Congress established the Basic Educational Opportunity Grant Program in the 1972 reauthorization of the Higher Education Act, the grants was renamed the Pell Grant program in 1980 after its champion, Senator Claiborne Pell (D-RI). The program has since provided federal grant aid directly to financially needy undergraduate students to pay for the cost of attendance at any eligible institution of higher education.
The U.S. Department of Education awards Pell Grants to eligible students based on a needs-analysis formula in federal law. Grants are awarded to individual students on a sliding scale based on a student’s expected family contribution (EFC), the cost of attendance of the chosen university or college, and the student’s enrollment status (part-time or full-time). The Department of Education calculates a student’s EFC using financial information that she submits on the Free Application for Federal Student Aid (FAFSA). Generally, a student will receive a Pell Grant if his expected family contribution is less than the maximum grant that Congress has made available that year. According to Department of Education figures, recipients received an estimated average Pell Grant of $3,629 for the 2013-14 school year when Congress had set the maximum grant at $5,645. Congress has set the maximum grant at $5,730 for the 2014-2015 school year.