20 Minute Interview
Q: Republican Denny Rehberg has taken some heat back home for comparing Pell Grants to being on the dole. On April 1 of this year he announced on a radio show that students who receive Pell Grants don’t have any sort of graduation requirement and could go straight from the education grant to receiving federal food aid. Do you agree with Republican Rehberg that Pell grants are the welfare of the 21st century?
A: that’s a really good question. I do not agree that Pell grants should be compared to welfare of the 21st century. I think that comment is almost offensive and derogatory. I do feel that Pell grants are issued to individuals who have a financial need we all know that. I do feel that they are of good use and that students who receive Pell grants receive the grant for various reasons it’s not just for students who do not meet financial criteria but also size is a factor in the government determining if a student is going to be Pell grant eligible. So I do not agree that it should be compared to welfare and I’m really insulted by that comment.
Q: The House GOP budget resolution in Montana would reduce the maximum Pell Grant from $5,500 to $4,705. How do you feel about this?
A: Well, I do believe that students have some accountability for the cost of their education. I don’t feel that every person who is a tax payer is responsible to put extra money in a student’s pockets because in some cases almost all cases in which I deal with these students use the Pell grants as access funds where they use that money to live on for student financial need while they’re in school. So, in that sense if you look at it if their tuition is already paid for I do not feel that they should get additional money outside of their cost of tuition in order for them to use for student financial needs such as living expenses while they’re in school.
Q: Everyone is not qualified to receive Pell Grants from the government. Can you tell us who is and how that process works?
A: That’s a really great question. No one really knows but the government how the process works. The federal department of education determines if the student is Pell grant eligible. When the student fills out the Fafsa the student is applying for loans, subsidize and unsubsidized loans and the Pell grant is considered at the same time. So the way it works once you put in your information for the previous income tax year then the system does a determination at the very end if you may be Pell grant eligible. It will provide you with an expected family contribution number or (EFC) at the very end of your fafsa that number tells the counselor if the student may be eligible for some Pell grant. The lower the number the higher the Pell grant the student is eligible for. So for example if the EFC is zero then chances are the student will receive full or maximum amount in Pell grant money.
Q: The primary controversy is that a small set of educational institutions comprising 6% of all college students receives roughly 20% of all Federal Pell grant money. University of Phoenix tops this list with Pell Grant revenue of $656.9 million. Are you at all bothered by these numbers?
A: I think that we have to take the overall like all the different pieces of the pie into consideration. So, the University of Phoenix also has over 400,000 students currently pursuing a degree and we have to also take into consideration they are the largest private accredited university in the entire country. So of course their numbers are going to be higher. I mean logic tells us that. I’m not necessarily bothered by the amount of Pell grant revenue but I do believe that again if a student has enough money to cover the cost of their tuition that the Pell grant should not be a means for them to able to use for student financial needs while they’re in school because they’re using that financial needs as an extra income tax it’s like a bonus at the end of the year. It’s not a bonus it is to be used towards tuition or a need that you have as a student to fulfill. So, I’m not bothered that the revenue is higher at that private institution, I am bothered that so much money in general goes out towards those funds and this is tax payers money and not everyone has access to it only certain individuals. So that is an alarming figure for someone such as myself who is not Pell grant eligible or my child is Pell grant eligible. Yet in still I’m required to pay into the system.
Q: What are some negative and positive things to consider when discussing Pell Grants?
A: We’ve gone over negative time and time again, they’re using the money for financial needs not necessarily student financial needs and the Federal Department of Education clearly states that the Pell grant or any other access funds from the government, if they do keep that money it is to be used for student financial needs while you’re in school. So the negative is that students are using the money, they’re spending it and then they may not continue their education. So now they’ve gotten Pell and they don’t complete their degree. We call those individuals unfortunately the tag name is Pell runners. Pell runners are students who actually receive their Pell grant and then they discontinue their education after they have received their disbursement. These are students that have caught on to the system that they will get a disbursement if they maintain attendance long enough to say that they are a student and once that money is disbursed to them they discontinue the program. Unfortunately bad times, desperate time’s desperate measures and unfortunately people catch on to what they can do to get quick money or they may have family or friends that will tell them what they need to do. So, that’s the unfortunate part or the negative. The positive is that you do have some students that do the right thing and they receive their Pell grant money and they do use it for student financial needs. I’ve seen students purchase a computer; I’ve seen students purchase a printer. Students may use it to offset the cost of textbooks, one student bought a car. Very true story one student bought a car, paid cash for it. It wasn’t a brand new car but she attended classes on campus and her car broke down and she could not get and forth to class, she needed transportation. That is a student financial need while you’re in school and that’s exactly what she did and she really was very successful in her program. So they are some students who use the money as it is intended to be used. Unfortunately those who do not, who abusive the system and do not use the money appropriately, put a bad name on those who do and that’s one of the reasons that I did not want to categorize this as a negative thing or welfare of the 21st century because its degrading and insulting to a student who actually use the funds for the reason that it was intended.
Q: Why do you think the Republican Party is leaning more towards reducing if not eliminating Pell Grants?
A: Well that’s simple, we just can’t afford it. It’s not something that the federal department of education can maintain. I do think that students have to be a little more accountable for their own education. There are many, many many scholarships that are going unclaimed and students should be accountable for applying for scholarships or paying out of pocket. I’m personally not a fan of private loans when it comes to student education, but I’m also not a fan of being required to fund someone else’s education. So, the government provides loans, they’re not based on credit they’re not based on income. There’s different maximum loan amounts based on how many credits the student receives each year. So I do feel that outside of the loan amount that a student is eligible for then the student should be generating additional cost for the tuition. Through scholarships or private contributions or through personal or private loans.
