The Definitive Explanation of the 2011-2012 Pell Grant Cuts

Written by Michael Bennet

Due to an unexpected shortfall in funding for the federal Pell Grant program for the 2011-2012 school year, Congress voted to reduce funding by several billion dollars in the Spring of 2011.

While at first it was speculated that the maximum available Pell Grant amount was going to be significantly reduced, along with the overall reach of the program, neither of these reforms were passed, although the average award amounts for the 2011-12 school year will be significantly reduced across the board.

Along with these reduced award amounts, the other major change brought upon by this Congressional vote will be the elimination of a student’s ability to obtain more than one full Pell Grant award per school year, as no longer will students be able to get two Pell Grants per academic year.

Reduced Award Amounts

As was previously stated, the average amount of aid that students will be able to receive by way of the Pell Grant will be reduced in 2011-2012 as a result of this new piece of legislature, although the maximum Pell Grant amount will still remain at 5,550 dollars.

After comparing the new 2011-12 award schedule with the 2010-11 award schedule, it seems like on average award amounts are lower by about seven hundred dollars across the board. The minimum amounts for each enrollment status have also been significantly reduced to a uniform rate of 555 dollars.

This essentially means that whenever your EFC is lower than zero, or your enrollment status is below what is considered to be full-time, the Pell Grant amount you are able to qualify for will be adjusted downward according to the new 2011-12 award schedule, which does in-fact make less aid available to students with EFC values between zero, and 5,273.

The maximum EFC cutoff threshold still holds true at 5,273, so if as long as your EFC is below this figure you still should be able to become eligible for at least some Pell Grant aid during 2011-2012.

Elimination of the Double Pell Grant

While this initiative was only in existence for one full year, it was nice while it lasted, as it gave students the opportunity to get more than two Pell Grant awards during any one particular school year. With this recent Congressional vote this will no longer be a possibility, as students will now be limited once again to getting one Pell Grant award per school year.

This is not to say that students cannot still get a Summer Pell Grant, as they will still be able to utilize their Pell Grant aid for the Summer semesters. Rather it just means that students will no longer be able to get additional aid for the Summer after they have exhausted their award during the Fall and Spring semesters.

If a student chooses to delay their use of Pell Grant aid until the Summer, then that is okay as long as the student works out the details with their school’s financial aid department. Another scenario that may warrant the use of Pell Grant aid during the summer would be if both the Fall and Spring semesters were skipped entirely in favor of attending school in the Summer.

These scenarios still make it plausible to receive a Summer Pell Grant, although starting in 2011-2012 students will no longer be able to get more than one full Pell Grant award per year—bottom line. This means that students will not be able to get more than the maximum amount of 5,550 dollars for the entire school year, which may consist of the Fall, Spring, and Summer semesters.

Moving Forward

Overall this recent Congressional vote is a lose-lose situation for students, as they will not be able to access the same kind of funding via the Pell Grant program as they could in 2010-2011. That being said, it could be a lot worse, as the maximum Pell Grant amount, and the maximum EFC cutoff threshold were left untouched, while they were originally thought to be in jeopardy.

Students and parents should rejoice as their Pell Grant eligibility should remain about the same as it was in 2010-2011, and while the amount of aid they may be able to receive will be slightly lower, it won’t be reduced to the point of making the Pell Grant an irrelevant financial aid award instrument.

Rather the Pell Grant will still be the most prevalent, and highly funded government educational grant program in 2011-12, and will hopefully expand even further once the Department of Education can get back on track.