Panel Paper: The Effect of the Year-Round Pell Grant on Enrollment

Saturday, November 5, 2016 : 4:10 PM
Columbia 3 (Washington Hilton)

*Names in bold indicate Presenter

Elizabeth Friedmann, University of California, Davis

The Pell Grant program provides over $31 billion in aid to over 8.6 million students (Congressional Budget Office, 2013).  Pell recipients are typically only eligible for one award per year. However, in 2008, Congress authorized the Year-round Pell Grant, which allowed Pell Grant recipients to receive a second Pell Grant in the same fiscal year if they  “accelerated” their academic progress (Congressional Budget Office, 2013).  To receive the Year-round Pell, students had to have received the full Pell award in the fall and spring semesters, and then enroll in at least six units for summer. An estimated 1.2 million students received the Year-Round Pell Grant and the average grant was $1,700 (Congressional Budget Office, 2013).

There is limited research on the effect of the Year-round Pell Grant on student enrollment. This paper uses restricted-use administrative data collected by the California Community College Chancellor’s Office (CCCCO) to evaluate the impact of the Year-round Pell on California community college enrollment. Data including financial aid application and receipt, enrollment and student characteristics are available for all 2.3 million students enrolled each year since 1992.  The four outcomes of interest are summer enrollment at all, summer enrollment of at least six units (the minimum required for Year-round Pell receipt), number of summer credits enrolled and number of summer credits earned. 

This paper exploits the exogenous timing in the Year-round Pell Grant implementation by using a quasi-experimental difference-in-difference approach, which has been used in previous Pell Grant research (Seftor & Turner, 2002; Lovenheim & Owens, 2014). This difference-in-difference analysis compares Pell recipients who received the full Pell award in fall and spring to Pell recipients who received less than the full award, before and after the Year-round Pell was introduced. Results from the difference-in-differences estimations show a 3.1-4.1 percentage point increase in summer enrollment. The results also show a 0.2-0.3 increase in the number of summer units enrolled completed, representing a 18-22 percent increase. Results varied by year, with lower campus participation in the first year of the program, and larger effects with greater campus participation in the second and third year of the program. There are also differential treatment effects by student characteristics and campus.

This paper contributes to the limited research on the effect of the Year-round Pell Grant. President Obama has proposed reinstating the program, but little is known about its effects. Examining the impact of the year-round Pell Grant on community college students is particularly important. Community college Pell recipients generally are lower income than students at other institutions, and are also more likely to work and less likely to enroll full-time compared to Pell recipients at other types of institutions (Baime & Mullin, 2011). California is an ideal setting for this study because over 20 percent of community college students in the nation are in California, and its 113 campuses represent an enormous amount of institutional diversity.