Updated cost projections for the Pell Grant program
New America points us to Pell Grant cost projections:
The Congressional Budget Office this week released updated cost projections for the Pell Grant program – and the estimates show an unexpected surplus over the past several years. The figures are much awaited because they dictate what lawmakers must allocate to the program in the upcoming fiscal year 2014 appropriations process if they want to keep the program running at its current level of benefits and with existing eligibility rules.
In 2010 and 2011, those estimates sparked panic. The program was burning through money faster than anyone expected, prompting Congress and the Obama administration to shift funding from other programs and cut parts of the Pell Grant program itself three separate times.
The funding emergency was exacerbated by the fact that congressional lawmakers and the Obama administration had tried to maintain a large increase in the maximum grant, first funded without any long-term funding plan by the American Recovery and Reinvestment Act of 2009. The latest round of temporary funding was set to dry up in 2014, leaving a $5.8 billion hole in the program. In 2015, the number would jump to $8.7 billion, and stay at about that level indefinitely.
Luckily for procrastinators in the White House and on Capitol Hill – and for Pell Grant supporters – the latest Congressional Budget Office estimates have come to their rescue. According to CBO, the program was actually overfunded the past few years, leaving a surplus of $9.2 billion. The CBO doesn’t give much explanation as to what changed. For that we’ll have to wait for the president.