In Focus: Federal Postsecondary Policy
Apr 23, 2013 | Permalink »
Separate and Unequal: College Board Pell Grant Proposal Tackles College Completion, Solutions Fall Short
By CLASP
Last week, the College Board Study Group released its proposal to redesign the Pell Grant program to meet changing student needs. The proposal, Rethinking Pell Grants, which was authored by a 14-member panel of national higher education researchers and leadership, puts forth a plan to restructure the Pell Grant program into two separate and targeted programs based solely on the age of a student: “Pell Y” for younger students and “Pell A” for adult students (defined as 25 and older). We commend the College Board Study Group for recognizing the needs of all students, both young and old(er), as well as recognizing that many students need additional supportive services beyond financial aid to successfully persist and complete their programs. Still, we remain concerned about the implications of a separate and unequal Pell Grant program that threatens to cut benefits for students based solely on age.
Importantly, a major proposed reform is that Pell A and Pell Y grants would be calculated differently. Among students in the Pell Y program, eligibility would be based on their parents' income as a percentage of the federal poverty level, whereas a student in the Pell A program would receive a flat grant (or partial grant) based (tentatively) on the average cost—including books and supplies—of community colleges. This would be a stark departure from the current Pell grant program, which considers a number of factors including the cost of attendance, income, and living expenses required to be successful in school such as dependent care, transportation, and other significant “indirect costs.” These indirect costs are particularly relevant for adult students who must continue to cover such costs while pursuing a degree or certificate. Instead of including allowances for these living expenses in the Pell grant calculation, the proposal relies on an unrealistic assumption that federal and state workforce and income support programs alone can shore up these students’ living expenses and dependent care costs while in school.
The authors claim that such a bifurcated Pell program will serve all students better. Yet increasingly, students no longer fall into typical traditional-versus-nontraditional or younger-versus-older categories. Is the College Board’s proposal going backwards by dividing students into rigid categories at a time when there are more “gray areas” between students than ever before? Will an age-based student aid system lead to “tracking” students and creating eligibility “cliffs,” limiting financial aid eligibility and potentially limiting future choices?
The College Board Study Group presented the report as a framework and hopes to engage stakeholders to explore the implications of such a proposal and work to refine details. As such, CLASP poses key questions below in areas that we believe the proposal would benefit from refinements.
Is age the most important characteristic related to student completion trends?
The rationale for this proposal, stated by the panel, is that younger and older students vary across numerous dimensions all highly correlated with age. They claim adult students have lower completion rates and are more drawn to occupational, shorter-term programs. Though older students may indeed be more focused on programs that are well-connected to job opportunities (as are many younger students), we disagree with the claim that age alone dictates completion rates. Read More >>
Much attention and effort has gone into increasing equity in higher education across various types of student characteristics from race to income to family background. In that spirit, the goal of the federal student aid system is to ensure access and equity across disadvantaged groups of students. But the report draws a bright line between students based solely on age and gives no consideration to need and credential goals. Drawing such an arbitrary distinction between groups of students does not serve all students better and actually introduces inequality into the student aid system at a time when we are trying to reduce inequalities in access and success in postsecondary education. Read More >>
Will this proposal reduce postsecondary access and affordability, particularly for adult students?
Current student aid law takes into consideration not only the cost of tuition, fees, books and supplies, but also a modest allowance for basic living expenses. This is designed to recognize that students, particularly those who are independent and may have children, face a myriad of costs associated with attending college which may include lost wages due to having to work fewer hours. But grant aid and the contribution low-income students can afford to make fall woefully short of high and growing college costs, and the vast majority of low-income students still have considerable unmet need (the amount they must pay above and beyond their expected family contribution and grant and scholarship aid). New analysis by CLASP shows that, while high percentages of low-income dependent and independent students have unmet need, over 98 percent of independent full-time community college students with incomes in the bottom three quartiles (≤$30,622) had unmet need in 2007-2008. Read More >>
The proposal hinges on an unrealistic assumption that Pell A students will have greater access to other training resources and income supports. However, public investments in education and training programs that might help to cover these costs – such as career-technical education, workforce development, and adult education -- have been slashed over the last three years alone by 16 percent, before the devastating impact of sequestration.
