complete a college degree,” the Consortium said in its paper. “A next-generation design for federal financial aid can spur economic mobility, stem the tide of state disinvestment from higher education, and halt full-scale privatization of a public good.”

Prior to creating the consensus paper, each group of the Consortium issued its own paper that addressed ways to better target financial aid programs. The consensus paper “represents shared agreement … for reforming the dissemination of grants and work-study” among the four groups.

In the consensus paper, the Consortium offers three proposals that would ensure low-income students, defined as maximum Pell Grant recipients for students with family incomes of $23,000 or less, would not have to borrow or pay more than 10 percent of their families’ income each year for college. The proposals include creating:

  1. A New Federal Block Grant Program in which federal matching grants could be given to states that provide, per full-time student, funding “at a level equal to between 50 percent and 150 percent of the maximum Pell grant”;
  2. A Pell Grant Matching Program that would provide additional Pell funding to institutions that create an affordability guarantee that matches the 10 percent proposal above; and
  3. A New, Flexible Federalism for Higher Education in which states would be required to maintain an affordability guarantee if they are to continue to receive federal higher education funds. 

Other proposals to increase access and success for low-income students from the Consortium groups include clarifying the definition and requirements behind the Fee Application for Federal Student Aid (FAFSA); revamping the Federal Work Study (FWS) Program so that students with demonstrated financial need are given a dedicated percentage of eligible positions and include more employer outreach; and identifying minimum performance measures for any four-year college or university based on enrollment of low-income students and graduation rates. 

Below is a summary of each group’s individual paper:

  • AASCU: The group called for the creation of a Federal-State College Affordability Partnership that would aim to better incentivize state support for higher education. During the Consortium event Thursday, Daniel Hurley, AASCU associate vice president for government relations and state policy, said states should be held more accountable for their role in higher education at their public institutions. A partnership like the one described in AASCU’s report, co-authored by Hurley, would establish the expectation that states must contribute to their public higher education systems instead of reducing their contribution in favor of relying more heavily on federal funds or pushing the costs onto students and families. 
  • Education Trust: The group recommends proposals that will hold consistently underperforming schools accountable to taxpayers and students by imposing various sanctions on cases where there is no improvement, including cutting off access to federal aid programs. The federal government ought to play a more active role, before doling out check after check for higher education, by establishing minimum performance standards for four-year colleges “that align with its core purposes for investing in financial aid and giving institutions several years to meet those standards.” The aim should spur institutions to progress, not to diminish or close them, the report said.
  • New America: The report focuses on how to make better the federal grant programs for non-traditional students, including altering the definition of a dependent student to make it more flexible and reduce the administrative burden aid offices have in making that determination. The group also recommends requiring institutions to establish a procedure to help incoming students create degree-attainment plans to help non-traditional students complete their education in a timely manner.
  • Young Invinicibles: The group’s report examines how FWS can be improved through changes to the program’s allocation formula. The group outlines five steps it thinks could improve the program, including implementing a new distribution formula focused on Pell recipients and establishing a Career Internships Program within FWS. Other ideas include requiring students, institutions, and employers to agree on what constitutes “course of study” and promoting the program as a career-ready program by expanding the Job Location Development Programs. 

These proposals come on the heels of NASFAA’s own Campus-Based Formula task force report recommending ways to modernize the distribution of funds in the FWS program.

For more information on the RADD project, including highlights and summaries of NASFAA’s own work on previous phases of the initiative, please visit our RADD Center


Publication Date: 10/3/2014

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