DB101 California - Pell Grants: Overview (2024)

Purpose

The federal Pell Grant Program awards grants, which do not have to be repaid, to low- and moderate-income students who have not earned a Bachelor’s or professional degree. The program provides a “floor” or “foundation” upon which other sources of financial aid, including scholarships, loans and other awards, can be added. Pell Grants are designed to be “portable” and independent of Campus-Based Aid. This means eligible students can apply their Pell Grant award to their choice of post-secondary educational institutions.

History

In 1965 the Higher Education Act formed the basis of current student aid programs administered by the U.S. Department of Education. It established federal scholarships for needy undergraduate students under the Educational Opportunity Grant Program, a precursor to the Federal Pell Grant Program. Congress enacted the Basic Educational Opportunity Grant (BEOG) Program or “Basic Grant” in 1972.

Under the Higher Education Amendments of 1980, the BEOG Program became known as the Pell Grant Program to honor Senator Claiborne Pell from Rhode Island, a long time advocate of federal funding for higher education.

Since 1980, a number of Higher Education Amendments have changed the eligibility requirements and funding levels of the Pell Grant Program. One significant modification occurred in 1998 when a Higher Education Amendment extended benefits to post-baccalaureate students who are preparing to teach.

Benefit

Undergraduate students who have not completed a Bachelor’s or professional degree and who meet other Pell Grant Program criteria are eligible to receive an award between $740 to $7,395 in the 2024-2025 academic year (July 1, 2024 - June 30, 2025). Pell Grant maximums are set each year by the federal government depending on program funding.

The actual amount of the student’s award depends on the Federal Student Aid (FSA) program’s calculation of the student’s Expected Family Contribution (EFC) based on information the student submits in the Free Application for Federal Student Aid (FAFSA). Factors include the student’s cost of attendance and attendance status. Part time students, or those enrolled for less than a full academic year, may receive a reduced award.

Pell Grants are need-based awards. Although students with family incomes up to $45,000 may be eligible, most awards go to students with family incomes below $20,000. There is no limit on the number of years students can receive a Pell Grant, however only one award may be granted each year by only one educational institution.