Biden Budget Proposes Pell Increase, Free Community College
March 13, 2024

​President Biden’s Fiscal Year 2025 budget request released Monday includes $82 billion in federal discretionary spending for the Education Department. That would be a $3.1 billion increase in education spending from FY 2023, the last fully approved amount since the FY 2024 education funding bill remains in flux.

The budget proposal includes a $750 increase to the maximum Pell Grant award ($100 from discretionary funding and $650 from mandatory funding), which would bring the maximum grant to $8,145. However, the Biden plan would set a different maximum for students who attend for-profit institutions, capping it at a $100 increase, for a maximum grant of $7,495. The proposal also says the administration continues to be committed to doubling the Pell Grant by FY 2029. As Inside Higher Ed noted, differentiating the Pell Grant based on the type of institution isn’t entirely new; it was part of President Biden’s Build Back Better Act, which ultimately did not become law.

ACE Senior Vice President Jon Fansmith told Inside Higher Ed that there is a concern with the notion of calculating aid based on the institution that students attend, which would be a shift in federal policy. The worry is that could make it more challenging for students to figure out how to pay for college and navigate their postsecondary options as they assess the aid available to them.  

The FY 2025 budget request includes several new programs, including partnerships between federal, state, and tribal governments to make two years of community college free. The budget also includes a new grant program for eligible Historically Black Colleges and Universities (HBCUs), Tribal Colleges and Universities, and Minority Serving Institutions (MSIs) to subsidize tuition up to $4,500 per year for students from families earning less than $125,000.

It also includes a $12 billion request for a new “Reducing the Costs of College Fund,” which would provide funds to increase access to dual enrollment programs and provide new awards to institutions to increase best practices and innovation around affordability and college completion in order to lower costs per student.

As in previous years, the president’s budget is largely a statement of administrative priorities, since the proposal is unlikely to be taken up by Congress as it is written. 

As Fansmith mentioned in interviews with Inside Higher Ed and Higher Ed Dive, Biden is taking the right approach by doubling down on Pell Grant investments and increasing funding for community colleges, HBCUs, MSIs, and tribal colleges.

“It’s important that the president is putting down a marker for the need to expand funding,” he said. “This is a really astute understanding of where the best gains can be made in the higher education space. It may not necessarily be new, or may be variations on previous proposals, but it’s the right place to keep putting emphasis.”

For the federal research agencies, the president’s budget request includes $48.3 billion for the National Institutes of Health base budget, which would be an $841 million increase from FY 2023. The National Science Foundation would receive $10.183 billion, an increase of $1.72 billion over the final FY 2024 funding level of $9.06 billion that Congress just approved last week.