Pell Grant Sustainability Act

The Pell Grant Sustainability Act adjusts Federal Pell Grants to keep pace with rising college costs by indexing them annually to inflation. It directly affects low-income undergraduate students who receive Pell Grants, ensuring the maximum award amount increases each academic year based on the Consumer Price Index. The bill replaces previous fixed amounts with a new formula: starting in 2023-2024, grants will be set at $6,895 (or the prior year's amount if higher), then adjusted yearly by the inflation rate. This change aims to restore the grant's purchasing power, which covered 80% of costs in 1974-75 but only 30% by 2020-21.