The road to expand Pell grants to serve eligible students attending short-term programs has been a long one, with many false starts. Most recently, last month the House was set to take a floor vote on the Bipartisan Workforce Pell Act - the latest iteration of legislative proposals seeking to extend Pell Grant eligibility to workforce programs that are between 8 - 15 weeks long or 150 - 600 clock hours. Unfortunately, the vote was postponed due to stiff opposition largely stemming from a provision included that was intended to “pay” for the program.

What’s at Stake

The Pell grant program is the cornerstone of federal financial aid for students from low-income backgrounds. It has opened the doors of postsecondary education to many folks, like me, who are the first of their family to attend college or are immigrants. However, for students to receive the Pell grant, they have to enroll in a credit bearing program or a non-credit program that is at least 600 clock hours. While this may not be a problem for “traditional” students attending college right after high school, or students seeking an associate or bachelor’s degree, it serves as a barrier for many others, particularly adult learners who are already in the workforce and looking to quickly make a job change or earn higher wages and receive better benefits.

As open access institutions, community colleges serve students from all walks of life: the average age for our students is 27, many of these students are parents, all of our students are seeking high quality, affordable education that can set them up for economic upward mobility. Many nontraditional students and adult learners seek a shorter term, workforce focused program to reskill or upskill and gain a better paying job. Similarly, students who may have never engaged with postsecondary education or who may have had a previous negative experience, are looking for a second opportunity. This is why short-term, or workforce, Pell has been a top priority for community colleges as we strive to increase access for all students, regardless of program length.

There is strong bipartisan agreement that students seeking to enroll in short-term workforce programs should have the same opportunity and resources as students enrolled in longer programs. At a time when higher education costs serve as a deterrent for many to participate in postsecondary education, and when the skills gap continues to widen leaving many good paying jobs unfulfilled, community colleges continue providing affordable high-quality education, including theseshort-term workforce programs.

The Obstacles

In addition to the stiff opposition to the “pay-for,” the latest attempt to move workforce Pell forward in the legislative process also saw the resurfacing of old arguments, as well as new arguments, against workforce Pell. However, many of these arguments and concerns have already been addressed in this latest legislative iteration or are only tangential to the issue. Let’s address some of these issues and look at how the legislation in place sets up the program so these concerns are already addressed.

“Weak Guardrails” and the Quality of Programs

One of the main concerns surrounding short-term/workforce Pell is that it could open the door for low-quality programs or prop up “shoddy, fly-by-night,” programs that will siphon federal funds from students leaving them with nothing to show for their efforts. The Bipartisan Workforce Pell Act includes some of the strongest guardrails any postsecondary education program must contend with. The eligibility standards that programs must meet ensure that they are of extremely high quality. The provisions include: 

• 70% completion rate.
• 70% job placement rate.
• an earnings metric that ensures program participants earn more after completion than the average salary of someone with only a high school diploma.
• an earnings metric that dictates that program costs cannot exceed the “added value” of a participant’s income after program completion.
• approval by a state workforce board.
• approval by accreditors approved by the Department of Education

In fact, the eligibility provisions are so robust that CBO’s cost estimate for the bill stated that, “CBO expects that many short-term programs that do not currently receive title IV funding, particularly those in the proprietary sector, would not participate in the Pell grant program under H.R. 6585 either because they could not meet the metrics established in the bill or because they would choose not to meet the additional requirements needed to participate in federal student aid programs.”

In addition to these very stringent guardrails for approval and continued eligibility, the bill ensures that no “fly-by-night” programs can participate by requiring any program to be in existence for at least one year prior to being eligible. There is also a “claw-back” provision requiring any institution providing inaccurate earnings data to return the funds in full to the Department of Education.

The Costs and Financial Health of the Pell Grant

Opponents of the proposal have argued that this program could weaken the financial health of the Pell Grant program and exacerbate the looming Pell grant shortfall. The reality is that the program’s cost is minimal – approximately 0.5% of the annual cost of the Pell Grant program.

The heated debate that has surrounded the issue of workforce Pell Grants stands in contrast to the actual increased expenditures as projected by the Congressional Budget Office. CBO estimates that the legislation would add $155 million in annual expenditures to the Pell Grant program. Total program costs were approximately $27.2 billion in the FY 22-23 year. The BWPA poses no threat to the fiscal integrity of the Pell Grant program. Other factors, including college enrollments and the revised system of assessing student need, are of much greater magnitude. Without Short-term Pell on the table, would Congress no longer need to address the shortfall? Likely not, even with today’s decision not to increase Pell Grant maximum. Congress will likely need to address the Pell shortfall before this program reaches implementation. Congress could proactively address the financial issues of the Pell grant program and account for the small,0 .5%, projected increase in expenditures before the program even took off.  

The Pay-for

By far, the primary reason why the vote on the floor was postponed was the inclusion of the particular pay-for. This provision would fund the program by imposing a new risk-sharing model on the roughly 30-60 institutions of higher education subject to the endowment tax. It requires that any loans not repaid by students who attended those institutions would have to be refunded to the Department of Education by the Institution. Several groups in the higher education space came out against the bill based on this pay-for and argued that it could negatively impact students’ ability to participate in federal programs like the Public Service Loan Forgiveness (PSLF) or Income-driven repayment plans like the new SAVE plan. 

Community colleges do not support risk-sharing. Risk-sharing is a flawed concept, irrespective of a given institution’s resources. However, it should be clear that all students who attend potentially impacted institutions would have full access to federal student aid and the myriad of benefits that come with this aid, including income-driven repayment plans, Public Service Loan Forgiveness, and any future student debt relief for which they may become eligible. Participation in these programs is a decision that the student borrower makes after they have graduated and entered repayment status, and it’s not something any institution could restrict. Furthermore, we do not believe that institutions would or could steer students away from any particular education programs because of risk-sharing or choose to admit more affluent students.    

What’s Next?

While the House vote on the Bipartisan Workforce Pell Act is currently on hold, we expect it to come back again before the end of the year, perhaps with a new pay-for. In the meantime, the Senate also has bipartisan proposals like the JOBS Act that would achieve the goal of expanding Pell grant to short-term programs. The JOBS Act – which has been introduced across several Congresses and in the past has garnered over 50 bipartisan cosponsors – served as the foundation for many of the recent new proposals and we hope that the Senate will take it up for consideration. This way, if the House passes the Bipartisan Workforce Pell Act, lawmakers could conference both legislations and possibly settle on a compromise bill. We urge Congress to work in a bipartisan, bicameral fashion and enact this crucial legislation that will finally open to the door of opportunity for many adult learners who are currently left behind without federal support.  

José N. Miranda is the Director of Government Relations at ACCT

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