Department of Education

STUDENT FINANCIAL ASSISTANCE

Fiscal Year 2021 Budget Request

CONTENTS

Page

Appropriations Language ........................................................................................................ P-1

Analysis of Language Provisions and Changes....................................................................... P-2

Appropriation, Adjustments and Transfers .............................................................................. P-3

Summary of Changes ............................................................................................................. P-4

Authorizing Legislation............................................................................................................ P-5

Appropriations History............................................................................................................. P-6

Summary of Request .............................................................................................................. P-7

Activities.................................................................................................................................. P-9

Federal Pell grants ............................................................................................................. P-9

Federal supplemental educational opportunity grants....................................................... P-23

Federal work-study ........................................................................................................... P-28

Iraq and Afghanistan service grants.................................................................................. P-36
STUDENT FINANCIAL ASSISTANCE

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Appropriations Language

For carrying out [subparts 1 , 3, and 10] subpart 1 of part A, and part C of title IV of the HEA, 

[$24,520,352,000] $22,975,352,000, which shall remain available through September 30, [2021] 

2022:1

The maximum Pell Grant for which a student shall be eligible during award year [2020-2021] 

2021-2022 shall be $5,2852. 

GENERAL PROVISIONS

 [(RESCISSION)] 

[SEC. 308. Of the unobligated balances available under the heading “Student Financial 

Assistance” for carrying out subpart 1 of part A of title IV of the HEA, $500,000,000 are hereby 

rescinded.]3 (Department of Education Appropriations Act, 2020.)

NOTE

Each language provision that is followed by a footnote reference is explained in the Analysis of Language 

Provisions and Changes document which follows the appropriation language. 
STUDENT FINANCIAL ASSISTANCE

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Analysis of Language Provisions and Changes

Language Provision Explanation

1For carrying out [subparts 1, 3, and 10]

subpart 1 of part A of title IV of the HEA, 

[$24,520,352,000] $22,975,352,000 which 

shall remain available through September 30, 

[2021] 2022.

This language sets the availability of funds 

provided under the account through the end of 

fiscal year 2022.

2The maximum Pell Grant for which a student 

shall be eligible during award year [2020-

2021] 2021-2022 shall be $5,285.

This language sets the maximum Pell Grant 

award for award year 2021-22. Including 

mandatory funding provided in the Higher 

Education Act, the Pell Grant maximum award 

in award year 2021-22 will be $6,345, the 

same as the previous award year.

GENERAL PROVISIONS

3[Of the unobligated balance available under 

the heading “Student Financial Assistance” for 

carrying out subpart 1 of part A of title IV of 

the HEA, $500,000,000 are hereby 

rescinded.]

The 2020 Appropriation rescinded 

$500,000,000 of unobligated funds from the 

Pell Grant program. The 2021 Request does 

not include a rescission.
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Appropriation, Adjustments and Transfers

(dollars in thousands)

Appropriation/Adjustments/Transfers 2019 2020 2021

Discretionary: 

Discretionary Appropriation........................................... $24,445,352 $24,520,352 $22,975,352

Mandatory:

Mandatory Appropriation .......................................... 6,758,443 7,143,463 7,009,000

Total, discretionary and 

mandatory appropriation ................. 31,203,795 31,663,815 29,984,352
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Summary of Changes

(dollars in thousands)

2020.................................................................................................. $31,663,815

2021.................................................................................................. 29,984,352

Net change................................................................................. -1,679,463

Increases: 2020

Change 

from base

Program: 

Increase in indefinite mandatory funding required for the addon to the maximum Pell Grant due to higher estimated 

program costs, including the cost associated with policy 

proposals. $5,738,000 +$168,000

Subtotal, increases +168,000

Decreases: 2020

Change 

from base

Program: 

Decrease in discretionary funding to reflect the elimination of 

the Supplemental Education Opportunity Grant (SEOG) 

program. 865,000 -865,000

Decrease in discretionary funding to reflect changes to the 

Federal Work Study Program. 1,180,000 -680,000

Decrease in indefinite mandatory funding required for the 

add-on to the maximum Pell Grant due to projected savings 

from improper payments. 5,738,000 -19,000

Decrease in specified mandatory funding for use in the Pell 

Grant program due to amount provided in the HEA for 

FY 2020. 1,405,000 -235,000

Decrease in specified mandatory funding in the HEA to offset 

the mandatory costs associated with Pell Grant policy 

proposals. 1,405,000 -48,000

Decrease in mandatory funding to reflect the move of the Iraq 

and Afghanistan Service Grant (IASG) program into the Pell 

Grant program. 463 -463

Subtotal, decreases -1,847,463

Net change -1,679,463
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Authorizing Legislation

(dollars in thousands)

Activity

2020

Authorized Foot

note

2020

Appropriated

2021

Authorized

2021

Request

Footnote

Federal Pell grants (HEA-IV-A-1): 

Career and Technical:Federal Pell grants (discretionary) ......................... 01 $22,475,352 To be determined $22,475,352

Career and Technical: Federal Pell grants (mandatory)............................. Indefinite 7,143,000 To be determined 7,009,000

Federal supplemental educational opportunity grants 

(HEA-IV-A-3)....................................................... 02 865,000 02 0

Federal Work-Study (HEA-IV-C) ............................... 03 1,180,000 To be determined 500,000

Iraq and Afghanistan Service Grants (HEA-IV-A-10). Indefinite 463 0 0

Total discretionary appropriation ......................... 24,520,352 22,975,352

Portion of the discretionary request subject to 

reauthorization.................................................... 0 22,975,352

Total mandatory appropriation............................. 7,143,463 7,009,000

Total appropriation .............................................. 31,663,815 29,984,352

1The GEPA extension expired September 30, 2018; the program is authorized in FY 2020 through appropriations language; reauthorizing legislation is sought for 

fiscal year 2021.

2The GEPA extension expired September 30, 2015; the program is authorized in FY 2020 through appropriations language; reauthorizing legislation is not sought 

for fiscal year 2021.

3The GEPA extension expired September 30, 2015; the program is authorized in FY 2020 through appropriations language; reauthorizing legislation is sought for 

fiscal year 2021.
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Appropriations History

(dollars in thousands)

(Year

Budget 

Estimate 

to Congress

footnote House 

Allowance

footnote Senate 

Allowance footnote

Appropriationfootnote

2012 $30,338,016 $22,367,5211 $24,670,5171 $24,535,281

2013 24,685,281 24,535,2812 24,535,2812 24,400,122

2014 24,685,281 N/A3 24,536,2104 24,486,210

2015 24,486,210 N/A3 24,233,2105 24,198,210

2016 24,198,210 23,828,2106 24,129,3526 24,198,210

2017 24,198,210 22,888,2107 24,198,2107 24,198,2107

2018 22,932,626 24,198,2108 24,198,2108 24,033,8808

2019 22,675,352 24,445,3529 24,445,3529 24,445,3529

2020 22,975,352 24,937,35210 24,445,35210 24,520,35210

2021 22,975,352 

1 The level for the House allowance reflects an introduced bill; the level for the Senate allowance reflects 

Senate Committee action only.

2 The level for the House and Senate allowances reflect action on the regular annual 2013 appropriations 

bill, which proceeded in the 112th Congress only through the House Subcommittee and the Senate 

Committee.

3 The House allowance is shown as N/A because there was no Subcommittee action.

4 The level for the Senate allowance reflects Committee action only.

5 The level for the Senate allowance reflects Senate Subcommittee action only.

6 The levels for House and Senate allowances reflect action on the regular annual 2016 appropriations 

bill, which proceeded in the 114th Congress only through the House Committee and Senate Committee.

7 The levels for the House and Senate allowances reflect Committee action on the regular annual 2017 

appropriations bill; the Appropriation reflects the Consolidated Appropriations Act, 2017.

8 The level for the House allowance reflects floor action on the Omnibus appropriations bill; the Senate 

allowance reflects Committee action on the regular annual 2018 appropriations bill; the Appropriation

reflects the Consolidated Appropriations Act, 2018 (P.L. 115-141).

9 The levels for the House and Senate allowance reflect Committee action on the regular annual 2019 

appropriations bill; the Appropriation reflects enactment of the Department of Defense and Labor, Health 

and Human Services, and Education Appropriations Act, 2019 (P.L. 115-245).

