Report predicts increase in state grants

Organizations agree the budget supports students, not banks

The Institute for AmericaâÄôs Future and the U.S. Public Interest Research Group released a report Thursday praising Barack ObamaâÄôs budget proposal for supporting students and taking support away from banks. ObamaâÄôs budget would eliminate the Federal Family Education Loan Program and move that funding to the U.S. Department of EducationâÄôs Direct Loan program, which awards Pell Grants, the report stated. A Pell Grant is a federally awarded, need-based grant for post-secondary education. ObamaâÄôs budget would increase the Pell Grant maximum from $5,350 to $5,550, and would increase the national average award by a predicted $121, according to the report, titled âÄúObamaâÄôs budget: supporting students, not banks.âÄù The report predicts Minnesota will have 76,537 Pell Grant recipients in 2010-2011. This is an increase of nearly 4,000 recipients, according to the report. The stateâÄôs average Pell Grant for the 2009-2010 year is $3,052. ObamaâÄôs budget is predicted to increase the average in Minnesota $114 in the 2010-2011 year to $3,166, the report stated. âÄúReform is needed,âÄù Robert Borosage, co-director of Campaign for AmericaâÄôs Future , said in a phone press conference Thursday. In the report, the groups state that college tuition went up 5 percent nationwide and 3 percent in Minnesota last year alone. In 1977, a Pell Grant could cover 77 percent of public college costs. According to the report, it is now down to covering 35 percent. As a result, the amount of students borrowing money to complete school has increased. âÄúStudents are plunging into deep student loan debt âĦ which has great negative consequences,âÄù Christine Lindstrom, director of the USPIRG Higher Education Program and co-author of the report, said in the phone conference. ObamaâÄôs $3.6 trillion budget proposal, introduced in February, has been met with bipartisan scrutiny that it could worsen the current economic crisis. Budget plans will go before the House and Senate next week.