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Proposed Pell Grant Increase ‘Great News’ For Low-Income Students

Two weeks after voting to cut student loan interest rates, the U.S. House of Representatives is moving quickly to address another key element of college affordability: the maximum Pell Grant for needy students.

An agreement between House and Senate Democrats would increase the maximum need-based Pell Grant by $260, to $4,310, for fall 2007. If approved by both houses, the plan would increase the top grant for the first time since 2003.

“Finally, it will be getting a much-needed boost,” says U.S. Rep. George Miller, D-Calif., chairman of the House Committee on Education and Labor. “We have more work to do to make college more affordable, but this is a significant step in the right direction.”

House leaders plan to bring the measure to the floor Wednesday, with final action by both chambers likely before Feb. 15, when temporary funding runs out for Department of Education programs. Last year’s Congress adjourned without finishing work on the 2007 education budget.

The new agreement follows a period this month when Democrats focused primarily on student loan interest rates to meet a 2006 campaign pledge. Some analysts had questioned whether that move would promote access, since it primarily would help those who already graduated from college.

But Democrats say the rate cut was only a first step to improve college affordability, and they promised more action this year.

“By taking this step, we will be getting on track towards ensuring that the Pell Grant scholarship covers a greater share of recipients’ overall college expenses,” says Miller.

Higher education leaders welcomed the news. The agreement is “great news for low-income students and represents a down payment on what is clearly a need for major investment in our future workforce,” says Jamie P. Merisotis, president of the Institute for Higher Education Policy.

Last year, the maximum Pell Grant covered only about one-third of tuition and fees at a four-year public college. Two decades ago, the top grant was large enough to pay for 60 percent of college costs, according to the College Board.

The lack of an increase in four years clearly has hurt students, says Luke Swarthout, a higher education advocate at U.S. PIRG. “As a result, students have had to make up the gap between tuition and aid with more work and larger loans,” he says.

Pell is one of few domestic programs to receive an increase in the Democrats’ 2007 budget bill, which covers the Education Department and other agencies still without funding for the rest of the government’s fiscal year. To help pay for the Pell increase, Democratic leaders are seeking a one-year ban on earmarks, the pet projects that members of Congress traditionally add to government spending bills.

–Charles Dervarics


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