10 The Senate allowance reflects the Chairman’s mark; the Appropriation reflects the Further 

Consolidated Appropriation Act, 2020 (P.L. 116-94).
Summary of Request

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P-7

Summary of R equest

Click here for accessible version
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Summary of Request

The Administration’s fiscal year 2021 budget request will provide $125 billion in new Federal 

grants, loans, and work-study assistance to help students pay for postsecondary education and 

compete for new jobs in the expanding economy. Overall, funds requested for programs in the 

Student Financial Assistance account would provide $30.9 billion in aid1 and 7.4 million student 

aid awards. The fiscal year 2021 budget request takes steps to redirect and expand Federal 

student aid to students with the most need so they can obtain the skills and education required 

in today’s workforce. The request also proposes the evaluation of Federal Student Aid (FSA) as 

a separate organization, with reformed governance, to significantly improve FSA’s ability to 

serve students and taxpayers by improving its management, oversight, and administration of the 

Federal student aid programs.

The fiscal year 2021 funding proposed for the Student Financial Assistance (SFA) account is 

$30.0 billion, approximately $1.7 billion less than the fiscal year 2020 appropriation. This

includes a discretionary request of $23.0 billion: $22.5 billion for Pell grants and $500 million for 

Federal Work-Study (FWS). More than $7.0 billion in mandatory funds are provided in fiscal 

year 2021 for the Pell Grant program.

The Administration’s 2021 budget proposal maintains Pell Grant funding in fiscal year 2021 and 

ensures the program remains on a stable footing, while also expanding eligibility where it is 

most needed. Under the fiscal year 2021 proposal, the maximum Pell Grant in award year 2021-

22 will be $6,345, the same level as the previous award year. The Administration’s request

proposes to expand Pell Grant eligibility to students enrolled in high-quality short-term programs

offered by institutions that provide students with a credential, certification, or license in a highdemand field. The budget also makes Pell Grants available to certain incarcerated students to

improve employment outcomes, reduce recidivism, and facilitate their successful reentry to 

society. The Administration’s proposal also restores nearly $400 a year to each recipient of an 

Iraq and Afghanistan Service Grant, by protecting those grants from sequestration cuts and 

treating them just like Pell Grants.

The request would also reform campus-based programs by focusing limited resources on

bolstering effective workforce development opportunities for students with the greatest need.

The Administration proposes to reduce funding for the FWS program to $500 million in fiscal 

year 2021, a reduction of $680 million, or 58 percent compared to the fiscal year 2020 

appropriation. The request also proposes to reform the FWS program to support workforce and 

career-oriented training opportunities for low-income undergraduate students. The 

Administration’s budget request would also save $865 million in fiscal year 2021 by eliminating 

the Supplemental Education Opportunity Grant (SEOG) program, which currently allows 

institutions to provide grant aid to students that do not always have the greatest need for 

assistance and is duplicative of the better-targeted Pell Grant program.

Fiscal year 2021 program-specific funding information and policy proposals, as well as program 

performance information that applies to all student assistance programs, are discussed in the 

Student Aid Overview.

1 Total aid available is based on new budget authority and any required matching funds, less allowable administrative 

costs.
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Activities

Federal Pell grants

(Higher Education Act of 1965, Title IV, Part A, Subpart 1)

(dollars in thousands)

FY 2021 Authorization: To be determined

Budget authority:1

Period of fund availability:

2020 

Appropriation

2021 

Request

Change from 

2020 to 2021

Program funds: 

Discretionary appropriation $22,475,352 $22,475,352 $0

Mandatory appropriation 5,738,000 5,887,000 +149,000

Mandatory appropriation for 

discretionary program costs2 1,405,000 1,122,000 -283,000

Subtotal, current year funding 29,618,352 29,484,352 -134,000

Pell Grant program costs 29,631,000 30,383,599 +752,599

1Table reflects discretionary budget appropriations and mandatory budget authority in support of program costs for 

each fiscal year.

2The Higher Education Act (HEA) provides $1,170,000 thousand in mandatory funding to be used for discretionary 

program costs in FY 2021. The budget proposes to use $48,000 thousand of this funding to offset the cost of student 

aid policy proposals included in the Budget.

PROGRAM DESCRIPTION

The Federal Pell Grant program helps ensure access to postsecondary education for low- and 

moderate-income undergraduate students by providing grants that help meet postsecondary 

education costs. The program also promotes lifelong learning by providing resources for lowand moderate-income adults now in the workplace to return to school to upgrade skills.

The Department provides funds to participating institutions to deliver aid to all students at the 

institution who are eligible and apply for a Pell Grant. Unlike Campus-Based Programs (SEOG 

and FWS), a student’s eligibility is not dependent on the availability of funds awarded to the 

institution.

A Pell Grant is the foundation of a student’s financial aid package, to which other forms of aid 

are added. The amount of a student’s Pell Grant is dependent on the student’s “expected family 

contribution” (EFC), cost of education, whether the student attends school full time or part time, 

and whether the student’s program is a full academic year in length or less. Pell Grant 
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disbursements are made to a student at least once every term during the award year or at the 

beginning and mid-point for programs without terms.

Budget authority in the Pell Grant program is available for 2 fiscal years; for example, funds 

become available for obligation on October 1 of the fiscal year in which they are appropriated 

and remain available through September 30 of the following fiscal year. Funds proposed for 

fiscal year 2021 would be used for grants in the 2021-22 award year, which runs from July 1, 

2021, through June 30, 2022. If Pell Grant costs for a given academic year exceed the 

corresponding appropriation, the Department uses the next fiscal year’s appropriation to cover 

the balance.

The Fostering Undergraduate Talent by Unlocking Resources for Education Act (FUTURE Act) 

of 2019 has excepted the Department from restrictions of Section 6103 of the Internal Revenue 

Code to authorize the Internal Revenue Service (IRS) to disclose tax return information directly 

to the Department for the purpose of administering certain Federal aid programs. One of the 

primary causes of improper payments in the Pell Grant program is failure to verify financial data 

accurately. This new exception is expected to simplify and improve the accuracy of FAFSA filing 

by prepopulating certain fields.

Recent and projected funding: The Pell Grant program is the single largest source of grant aid 

for postsecondary education and helps ensure low-income students can afford higher education 

and successfully attain a postsecondary credential. In 2021, nearly 7.1 million students are 

expected to receive Pell Grant awards up to $6,345. The program operates as an entitlement to 

eligible students once the maximum grant, award rules, and payment schedule are established. 

The Higher Education Act (HEA) does not provide for the denial of an award to any student who 

meets the qualifying conditions, nor does it allow the Secretary to reduce any student’s award 

level.

Mandatory funding: The College Cost Reduction and Access Act authorized mandatory funding 

to support increases to the Pell maximum award set in each fiscal year’s appropriations act. The 

Health Care and Education Reconciliation Act (HCERA) amended that provision and increased 

the maximum award by $690 for award years 2010-2011 through 2012-2013, and by the 

Consumer Price Index (CPI) from 2013 to 2017. Beginning with the 2018-19 award year, the 

add-on award is equal to the award year 2017-2018 level and is not increased by the CPI.

Pell Grant program scoring rule: The congressional budget resolution for fiscal year 2006 

included a rule under which appropriations bills for the Pell Grant program are scored by the 

Congressional Budget Office for the estimated budget authority needed to fund the program for 

that year, or the requested budget authority, whichever is greater. If the appropriation exceeds 

the program cost as estimated at the beginning of the subsequent fiscal year, any surplus is 

available to reduce the appropriation needed to support that subsequent year’s program costs. 

Conversely, if the appropriation is lower than the updated estimated program cost, the 

difference is automatically scored against the subsequent year’s appropriation.

Given the nature of the program, it is reasonable to consider Pell Grants an individual 

entitlement for purposes of budget analysis and enforcement. Congress has chosen to continue 

treating the portion funded in annual appropriations acts as discretionary, continuing the scoring 
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of budget authority for Pell Grants against the appropriations allocations established annually 

under section 302 of the Congressional Budget Act. Like previous years, this budget presents 

the portion of Pell Grants provided in the annual appropriations act as discretionary funding.

