Consortium Calls on Congress to Make Federal Financial Aid Work Better for Today’s Students
Original URL: https://edtrust.org/node/4471
WASHINGTON (October 2, 2014) Today, the Reimagining Aid Design and Delivery (RADD) Consortium for Higher Education Grants and Work-Study Reform released a paper detailing how the federal government can modernize its financial aid system to be more efficient, to bring it in line with the needs of todays students, and to make colleges and universities more accessible to the lowest income students.
Since its creation in 1972, the Pell Grant Program has been a crucial source of financial aid for Americas lowest-income students. But even significant federal funding increases have not been able to keep pace with increased demand and rising tuition costs. Pell Grants used to cover a significant portion of college expenses, but now only cover a fraction. The federal financial aid system must adapt to the needs of todays postsecondary students who are increasingly older, students of color, and balancing the demands of work and family with academics. The financial aid system desperately needs to be modernized to recognize the growing costs of a postsecondary degree and the financial realities of many of the students.
Our nations lowest-income students pay roughly 80 percent of their families annual income to finance just one year of college. Thats more than five times the percentage wealthy families have to contribute, said José Luis Santos, vice president of higher education policy and practice for The Education Trust. Too often, the doors of opportunity are being slammed in low-income students faces because of costs and outdated systems that are too slow to change.
The policy agenda, Beyond Pell: A Next-Generation Design for Federal Financial Aid, proposed by The Education Trust, New America Foundation, and Young Invincibles, calls on Congress to make the following changes:
- Cap Student Debt for Students from Working-Class and Low-Income Families: Students who are eligible for the maximum Pell Grant those in families with $23,000 in adjusted gross income and lower should not have to pay or borrow more than 10 percent of their familys limited income each year to go to college. The federal government can facilitate this by providing matching grants to states that maintain this guarantee, augmenting Pell Grants for institutions that do, or tying financial aid eligibility to this mandate.
- Cultivate a College Culture Centered on Completion: The federal government can and should leverage grant aid for institutions that focus on on-time completion, experiment with new ways to support and provide remedial coursework, and expand and align work-study opportunities to include more tie-ins to careers.
- Set New Minimum Standards for Institutional Eligibility: In exchange for federal funds, all colleges and universities should be held accountable for reaching three minimal performance standards: increasing access to and supporting low-income students, graduation rates, and providing a quality education that enables students to pay back loan debt.
About the Consortium: The Grants and Work-Study Consortium is a partnership of four organizations concerned with college affordability, access, and completion for low-income and modest-income individuals. They are The Education Trust (www.edtrust.org), The New America Foundation (www.edcentral.org), Young Invincibles (www.younginvincibles.org), and The American Association of State Colleges and Universities (www.aascu.org)