Congressman DeSaulnier Announces Bipartisan Legislation to Make College More Affordable for Low Income Students

July 18, 2019
Press Release

Washington, DC – Today, Congressman Mark DeSaulnier (CA-11) announced the introduction of the Pell Grant Flexibility Act (H.R. 3803), commonsense legislation to protect low income students from being taxed on using their Pell Grants for non-tuition goods and services. Co-authors of the legislation include Congressmen Lee Zeldin (R-NY) and Congressman Peter King (R-NY). The bill is also supported by 23 leading education organizations including The Institute for College Access and Success (TICAS) and the National Education Association (NEA).

Each year approximately eight million students receive Pell Grants, which are awarded to students from low income families. Currently, Pell Grants can be used to cover both tuition and non-tuition expenses. However, when students use these funds for non-tuition expenses, their Pell Grant is taxed, while strictly tuition costs are exempt.

“The cost of a college education is not limited to tuition. Textbooks, off-campus housing, transportation, and child care can account for 60 to 80 percent of the total cost of higher education and those expenses continue to rise each year,” said Congressman DeSaulnier. “Instead of taxing Pell and creating a disincentive for students to use the grants they deserve, this bill would allow students to take their focus off of finances and put it back on working toward a degree.”

“Pell Grants should not be treated as taxable income regardless of which qualified education expense they are used to cover. By eliminating the inconsistent tax treatment of Pell Grants, this bill will help hardworking students, simplify the tax code, and improve coordination between Pell Grants and the American Opportunity Tax Credit (AOTC),” said TICAS Vice President, Beth Stein.

“The cost-of-attendance for higher education needs to address beyond college tuition.  The ability to use Pell Grants for textbooks, transportation, child-care, and other expenses at a tax-free basis is critical for working and non-traditional students.  NEA is proud to support Rep. DeSaulnier’s Pell Grant Flexibility Act in increasing the purchasing power of Pell Grants,” said Marc Egan, Director of Government Relations, National Education Association.

The complete list of organizational support includes: American Association of Collegiate Registrars and Admissions Officers (AACRAO), American Association of Community Colleges (AACC), American Association of State Colleges and Universities (AASCU), American Council on Education (ACE), American Federation of Teachers (AFT), Association of American Colleges and Universities (AAC&U), Association of American Universities (AAU), Association of Catholic Colleges and Universities (ACCU), Association of Community College Trustees (ACCT), Association of Jesuit Colleges and Universities (AJCU), Association of Public and Land-grant Universities (APLU), Center for Law and Social Policy (CLASP), Consumer Action, Contra Costa Community College District, Hispanic Association of Colleges & Universities (HACU), National Association for College Admission Counseling (NACAC), National Association of Independent Colleges and Universities (NAICU), National Association of Student Financial Aid Administrators (NASFAA), National College Access Network (NCAN), National Education Association (NEA), The Education Trust, The Institute for College Access and Success (TICAS), Young Invincibles.