Report Examines Pell Grant Program’s Growth and Options for Changing It

A report released Thursday by the Congressional Budget Office examines the growth of the federal Pell Grant program and explores some ideas that have been proposed to deal with concerns about the program’s cost.

The report found that between the 2006-7 and 2010-11 award years, inflation-adjusted spending on Pell Grants increased by 158 percent, stemming from an 80-percent rise in the number of recipients and a 43-percent real increase in the average grant amount. The rise in the number of grant recipients was the most significant contributor to rising costs, the report says. But spending for the program declined in 2011–12, it says, because of a reduction in the amount of the average grant.

The report comes as Congress gears up for the next reauthorization of the Higher Education Act, the main law governing federal student aid. The act was last renewed in 2008 after five years of debate.

The nonpartisan budget office prepared the report at the request of the senior Republican member of the Senate Budget Committee and, in keeping with the CBO’s “mandate to provide objective, impartial analysis,” it makes no recommendations. The report discusses 12 ideas that have been advanced for changing the Pell program and contains a summary of arguments for and against those proposals. It also considers a series of approaches for alternatives to the program, and includes a corresponding summary of the arguments for and against them.

Read the full report here.

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