Short-Term Pell remains on the radar of both the House and Senate in early 2024.

By Jennifer Stiddard, March 26, 2024

As Congress continues to consider legislation to expand Pell Grants to shorter-term programs, the topic of assessing quality remains at the center of that debate. That’s because quality non-degree credentials can lead to good jobs and family-sustaining wages. Several states are at the forefront of defining, measuring, and tracking quality in non-degree credentials. National Skills Coalition’s report The Non-Degree Credential Quality Imperative examines how states have done this work and offers takeaways for how to advance quality assurance so that policymakers feel confident in investing in non-degree credentials, students have confidence in their training programs, and employers know which programs effectively prepare people for careers.

Short-Term Pell and the JOBS Act

For the last decade, NSC and its network have advocated to expand Pell Grant eligibility to shorter-term education and training programs offered by postsecondary institutions. Presently, in order for a student to receive a Pell Grant they have to meet individual eligibility requirements (primarily being lower-income) and be enrolled in an education or training program that is also eligible for Pell. That eligibility is partially based on the length of a program, which at minimum must be 600 clock hours and 15 weeks. NSC believes that expanding Pell Grants eligibility to high quality programs that fall below this threshold could provide students with more opportunities to receive financial assistance while meeting the needs of employers in high-demand industries and sectors.

There have been various legislative proposals aimed at expanding Pell Grants to shorter-term programs during the 118th Congress. However, this blog is going to focus on two: the stalwart in this arena – the JOBS Act; and the latest newcomer – the Bipartisan Workforce Pell Act (BWPA).

JOBS Act (S. 161, H.R. 793)
  • Sponsors – Senators Kaine, Braun; Reps. Bill Johnson, Lisa Blunt Rochester.
  • NSC has long endorsed the JOBS Act and up until recently it was the main bipartisan bill introduced.
  • Expands Pell Grant eligibility to quality programs that are between 150 and 599 clock hours and at least 8 weeks in length.
  • Includes quality metrics aimed at employer demand, aligned with the ETPL, and recognized by industry to meet the hiring requirements of employers.
  • A version of JOBS was slated to be marked up by the Senate last July. It was one of several workforce related bills the Senate Health, Education, Labor and Pensions Committee was slated to consider, but that markup was indefinitely postponed.
Bipartisan Workforce Pell Act (H.R. 6585)
  • Sponsors – Reps. Stefanik, Bobby Scott, Foxx, DeSaulnier
  • The bill was negotiated between the Chair and Ranking Member of the House Committee on Education and the Workforce and passed out of Committee in mid-December. However, it did not pass unanimously.
  • Similar to the JOBS Act in that it would cover programs that are 150 to 599 clock hours, however, the metrics to determine quality differ and it would allow for participation by for-profit colleges.
  • Efforts to bring this bill to the House floor have thus far been unsuccessful.

Closer Look at the Bipartisan Workforce Pell Act (BWPA)

While there has been a great deal of bipartisan support for the concept of expanding the Pell Grant programs to quality short-term education and training programs, figuring out the details on how that should be achieved has resulted in years of gridlock. There are two main points of contention – how quality should be defined and measured; and whether to allow for participation by for-profit institutions.

How Does BWPA Measure Quality?
  • Training must align with the requirements of high-skill, high-wage, or in-demand industry sectors or occupations in a State or local area.
  • The program must provide students with a recognized postsecondary credential and meet the hiring requirements of potential employers.
  • The program must satisfy any applicable educational prerequisite requirement for professional licensure or certification.
  • The program must have a 70 percent completion and a 70 percent placement rate.
  • The credential earned must be stackable unless it isn’t possible to do so.
  • The program must provide academic credit to a student that can apply toward a certificate or degree.
  • The program must be offered to students for at least a year prior to seeking eligibility.
  • There are also two earnings metrics. Programs must pass both.
  • Value-added earnings, which is calculated by subtracting 150 percent of federal poverty level from the median earnings for students one year after completion. That value-added number must exceed tuition and fees for a program in order for a program to qualify.
  • Median earnings of program completers must exceed the median earnings of adults aged 25-34 with only a high school diploma (or equivalent) in the state in which the program is located.

Committee leadership had hoped that the BWPA would be voted on by the full House in late-February. However, there has been ongoing controversy in the form of an offset. In order to pay for the mandatory and discretionary costs associated with the implementation of Short-Term Pell, the BWPA has sought to either restrict access to certain federal financial aid or enact student loan related penalties on so-called ‘endowment tax colleges.’ Opposition to those restrictions and penalties has prevented the bill from receiving a vote by the full chamber.

What is Happening with Short-Term Pell in the Senate?

Last summer, a version of the JOBS Act was slated to be part of a workforce markup where several workforce-oriented bills would be considered by the Senate Committee on Health, Education, Labor, and Pensions (HELP). The markup ran into some roadblocks with the Senate’s proposed apprenticeship bill. Thus, consideration of that bill and all bills (including JOBS) slated for that markup were shelved.

The Senate HELP Committee is gearing up once again to consider a package of workforce bills with a Memorial Day-ish target. At this point it’s unclear if that’s going to happen and it’s also unclear if JOBS (or a version of JOBS) would be part of that package. There is very little chance the Senate would consider the House’s BWPA as-is. HELP Committee Chair Sanders has a great deal of trepidation around the inclusion of for-profits and the Senate would also likely want to create their own marker on how short-term Pell Grants should be structured. Enthusiasm for short-term Pell is not as great in the Senate compared to the House, but it could still be included as part of a larger package of bills.

Will a Looming Shortfall Impact the Prospect of Short-Term Pell?

The new elephant in the room is a potential shortfall for the Pell Grant program. Everyone who qualifies for a Pell Grant receives an award. The Pell Grant program operates with both mandatory funding and annual discretionary funding. Sometimes that funding covers all costs of the program and Pell has a surplus. Other times there is not enough funding, and the program has a shortfall. Pell has been in surplus for around a decade. Increases to the Pell Grant maximum award have been paid for largely using the surplus. Restoration of year-round Pell Grants was also paid for with the surplus. Generally, the plan was to also pay for short-term Pell Grants with the surplus. But recent projections show that the Pell Grant program is slated for a shortfall in the coming years. This adds an additional wrinkle to the passage of JOBS, BWPA, or any version of a short-term Pell bill as some will question the utility of adding additional students to the program at a time when the program may face financial challenges. However, this speedbump does not necessarily prevent Congress from passing short-term Pell, but it will likely add another layer of discussion.

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