House Budget Bill Would Reduce Pell Grant Eligibility and Could Cause a Decline in Community College Enrollments

As reported yesterday by Inside Higher Education, the House of Representatives recently passed a budget bill that, if implemented, would make it more difficult for community college students to qualify for Pell Grants.  The bill would reduce financial aid opportunities for students and, ultimately, could reduce community college enrollments.

The House’s budget reconciliation changes the definition of full-time enrollment for Pell Grant eligibility from 12 credit hours to 15 credit hours.  It also would disqualify students who are enrolled less than half-time from Pell Grant eligibility.

The Congressional Budget Office (CBO) estimated that by changing the definition of full-time to 15 credit hours, more than half of students enrolled in the program would receive smaller Pell Grants and most students enrolled less than half-time would no longer be eligible for any aid under the program. (See https://www.cbo.gov/publication/61412#section4-3.)  “CBO estimates that enacting this provision would reduce direct spending outlays by $78 million over the 2025‑2034 period.”

The Pell Grant eligibility changes would make it more difficult for students to receive the financial aid they need to enroll in college and could ultimately cause a reduction in community college enrollments.  Critics of the program argue that the program is not financially sustainable and the changes will help students graduate more quickly.

The budget reconciliation process now moves to the Senate where further amendments to the bill are anticipated.

With the proposed changes, many students would see their [Pell Grant] aid reduced or lost; a Center for American Progress report estimates those total numbers could be as high as three million and 1.2 million, respectively. And community colleges, which mostly enroll part-time students, would be hit especially hard.