Need analysis formula: The need analysis formula for the Title IV need-based student aid

programs, stipulated in the HEA, determines financial eligibility for Pell Grants and is applied 

uniformly to all applicants. This formula determines a student’s EFC. The fundamental elements 

in the formula are the student’s (and in the case of dependent students, their parents’) income 

and assets (excluding the value of the family’s home or farm), the family’s household size, and 

the number of family members (excluding the student’s parents) attending postsecondary 

institutions. The EFC is the sum of (1) a percentage of net income (remaining income after 

subtracting allowances for taxes and basic living expenses), and (2) a percentage of net assets 

(assets remaining after subtracting an asset protection allowance). Different assessment rates 

and allowances are used for dependent students, independent students, and independent 

students with dependents. For award year 2020-21, the income threshold at which a dependent 

student receives an automatic zero EFC determination is $26,000.

Institutional participation: More than 4,500 postsecondary institutions currently participate in the 

Pell Grant program. Institutions that lose their eligibility to participate in the loan programs due 

to high default rates are also precluded from participation in the Pell Grant program.

Student participation: Students may use their grants at any participating postsecondary

institution. Pell Grants are disbursed to the student through the institution. The Pell Grant 

program is the largest source of grant aid to students under the HEA, with approximately 39

percent of all undergraduates receiving a Pell Grant.

Recipients must be undergraduates and cannot have received a bachelor’s degree previously 

(except for certain teacher certificate programs) and must be enrolled with the purpose of 

obtaining a degree or certificate at an eligible institution.

Students must also have a high school diploma (or its equivalent) or have been homeschooled. 

Students who did not have a high school diploma or were not homeschooled and first enrolled in 

an eligible program prior to July 1, 2012, may receive a Pell Grant by meeting one of the abilityto-benefit (ATB) alternatives. These alternatives include: (1) passing an independently 

administered, Department-approved ability-to-benefit test; (2) completing at least 6 credit hours 

or 225 clock hours that are applicable toward a degree or certificate offered by the institution; or 

(3) completing a State process approved by the Secretary of Education.

Students who did not have a high school diploma or were not homeschooled and first enrolled in 

an eligible program on or after July 1, 2012, can only become eligible through one of the ATB

alternatives described above if they are enrolled in an eligible career pathway program as 

defined in section 484(d)(2) of the HEA. 

Less than full-time students are eligible for pro rata awards based on their enrollment status. As 

of July 1, 2012, students are eligible for Pell Grants for a maximum of 12 semesters (or its

equivalent) of full-time enrollment.
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A student in default on a loan made under any Title IV HEA loan program, or who owes an 

overpayment on any other previously received Federal student aid, may not receive additional 

funds under the program unless he or she repays the debt in full or makes satisfactory 

repayment arrangements with the holder of the debt.

Annual award amount: The annual award amount may vary from the statutory minimum 

payment up to the maximum authorized by statute for the academic year. The Higher Education 

Opportunity Act of 2008 enacted a minimum Pell Grant award of 10 percent of the maximum 

award. That is, students who do not qualify for at least 10 percent of the maximum grant do not 

receive a Pell award. Appropriations acts set annual maximum award levels. For award year 

2020-21, the 2020 appropriation level supports an award of $5,285. With the mandatory add-on 

award established by the HCERA, the maximum award will increase to $6,345. The minimum 

Pell award for award year 2020-21 is $634.

The aggregate Pell Grant award is the lesser of: 

• the maximum award (as set in annual appropriations acts) plus the additional amount 

provided by mandatory funds, minus the EFC, or

• the student’s cost of attendance minus the EFC.

Additionally, students who complete more than one academic year within an award year are 

eligible for larger awards under the “year-round Pell” provision, which was enacted in the fiscal 

year 2017 Consolidated Appropriations Act. Awards under this provision are capped at 150% of

the student’s regular award. In the 2018-19 award year approximately 788,000 recipients 

benefitted from the year-round Pell provision with an average additional award of nearly $1,600. 

The total aid disbursed under this provision was $1.2 billion.

Cost of attendance: For purposes of determining the Pell Grant award, the postsecondary 

institution establishes the cost of attendance using the following cost items: 

• tuition and fees;

• an allowance for books, supplies, transportation, dependent care, and miscellaneous 

expenses, including a reasonable allowance for the documented rental or purchase of a 

personal computer; and

• living allowances of: 

o the actual amount charged by the institution for room and board for students living at 

school,

o an amount determined by the institution for students without dependents living at home 

with parents, or

o for all other students, an amount based on the expenses reasonably incurred for room 

and board.
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The cost of attendance for less-than-half-time students includes: tuition and fees; an allowance 

for books, supplies and transportation; and dependent care.

Financial aid administrator discretion: The HEA stipulates financial aid administrators may, on 

the basis of adequate documentation and on a case-by-case basis, adjust a student’s Pell Grant 

award by changing the cost of attendance or the value of data elements used to calculate the 

EFC to reflect “special circumstances,” such as the following: 

• tuition expenses at an elementary or secondary school;

• medical or dental expenses not covered by insurance;

• unusually high childcare costs;

• recent unemployment of an independent student or a family member;

• changes in a student’s housing status resulting in homelessness;

• the number of parents enrolled at least half-time in a degree or certificate or other program 

leading to a recognized educational credential at an institution participating in any of the 

Title IV programs; or

• other changes in a family’s income, assets, or a student’s status.

Institutional payments: The HEA provides for payment to institutions of $5 per Pell Grant 

recipient to reimburse institutions for a share of the cost of administering the Pell Grant 

program. Funds for these payments are paid from the Pell Grant appropriation. In award year 

2020-21, these payments will total $34 million.

Because of the structure of the Pell Grant program, annual funding levels may not equal annual 

expenditures.
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Discretionary and mandatory funding levels for the past 5 fiscal years were: 

Fiscal Year (dollars in thousands)

2016.............................................................. ........$27,315,7131

2017.............................................................. ..........29,475,7522

2018.............................................................. ..........29,806,6913

2019.............................................................. ..........29,233,3924

2020.............................................................. ..........29,618,3525

1 Includes $4,840 million in mandatory funds to increase maximum award by $965.

2 Includes $5,680 million in mandatory funds to increase maximum award by $1,060 and $1,320 million in additional 

mandatory funds provided in legislation to reduce discretionary need.

3 Includes $5,997 million in mandatory funds to increase maximum award by $1,060 and $1,334 million in additional 

mandatory funds provided in legislation to reduce discretionary need. 4 Includes $5,388 million in mandatory funds to increase maximum award by $1,060 and $1,370 million in additional 

mandatory funds provided in legislation to reduce discretionary need.

5 Includes $5,738 million in mandatory funds to increase maximum award by $1,060 and $1,405 million in additional 

mandatory funds provided in legislation to reduce discretionary need.

FY 2021 BUDGET REQUEST

The Administration’s budget request for fiscal year 2021 includes $22.5 billion in discretionary 

funding for the Pell Grant program, level with the 2020 appropriation. This discretionary request, 

plus $7.0 billion in mandatory funding, establishes the total fiscal year 2021 Pell funding level at 

$29.5 billion. The mandatory request supports an add-on award of $1,060 to the base maximum 

award of $5,285, resulting in a total maximum award of $6,345 in award year 2021-22. 

The fiscal year 2021 request would expand Pell Grant eligibility to students enrolled in highquality, short-term programs offered by institutions that lead to a credential, certification, or 

license in a high-demand field. Currently, students enrolled in these types of postsecondary 

programs are not eligible to receive federal student aid due to time and program length 

requirements. The proposed expansion reflects the principle that Federal laws and regulations 

should be updated to facilitate, not impede, students from acquiring the skills needed in today’s 

workforce. This proposal would help more Americans access education and training programs 

that provide them with the skills needed to secure well-paying jobs in high-demand fields more 

quickly than traditional 2-year or 4-year degree programs.

The request also includes expansion of Pell Grant eligibility to certain incarcerated students. 

Today, nearly 1.5 million Americans are in prisons across the country, and more than 95 

percent of these prisoners will eventually leave prison and face the challenge of getting jobs and 

rebuilding their lives. Research shows that correctional education reduces the likelihood of 
STUDENT FINANCIAL ASSISTANCE

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recidivism, benefitting the individual and saving taxpayers reincarceration costs1

. To support 

returning citizens by improving employment outcomes and reducing recidivism, the request 

proposes to expand Pell Grant eligibility to incarcerated students. The proposal includes the 

following parameters:

• Students must be within five years of their likely release and participating in programs that 

prepare them for high-demand occupations that can also be completed post-release.

• Students cannot enroll in programs that prepare them for fields where they face legal 

barriers to employment.

• Institutions, to be eligible, must provide academic and career guidance to students,

• Participating institutions and Federal and state prisons cannot use the Pell Grant funds to 

supplant existing funding for postsecondary prison-based education programs. 

