Pell Grants see significant changes in $1 trillion spending bill

Students who do not complete their undergraduate degrees in six years will lose Pell Grant funding; previously, students were eligible for Pell Grants as long as they completed their undergraduate degrees in nine years. The change is expected to save the federal government about $11 billion over the next decade.

It’s estimated that about 100,000 students would be affected by this change, said Amy Wilkins, vice president for government affairs and communications for the advocacy group Education Trust. Students who take that long to get a degree typically are either transfer students who don’t receive full credit for previous coursework or those working and supporting a family, Wilkins said. Some, she said, will be surprised to learn they might have to come up with thousands of dollars to make up the difference.

“For those 100,000 kids, it’s pretty bad,” Wilkins said.

The bill also reduces the income level under which a student will be eligible to receive the maximum Pell Grant amount, from $30,000 to $23,000, and it eliminates a six-month grade period on federal student loan payments. In addition, it requires recipients to have a high school diploma, a GED certificate, or complete a home-schooling program to receive a Pell Grant.

As more low-income students have enrolled in college during a weak economy, spending on Pell Grants has exploded, nearly doubling in just over two years to $34.8 billion. In 2008-09, according to data collected by the College Board, 6.2 million students received Pell Grants averaging $2,945; in 2010-11, 9.1 million students received grants averaging $3,828.

The bill passed in the House on Dec. 16 by a vote of 296-121. The Senate approved the measure on Dec. 17, with a 67-32 vote. It now goes to President Obama for approval.

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