As your Student Loan Ranger noted in an earlier blog post, Republican presidential nominee Mitt Romney’s education plan, “A Chance for Every Child: Mitt Romney's Plan for Restoring the Promise of American Education,” is a bit vague in specifics. When it comes to Pell Grants, for example, it promises only to “refocus Pell Grant dollars on the students that need them most and place the program on a responsible long-term path that avoids future funding cliffs and last-minute funding patches.” However, Romney’s recent selection of Paul Ryan as his running mate has spurred new questions about how a Romney administration would treat Pell Grants compared to Obama in a second term.
There’s no doubt that the “Ryan budget,” the fiscal year 2013 budget resolution passed by the House, would severely diminish Pell Grants. It would lower the income level at which students qualify for an automatic maximum grant; create a maximum income to be eligible for a grant; reduce the amount of income a student or family can keep to cover minimal living expenses before being expected to contribute toward college costs; freeze the maximum grant at the fiscal year 2012 level of $5,550; and make students attending school less than half-time ineligible for grants. It would also end the entitlement portion of the program which is designed to ensure funding is automatically allocated for every student who qualifies for a Pell Grant, opening the door for future cuts.
The upshot of the Ryan budget? More than 1 million students would no longer be eligible for Pell Grants in the next decade according to Education Trust and those who did qualify would receive less aid. This would do a disservice to millions of needy students. And while there is no way to know for certain if Romney would follow the Ryan template, some of his recent statements suggest he may.
In contrast, President Obama has been a strong supporter of Pell Grants. He is not further reducing eligibility, would retain the entitlement funding portion and allow increases in the maximum grant that would track inflation and the rise in tuition costs. The President claims to have more than doubled the total amount of funding available for Pell Grants since he took office, although we have been disappointed that he has funded Pell Grants in part by eliminating other helpful benefits, such as the in-school interest benefit on subsidized Stafford loans for graduate students, and allowing students to get additional Pell Grants for summer enrollment.
Ultimately, however, as the New America Foundation points out, the future of this venerable and highly successful program will depend on increased Congressional appropriations. We urge you to make sure your Representative is on board with increasing that funding. And make sure you are getting the information you need to make informed choices on student loan borrowing by following us on Twitter (use #studentdebthelp), downloading our new Educational Debt Manual and attending one of our free educational debt webinars.
Isaac Bowers is a senior program manager in the Communications and Outreach unit, responsible for Equal Justice Works' educational debt relief initiatives. An expert on educational debt relief, Bowers conducts monthly webinars for a wide range of audiences; advises employers, law schools, and professional organizations; and works with Congress and the Department of Education on federal legislation and regulations. Prior to joining Equal Justice Works, he was a fellow at Shute, Mihaly & Weinberger LLPin San Francisco. He received his J.D. from New York University School of Law.