The Federal Pell Grant is one of the post-secondary education grant programs run under the auspices of the United States Department of Education. The name itself comes from a US Senator, Claiborne Pell, while the program was originally called the Basic Educational Opportunity Grant program.
The fact that it is a grant means that it does not require repayment, and it is awarded on the basis of financial need, which is calculated via a formula devised and overseen by the US Congress. A student’s application is considered after his or her submission of the Free Application for Federal Student Aid (more commonly known as the FAFSA) form, which may be downloaded from the Internet.
Due to the fact that the Grants are aimed principally at students from lower-income families, the receipt of a Pell Grant is often used for research purposes to gauge the attendance of low-income students as well as to gauge how economically diverse the student body of a college is. In early 2006, Federal budget legislation served to cut the financial aid budget a staggering $12.5 billion, although the maximum limit was upped to $5,800 until the end of 2011.
Despite this, however, maximum Grants are not funded at such a high amount, and the highest Pell award that can be made to students has remained at $4,050 since the 2003-04 academic year. The maximum award given under the Grant program can change from year-to-year, and is entirely dependent on available program funding. The current indications are that the maximum Pell Grant will rise to $5,400 by the year 2012. Due to increasing cost posed by fees and tuition, however, a Pell Grant only covers around 31% of a student’s attendance cost as compared to around 60% twenty years ago.
For a student to qualify to receive a Pell Grant they should demonstrate financial need, and this is calculated against Expected Family Contribution, which is determined from the information the student provides on their submitted FAFSA form. A student may only receive Federal Pell Grant support from one school at a time.