Pell Grants as Performance-Based Scholarships? An Examination of Satisfactory Academic Progress Requirements in the Nation’s Largest Need-Based Aid Program
The Federal Pell Grant Program is the nation’s largest need-based grant program. While students’ initial eligibility for the Pell is based on financial need, renewal is contingent on meeting minimum academic standards similar to those in models of performance-based scholarships, including a grade point average (GPA) requirement and ratio of credits completed compared to those attempted. In this study, we describe federal satisfactory academic progress (SAP) requirements and illustrate the policy’s implementation in a statewide community college system. Using state administrative data, we demonstrate that a substantial portion of Pell recipients are at risk for Pell ineligibility due to their failure to meet SAP GPA or credit completion requirements. We then leverage the GPA component of the policy to explore the impacts of failure to meet standards on early college persistence and achievement, earning a credential, and transferring to a 4-year college using two methodological approaches: regression discontinuity (RD) and difference-in-differences (DD). Our results across the two approaches are mixed, with the RD providing null estimates and the DD indicating statistically significant impacts, including a negative effect on early college persistence. We conclude by discussing the implications for future research.
KeywordsHigher education policy Community college Need-based aid Persistence College completion Financial aid Satisfactory academic progress
- Angrist, J., Autor, D., Huson, S., & Pallais, A. (2014). Leveling up: Results from a randomized evaluation of post-secondary aid. (NBER Working Paper No. 20800). Cambridge, MA: National Bureau of Economic Research.Google Scholar
- Barreca, A. I., Lindo, J. M., & Waddell, G. R. (2011). Heaping-induced bias in regression-discontinuity designs. (NBER Working Paper No. 17408). Cambridge, MA: National Bureau of Economic Research.Google Scholar
- Baum, S., & Payea, K. (with Kurose, C.). (2013). Trends in student aid 2013. Retrieved from the College Board website: http://trends.collegeboard.org/sites/default/files/student-aid-2013-full-report-140108.pdf.
- Bennett, W., & Grothe, B. (1982). Implementation of an academic progress policy at a public urban university: A review after four years. Journal of Student Financial Aid, 12(1), 33–39.Google Scholar
- Calonico, S., Cattaneo, M. D., & Titiunik, R. (2014a). Robust data-driven inference in the regression-discontinuity design. Stata Journal, 14(4), 909–946.Google Scholar
- Carruthers, C. K., & Ozek, U. (2013, February). Losing HOPE: Financial aid and the line between college and work. National Center for Analysis of Longitudinal Data in Education Research Working Paper 91.Google Scholar
- Casey, M., Cline, J., Ost, B., & Qureshi, J. (2015, February). Academic probation, student performance and strategic behavior. Paper presented at the annual meeting for the Association for Education Finance and Policy, Washington, DC.Google Scholar
- Castleman, B., & Long, B. T. (2013). Looking beyond enrollment: The causal effect of need-based grants on college access, persistence, and graduation (NBER Working Paper No. 19306). Cambridge, MA: National Bureau of Economic Research.Google Scholar
- Cohodes, S. R., & Goodman, J. S. (2014). Merit aid, college quality, and college completion: Massachusetts’ Adams Scholarship as an in-kind subsidy. American Economic Journal: Applied Economics, 6(4), 251–285.Google Scholar
- Denning, J. (2014, December). College on the cheap: Costs and benefits of community college. University of Texas: Working paper.Google Scholar
- Goldrick-Rab, S. (2013). Increasing the impact of student financial aid: Three recommendations for financial aid administrators. Washington, DC: HCM Strategists.Google Scholar
- Goldrick-Rab, S., Kelchen, R., Harris, D., & Benson, J. (Forthcoming). Reducing income inequality in higher education: Experimental evidence on the impact of financial aid on college completion. American Journal of Sociology.Google Scholar
- Kane, T. J. (1995, July). Rising public college tuition and college entry: How well do public subsidies promote access to college? (NBER Working Paper No. 5164). Cambridge, MA: National Bureau of Economic Research.Google Scholar
- Lindo, J. M., Sanders, N. J., & Oreopoulos, P. (2010). Ability, gender, and performance standards: Evidence from academic probation. American Economic Journal: Applied Economics, 2(2), 95–117.Google Scholar
- Martorell, P., McCall, B. P., & McFarlin, I. (2014, September). Do public tuition subsidies promote college enrollment? Evidence from community college taxing districts in Texas. US Census Bureau Center for Economic Studies Paper No. CES-WP-14-32.Google Scholar
- Mayer, A. K., Patel, R., Rudd, T., & Ratledge, A. (with Blake, S.). (2015). Designing scholarships to improve college success: Final report on the Performance-based scholarship demonstration. New York: MDRC.Google Scholar
- McNair, E., & Taylor, S. E. (1988). Satisfactory academic progress standards: Jeopardizing efforts toward educational equity? Journal of Student Financial Aid, 18(1), 10–17.Google Scholar
- Richburg-Hayes, L., Brock, T., LeBlanc, A., Paxson, C., Rouse, C. E., & Barrow, L. (2009). Rewarding persistence: Effects of a performance-based scholarship program for low-income parents. New York: MDRC.Google Scholar
- Satisfactory Academic Progress, 34 C.F.R. § 668.34. (2013). Electronic Code of Federal Regulations. Retrieved from http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&tpl=/ecfrbrowse/Title34/34cfr668_main_02.tpl.
- Scott-Clayton, J. (2013). Information constraints and financial aid policy. In D. E. Heller & C. Callender (Eds.), Student financing of higher education: A comparative perspective (pp. 75–97). New York, NY: Routledge.Google Scholar
- Student Eligibility, 20 u.s.c. 1091 H.E.A. § 484. (2013). Retrieved from http://www.house.gov/legcoun/Comps/HEA65_CMD.pdf.
- U.S. Census Bureau. (2014). Median household income (in 2013 inflation-adjusted dollars) by state ranked from highest to lowest using 3-year averages. Retrieved from http://www.census.gov/hhes/www/income/data/statemedian/.
- U.S. Census Bureau. (2007). Small Area income and poverty estimates: state and county estimates for 2007. Retrieved from https://www.census.gov/did/www/saipe/data/statecounty/data/2007.html.
- U.S. Department of Education, National Center for Education Statistics. (2013). Digest of education statistics, 2012 (NCES 2014-015), Chapter 3, Table 381. Retrieved from http://nces.ed.gov/programs/digest/d12/tables/dt12_381.asp.
- Welbeck, R., Ware, M., Cerna, O., & Valenzuela, I. (with Ratledge, A., & Boynton, M.). (2014). Paying it forward: A technical assistance guide for developing and implementing performance-based scholarships. New York: MDRC.Google Scholar
- Whitehouse.gov. (2015). Fact sheet—White House unveils America’s college promise proposal: Tuition-free community college for responsible students. Retrieved from: https://www.whitehouse.gov/the-press-office/2015/01/09/fact-sheet-white-house-unveils-america-s-college-promise-proposal-tuitio.