Policy Steps – Pell Grants: Are Prisoners the Program’s Biggest Problem?

Federal and state investment in higher education is essential for expanding educational opportunity and building a 21^st century workforce. But despite a national commitment to improving access to quality education for all students, adequate funding remains a persistent challenge. For example, the federal Pell Grant program is the bedrock of educational opportunity for thousands of low-income students, but the program has not kept pace with the rising costs of college. State contributions to higher education vary from year to year, causing uncertainty for students, families, and institutions.

This edition of Policy Steps evaluates three proposed solutions to the challenge of providing access to higher education for all of our students, including eliminating Pell Grant eligibility for incarcerated students, switching states to Biennial budgets to stabilize higher education funding, and U.S. Sen. James Jeffords’ (R-Vt.) plan to increase federal spending on education by one percent each year until it equals 10 percent of the federal budget.

Key findings in this edition include:

• Pell Grant eligibility for incarcerated students makes up less than one percent of the program’s spending.
• The number of incarcerated students receiving Pell Grants does not affect how many non-incarcerated students qualify for the program nor does it affect the maximum award amount.
• The true shortcoming of the Pell Grant program is persistent underfunding, and the discrepancies between authorized and awarded grant maximums.  
• Higher education appropriations were more consistent in Biennial state budgets than Annual state budgets.
• Sen. Jeffords’ “1% for Education” plan would greatly increase federal funding for education, but an appropriate fixed dollar amount should be allocated to higher education, with the largest funding increases going to the Pell Grant program.

When discussing ways to improve access to higher education, a continued focus on federal and state funding is essential.  Student aid programs must be funded appropriately to keep pace with the rising cost of college, and state contributions must remain consistent.