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Commentary By Beth Akers

Congress Should Support Year-Round Pell Grants

Education Higher Ed

During a meeting last week with presidents from historically black colleges and universities, House Speaker Paul Ryan suggested that he would be in favor of a return to year-round Pell Grants. It comes after President Trump and Education Secretary Betsy DeVos made overtures to HBCU leaders, and earlier statements from DeVos suggesting support for Pell Grant flexibility.

Pell Grants, which are the primary mechanism for using federal dollars to subsidize college enrollment, were originally designed to be disbursed per a traditional two-semester per academic year schedule. This meant students who wished to complete their degrees more quickly than the traditional schedule, by taking courses in summer, would have to finance that enrollment without the help of Pell Grants. Obviously, this creates the perverse incentive for students to progress through their degrees more slowly than they otherwise would.

The problem was addressed in the 2007 reauthorization of the Higher Education Act, which had provisions which created a year-round Pell Grant program. However, just two short years later, the program was cut in President Obama’s 2011 budget. The rationale for this change has never been entirely clear, but it was almost certainly driven by a need to cut costs. Those unfamiliar with federal budget accounting might ask why allowing students to take aid on a more accelerated schedule would result in any additional cost relative to the status quo. 

But since year-round Pell essentially pulls future government expenses closer to the present day, it also increases the annual budget in a macro sense even though the spending on any single student would not be any larger.

The short life of the year-round Pell Grant program make it difficult to estimate the impact of its elimination, but some evidence suggest that the introduction of year-round Pell Grants had a significant impact on enrollment.  One study by the Council for the Study of Community Colleges indicates that the introduction of summer funding boosted enrollment at some Community Colleges by as much as 15 percent.

The current system of federal intervention in higher education is largely based on the traditional college experience. And the Pell Grant Program is no exception. The problem with this is that students who are keen on the less than traditional experience of an accelerated path to graduation must pay a huge premium to do so.

While some students may find productive and pleasant ways to spend summer vacations from higher education, others see pauses in enrollment as an unnecessary delay in them reaching the economic benefits that come from completing their degree.

Allowing students to accelerate their enrollment to complete a degree more quickly seems like a no brainer. And many institutions have created the course availability to make that a viable option for students, particularly at community colleges. The elimination of year-round Pell has made even this obvious step in the right direction an impossibility for many students. Federal oversight of higher education is critical but also difficult to do perfectly.

However, we need to be more careful about making changes like this one that step on innovations like accelerated enrollment that have the potential to help the students who need it the most.

In addition to being bad policy, elimination of year-round Pell was also false economy. Not only are the budgetary implication of year-year Pell Grants misguiding, they also overlook the advantages of getting through their degrees more quickly. The longer that it takes a student to complete their degree, the more that can get in the way of them ever crossing the finish line. Eliminating year-round Pell Grant eligibility pushed students toward a slower pathway to degree but may also be reducing their chances of ever achieving the benefits associated with degree completion.

Reinstating year-round Pell Grants has been on and off the agenda since it was eliminated. New proposals do not differ greatly from the eliminated program, but they don’t need to. Despite many arguments to the contrary, and as education policy experts Jason Delisle and Ben Miller point out in their report on the subject, “there was never a fatal flaw” with the year-round Pell Grant program.

Reinstating year-round Pell Grants may appear expensive, at least in a budgetary sense, but it is the right thing to do. Helping students get through college who might not have done so without additional support is the right place to spend federal tax dollars in higher education.

This piece originally appeared at The Hill


Beth Akers is a senior fellow at the Manhattan Institute and coauthor of "Game of Loans: The Rhetoric and Reality of Student Debt."

This piece originally appeared in The Hill