Additionally, the request proposes to prevent fraudulent activity by barring someone from 

receiving another Pell Grant if they have been awarded three consecutive Pell Grants without 

earning any credits. 

Finally, the Administration’s fiscal year 2021 request proposes to move the Iraq and Afghanistan 

Service Grant (IASG) program into the Pell Grant program to protect these students from cuts to 

their grant of nearly $400 each year. This proposal is discussed in further detail in the IASG 

section.

The request for this program is best understood in the context of the Administration’s proposals 

for student aid programs as a whole. Accordingly, program-specific funding information and 

policy proposals also are discussed in the Student Aid Overview.

PELL GRANT PROGRAM HISTORICAL DATA

Applicant and Recipient Growth

The graphs on the following pages show the latest applicant, recipient, and aid available trends 

for the Pell Grant program. Applicants are estimated at 15.4 million for award year 2021-22, an 

increase of 400,000 compared to award year 2020-21. Recipients are estimated at 7.1 million in 

award year 2021-22, an increase of 252,000 over award year 2020-21, including an estimated 

111,000 due to proposed policies.

Many factors affect applicant growth, including demographic trends and changes in economic 

conditions, such as labor market demands, as well as the inclusion of recently finalized 

regulations governing accreditation. Factors affecting recipient growth include family incomes, 

need analysis, college costs, the level of the maximum Pell Grant award, and changes in the 

volume of applicants.

1 https://www.rand.org/pubs/research_reports/RR266.html
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The following tables show program information consistent with actual or requested funding 

levels.

Federal Pell Grants Applicant Trends1

Award Year Valid Applicants2 Applicant Growth: 

Number

Applicant Growth: 

Percent Change

2003-04 11,093,506 738,981 7.14%

2004-05 11,539,497 445,991 4.02%

2005-06 11,611,388 71,891 0.62%

2006-07 11,811,911 200,523 1.73%

2007-08 12,299,232 487,321 4.13%

2008-09 13,883,288 1,584,056 12.88%

2009-10 16,482,495 2,599,207 18.72%

2010-11 17,625,778 1,143,283 6.94%

2011-12 18,458,701 832,923 4.73%

2012-13 18,294,947 -163,754 -0.89%

2013-14 17,915,446 -379,501 -2.07%

2014-15 17,312,207 -603,239 -3.37%

2015-16 16,362,617 -949,590 -5.49%

2016-17 15,462,153 -900,464 -5.50%

2017-18 15,529,912 67,759 0.44%

2018-19 15,240,392 -289,520 -1.86%

2019-20 15,039,467 -200,925 -1.32%

2020-21 14,985,059 -54,408 -0.36%

2021-22 15,400,726 415,667 2.77%

1 Applicant data through award year (AY) 2018-19 are considered final and are taken from internal operational 

reports. Applicant data for award years 2019-20 through 2021-22 are estimates and are subject to change.

2 A valid applicant is an undergraduate student who submits an application with sufficient data to calculate an EFC 

and determine Pell Grant eligibility.
STUDENT FINANCIAL ASSISTANCE

Federal Pell Grants

P-17

NOTE: Applicants reflect those applying for all Federal student financial assistance, including those 

receiving only non-need-based student loans.

Number of Recipients: 

Under current estimates, the funds requested for fiscal year 2021 would support Pell Grant 

awards to 7.1 million recipients. 

0

3,000,000

6,000,000

9,000,000

12,000,000

15,000,000

18,000,000

1975-761979-801983-841987-881991-921995-961999-002003-042007-082011-122015-162019-20

Pell Grant Program Historical Data

Applicants and Recipients (1973-74 to 2019-20)

Applicants Recipients
STUDENT FINANCIAL ASSISTANCE

Federal Pell Grants

P-18

Aid Available 

Under current estimates, the Administration’s fiscal year 2021 proposal would provide $30.3 

billion in Pell Grants to students.

Maximum award 

The Administration proposes to maintain the base maximum award at $5,285 for award year 

2021-22 through discretionary and mandatory funding. The cost of providing the mandatory 

add-on that increases the maximum award to $6,345 in award year 2021-22 is funded by 

permanent mandatory indefinite funding as provided through HCERA.

Pell Maximum Award, Aid Available, and Recipients

Award 

Year

Maximum 

Award

Aid Available 

(dollars in millions) Recipients

2016-17 $5,825 $26,884 7,192,223 

2017-18 5,920 28,672 7,111,342 

2018-19 6,095 28,402 6,862,000 

2019-20 6,195 28,247 6,673,000 

2020-21 6,345 29,597 6,834,000 

2021-22 6,345 30,348 7,086,000 

$0

$3

$6

$9

$12

$15

$18

$21

$24

$27

$30

$33

$36

1975-761979-801983-841987-881991-921995-961999-002003-042007-082011-122015-162019-20

Pell Grant Program Historical Data

Aid Available (1973-74 to 2019-20)

$ in Billions
STUDENT FINANCIAL ASSISTANCE

Federal Pell Grants

P-19

The following table shows the Pell Grant maximum award levels, budget authority by type, and 

program costs for fiscal years 2012 to 2021. Fiscal year 2021 reflects the President’s Budget 

policies.

Pell Maximum Award Levels, Budget Authority, and Program Costs

(Dollars in Thousands, Except for Maximum Award Levels)

FY Maximum 

Award

Discretionary 

Budget 

Authority

Mandatory 

Budget 

Authority

Mandatory 

for 

Discretionary 

Budget 

Authority

Total 

Budget 

Authority

Program 

Cost

2012 $5,550 $22,824,000 $4,950,000 $13,795,000 $41,569,000 $32,082,000

2013 5,645 22,778,352 4,854,000 7,587,000 35,219,352 31,490,000

2014 5,730 22,778,352 4,835,469 588,000 28,201,821 30,651,000

2015 5,775 22,475,352 5,152,933 0 27,628,285 28,585,000

2016 5,825 22,475,352 4,840,361 0 27,315,713 26,920,000

2017 5,920 22,475,352 5,680,400 1,320,000 29,475,752 28,708,000

2018 6,095 22,475,352 5,997,339 1,334,000 29,806,691 28,059,000

2019 6,195 22,475,352 5,388,040 1,370,000 29,233,392 28,280,0001

2020 6,345 22,475,352 5,738,000 1,405,000 29,618,352 29,631,0001

2021 6,345 22,475,352 5,887,000 1,122,000 29,484,352 30,383,5991

1 Estimate.
STUDENT FINANCIAL ASSISTANCE

Federal Pell Grants

P-20

Distribution of Pell Grants

Distribution of Pell Grants by Student Status and Income Level

The tables below illustrate the distribution of Pell Grant funds to dependent and independent 

students at various income levels. In 2018-2019, approximately 66 percent of all Pell Grant 

recipients (including independent students) had incomes less than or equal to $30,000.

Distribution of Pell Grants to Dependent Undergraduates in 2018-19

Income Level Recipients Available Aid Average 

Award

0 - $6,000 422,033 $2,125,318,630 $5,036 

$6,001 - $9,000 89,977 456,349,259 5,072

$9,001 - $20,000 691,977 3,503,741,462 5,063

$20,001 - $30,000 650,879 3,256,752,192 5,004

 $30,001 + 1,601,277 5,430,679,005 3,391

Total Dependent 3,456,143 14,772,840,548 4,274

Independent students make up nearly half of the students receiving assistance under the Pell 

Grant program. These recipients tend to be in the lowest income groups, as shown below.

Distribution of Pell Grants to Independent Undergraduates in 2018-19

Income Level Recipients Available Aid Average 

Award

0 - $ 1,000 604,265 $2,664,795,415 $4,410 

$1,001 - $ 3,000 142,368 650,950,075 4,572

$3,001 - $ 6,000 216,644 986,370,320 4,553

$6,001 - $ 9,000 234,037 1,052,708,705 4,498

$9,001 - $15,000 553,225 2,375,077,241 4,293

$15,001 - $20,000 423,803 1,532,248,846 3,615

$20,001 - $30,000 528,332 1,845,052,039 3,492

 $30,001 + 703,183 2,521,646,811 3,586

Total Independent 3,405,857 13,628,849,452 4,002

All Undergraduates 6,862,000 28,401,690,000 4,139

Distribution of Pell Grants by Type of Institution

The table below shows the distribution of Pell Grants to students attending different types of 

institutions. In 2018-2019, approximately 42 percent of the total aid available for Pell Grants 

went to students attending Public 4-Year schools, and approximately 29 percent went to 

students attending Public 2-Year schools.
STUDENT FINANCIAL ASSISTANCE

Federal Pell Grants

P-21

Over the lifetime of the Pell Grant program, the share of Pell Grant aid to proprietary institutions 

has changed significantly. For example, in the 2009-2010 award year, approximately 25 percent 

of total Pell Grant aid went to students at proprietary institutions; in the 2018-19 award year, that

figure was 14 percent.

