Pell Grant program faces growing funding shortfall
Bipartisan changes to the FAFSA increased Pell Grant eligibility and awards, producing measurable gains—about 570,000 more students became eligible and 1.9 million more qualified for the maximum award in 2024–25. Those gains coincided with rising program costs, and the Congressional Budget Office projects a $5 billion shortfall by fiscal 2026 that could grow to $15 billion by 2027 without new funding. Regional public universities educate most Pell recipients and saw nearly 2 million students receive about $11.3 billion in Pell in 2024–25, tying federal funding to workforce and local economic outcomes.
FAFSA reform expanded Pell but created a sizeable federal funding gap.
Context
The FAFSA was redesigned and simplified, which expanded Pell eligibility. That change increased the number and size of awards. If Congress does not act, the shortfall is likely to grow and lawmakers may consider funding changes.
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