Q: Who do you think benefits from Pell Grants? Who suffers?
A: Well obviously the students benefit from Pell grants and let’s be honest if the tuition is high or significant and the student is able to receive Pell grant in addition to the loans then the school profits because the student does not see that as out of pocket expense and it’s a little bit easier to sell the school so to speak. So what I mean by this is that you may have for an example a student that is eligible for let’s say $9,500 in their first academic year as an independent student receiving financial aid the max amount that you could receive that year is $9,500. So let’s say that the school, the institution charges $12,500 for tuition for the first year. There’s a $3,000 difference here so where’s the student going to get the other $3,000? Well, if the student was to apply a loan or a fafsa, go through the process and if at the very end if the EFC is zero well that shows that more than likely the student may be eligible for the full Pell grant money, the $5,500. So the school has a little leverage to sell the program because the student doesn’t have to come out of pocket because they’re going to receive $9,500 in loans in addition to the $5,500 in Pell grant money. So they have more than enough to cover the cost of tuition with some change left over. So, the other scenario is if the student decided that the student wasn’t getting Pell at all and the tuition was $12,500 then the student is going to have what we call a short fall. That’s a $3,000 difference and the student has to find a way to pay out of pocket for that expense. Well, let’s face it if you’re in school, isn’t it easier to sell the program when you can show that the money is coming from Pell grants and coming from loans that the student doesn’t have to come out of pocket to cover the difference when they start school. So who benefits, obviously the students who receive Pell and the educational institution. Who doesn’t benefit, well obviously tax payers and unfortunately we lose in another way where if the student doesn’t continue their education and they are unfortunately a Pell runner.
Q: Pell Grants do not require repayment and are awarded based on a “financial need.” What in your opinion is financial need?
A: Now that’s a really great question because no one really knows how the government determines who is Pell grant eligible. It seems so unfair it truly does, this is kind of a touchy subject. I guess in my opinion, financial need is going to be contingent upon the household size and I would say in addition to (this is all based on the previous income tax year) So for example, if someone was filling out their fafsa for 2011-2012 school year, then they would provide their 2010 income tax information. So, the financial need is going to be based on what happened in 2010. So someone could be currently making significant amount of more money this year than they did in 2010 and still be eligible for Pell grant because it’s based on the previous income tax year. So in that sense, I don’t know if the government really has a true picture of who has a current financial need. The other piece of that is you have students who may be in a single parent household and that single parent may be able to show that he or she makes a significant amount of money, whatever is considered significant to the government, but the expenses and the burden of financial draw-back of being a single parent is very difficult and I think that there’s no concessions made in cases like that because the household size and the income are the only two factors that are taken into play not necessarily what the cost of living expenses are for that student or the students’ parents. So, it’s really just solely based on household size and income as far as we know. Any other factors are kind of unknown at this point. As I stated before it’s electronically programed to determine if a student is eligible no school can tell a student if he or she will be eligible for Pell because that is determined electronically through the department of education.
Q: Do you think diversity plays a role in Pell Grants? Why or why not?
A: In my experience I’m going to say no because I’ve seen all ethnicities be awarded Pell. I’ve seen people of different household sizes be awarded Pell. It’s really based on financial need of the previous income tax year. That has been the norm so I don’t think that black/white/Hispanic; I don’t think that any of those ethnicities really matter. As far as geographical location I have not noticed a difference in where a student was located whether he or she would be Pell eligible. So I would say no, diversity it does not play a role in that.
Q: Can you briefly explain the process for a potential student going through the financial aid process in your workplace versus a traditional student in a 4-year college?
A: Well in my workplace I deal primarily with non-traditional students. A non-traditional student is a person who did not get their college degree right out of high school. These are students who are adults with families, husbands and wives, with responsibilities work full time jobs, sometimes work more than one job. These are the adult learners so the program is structured for adult learners. So the majority of the students I work with are independent students. An independent student is someone who is over the age of 24, also who may be married or who may have a child that they spend at least %50 of their support for, or who is in the military. So if you answer yes to at least one of those criteria those are considered independent students. The independent student does not have to get parental information in order to complete the financial aid process. That is the primary difference in students who are traditional students at a 4-year college because they are a majority all dependent students and dependent students need parental information such as income tax information, or applying for the plus loan in order to process their financial aid. If the parent is not willing to assist, the dependent student in the financial aid process is only going to receive partial funding from the government. So, in short, the primary difference is that an independent student does not require parental information in order to proceed with the application process; a dependent student does require parental information in order to qualify for the maximum of funding. If the dependent student did not get parental information, then they will only receive partial funding from the government.
Q: What do you think will happen if the government votes to cut back or eliminate Pell Grants?
A: That is an awesome question. I think we’re going to see less people going back to school. Unfortunate as that may be a lot of students do go back to school for the additional money, let’s be honest that is the truth. I also think that there is a flipside to that; any time that there’s a change, you have to give people an opportunity to buy into the change. I do believe that students will get accustom to the fact that the grants are no longer there but then will force them to look into other options such as unclaimed scholarships that go on each year, I’d be real interested to know the amount in unclaimed funds every single year. I’m sure that would be a number that would be difficult to narrow down but that is a true factor it’s a real issue that the scholarships are not being applied for. Schools will have to change their verbiage to really encourage students to practice responsible borrowing meaning only borrow the amount of loan money that you need and also look into other sources such as scholarships so when those scholarships some in you can offset the loans that you actually want to borrow. So, I do think in the beginning if the government took away the Pell grant that it’s going to take students time to adjust to that especially those students who are accustomed to living off of those funds and almost 100% of my students do. But then I think that incoming students would not know the difference that they would be forced to look into scholarships and other options to fund or offset the cost of tuition.
