Next cuts could hit college aid - Steve Rosen, Kansas City Star

Congress rewrote some of the rules regarding student loans. The agreement allocated $17 billion for Pell grants for the 2012 and 2013 fiscal years, but it eliminated an interest payment subsidy that largely benefited graduate students and removed an incentive for making prompt loan repayments. However, the clock is still ticking for Pell grants. For one thing, the program faces a $1.3 billion shortfall in fiscal 2012, according to Mark Kantrowitz, publisher of the Fastweb and FinAid student loan websites. Congress might address the Pell shortfall by making further cuts in other student aid, Kantrowitz said. However, he said, “the most likely scenario involves changing the eligibility requirements for the Pell grant program,” including reducing the number of semesters the funds would be available for a student. The upshot: While the maximum $5,550 award may remain, don’t expect to see increases in Pell grants or other federal student aid programs for the next decade, Kantrowitz said.