Distribution of Pell Grants by Type of Institution in 2018-19

Institution 

Type Recipients Available Aid

Average 

Award

Percent of 

Pell Aid

Public 4-Year 2,788,686 $11,796,973,859 $4,230 41.5%

Public 2-Year 2,054,150 8,124,838,297 3,955 28.6

Private 1,104,211 4,456,780,627 4,036 15.7

Proprietary 914,953 4,023,097,217 4,397 14.2

Total 6,862,000 28,401,690,000 4,139 100.0

The following two charts show, for the award years 2000-2001 to 2018-2019, total Pell 

recipients (in thousands) by type and control of institution; and the institutional share 

(percentage) of total Pell recipients.

 -

 500

 1,000

 1,500

 2,000

 2,500

 3,000

 3,500

 4,000

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18

Pell Recipients by Type & Control of Institution 

2 Yr Public 4-Year Public Proprietary Private
STUDENT FINANCIAL ASSISTANCE

Federal Pell Grants

P-22

PROGRAM OUTPUT MEASURES 

(dollars in thousands)

Output Measures 2019 2020 2021

Recipients 6,673,000 6,834,000 7,086,000

Aid available to students1 $28,246,635 $29,596,830 $30,348,169

Maximum grant (in whole dollars) $6,195 $6,345 $6,345

Minimum grant (in whole dollars)2 $619 $634 $634

Average grant (in whole dollars) $4,233 $4,331 $4,283

1 Overall aid available reflects the estimated cost of the program minus administrative costs of $5 per recipient.

2 The minimum grant reflects the statutory minimum, but the actual minimum grant published by the Department may 

be slightly higher due to the calculation methodology used in the payment schedule.

PROGRAM PERFORMANCE INFORMATION

This section presents selected program performance information, including, for example, GPRA 

goals, objectives, indicators and performance data and targets; and an assessment of the 

progress made toward achieving program results. Achievement of program results is based on 

the cumulative effect of the resources provided in previous years and those requested in fiscal 

year 2021 and future years, as well as the resources and efforts invested by those served by 

this program.

Because the Federal Pell Grant program account relies on the same performance measures, 

strategies, and program improvement activities that apply to all the student financial assistance 

grant programs, Pell program performance is discussed in the Student Aid Overview and is 

not repeated here.

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18

Pell Recipients by Institutional Share of Total

2-Year Public 4 Yr Public Proprietary Private
STUDENT FINANCIAL ASSISTANCE

P-23

Federal supplemental educational opportunity grants

(Higher Education Act of 1965, Title IV, Part A, Subpart 3)

(dollars in thousands)

FY 2021 Authorization: 01

Budget authority: 

2020 

Appropriation

2021 

Request

Change from 

2020 to 2021

$865,000 0 -$865,000

1The GEPA extension applies through September 30, 2015; reauthorizing legislation is not sought in fiscal year 2021.

PROGRAM DESCRIPTION

The Federal Supplemental Educational Opportunity Grant (SEOG) program provides needbased grant aid to eligible undergraduate students to help reduce financial barriers to 

postsecondary education. Federal funding allocations are awarded to qualifying postsecondary 

institutions under a statutory formula. Unlike the Pell Grant program, the SEOG program is 

operated by institutional financial aid administrators who have substantial flexibility in 

determining student awards.

The funding provided for the SEOG program is available for 2 years. Funds become available 

for obligation on October 1 of the fiscal year in which they are appropriated and remain available 

through September 30 of the following fiscal year. Funds available for the current fiscal year 

2020 will be used for the 2020-21 award year, which runs from July 1, 2020 through June 30, 

2021.

Institutional participation: Roughly 3,600 postsecondary institutions receive funds under the 

SEOG program, compared to more than 4,500 institutions that administer Pell Grants. Under 

the statutory formula, funds are distributed to institutions first on the basis of the institution's 

fiscal year 1999 SEOG program base guarantee and pro rata share (a hold harmless basis), 

and then on the basis of the aggregate need of the eligible undergraduate students in 

attendance.

Institutional matching: Participating institutions are required by statute to contribute at least 

25 percent of the SEOG award amounts. The institutional share can be met using the 

institution's own resources, State grants, or funds from foundations or other charitable 

organizations.

Student participation: Students qualify for grants of up to $4,000 by demonstrating financial 

need under the need analysis formula used for Federal student aid. Institutions must give first 

priority for awards to students with demonstrated “exceptional need” (students with the lowest 

Expected Family Contributions (EFCs) at the institution) who are also Pell Grant recipients. 

Remaining awards are then available for students with exceptional need who are not Pell Grant 

recipients. In addition, if any part of the institution’s SEOG allocation determination to students 

is based, in part, on the financial need demonstrated by students who are independent or 
STUDENT FINANCIAL ASSISTANCE

Federal supplemental educational opportunity grants

P-24

attending the institution less-than-full-time, then a reasonable portion of the allocation must be 

made available to such students.

Recipients must be undergraduates, cannot have received a bachelor’s degree, and must be 

enrolled with the purpose of obtaining a degree or certificate at an eligible institution.

Approximately 9 percent of undergraduates receive SEOG awards.

Recipients must also have a high school diploma (or its equivalent) or have been 

homeschooled. Students who did not have a high school diploma or were not homeschooled 

and first enrolled in an eligible program prior to July 1, 2012, may receive SEOG funds by 

meeting one of the ability-to-benefit (ABT) alternatives. These alternatives include: (1) passing 

an independently administered Department-approved ability-to-benefit test; (2) completing at 

least 6 credit hours or 225 clock hours that are applicable toward a degree or certificate offered 

by the institution; or (3) completing a State process approved by the Secretary of Education.

Students who did not have a high school diploma or were not homeschooled and first enrolled in 

an eligible program on or after July 1, 2012, can only become eligible through one of the ABT 

alternatives described above if they are enrolled in an eligible career pathway program as 

defined in section 484(d)(2) of the Higher Education Act (HEA). 

Students already in default on a Federal student loan or who owe an overpayment on any other 

previously received Federal student aid may not receive a SEOG unless they repay the debt in 

full or makes satisfactory repayment arrangements.

Institutional administrative provisions 

• Administrative costs. Each institution’s administrative cost allowance is based upon its 

expenditures for both campus-based programs (SEOG and Work-Study). An institution may 

use up to 5 percent of the first $2.75 million of its program expenditures; plus up to 4 percent 

of expenditures greater than $2.75 million but less than $5.5 million; and up to 3 percent of 

expenditures greater than $5.5 million during an award year to meet administrative costs 

associated with these programs.

• Transferability of funds. An institution may transfer up to 25 percent of Work-Study funds to 

SEOG. Up to 10 percent of an institution’s SEOG funds may, at the discretion of the 

institution, be used for expenditures for the preceding fiscal year, and up to 10 percent of an 

institution’s SEOG funds may remain available for the next fiscal year.

• Reallocation of funds. Excess funds available because of under-utilization by institutions are 

reallocated to other institutions in accordance with program regulations. An institution 

returning more than 10 percent of its allocation will have its subsequent allocation reduced 

by the same amount. Under The Hurricanes Harvey, Irma, and Maria Education Relief Act of 

2017, the Secretary was provided authority to waive reallocation rules; excess SEOG funds 

were reallocated to institutions that were directly affected by the 2017 hurricanes or located 

in disaster areas.
STUDENT FINANCIAL ASSISTANCE

Federal supplemental educational opportunity grants

P-25

Funding levels for the past 5 fiscal years were: 

Fiscal Year (dollars in thousands)

2016.............................................................. ..............$733,130

2017.............................................................. ................733,130

2018.............................................................. ................840,000

2019.............................................................. ................840,000

2020.............................................................. ................865,000

FY 2021 BUDGET REQUEST

Currently, SEOG awards are not optimally allocated based on a student’s financial need, 

despite being a need-based program. Although the HEA requires that participating institutions 

give priority in awarding SEOG funds to Pell-eligible students, there is no requirement that the 

size of these awards be tied to the need of the student. As a result, institutions are given the 

discretion to provide larger SEOG awards to students who do not exhibit the greatest need. In 

addition, the current “hold harmless” provision distorts the allocation of funding among 

institutions so that certain institutions receive more funds than if the funds were solely 

distributed based on their students’ financial need.

