The staggering economy is clearly hitting working families, investors … and college students with financial need. The New York Times reports that the Federal Pell Grant Program faces a $6 billion shortfall.
Battered by a worsening economy, college students are seeking federal financial aid in record numbers this year, leading Bush administration officials to warn Congress that the most important federal aid program, Pell Grants, may need up to $6 billion in additional taxpayer funds next year.
Driving the increased applications for federal aid, in part, have been nontraditional students returning to school to improve their job skills during the economic downturn, said Terry W. Hartle, senior vice president for public affairs at the American Council on Education, which represents colleges and universities.
Estimates by the Department of Education suggest that the new president will face an unusually burdensome financing shortfall or the fallout that would accompany trimming the nation’s leading college aid program.
“There are a lot of things going on — more people are applying for student aid, more people are going to college, more people who qualify for the aid are showing up at school,” said Thomas P. Skelly, the Department of Education’s director of budget service, who wrote a memorandum detailing the problem to Congress.
As of July 31, 800,000 more students had applied for grants than on that date last year, according to the memorandum, which called the increase one of the largest ever year to year.
This year, more than six million low-income college students will receive Pell Grants ranging from $431 to $4,731, federal officials said.
Congress appropriated $14 billion for the grants for the current fiscal year, but because of the increase and because of accumulated shortfalls from previous years, lawmakers will need to add $6 billion in new funds next year or cut the size of the grants, Department of Education officials said.
Perhaps the Iraqi government with its oil-driven $79 billion surplus can bail the Bush Administration out of this mess it has created.