Parents, teachers, guidance counselors, and other role models often tell students that education is the key to their future. Students are told that if they study hard, do well in school, and get into a good college, it will open the door to abundant opportunities. Unfortunately, however, some students never make it though that door once they learn the key to higher education comes with a costly price tag, one that too many American families cannot afford.
Our system of higher education is in many ways the envy of the world. But its benefits are not equally available to all Americans. That is because one of the most determinative factors of whether students pursue higher education is their family income. Students from families with incomes above $75,000 are more than twice as likely to attend college as students from families with incomes of less than $25,000.
Studies demonstrate the negative effect of unmet financial need on college attendance for even the most academically prepared students. Among even the most highly qualified high school students, those from low-income families were 43 percent less likely to attend college than their wealthier counterparts.
To help remedy these inequities, the federal government has wisely invested in a need-based system of student financial aid designed to help remove the economic barriers to higher education. The Pell Grant program has been central to this effort for more than thirty years. It is the single largest source of federal grant aid for post-secondary educations. The program provides grants to students based on the level of financial aid needed to support their studies at the institutions they have chosen to attend. For the current fiscal year, the program is funded at more than $13 billion and is estimated to serve more than 5.2 million students.
Pell Grants help to ensure greater access to quality higher education for all students, regardless of their financial means. Unfortunately, the purchasing power of the Pell Grant has eroded significantly in recent years, forcing students to rely increasingly on loans to finance higher education. In 1975, the amount of the maximum Pell Grant award was equivalent to approximately 80 percent of the average costs of attending a public four-year institution. But today the maximum award covers less than 40 percent of these costs, forcing students to make up the difference by taking on larger and larger amounts of debt.
This growing reliance on loans has a particularly strong deterrent effect on students from low-income families and their decision to attend college. According to the College Board, low-income students are significantly less willing, by almost 50 percent, to finance college through borrowed money than students whose families are economically better off.
This does not surprise me. Many working families in Maine are committed to living within their means. Understandably, they are extremely wary of the amount of debt that is now required to finance a college education.
I also know this to be true from my experience working at Husson College in Bangor prior to my election to the Senate. At Husson, 85 to 90 percent of students currently receive some sort of federal financial aid, and approximately 60 percent of students receive Pell Grants.
For low income students, several hundred dollars in additional Pell grant aid may make the difference in whether they can afford to pursue their college dreams. This is why I am sponsoring legislation to increase the maximum Pell Grant award from $4,050 to at least $4,500. This effort is critical if we are to preserve the Pell Grant as the cornerstone of our federal need-based aid program.
An increase in the maximum Pell Grant award is long overdue. The maximum grant award has been essentially level-funded for five straight years.
We know that a well-educated workforce is crucial to our state and our country’s economic future and competitiveness in the global economy. The Bureau of Labor Statistics projected that over the next ten years there will be significant growth in jobs requiring at least some postsecondary education. So increasingly, higher education is going to be necessary to ensure employability and to prepare Americans to participate in tomorrow’s economy.
I have sponsored and supported similar measures in the past to bolster the Pell Grant program. I recently spearheaded a letter to the leaders of the Senate Budget Committee encouraging them to include the proposed Pell Grant increase in the fiscal year 2007 budget resolution. This effort is backed by a bipartisan group of 43 Senators.
Every added dollar in Pell Grant aid makes a difference for low-income families who are struggling to send their children to college and for students who are paying their own way or taking out loans to pay tuition. In addition, an increase now will finally reverse the deplorable trend of flat funding for the Pell Grant program and the eroding value of Pell Grant aid relative to the rising cost of higher education.
Think of the additional students who might be able to enter college and graduate with a degree, if only they could receive additional support from the Pell Grant program. This aid is targeted to the neediest of students – recipients have a median family income of only $15,200. An additional $450 in Pell Grant aid may very well be the deciding factor for whether such students can open the door to higher education and a more promising future. It is now up to Congress to help give them the key.