Pell Grant program faces $18 billion shortfall

The Pell Grant program for needy college students is facing a massive shortfall as the country’s bleak job market drives people back to school, reports the Associated Press. An administration official told AP the program will cost $18 billion more than Congress and the White House had anticipated over the next three years. "The administration is working with Congress to fill the gap, and we are committed to making sure the U.S. has an educated work force able to fill the jobs of the 21st century," said the official, who was not authorized to speak publicly. The red ink likely won’t affect students and parents, but it will affect the federal government, which must find a way to come up with the extra $18 billion. Shortfalls and surpluses are common in the Pell Grant program, which forms the foundation for federal college aid. Anyone who is eligible gets a grant, making it difficult for the government to anticipate how many people will apply. Pell Grants typically go to families earning less than $40,000, and about 6.3 million students received Pell Grants last year. Yet the looming shortfall is the largest in the 36-year history of the program, with an entire budget of about $18 billion. Lawmakers had approved a 13-percent increase in the maximum grant as part of President Barack Obama’s economic stimulus law. That boosted this year’s Pell Grant by about $600, to $5,350. The chairman of the House Education and Labor Committee, Rep. George Miller, D-Calif., said lawmakers will work together to make sure the program is funded, and he sees a silver lining in the shortfall: "In this difficult economy, it is good news that more people are going back to school to get the skills they need for in-demand jobs," he said. "We want to make sure we are doing everything we can to help them in this effort."

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