Pell Grant Restrictions Hurt Enrollment at Community Colleges in the South, Study Finds

February 12, 2013

Community colleges throughout the United States have seen lower enrollments this year for a number of reasons, including a recovering economy that is steering students toward jobs, and budget cuts that have led to fee increases and fewer course offerings.

But in the Deep South, where state student-aid programs are less substantial, two-year institutions have also been hard hit by changes in federal Pell Grant eligibility that took effect last year, according to a new study.

The University of Alabama's Education Policy Center released a report on Tuesday that argues community-college enrollments in Alabama, Arkansas, and Mississippi are highly sensitive to changes in the federal grant program. Enrollment in 47 of the 62 two-year colleges across the three states declined this past fall, and more than 5,000 students lost Pell Grants—a change that the report's authors say can be directly attributed to the eligibility changes, which Congress approved to save money.

Under the changes, students are limited to six years of Pell Grants, down from the previous limit of nine; fewer students automatically qualify for the maximum grant because of a lower income cap for receiving an "automatic zero" expected family contribution; and students without a high-school diploma or GED are no longer eligible to receive federal financial aid.

The authors of the report estimate that the changes mean nearly 17,000 students across the three states will lose their Pell Grant eligibility this year.

Many states have started to see their economies improve, prompting students to find jobs and leave school. But in the three states the policy center studied, the report says, economies have not recovered, and state-supported student-aid programs are much smaller. The colleges are thus left with few available resources to help low-income students who no longer qualify for Pell Grants.

"The simple truth is that all community colleges are more tuition-sensitive today; which means cuts at the federal level in Pell Grants can result in immediate enrollment declines, which in turn mean lower tuition revenue," the report states.

National Trends

In other areas of the country, community colleges are also experiencing declines in enrollment, but officials hesitate to attribute the downturn to the changes in Pell Grant policy.

Columbus State Community College, in Ohio, enrolled about 5,000 fewer students this past fall, according to Martin Maliwesky, the college's dean of enrollment services. But the college still serves nearly 1,300 students who have reached their lifetime Pell limits.

Mr. Maliwesky said the decline at his institution stemmed in part from students who had taken more classes in order to graduate before the academic calendar was changed from quarters to semesters.

The California Community Colleges have lost 334,828 students since the 2009-10 academic year. But Timothy Bonnel, coordinator of the system's student-financial-assistance program, said the declines had as much to do with cuts in the state budget as changes in federal financial-aid policy.

"Where we run into issues is with the nature of the economic conditions in California," Mr. Bonnel said. Less money from the state "means less sections of class offerings—students can't get the classes they need," he said.

Legislation that would restore financial aid to some students without a high-school diploma or GED if they could demonstrate an "ability to benefit" passed the U.S. Senate last June, but the bill died with the end of the 112th Congress. Community-college advocates hope to see the measure reintroduced and included in the overall spending bill expected to come before Congress by the end of March.

Kelly Field contributed to this article.