Colleges Worry Pell Grant Expansion Could Set ‘Dangerous Precedent’

Inside Higher Ed

Katherine Knott
February 29, 2024
House lawmakers are proposing to charge wealthy colleges for unpaid student loans, using the money for students in short-term workforce training programs.
A bipartisan bill to expand the Pell Grant to short-term workforce training programs—those that run between eight and 14 weeks—could set a troubling precedent, representatives of colleges and universities warned this week.
The House had been scheduled to consider the legislation today, but that vote was scrapped Wednesday evening, Politico reported.
The latest version of the Bipartisan Workforce Pell Act, which advanced out of committee in December, requires a couple dozen wealthy private institutions that are subject to an endowment tax to reimburse the Education Department for unpaid student loans in order to pay for expanding the program that provides federal financial aid for low-income students.
The Association of American Universities and other higher education associations said this requirement would amount to “a second new arbitrary tax” that targets one group of institutions to benefit another—and that it could take money away from need-based grants and scholarships at top universities. If the proposal is enacted, the association said in letters to the House, some colleges might choose to leave the federal student loan program or opt to not enroll students considered to be at risk of not repaying their loans.