Blog Post | July 22, 2019

Slow and Steady…Appropriate Safeguards Are Needed for Any Extension of Pell Grants to Short-Term Programs

Author: TICAS

Millions of undergraduate students each year receive a federal Pell Grant to help pay for the costs of enrolling in a wide range of eligible academic and vocational postsecondary education programs. While these programs may lead to either a degree or certificate, programs must be at least 15 weeks in length and lead to a credit-bearing award in order to be eligible for federal Pell Grant funding. Programs as short as ten weeks may be eligible for federal student loans, provided the program meets additional criteria, including specific graduation and job placement standards.

Some advocates suggest that some short-term workforce training programs not currently eligible for Pell Grants hold unique value for students by offering an accelerated route to increased earnings; they furthermore assert short programs can be uniquely responsive to local employer needs. In response, several legislative proposals to extend Pell Grant eligibility to programs as short as eight weeks have been introduced. These proposals would also extend the Pell Grant to non-credit bearing programs falling below the current statutory program length requirements. These non-credit programs in particular may not be subject to the same level of oversight by accreditors and states as programs offered for credit.

Supporting low-income students’ access to a range of postsecondary pathways to upward mobility remains vital. Yet, there is significant concern about extending the already under-resourced Pell Grant to students enrolled in very short programs, including those not offered for credit, without strong program quality. Given how little is known about these programs and their payoff for students, in this area, the rhetoric has so far outpaced the research.

Our new research finds that available data fall short of providing sufficient evidence demonstrating that these programs are, on whole, a good investment of limited federal Pell dollars. In this post, we outline our concern about extending Pell Grant eligibility to very short-term programs, many of which are not offered for credit, and offer constructive recommendations for policymakers looking to make changes to current program level eligibility requirements.

TICAS Research Findings, Limitations, and Concerns
There is no national source of data on the number or type of short-term programs under consideration for new Pell Grant eligibility, nor information about who enrolls in them and how well they fare. In an effort to better understand this landscape, TICAS recently published a report analyzing short-term programs identified in state- and college system-level data. Our report offers important new insights into these programs – including the wide range in program length, industry focus, and payoff for students.

Despite access to the most robust data on short-term programs we could identify and obtain, we encountered serious data limitations that leave open important information gaps. For example, a potentially large number of short-term programs operate outside of state reporting requirements and are therefore out of reach of existing data systems. Furthermore, strengths and limitations unique to different states and systems make it difficult to make fair comparisons across states.

Ultimately, while our research sought to understand where program offerings held the most promise for students and taxpayers, we found that available data fall short of providing sufficient evidence demonstrating that these programs are, on whole, a good investment of limited federal Pell dollars. Labor market outcomes specific to short-term programs are limited. Where available, outcome data show that some short-term programs offer students pathways to meaningful earnings while others do not.

While variable labor market outcomes are not unique to the short-term program space, they do underscore the need for strong quality assurance before Congress stretches available Pell Grant dollars further and risks allowing low-quality programs to proliferate. The Pell Grant program was furthermore designed by Congress to work alongside the triad of basic accountability, including Title IV eligibility and accreditation. As such, it may not be the best fit for funding non-credit programs that receive less oversight – baseline oversight which Pell eligibility itself does not provide.

A Prudent Path Forward
Open questions remain about whether the Pell Grant program is the most appropriate source of funding for programs designed to fulfill specific workforce training needs. Others have raised concerns about the equity impact of redirecting higher education funding to short-term workforce training programs. And policymakers should be cautious about extending Pell to short-term programs with a history of documented abuse.

As such, policymakers interested in extending Pell Grants to very short workforce programs must ensure that doing so does not serve to expend scarce resources on low-quality programs with little to no payoff for students – or worse, reopen opportunities for abuse. TICAS recommends that any extension of Pell Grants to very short programs adheres to each the following safeguards:

• Prioritize Enhancing Data Systems
The inability of federal data to isolate short-term programs, coupled with methodological challenges we encountered in our analysis of state- and college system-level data, underscores the need for better data and data systems capable of assessing the quality and payoff of programs not currently eligible for the Pell Grant. State and federal policymakers interested in exploring increased federal investment in short-term programs should prioritize improving data systems to enhance their capacity to better understand the payoff of these programs for students and taxpayers. This includes appropriately investing in state data systems, to allow for the calculation and reporting of enrollment and outcomes, and updating the federal postsecondary data infrastructure to enable the tracking of metrics by key disaggregates like student income and race/ethnicity. Coordination across accrediting agencies, state regulators, and the federal government is also necessary to ensure key outcome metrics are consistently calculated, accurate, and accessible.

• Start Small
The shortcomings that exist across the data sets analyzed by TICAS render many important questions about short-term programs unanswerable. At the same time, the Department of Education’s own exploration of the impact of extending Pell Grant eligibility to these programs is still underway, with an evaluation forthcoming. Particularly if it proceeds before understanding the implications through a quality evaluation, an expansion of Pell Grants to short-term programs should be undertaken on a small scale that allows careful and robust study of the impact new Pell funding has on these programs and the students who enroll in them. Such a demonstration project should require eligible entities to show that they have the ability to track labor outcomes and student success metrics in order to verify they adhere, at a minimum, to each of the standards articulated below. This approach will help identify characteristics of short-term programs that lead to meaningful wages and long-term improved outcomes for students. This is all the more important because we would expect the current landscape of short-term programs to change dramatically if federal funding becomes widely available following any expansion beyond a demonstration project.

• Require Baseline Institutional and Program-Level Oversight
Because institutional eligibility for federal financial aid provides several layers of basic federal oversight, only those programs offered at schools already eligible for federal financial aid should be considered for expanded Pell Grant eligibility. Furthermore, the Pell Grant program was designed by Congress to work in conjunction with the oversight of the triad of basic accountability, including Title IV eligibility and accreditation, and it may not be the best fit for funding unaccredited programs not offered for credit. Many short-term programs are not offered for credit, meaning that the coursework may not translate to a credit-bearing degree or certificate and the program may not be approved by an accrediting agency. There is no dispute that such programs can be valuable, and that many potential students could use help paying for them. At the same time, these programs often receive little or no scrutiny from independent entities tasked with verifying program quality. The Pell Grant program is not the only federal program tasked with bringing the cost of workforce education into reach: systemically underfunded programs like the Workforce Investment Opportunity Act (WIOA) or the recently expired TAACCCT programs are also options.

• Establish Minimum Quality Standards
To become eligible for Pell Grants, short-term programs should meet basic quality standards aligned with their specific goals. In the immediate term, Congress should ensure that short-term programs seeking access to Pell are able to meet the same standards already in place for short-term programs seeking access to the student loan program: a demonstration that the program has both a completion rate and job placement rate of at least 70 percent. These standards were established in response to widespread concerns about documented fraud and abuse of federal aid within short-term programs, and remain necessary to avoid replicating past problems. Furthermore, our research identified a wide range of post-enrollment earnings among employed students. In order to protect against a proliferation of low-quality programs that fall short of even providing graduates with earnings typical of high school graduates without any postsecondary education or training, Congress should also require colleges demonstrate that students completing the programs meet a basic earnings threshold.

The Pell Grant is the federal government’s most important investment in higher education. Proposals to expand eligibility to new types of programs are worthy of consideration but ultimately call for caution given how little is known about program offerings and outcomes. We urge Congress to protect the program from new risk of abuse, and continue to consider the many ways to strengthen the program.