# Purpose of the End-of-Year Report

The Federal Pell Grant End-of-Year Report presents primary aspects of
Federal Pell Grant Program activity for the 2006-2007 award year.

This presentation is a compilation of quantitative program data
assembled to offer insights into the changes to the Title IV applicant
universe and the Federal Pell Grant Program. The Federal Pell Grant
End-of-Year Report provides factual information and highlights important
programmatic issues.

Since 1973, the Office of Postsecondary Education has compiled summary
information on Title IV applicants and Federal Pell Grant Program
activity. The information provides a basis for program planning and
development. The Report can also be used by policy makers to estimate
the potential impact of actual or proposed policies on Pell Grant
recipients and federal aid applicants. In addition, the End-of-Year
Report can assist researchers, students, higher education officials, and
financial aid administrators to better understand current patterns of
Federal Pell Grant disbursements and Title IV applicant activity.

The Title IV/Federal Pell Grant Program End-of-Year Report is produced
by Vangent, Inc., under contract to the Office of Postsecondary
Education of the U.S. Department of Education. Comments, questions, or
request for copies should be addressed to:

Mary A. Miller

U.S. Department of Education

Office of Postsecondary Education

1990 K Street, N.W.

Mail Stop 8540

Washington, D.C. 20006-8540

<mary.miller@ed.gov>

Copies of the End-of-Year Report can also be obtained on-line at:

<http://www.ed.gov/finaid/prof/resources/data/ope.html>

# Federal Pell Grant Program

Title IV programs are managed by the Office of Federal Student Aid (FSA)
within the U.S. Department of Education. The programs are authorized by
the Higher Education Act of 1965, as amended.

A formula established by Congress is used to calculate a student's
Expected Family Contribution (EFC). This is the amount that a family can
be expected to contribute towards the student's cost of attendance. For
the Federal Pell Grant Program the EFC is used to determine the
financial eligibility of the student.

The Federal Pell Grant Program is designed to help the neediest
undergraduate students. For many students, Federal Pell Grants provided
a foundation of financial aid, to which aid for other federal and
non-federal sources may be added. The program provided grants ranging
from \$400-\$4,050 to over 5.1 million students in 2006-2007, with
awards totaling \$12,817,316,257.

# Databases for the End-of-Year Report Tables

All tables in the 2006-2007 End-of-Year Report are derived from a merged
file containing Title IV applicant and Federal Pell Grant recipient data
through January 2008. The applicant data are from the student
applications processed by the central processing system; recipient
information is from the common origination and disbursement system.
Since the Pell Grant recipient system continues to process data long
after the end of the award year, some unreconciled student payment data
may be included in the universe file. The potential number of students
with this unreconciled payment data is very small, and would have
minimal impact on the dollar figures and student distributions herein
presented.

# Eligibility

The Federal Pell Grant is distinguished from other financial assistance
in that all students meeting certain criteria are guaranteed aid, with
the amount of aid determined by financial need,

enrollment level, and educational cost. However, because of limited
funding, the program is not a true entitlement, as benefits may be
reduced from those anticipated under a fully-funded system. To be
eligible for a grant, an individual must meet certain residency
requirements, be enrolled in an eligible program at a school
participating in the Federal Pell Grant Program, and be determined to
have sufficient financial need.

As mentioned above, financial need for 2006-2007 is calculated using
formulas mandated by Congress in the Higher Education Amendments of
1965, as amended. These formulas, applied consistently to all
applicants, take into account such indicators of financial strength as
income, assets, and family size. The EFC is combined with the cost of
the student's education and the student's enrollment status (full-time,
three-quarter-time, half-time, or less than half-time) to determine the
amount of the Federal Pell Grant (although cost of education only
affects the student's award amount if the cost is less than \$4,050).
Tuition may also be a factor in calculating the amount of the award for
students enrolled at low-tuition schools.

The lower the EFC, the greater the demonstration of a student's
financial need. Consequently, the amount of the grant increases as the
EFC decreases, such that an applicant with the minimum EFC of zero may
generally receive the maximum award equal to the applicant's education
cost for the year up to \$4,050. Proportionally smaller awards are made
to part-time students.