After several months of negotiations between Congress, the White House and the Department of Education, Pell Grant funding and other federal sources of financial aid have emerged from the budget process relatively unscathed.
The negotiated continuing resolution allocates $23 billion to the program and maintains the maximum annual Pell Grant award at $5,550. Supplemental Educational Opportunity Grant funds, another program from which Georgetown students draw federal aid, was slated to be entirely eliminated in earlier House versions of the budget. The program was only modestly reduced, however, after it was allocated $780 million, a reduction of $20 million from last year.
This budget battle was watched closely by Georgetown officials, as some 830 students received Pell Grants totaling $3,478,197 in the 2009-2010 academic year. Georgetown also utilized $1,864,796 in SEOG funds last year in financial aid packages for 467 students.
Not all aspects of the Pell Grant program survived the process. A part of the program that allows qualified students to take out a second Pell Grant in a single year, usually for summer study, was eliminated for 2012.
The elimination of the summer Pell Grant was expected, as both Congress and the White House agreed that the program had ballooned well beyond its initial projected costs.
Initial estimates for the summer grant put it at one percent of the total Pell budget, but demand far exceeded expectations, and projections for 2013 put expected costs of these grants at $5 billion, or 14 percent of the total budget.
Despite some cuts, university officials and administrators were satisfied overall with how the chips fell.
“Obviously, the absence of summer Pell will have an impact on some students,” Associate Vice President for Federal Relations Scott Fleming said. “Beyond that, however, the maintaining of the maximum Pell Grant at $5,550 and the maintaining of most of SEOG funding will mean our student aid programs will not be hindered.”
Fleming’s response echoes that of University President John J. DeGioia.
“We were very pleased that the [Obama] administration was successful in protecting the $5,550 maximum Pell Grant award. … In the face of the severe cuts proposed in the initial House-passed Fiscal 2011 Continuing Resolution, the outcome was very welcome,” DeGioia said in an April 20 letter to Education Secretary Arne Duncan,
When asked what caused the turn in favor of higher education aid programs, Fleming pointed to the top.
“I believe … [in] large part, it was the [Obama] administration’s forcefulness in saying education was an area that was important,” he said.
Even though summer Pell Grants were eliminated by the continuing resolution, both the Office of Federal Relations and the Office of Student Financial Services confirmed that the 55 Georgetown summer 2011 Pell Grant recipients, who have received a total of $79,000, will keep their aid. More students are expected to be confirmed for summer grants in the coming weeks.
Even though Pell Grant and SEOG funding were largely spared this time, the continuing resolution covers Pell Grant and SEOG funding only through the 2011-2012 academic year. Battles over the future of these programs have already begun. Both Fleming and the dean of the Office of Student Financial Services, Patricia McWade, expressed some concern over the Republican Party’s budget plans for the next year.
Fleming pointed to the plan, proposed by Rep. Paul Ryan (R-Wis.), that targets Pell Grant funding, citing a report saying that increases in Pell Grant funding lead “almost dollar for dollar” to increases in tuition.
Both Fleming and McWade said this is categorically untrue for Georgetown.
“For Georgetown that’s just a bogus argument,” McWade said.
“We spend at least eight institutional dollars for each federal grant dollar,” Fleming added.
Though Fleming acknowledged that the United States faces a serious budget problem, he remained firm in his support for the Pell Grant program.
“At this date, that would be a huge mistake in my view, budgetarily a mistake,” he said, adding that investments in higher education lead to a fiscally stronger country and that cutting aid would hurt the country financially in the future.
McWade said that institutional grant money would have made up any differences for current students if Pell Grant funding had been reduced as initially proposed by Congress. She added that potential future cuts to Pell Grants are not likely to hurt Georgetown’s competitiveness against peer institutions in attracting a socioeconomically diverse applicant group.
The lion’s share of aid included in the packages of students with high financial need comes from institutional dollars. Twenty-three percent of scholarships are funded by specific endowments, and gifts with many more millions in funding come from the university’s general endowment. For the 2009-2010 school year, $70 million out of $96 million in total aid was provided by Georgetown. The remaining $26 million came from federal aid and external awards.
“Quite frankly, the federal government is the small player here … but at the end of the day, we don’t want the bottom cut out from under us,” Fleming told The Hoya in a February interview during the height of the budget battles.
Despite concerns, both Fleming and McWade were hopeful about the future of the Pell program.
“I’m optimistic because I think that supporting higher education is a priority for both [political] parties,” McWade said. “I hope when it’s all over, they choose something other than education to cut.”