Pell Grants

Congress created Basic Educational Opportunity Grants in 1972, and they were renamed in 1980 for Senator Claiborne Pell of Rhode Island, who championed them. Pell Grants go to undergraduates with financial need, based on the Student Aid Index from the FAFSA, and do not have to be repaid. The maximum award has been 7,395 dollars a year since the 2024-25 school year, and students can receive Pell for up to 12 semesters.

About 7.6 million students receive Pell Grants, about a third of undergraduates, and the program costs roughly 30 billion dollars a year. When Pell began, the maximum covered most of the cost of a public four-year college, but today it covers about a quarter of total costs. The 2025 budget law created Workforce Pell starting July 1, 2026, for short job-training programs of 8 to 15 weeks, and barred Pell for students with high family resources or full scholarships.

Pell is funded mostly through yearly appropriations, and the Congressional Budget Office projected shortfalls of 5.5 billion dollars by the end of fiscal 2026 and 11.5 billion in fiscal 2027 as eligibility expanded and costs grew. Supporters want to fill the gap and raise the maximum, while others propose tighter eligibility or limits on the programs that can receive Pell. Prison education programs regained Pell eligibility in 2023 after a ban dating to 1994.