CLASP applauds the panel for beginning a conversation about how to improve student access to income supports such as the Supplemental Nutrition Assistance Program (SNAP), housing subsidies, Medicaid, and Temporary Assistance for Needy Families (TANF) cash assistance. However, these supports should be seen as supplements to the portions of financial aid that can be devoted to living expenses, not replacements for them. Relying on these programs as a main source of financial support for students is not realistic for a number of reasons. Read More>>
We commend the College Board Study Group for highlighting the importance of Pell Grants and other student aid for both younger and older students and for particularly thinking hard about the additional supports adult students need, such as increased college and career counseling and access to other supportive services. However, the proposals to redefine student aid eligibility based on age alone and to limit the types of college costs that adult students can include in their grant calculation sets up a separate and unequal student aid system. In helping low-income students – especially adults - obtain more financial resources for college, the solution is not to create an arbitrarily bifurcated system of aid that gives one group an advantage over another. The solution is to keep college costs from growing and to find ways to help students access a broader range of financial resources above and beyond student financial aid.
Mar 15, 2013 | Permalink »
Murray and Ryan Budgets Offer Divergent Visions for Access to Postsecondary Education and Student Financial Aid
This week, two FY14 budget proposals emerged from Congress that presented contrasting views of education and economic opportunity in the nation. Rep. Paul Ryan’s budget, once again titled Path to Prosperity, echoes similar themes from last year’s House budget, slashing critical higher education investments and cutting access to college for millions of low-income students. These and other draconian cuts are starkly different from Senator Murray’s proposed budget, Foundation for Growth, which improves college affordability and makes smart investments in postsecondary education to ensure that U.S. students and workers have the skills and education needed to support continued economic growth. The Ryan budget was passed by the House Budget Committee on a party line vote and is expected to be taken to the House floor for a vote next week. The Senate Budget Committee also passed its budget on a party line vote and the full Senate will consider the resolution next week.
Ryan’s budget proposes deep and alarming cuts to student financial aid, particularly for those most in need. The budget severely cuts the Pell Grant program, eliminating its mandatory funding portion, which would significantly drive up the discretionary costs and threaten adequate funding in the future to aid all needy students. Further, it eliminates eligibility for students who have to reduce their course load to less than half time (less than 6 credit hours) due to unavailability of courses, heavier or inflexible work schedules or family obligations. This short-sighted cut risks losing these students altogether and reducing college persistence and success rates precisely when the nation needs to be increasing them. It also freezes the maximum grant amount to the current award level ($5,645) for the next ten years, preventing the program from keeping up with rising tuition costs and inflation. Even with current funding, Pell Grants are losing substantial purchasing power, disproportionately impacting college access for low-income and disadvantaged students. Keeping the Pell Grant at current levels for 10 years would considerably lower its purchasing power to cover only 17 percent of the cost of college by 2023—the lowest share since the start of the program. Ryan uses misguided evidence to support these cuts, claiming that Pell Grant spending is on an unsustainable path. In fact, Pell Grant costs have declined since 2010 and are projected to remain level over the next 10 years after adjusting for inflation. Furthermore, the program has suffered massive cuts from recent budget agreements which have already slashed Pell spending by $56 billion over the next ten years.
The Ryan budget also makes significant eligibility changes to the formula for calculating student financial aid; these changes reduce eligibility for all types of aid–including Pell Grants, student loans, and other aid–and would hit nontraditional, working, adult students especially hard. These students can least afford these cuts at a time when college costs have increased nearly four times faster than median family income over the last three decades. The budget also targets new funding made available through the Trade Adjustment Assistance Community College and Career Training Grant Program (TAACCCT) by moving it from mandatory to discretionary funding. Funds from this program are designed to assist community colleges deliver training for high-skilled occupations to workers through career pathways and other innovative strategies.
By contrast, Murray’s budget takes a balanced approach to deficit reduction and strengthens the nation’s commitment to postsecondary education for low-income students. Citing rising college costs and declining state support of public higher education, Murray prioritizes investments that aim to keep college affordable, particularly for low-income and underrepresented students. To strengthen Pell, the budget assumes that Congress will carry over the current FY13 surplus of $9.2 billion to FY14, resulting in a surplus for FY14 of nearly $4.5 billion. Murray’s budget also bolsters the discretionary portion of Pell for FY15 and future years. The proposal calls on Congress to take action to reduce college costs through the enactment of legislation, and supports this effort by providing a “deficit-neutral” reserve for this purpose. Murray also calls for $10 billion in training investments for adults and youth seeking to improve their skills and obtain jobs in sectors with immediate openings.
