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Blog Post · June 6, 2017

Year-Round Pell Grant Revived

As California State University and the University of California work to increase the number of students who graduate within four years, the federal government has reinstituted the year-round Pell Grant—a financial aid program that can help accomplish this goal. Increasing on-time graduation rates has benefits for both students and the state—opening up more spots in the state’s higher education institutions, reducing the total amount of tuition and fees that students pay, and allowing students to enter the workforce sooner.

The year-round Pell Grant is designed to address a specific problem: while students need to take 15 units in the fall and in the spring semester to graduate on time, many take only 12 units, which adds an extra year to their time to degree. Acknowledging this issue, some campuses are adopting the “Finish in Four” model, which encourages students to complete 30 units per year while giving them flexibility in how they meet that goal. For example, a student could take 12 units in the fall, 12 in the spring, and 6 in the summer. The year-round grant program complements this model by allowing recipient students flexibility to use Pell funding for summer coursework.

Many California students already receive Pell Grants―around 46% of students at CSU and UC, and 29% at the community colleges. The new year-round grant allows recipients to receive one-and-a-half Pell awards in one academic year. While this may not cover the full cost—six units during the summer term costs about $120 more than six units in the fall and spring terms—it makes attending more affordable.

However, it is unclear if the program will incentivize students to enroll in the summer term to stay on track for timely graduation. The program was previously only in effect for two years (2009–2011), and the limited research studying its impact suggests mixed results. Preliminary findings from a study presented at the Association for Public Policy Analysis and Management conference found a small increase of 3.5 percentage points in Pell students’ summer enrollment. Initial findings from another study presented at the Association for Education Finance and Policy conference found that summer enrollment increased by 28 percentage points. Given the short lifespan of the first year-round Pell, its impact may have been limited by students’ lack of awareness of the program and campuses’ lack of infrastructure to offer the right courses.

To ensure the program’s effectiveness, colleges need to help students use the summer semester to reach a full 30 units per year. The year-round Pell is not the only effort to help students use their summers to finish on time. For example, Sacramento State University is offering $1,000 grants for students who enroll in the summer term. Given the uncertainty of long-term federal funding for a year-round Pell, campuses may need to develop other similar programs to incentivize summer enrollment and encourage on-time graduation.

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Affordability California Community Colleges California State University Completion Equity financial aid Higher Education University of California