Federal student grants

New data from the U.S. Department of Education shows the rising demand for Pell grants and the quickly growing shortfall in the nation's main grant aid program for college.

The number of Pell grant recipients increased nearly 25 percent during the past two years, says Sally Stroup, assistant education secretary for post-secondary education. This increase is a stark difference from the period 1997-1999, when the number of recipients was up by only 5 percent.

Analysts have pointed to the declining economy as a main factor in the increase, as more low-income students go to school rather than enter the job market.

Appearing before Congress in late March, Stroup cited the huge increase in demand in outlining why the Bush administration is not recommending an increase in the maximum Pell grant next year. The main goal of the president's budget is to attack the program's shortfall by providing an extra $1.4 billion--"the largest increase ... of any program in our budget," Stroup told a House budget panel.

But the Education Department's recommendation falls far short of advocates' request. By comparison, college lobbyists are recommending a $500 increase in the maximum Pell grant. They argue that addressing only the past shortfall is not enough to meet current and future family needs. "Enrollments are increasing and Pell's purchasing power has eroded," says Noah Brown, public policy director for the Association of Community College Trustees. "We need to grow the program."