Pell Grant has significant impact on rural students, report finds

Frances Myers

In an effort to decrease the deficit facing the economy, President Barack Obama has announced plans to eliminate the Summer Pell Grant as part of his fiscal year 2012 budget.

According to the U.S. Department of Education, “the Federal Pell Grant Program provides need-based grants to low-income undergraduate and certain postbaccalaureate students to promote access to postsecondary education. Students may use their grants at any one of approximately 5,400 participating postsecondary institutions. Grant amounts are dependent on: the student’s expected family contribution (EFC); the cost of attendance (as determined by the institution); the student’s enrollment status (full-time or part-time); and whether the student attends for a full academic year or less.”

Roberta Johnson, director of financial aid at Iowa State, explained the Pell Grant.

“The maximum amount of the Pell Grant when Obama came into office in 2008 was $5,550 and that was what a student would get if he or she were extremely needy and the amount of money their family was contributing was zero,” Johnson said. “Based on its three standards, if a student was eligible for the full amount, they could either get $2,775 by attending full time in the fall and spring semester.”

The Summer Pell Grant was added then.

“If a student was eligible for the full amount — $5,550 — and attended full time in the fall, they would get $2,775 from the Pell Grant,” Johnson said. “But let’s say they attended only part time in the spring semester. In this case, they would get around $1,300. Then the remaining money would have been given to them during the summer semester.”

Johnson said the cost of the Pell Grant Program rose rapidly with the aid given out to students, making it so the program was just “not sustainable.”

According to CNN Money, Obama’s proposal “calls for the end to the policy where students could qualify for two grants in one year — one for the regular academic year and a second for summer school. Only one Pell grant per year would be awarded.”

Two ISU researchers co-authored a report with three others from different universities that found the elimination of the Summer Pell Grant as well as reductions to the rest of the Pell Grant Program could have a major impact on students, especially in rural areas, who attend community colleges.

“The Pell Grant is a form of financial aid that does not require students to pay it back,” said Linda Hagedorn, associate dean of the College of Human Sciences, professor of educational leadership and policy studies and co-author of the report. “The amount is based on student need, full- or part-time status and family contribution. In our report, we focused on the impact on rural students because rural students tend to go to college full time more extensively. They have much less opportunities and usually incur greater debt.

“College students in urban settings usually are working part time and they have more opportunities.”

In their report “Pell Grants and the Lifting of Rural America’s Future,” Hagedorn, Janice Friedel — ISU associate professor of educational leadership and policy studies — and their three other co-authors found that rural community college students “have the highest rates of Pell participation and incur by far the highest rates of debt — 48 percent of the total — due to out-of-pocket expenses such as child care and transportation.”

Hagedorn said that while reductions in the Pell Grant would especially impact students at rural community colleges, it also would have an effect on students at larger universities, including Iowa State.

“We surmised that a decrease in aid means a decrease in enrollment,” Hagedorn said. “During our research, we asked state directors what did they think would happen if the Pell Grant aid were decreased, and across the board they said it would have serious ramifications. Community college students are more dependent on financial aid, and so it has a special impact on them, but yes, it would definitely affect students at Iowa State.”

Hagedorn said that while she sees that Obama is merely trying to take care of the deficit, there is no easy way about it.

“No matter where you cut major spending, someone is bound to be unhappy,” she said. “Student debt is a big target along with Medicare and Social Security. In the long term, though, this really impacts students because it affects their access to getting a degree. The more access a student has to a college education, the higher likelihood they will graduate.”