These two budgets paint distinctly divergent views of access to postsecondary education and student financial aid in the U.S. Ryan’s proposals are deep, damaging, and would undermine the nation’s growth by limiting student access to postsecondary education. By contrast, Murray’s budget continues investments in student financial aid and seeks to slow the growth of skyrocketing college costs.
Every cut to the Pell Grant program, which is already well-targeted to needy students, reduces students' access to credentials, which results in America's workforce falling behind our competitors and our economic engine slowing. Before proceeding with the House budget proposal, federal policymakers should first get their Pell Grant facts straight, and then carefully consider the long-term economic costs of reducing investments in the program and in our shared economic future.
For more information on the benefits of the Pell Grant program see the CBPP and TICAS factsheet Pell Grants Help Keep College Affordable for Millions of Americans.
See also previous CLASP posts on these issues: College Costs Rising Four Times Faster than Income, Two and a Half Times Faster than Pell and Financial Pressures Drive Down College Completion
For a CLASP budget primer, see Confused by the Federal Budget? You’re Not Alone.
Jun 18, 2012 | Permalink »
Senate Appropriations Committee Takes Steps to Restore Financial Aid for College-Ready Adults without a High School Diploma
On June 14, the Senate Appropriations Committee approved the FY 2013 Labor-HHS-Education appropriations bill that sets funding levels for key education and training programs. Importantly, the bill also includes an amendment that would restore financial aid eligibility for some students without a high school diploma or its equivalent who are able to demonstrate their ability to benefit from college-level coursework. The provision would allow this eligibility only for ATB-eligible students who are enrolled in career pathway programs, a program model which CLASP has long-supported.
This is the first action to restore eligibility for these students since Congress eliminated it late last year in the Consolidated Appropriations Act of Fiscal Year 2012. Before its elimination, students without a high school degree or GED who passed a test proving their ability to succeed in college were eligible to receive federal student financial aid. The elimination is set to go into effect July 1, 2012. Without action, many low-income and low-skill students will lose the opportunity for this valuable aid and may not be able to afford a higher education.
The Senate Appropriations Committee action would specifically restore the "ability to benefit" (AtB) options for students who are enrolled in programs that are part of a career pathway-a series of education and training courses that lead to a high-demand, employer-valued certificate or degree. Career pathways are gaining traction in states seeking to increase the number of adults and out-of-school youth who have access to college and training programs and complete such programs, helping these workers gain greater self-sufficiency.
Students who qualify for federal aid under the ability to benefit option are more likely to be low-income, first generation and minority than other students receiving federal aid. An estimated 31 percent of AtB students are Hispanic and 19 percent are black - compared to 14 percent of all undergraduates who are Hispanic or black.
The bill also keeps funding at FY12 levels for critical education and training programs, such as job training programs under Title I of the Workforce Investment Act, adult education programs under the Adult Education and Family Literacy Act, and career and technical education under the Carl D. Perkins Act. In addition, the Committee increased the maximum Pell grant to $5,635 from $5,550 and starts to address the funding gap anticipated in FY14.
Funding for a $50 million Workforce Innovation Fund (WIF), which provides competitive grants to improve the delivery of job training and education programs, is also included, but funded only through the Department of Labor. This is an adjustment from the President's budget request, which funded the WIF through a variety of funding sources, including adult education funds.
For these funding levels and reforms in the Senate appropriations bill to become law, the House and Senate would have to come to an agreement on funding levels and policy riders included in the bill. In the meantime, CLASP will continue to analyze the various proposals and advocate for sufficient funding and policies to strengthen our workforce and keep the opportunity of a higher education open to all.
For more information about how the elimination of Ability to Benefit harms students and innovation, view Eliminating "Ability to Benefit" Student Aid Options Closes Door to College Credentials for Thousands and Undermines Innovation >>
For answers to Frequently Asked Questions about the impact of ATB elimination on current and future students, view FAQs on How the Loss of Ability to Benefit Options in Federal Student Aid Affects Those without a High School Diploma >>