Pell Grant expenditures by the federal government fell by more than six percent last year, according to new figures from the federal government, despite the fact that they were expected to rise by some $4.4 billion.
The $2.2 billion (or $6.6 billion, depending on how you look at it) savings won’t be fully explained until more detailed numbers are released, but there are likely three overlapping explanations.
The first, and likely largest, factor was the government’s elimination of year-round Pell eligibility last year. Congress zapped summer Pell Grants as a cost-saving measure, and that policy change was expected to reduce outlays by some $4 billion.
Another $1.4 billion of the gap came from declining grant awards to for-profit colleges, which saw Pell enrollment fall by more than a hundred thousand students, or about five percent.
As for the rest? Experts interviewed by Inside Higher Ed suggested that it might have come from a shift from full-time to part-time enrollment, possibly spurred by higher costs of attendance.
The elimination of year-round Pell was obviously a setback for higher ed access, and if students are dropping down to part-time for financial reasons that’s troubling too. But the shrinkage of for-profit enrollment is good news for a few reasons.
For-profit colleges charge students more than publics, and they pass those costs on to the government. Because average Pell outlays to students at for-profits are higher than those to students at the public colleges they’d most likely be attending otherwise, for-profit colleges have for years consumed a disproportionate share of Pell Grant spending. A decline in for-profit colleges — which often engage in predatory enrollment tactics, deliver shoddy instruction, and dump students into loan default after graduation — is good for students, good for the economy, and good for the government’s bottom line.