As shown in the tables below, the average SEOG award increased as income levels increased 

for families of dependent students. Furthermore, provisions in the SEOG funding allocation 

formula also distort the targeting of aid. For example, according to the distribution tables for Pell 

Grant aid presented earlier, about 70% of Pell recipients attend public 4-year or public 2-year 

institutions, while only 53% of SEOG funds go to these institutions. Moreover, the SEOG 

program is part of a complex and confusing array of federal aid programs that could benefit from 

simplification and better targeting of aid to needy students. In award year 2020-21, the 

Department of Education is expected to pay institutions more than $15.1 million dollars to 

administer the SEOG program—dollars that could be better targeted directly to needy students.

The Administration’s fiscal year 2021 budget request proposes to eliminate the SEOG program 

beginning in award year 2021-22, which would result in a savings of $865 million compared to 

the 2020 appropriation.

The request for this program is best understood in the context of the Administration’s proposals 

for the student aid programs as a whole. Accordingly, student assistance policy proposals are 

discussed in greater detail in the Student Aid Overview.
STUDENT FINANCIAL ASSISTANCE

Federal supplemental educational opportunity grants

P-26

Distribution of SEOG Funds by Student Status and Income Level 

The following tables (structured to compare across the programs in the Student Financial 

Assistance account) show the distribution of SEOG funds to dependent and independent 

students at various income levels in 2017-2018. These tables include the most recent 

distributional data available, which may not match directly with the data provided in the Program

Output Measures section.

In 2017-2018, 70 percent of dependent SEOG recipients had family income levels under 

$30,000 and 72 percent of independent SEOG recipients had family income levels under 

$20,000.

Distribution of SEOG to Dependent Undergraduates in 2017-18

Family Income 

Level Recipients Available Aid Average Award

0 - $5,999 136,597 $101,842,723 $746

$6,000 - $11,999 78,976 60,203,098 762

$12,000 - $23,999 250,843 194,317,345 775

$24,001 - $29,999 101,818 82,845,250 814

$30,000 + 238,751 206,787,003 866 

Total Dependent 806,985 645,995,419 801 

Distribution of SEOG to Independent Undergraduates in 2017-18

Family Income 

Level Recipients Available Aid Average Award

0 - $ 1,999 169,612 $94,728,381 $559

$2,000 - $ 3,999 41,045 23,573,493 574

$4,000 - $ 7,999 84,874 47,199,518 556

$8,000 - $11,999 92,747 48,499,999 523

$12,000 - $15,999 59,972 28,586,457 477

$16,000 - $19,999 52,130 24,960,713 479

$20,000 + 191,477 94,123,016 492

Total Independent 691,857 361,671,577 523

All Undergraduates 1,498,842 1,007,666,996 672
STUDENT FINANCIAL ASSISTANCE

Federal supplemental educational opportunity grants

P-27

Distribution of SEOG Funds by Type of Institution 

The distribution of SEOG assistance to institutions is controlled by a statutory formula. The 

distribution of SEOG across different types of institutions has remained relatively constant over 

time due to this formula and the base guarantee. The distribution of aid by institution type has 

remained relatively constant over the last 5 years.

The following table shows the distribution of SEOG to students attending different types of 

institutions in 2017-2018. Most funding goes to students attending public institutions.

Distribution of SEOG by Type of Institution in 2017-18

Institution 

Type Recipients Available Aid

Average 

Award

Percent of 

SEOG Aid

Public 4-Year 504,078 $369,014,739 $732 36.6%

Public 2-Year 385,982 168,080,252 435 16.7

Private 344,975 363,655,022 1,054 36.1

Proprietary 263,807 106,916,983 405 10.6

Total 1,498,842 1,007,666,996 672 100.0

PROGRAM OUTPUT MEASURES

(dollars in thousands)

Output Measures 2019 2020 2021

Recipients 1,718,000 1,769,000 0

Aid available to students1 $1,154,667 $1,189,032 $0

Average award (in whole dollars) $672 $672 $0

1Aid available includes budget authority, institutional matching funds, transfers from the Federal Work-Study 

program, minus administrative costs.

PROGRAM PERFORMANCE INFORMATION

This section presents selected program performance information, including, for example, GPRA 

goals, objectives, measures, and performance targets and data; and an assessment of the 

progress made toward achieving program results. Achievement of results is based on the 

cumulative effect of the resources provided in previous years and those requested in fiscal year 

2021 and the future as well as the resources and efforts invested by institutions.

Because the programs in the Student Financial Assistance account rely on the same 

performance data, performance measures, strategies, and program improvement activities that 

apply to all the programs, that information is discussed in the Student Aid Overview and is not 

repeated here.
Student Financial Assistance

P-28

Federal work-study

(Higher Education Act of 1965, Title IV, Part C)

(dollars in thousands)

FY 2021 Authorization: To be determined1

Budget authority: 

Period of 2020 

Appropriation

2021 

Request

Change from 

2020 to 2021

$1,180,000 $500,000 -$680,000

1The GEPA extension applies through September 30, 2015; reauthorizing legislation is sought for FY 2021.

PROGRAM DESCRIPTION

The Federal Work-Study (FWS) program ensures access to postsecondary education and 

lifelong learning by assisting needy undergraduate and graduate students with financing 

postsecondary education costs through part-time employment. Federal funds are distributed to 

qualifying institutions whose financial aid administrators select eligible students with financial 

need for employment. Students may be employed by the institution; by a Federal, State, or local 

public agency or private nonprofit organization; or by a private for-profit organization.

The funding for the FWS program is available for 2 fiscal years. Funds become available for 

obligation on October 1 of the fiscal year in which they are appropriated and remain available 

through September 30 of the following fiscal year. Funds requested for fiscal year 2021 would 

be used for the 2021-22 award year, which runs from July 1, 2021 through June 30, 2022.

Institutional participation: Approximately 3,200 institutions participate in the FWS program.

Funds are distributed to institutions based on a statutory formula. The formula starts with the 

institution's fiscal year 1999 FWS program base guarantee and pro rata share and bases the 

allocation on the aggregate need of the eligible undergraduate students currently in attendance.

The FWS program is administered by institutional financial aid administrators who have 

substantial flexibility in determining student awards.

If an institution is a proprietary school employing its own students, this employment must be: (1) 

on campus, except that at least 7 percent of the total funds granted must be used to 

compensate students employed in community service activities; (2) related, to the maximum 

extent practicable, to the student’s educational objectives; and (3) related to providing student 

services. The employment tasks of FWS program students, however, must not involve the 

solicitation of potential students to enroll in the school.

Institutional matching: In general, participating institutions or other employers must contribute at 

least 25 percent of a student’s part-time earnings (or 50 percent in the case of private-for-profit 

employers). The Federal share may be up to 90 percent for students employed at a private 

nonprofit organization or a Federal, State, or local public agency that would otherwise be unable 

to afford the costs of employing those students. The 90 percent Federal share is limited to no 
STUDENT FINANCIAL ASSISTANCE

Federal work study

P-29

more than 10 percent of the students paid under the FWS program; in addition, the school may 

not own, operate, or control the organization, and the school must select the organization or

agency on a case-by-case basis.

Student participation: Students qualify for FWS program awards by demonstrating financial 

need under the statutory need analysis system for the Federal student financial assistance 

programs. Hourly earnings must not be less than the current Federal minimum wage. 

Approximately 5 percent of undergraduates participate in the FWS program.

In addition, if the institution’s allocation is based in part on the financial need demonstrated by 

independent students or students attending the institution less-than-full-time, a reasonable 

portion of the allocation must be made available to such students.

Recipients must be enrolled with the purpose of obtaining a degree or certificate at an eligible 

institution. Students must also have a high school diploma (or its equivalent) or have been

homeschooled. Students who did not have a high school diploma or were not homeschooled 

and first enrolled in an eligible program prior to July 1, 2012, may receive FWS program funds 

by meeting one of the ability-to-benefit (ATB) alternatives. These alternatives include: (1) 

passing an independently administered Department-approved ability-to-benefit test; (2) 

completing at least 6 credit hours or 225 clock hours that are applicable toward a degree or 

certificate offered by the institution; or (3) completing a State process approved by the Secretary 

of Education.

