Department of Education estimated that approximately 84,000 students across the country are at risk of losing their Pell Grants. Another one million students might see their grant awards reduced, according to an article published Aug. 1 in The Chronicle of Higher Education,
Pell Grants are government-awarded scholarships that do not have to be repaid. They are granted solely on the basis of financial
need.
Although changes in the federal need-based formula used for calculating financial aid occur annually, this year's changes, which will save the government an estimated $270 million, are quite drastic compared to the changes of previous years. "Eighty-four thousand students
losing their Pell Grant eligibility is not 'a minimal impact on a handful of students.' It's a devastating blow," Democrat Rep. George Miller of California told The Chronicle.
According to The Chronicle, some lobbyists and lawmakers think that the change was made by the department in order to decrease the budget deficit in the Pell Grant Program.
The need-based formula calculates how much money families can afford to spend on college expenses. The new formula no longer takes into account how much each family pays in taxes. Instead, the formula will consider only a family's pre-tax income, which will result in lower assessments of need across the board.
Despite the change in formula calculations, the Department of Education will not increase the grant eligibility criteria. As a result, families that still fulfill current eligibility standards under the new
calculations will be granted less money.
There is a debate ensuing over whether the Department of Education's decision is acceptable. Across the country, college students and their families are beginning to
realize the impact of the change as the likelihood of declines in their grant awards loom.
A number of students at the College may be affected. "About 260 Amherst students receive Pell Grants, which range from $400 to $4,050 in value," said Director of Financial Aid Joe Case.
One problem with the
Department of Education's budget cut is that there is little the College can do to help students make up for the loss of a Pell Grant. "More significant, however, is the overall
reduction in eligibility for financial aid," said Case. "The financial need of students who receive any federal financial aid, including work-study and subsidized student loans, is
dictated by the federal formula."
According to Case, the College is bound to the federal formula's
determination of need when determining an aid package for an
individual student. Thus, the College cannot offer more aid than the
federal formula stipulates and, as the changed formula will determine lower average needs, the College
is held to the lowered limit.
"Other resources, in combination with federal student aid, cannot exceed a student's financial need as determined by the federal formula, regardless of the willingness of a college to provide assistance
according to its own need formula," said Case.
Despite these changes, the College will continue to make need-blind admissions decisions.