Scholarship Program for College Students Has $5.7 Billion Gap

Thousands of low-income college students may lose access to federal scholarship money because of a possible $5.7 billion shortfall in the Pell Grant program.

Congress underestimated the amount of money necessary to fully fund all students eligible for the grants, and if lawmakers don’t make up the difference, 7.7 million college students could see their awards reduced by $845 each next year, said Mark Kantrowitz, publisher of, a Cranberry Township, Pennsylvania-based web site about education lending. A funding bill making up the gap passed the House of Representatives on Dec. 9 and needs Senate approval.

Total funding for Pell Grants was $28.2 billion for the 2009-2010 academic year, three times the amount of 10 years ago, according to the College Board, a New York group that promotes college attendance. Congress increased the maximum grant and expanded the number of students eligible in the 2009 stimulus bill and in an overhaul of the student loan program passed in March this year. Congress underestimated the number of students who would apply for aid, said Lauren Asher, president of the Institute for College Access & Success, a nonprofit organization based in Oakland, California.

“Demand for higher education goes up when the economy is down,” Asher said. “More people are going to school and more people are eligible for aid and are eligible for larger amounts.”

Pell Grant awards increased to a maximum of $5,350 in 2009- 2010 from $4,731 the year earlier, according to the College Board. The maximum award is scheduled to increase to $5,550 in 2010-2011.

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To contact the editor responsible for this story: Jonathan Kaufman at

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