Students who did not have a high school diploma or were not homeschooled and first enrolled in 

an eligible program on or after July 1, 2012, can only become eligible through one of the ATB 

alternatives described above if they are enrolled in an eligible career pathway program as 

defined in section 484(d)(2) of the HEA. 

Students who have defaulted on a Federal student loan or who owe an overpayment on any 

other previously received Federal student aid, however, may not receive additional funds under 

the program unless they repay the debt in full, or make satisfactory repayment arrangements 

with the holder of the debt.

Institutional administrative provisions: Institutions may use their allocations to support a variety 

of Work-Study activities, including: 

• Community service. An institution must use at least 7 percent of its Federal allocation for 

payments to students employed in community service activities. Other Work-Study jobs that 

qualify as community service activities include community-accessible childcare and 

assistance for disabled students. The Higher Education Opportunity Act (HEOA) expanded 

the definition of community service to include emergency preparedness and response. The 

eligible institution, at its discretion, may count any contribution made by the employer toward 

the non-Federal share of the student’s compensation.

• Tutoring and literacy activities. An institution must include at least one tutoring or family 

literacy project as part of its community service activities. Under this requirement, institutions 

prioritize employing Work-Study recipients as reading tutors in schools participating in 
STUDENT FINANCIAL ASSISTANCE

Federal work study

P-30

programs, funded under the Elementary and Secondary Education Act of 1965, as 

amended, that train educators on science-based reading instruction. In 2016-17, the last 

year data was collected, almost 29,000 Work-Study students were employed as reading 

tutors.

• Private sector. An institution may use up to 25 percent of its Work-Study allocation to match 

earnings of students working for private for-profit organizations. Students must, to the 

maximum extent practicable, be placed in jobs that are academically relevant to their course 

of study. FWS program funds may not be used to pay any employee who would otherwise 

be employed by the private organization.

• Job Location and Development. An institution may use up to 10 percent of its FWS program 

allocation, or a maximum of $50,000, whichever is less, for administrative expenses 

associated with the establishment or expansion of a Job Location and Development (JLD) 

program. This program locates and develops off-campus full- or part-time jobs or community 

service jobs for currently enrolled students. The Federal share of the JLD program costs 

cannot exceed 80 percent.

• Work Colleges. A “Work College” is an institution that requires all resident students to 

participate in a work-learning program as an integral part of the institution’s educational 

philosophy. These colleges are authorized to receive special awards in addition to their 

regular FWS program allocations to support such programs. Work Colleges must match 

Federal allocations on a dollar-for-dollar basis. In addition, Work Colleges may transfer all 

their regular FWS program allotments for use under the Work Colleges program.

• Administrative costs. Each institution’s administrative cost allowance is based upon its 

expenditures for FWS and Supplemental Educational Opportunity Grants (SEOG). Under a 

statutory formula, an institution may use up to 5 percent of the first $2.75 million of its 

program expenditures; plus up to 4 percent of expenditures greater than $2.75 million but 

less than $5.5 million; and up to 3 percent of expenditures greater than $5.5 million during 

an award year to meet administrative costs associated with these programs.

• Transferability of funds. An institution may transfer up to 25 percent of its allocation from 

FWS to SEOG. Up to 10 percent of an institution’s FWS program funds may, at the 

discretion of the institution, be used for expenditures for the preceding fiscal year. In 

addition, up to 10 percent of an institution’s FWS program funds may, at the discretion of the 

institution, remain available for the next fiscal year.

• Reallocation. If funds become available because of under-utilization by institutions, excess 

funds are reallocated only to other institutions that used at least 5 percent of their FWS 

program allocations to compensate students employed in tutoring in reading and family 

literacy activities in the preceding year. Reallocated funds must be used to support student 

employment in community service activities. Under the Hurricane Education Relief Act of 

2017, excess FWS were first allocated to institutions located in FEMA-declared disaster 

areas, and then to institutions that enrolled a significant number of students that live in the 

FEMA-declared disaster areas.
STUDENT FINANCIAL ASSISTANCE

Federal work study

P-31

• Disasters. The HEOA added a provision under which an eligible institution located in an 

area affected by a major disaster, as determined by the Secretary, may make FWS

payments to disaster-affected students, for the period of time (not to exceed 1 academic 

year) in which the students were prevented from fulfilling their FWS obligations due to the 

disaster. Payment may be made in an amount equal to or less than the amount a student 

would have been paid had the student been able to complete the work obligation necessary 

to receive Work-Study funds. The Hurricane Education Relief Act of 2017 provided the 

Secretary authority to waive reallocation rules and to extend the deadline by which funds 

were reallocated in the campus-based programs due to Hurricanes Harvey, Irma, and Maria.

Funding levels for the past 5 fiscal years were: 

Fiscal Year (dollars in thousands)

2016.............................................................. ..............$989,728

2017.............................................................. ................989,728

2018.............................................................. .............1,130,000

2019.............................................................. .............1,130,000

2020.............................................................. .............1,180,000

FY 2021 BUDGET REQUEST

For fiscal year 2021, the Administration requests $500 million for the FWS program, $680 

million less than the fiscal year 2020 appropriation. The request would significantly reform the 

program from a model that mostly provides subsidized employment as a form of financial aid for 

higher income undergraduate and graduate students to one that supports workforce and careeroriented training opportunities for low-income undergraduate students. The request will 

generate nearly $504.4 million in available aid to support more than 315,000 career-oriented 

jobs for students, helping to meet the educational costs of undergraduate students and expand 

their future employment prospects.

Under the proposal, institutions could fund individual students through subsidized employment, 

paid internships, or other placements without limitation on the type of organization where the 

placement occurs, provided they are career or academically relevant. Institutions would also 

have greater flexibility to fund programs or initiatives serving multiple students – similar to the 

current Job Location and Development authority – that could provide exposure to, build

preparedness for, and help place students in career-relevant jobs and internships. The fiscal 

year 2021 request would also reform the allocation formula to focus scarce funds on institutions 

enrolling high numbers of Pell Grant recipients, while providing these students with access to 

employment that provides the training and skills to meet the needs of today’s workforce. As 

shown in the tables below, among dependent students, those with family incomes at or above 

$30,000 received 70 percent of FWS funds compared to 30 percent of FWS funds going to 

students with family incomes below $30,000. For Pell Grants, these numbers are nearly 

reversed: Among dependent students, 63 percent of aid goes to students with family incomes 

below $30,000 and 37 percent to those above. Independent students, who typically have lower 
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family incomes, received 48 percent of all Pell Grant aid, but only received 16 percent of FWS 

funds.

The Administration is also testing certain FWS reforms using the Higher Education Act (HEA) 

experimental site authority1

. The current FWS experiment will provide participating 

postsecondary institutions with waivers of statutory and regulatory provisions to test how 

changes to FWS will increase partnerships between institutions and industry, improve student 

retention and completion, reduce student debt levels, and yield strong post-graduation 

employment outcomes.

The fiscal year 2021 request for this program is best understood in the context of the 

Administration’s proposals for the student aid programs as a whole. Accordingly, policy 

proposals are discussed in greater detail in the Student Aid Overview.

Distribution of Work-Study Funds by Student Status and Income Level 

The following tables (structured to provide a common basis of comparison among the programs 

in the Student Financial Assistance account) illustrate the distribution of Work-Study funds to 

dependent students and the distribution to independent students at various income levels for 

2017-2018. These tables include the most recent distributional data available, which may not 

correspond directly with the data provided in the Program Output Measures section.

