History

• According to Jesse Perez Mendez in his thesis "Evolution of the Pell Grant," published online by Texas Tech University, the present Pell Grant evolved from the educational needs of soldiers returning from World War II. The National Defense Student Loan Program of 1958 and the College Work-Study Program of 1964 provided some financial assistance to students, but the Higher Education Act of 1965 greatly widened access to college for lower-income students. In 1972 the Pell grant was created with the reauthorization of the HEA. According to the Department of Education, Education Recovery Act funds have increased the amount of the awards for eligible students from $4,850 to $5,500 in fiscal year 2010.
  
  

Function

• The Federal Pell Grant Program provides funds to undergraduate students and some postgraduate students based on their income to apply to fees at any of 6,000 participating schools. Potential students apply by filling out the Free Application for Federal Student Aid, or FAFSA, online.
  
  

Award Formula

• The amount of the award is determined by a formula that includes either student income or the income of the parents if the student is still a dependent for tax purposes. Other factors considered are the size of the household and how many household members are enrolled in college. Awards can range from zero to $5,500, and a Student Aid Report is issued as soon as the FAFSA is completed, which indicates the amount the student is eligible to receive.
  
  

FAFSA Information

• To complete the application for a Pell Grant, the FAFSA applicant will need his previous year's tax return or the tax return of his parents if they are considered to be a dependent. The application will also ask which school the applicant plans to attend. Applications are completed and submitted online, and the results are sent to both the applicant and to the schools indicated on the application.
  
  

Considerations

• Although a student may be in too high an income bracket to receive a Pell Grant, alternative sources of financial aid such as federal student loans and many scholarships require a completed Pell application before initiating loan or scholarship applications. Funds from the grant are either paid directly to the school or to the student, and funds in excess of school costs, if any, are paid directly to the student.