Balance (1965 - 1990)
Pell Grant Program
The federal government, state government, and colleges and universities themselves are all pulling away from the framework of objectively measuring need and working as partners to meet it, which had dominated thinking about higher education finance in this country since the 1960s, and which the College Board did much to build. These underlying movements have played an important role in the trends toward declining access and increasing stratification in higher education
Michael S. McPherson and Morton Owen Schapiro
"The End of the Student Aid Era?: Higher Education Finance in the United States"
As this era began, there was commitment to extending access to those underrepresented in higher education through government grants, money provided to students to off-set the cost of tuition. The largest grant program was the Pell Grant program.
The idea of need-based grants to students had emerged before the Great Society programs of the Lyndon B. Johnson administration. Programs such as the G.I. Bill of 1947 provided federal aid for students to attend higher education institutions. However, the 1965 Higher Education Act and its Title IV program authorized federal dollars to equalize educational opportunities regardless of income. Specifically, the College Work-Study program and the Educational Opportunity Grant program were created by the Higher Education Act of 1965.
In 1969, Senator Claiborne Pell (D-RI) introduced a bill to amend the Higher Education Act. Pell's bill called for a "Basic Educational Opportunity Grant" based on the amount of need, not to exceed $1,200 a year for four years. In the bill's final form, the amount of need was changed to not exceed one-half the cost of attendance, to a maximum of $1,200. Until 1980, the bill was know as the "Basic Educational Opportunity Grant" or BEOG, although it is now called the Pell Grant.
The passage of Senator Pell's bill was not contentious, however. The Senate focused on student aid through grants and easily passed Pell's bill. The Congress, on the other hand, focused on institutional aid, or grants to institutions based on enrollment. Such capitation grants did not directly benefit students, whereas direct student aid worked more toward equalizing educational opportunities of individuals. Eventually, the focus on direct student aid carried Pell's bill through the federal government.
The key element behind the Pell Grant was that the aid was directly to a student to use at the student's institution of choice. While it targeted lower-income students, it did provide assistance to some middle-income students.
Run through the Office of Education in the Department of Health, Education, and Welfare (HEW), the Pell Grant program was implemented slowly, beginning in 1973-1974.
The commitment to equal access through dissemination of aid to lower-income students through the Pell Grant, however, conflicted with the federal government's concern for private institutions, especially those struggling to survive. Some people argued that the half-cost provision of the Pell Grant harmed those attending low-cost community colleges because these students were denied their full aid. Private colleges did not want these students to be able to use the maximum authorized amount of aid to cover all their costs, thereby making the low-cost institutions much more attractive to students. The private colleges resisted the repeal of the half-cost provision until 1992. In this way, student financial need conflicted with institutional need.
By the late 1970s, concerns about the rising cost of higher education for middle-income families spawned the Middle Income Student Assistance Act (MISAA). This expanded the proportion of middle-income households available for Pell Grants by reducing the family contribution in the financial needs assessment. Rather than targeting only low-income students, the Pell Grant targeted a broader segment of the population, thereby de-emphasizing the idea of aid for those in most need.
Throughout the 1980s, political turmoil continually contracted and then expanded the range of family incomes entitled to assistance through the Pell Grant program. The Reagan administration wanted a lower budget and therefore wanted to restrict the availability of the Pell Grant to a narrower range of low-income families. Congress wanted to extend the Pell Grant's reach further into the middle class. The federal government was able to affect these changes by either increasing or decreasing the amount of expected family contribution to higher education costs.