Distribution of Work-Study to Dependent Undergraduates in 2017-18

Income Level Recipients Available Aid Average 

Award

0 - $5,999 35,301 $62,874,853 $1,781

$6,000 - $11,999 21,105 37,891,851 1,795

$12,000 - $23,999 67,355 122,594,452 1,820

$24,001 - $29,999 32,246 58,030,606 1,800

$30,000 + 329,787 535,350,519 1,623 

Total Dependent 485,794 816,742,281 1,681 

1 https://ifap.ed.gov/eannouncements/052019PubofFRFWSExpUnderExpSitesInitiative.html
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Distribution of Work-Study to Independent Undergraduates and Graduates in 2017-18

Income Level Recipients Available Aid Average 

Award

0 - $ 1,999 24,555 $49,372,003 $2,011

$2,000 - $ 3,999 6,939 13,927,936 2,007

$4,000 - $ 7,999 12,078 25,830,188 2,139

$8,000 - $11,999 10,228 22,769,841 2,226

$12,000 - $15,999 7,558 16,489,168 2,182

$16,000 - $19,999 5,232 11,160,267 2,133

$20,000 + 16,366 32,556,330 1,989

Total 

Independent 82,081 $172,450,457 $2,101

Graduate Students 44,751 109,962,619 2,457

All Students 612,626 $1,099,155,357 $1,794

Distribution of Work-Study Funds by Type of Institution: 

The Work-Study program is a campus-based program, and the distribution of funds to 

institutions is controlled by a statutory formula. As a result, the distribution of Work-Study 

assistance across different types of institutions has remained relatively constant over time. The 

table below shows the distribution of Work-Study to students attending different types of 

institutions in 2017-2018.

Distribution of Federal Work-Study (FWS) by Type of Institution in 2017-18

Institution 

Type Recipients Available Aid

Average 

Award

Percent of 

FWS Aid

Public 4-Year 218,090 $422,754,038 $1,938 38.5%

Public 2-Year 62,950 138,826,869 2,205 12.6

Private 316,282 499,592,140 1,580 45.5

Proprietary 15,304 37,982,310 2,482 3.5

Total 612,626 1,099,155,357 1,794 100.0

NOTE: Percentages may not total to 100 percent due to rounding.

Community Service Activities: 

The Work-Study program has a long tradition of providing opportunities for students to perform 

community service activities. At least 7 percent of an institution's Work-Study allotment must be 

used to pay students employed in community service jobs, unless the institution obtains a 

waiver from the Department. Nationally, 16 percent of Work-Study funds are used for jobs in 

community service.
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Participating colleges and universities must ensure that at least one eligible project provides 

services to both children and their parents. Allowable activities, such as family literacy 

programs, emphasize preparing parents to read to their own children.

The Department has waived the usual 25 percent institutional contribution, allowing Work-Study 

funds to pay up to 100 percent of the wages to support students who tutor children in 

mathematics, or reading, or who serve in family literacy programs.

Distribution of Work-Study Funds to Students in Community Service Activities: 

The table below shows the distribution of Work-Study assistance to students employed in 

community service activities in 2017-2018.

Distribution of Work-Study to Students in Community Service Activities by Type of 

Institution in 2017-18

Institution 

Type Recipients Available Aid

Average 

Award

Percent of 

WS Aid

Public 4-Year 36,356 69,792,051 1,920 39.9%

Public 2-Year 28,374 26,949,627 950 15.4

Private 49,459 73,706,147 1,490 42.1

Proprietary 2,261 4,448,112 1,967 2.5

Total 116,450 174,895,937 1,502 100.0

NOTE: Percentages may not total to 100 percent due to rounding.

PROGRAM OUTPUT MEASURES

(dollars in thousands)

Output Measures 2019 2020 2021

Recipients 700,000 731,000 315,000

Aid available to students1 $1,152,402 $1,203,831 $504,393

Average award (in whole dollars) $1,647 $1,647 $1,709

1 Aid available includes budget authority, institutional matching funds, transfers from the SEOG program, minus 

administrative costs.

PROGRAM PERFORMANCE INFORMATION

This section presents selected program performance information, including, for example, GPRA 

goals, objectives, measures, and performance targets and data; and an assessment of the 
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progress made toward achieving program results. Achievement of results is based on the 

cumulative effect of the resources provided in previous years and those requested in 2021 and 

future years, as well as the resources and efforts invested by those served by this program.

Because the programs in the Student Financial Assistance account rely on the same 

performance data, performance measures, strategies, and program improvement activities that 

apply to all the programs, that information is discussed in the Student Aid Overview and is not 

repeated here.
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Iraq and Afghanistan service grants

(Higher Education Act of 1965, Title IV, Part A, Subpart 10)

(dollars in thousands)

FY 2021 Authorization: 0

Mandatory Budget Authority: 

2020 

Appropriation

2021 

Request

Change from 

2020 to 2021

$463 0 -$463

PROGRAM DESCRIPTION

The Iraq and Afghanistan Service Grants (IASG) program provides non-need-based grants to 

students whose parent or guardian was a member of the Armed Forces who died in Iraq or 

Afghanistan as a result of performing military service after September 11, 2001. Students are 

not required to be eligible for a Pell Grant in order to receive a Service Grant; however, the 

student must be 24 years old or younger; or, if older than 24, must have been enrolled in an 

institution of higher education at the time of the parent or guardian’s death.

Service Grants are equal to the maximum Pell Grant for a given award year, which was $6,195

in the 2019-20 award year. However, due to sequestration, IASG award amounts have been 

reduced in prior years and are subject to sequestration in the current year. Award amounts for 

any IASG first disbursed on or after Oct. 1, 2019, and before Oct. 1, 2020, will be reduced by 

5.9 percent, or $366 for a student receiving the maximum award. Thus far, 246 students have 

lost approximately $170,000 due to sequestration. Service Grants are excluded from the total 

“estimated financial assistance” used to determine a student’s eligibility for other Title IV Federal 

financial aid. In combination with other student aid, however, the Service Grant may not result in 

a student’s awards exceeding their cost of attendance. As with Pell Grant eligibility, students are 

limited to 12 semesters of full-time enrollment.

Funding levels for the past 5 fiscal years were: 

Fiscal Year (dollars in thousands)

2016.............................................................. .....................$384

2017.............................................................. .......................373

2018.............................................................. .......................329

2019.............................................................. .......................403

2020.............................................................. .......................463

FY 2021 BUDGET PROPOSAL

The Administration’s budget request for fiscal year 2021 proposes to move the Iraq and 

Afghanistan Service Grant program into the Pell Grant program. The children of our fallen 

service members deserve a full aid award, not to have nearly $400 cut from their award each 
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year. They should be treated equally to students receiving Pell Grants, which are exempt from 

cuts due to sequestration. This proposal would not make any other changes to the program’s 

benefits or eligibility. The first IASG recipient awards were given in award year 2010-2011 to 

fewer than 1,000 recipients. 

Distribution of Iraq and Afghanistan Service Grant Funds by Type of Institution: 

The data provided in the table below shows the distribution of Iraq and Afghanistan service 

grants to students attending different types of institutions in award year 2017-2018. 

Distribution of IASG by Type of Institution in 2018-19 

Institution 

Type Recipients Available Aid

Average 

Award

Percent of 

IASG Aid

Public 4-Year 45 $245,523 $5,487 62%

Public 2-Year 9 33,848 3,877 9 

Private 22 113,565 5,203 29

Proprietary 0 0 0 0 

Total 76 392,936 5,218 100

PROGRAM OUTPUT MEASURES

(dollars in thousands) 

Output Measures 2019 2020 2021

Recipients (1) (1) 0

Aid available to students (dollars in 

thousands)2 $445 $523 $0

Maximum grant (whole dollars) 3 $5,829 $6,345 $0

Average grant (whole dollars) $5,300 $5,626 $0

1Recipients estimated to number fewer than 500.

2Aid available is the amount of funding available for new IASG awards to students in any single academic year. This 

amount differs from budget authority because 1 fiscal year spans across 2 academic years. For instance, total aid 

available in FY 2020 is comprised of portions of both academic year 2019-2020 (ending June 30) and 2020-21 

(beginning July 1). Amount of aid available in 2021 reflects Budget policy to move IASG to the Pell Grant program. In 

2021, aid available is estimated to be $599 thousand.

3Maximum grant amounts for 2019 reflect impact of sequestration. The amount of the maximum grant in 2021 reflects 

Budget policy to move IASG to the Pell Grant Program.

PROGRAM PERFORMANCE INFORMATION

This section presents selected program performance information, including, for example, GPRA 

goals, objectives, measures, and performance targets and data; and an assessment of the 
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progress made toward achieving program results. Achievement of results is based on the 

cumulative effect of the resources provided in previous years and those requested in 2021 and 

future years, as well as the resources and efforts invested by those served by this program.

Because the programs in the Student Financial Assistance account rely on the same 

performance data, when available, the Iraq and Afghanistan Service Grants performance 

measures, strategies, and program improvement activities will be discussed in the Student Aid 

Overview and not repeated here.