Pell grant changes in ‘One Big Beautiful Bill’ could affect nearly 80,000 MS college students

Federal lawmakers are considering changes to a longstanding financial aid program that could impact the amount of money thousands of low-income Mississippi students and families depend on to pay for college.

The proposal known as the One Big Beautiful Bill Act — dubbed by President Donald Trump and passed by the U.S. House of Representatives in May — would reduce the maximum Pell Grant award students could receive from $7,395 to $5,710 beginning with the 2026-27 school year. It would also change the eligibility requirements by increasing the number of credit hours students must take from 12 to 15.

The Pell Grant is a form of aid for students “who display exceptional financial need,” according to the federal student aid website. Unlike student loans, Pell Grants do not have to be repaid.

Nationwide, nearly two out of three recipients could lose some or all of their Pell Grant funding as the House proposal now stands, according to the Center for American Progress. In Mississippi, 79,709 students received Pell Grants last year, according to a report from the National College Attainment Network.

Key takeaways:

▪ A bill passed by the U.S. House of Representatives would limit eligibility for the federal Pell Grant program by reducing the maximum award from $7,300 to $5,700.

▪ More than 79,000 Mississippi college students could see a reduction of their Pell Grant awards beginning with the 2026-27 academic school year.

▪ Students would no longer be eligible for the Pell Grant if they take fewer than 7.5 credit hours per semester. The change would shut out many part-time students who can only afford to take a class or two at a time.

▪ Changes could make college out of reach and unaffordable for many students in the state.

Mississippi higher educational officials and advocates warn that part-time students wouldn’t be eligible for Pell Grants at all if the budget proposal passes. The proposal would also negatively impact the state’s college access goals and affordability by making it hard for students with low income to earn a degree or certificate.

The Trump administration said reducing the maximum amount of the Pell Grant will help with the looming $2.7 billion shortfall created by past congressional decisions. Changing the eligibility definitions could save an estimated $7.1 billion over the next decade, according to the nonpartisan Congressional Budget Office.

The proposed changes aren’t final yet. The Senate did not include Pell Grant changes in its plans published last week. Both chambers will have to negotiate if any changes make it into the final budget.

Mississippi’s community colleges would be hit hardest by the proposed changes. They enroll many part-time students, including those who work and parent while taking classes. Rural students are also more likely to enroll part time because they are limited by time and expense required to commute to college.

Take Itawamba Community College in Fulton, a rural town in north Mississippi, for example. The college’s 428 Pell recipient students took less than 15 credit hours last fall. If the full-time requirement is increased to 15 credits a semester, the college would lose an estimated $877,047 in funding a year, a spokesperson for the state’s community college board said.

“The reductions would also impact the institutions because many students would drop out,” Jennifer Rodgers, director of state financial aid, said. “The institutions would lose those students and the corresponding tuition revenue.”

In Mississippi, groups like Woodward Hines Education Foundation, which helps support students through college advising, financial aid applications and scholarships, signed a letter to Congress to spare the Pell Grant program from cuts.

The foundation is among 170 college access, business, workforce development and advocacy groups who say the proposed budget would not only increase the cost burden on students and families, but would hinder nationwide economic growth by increasing student loan borrowing and reducing opportunities for students.

“You see some very nervous leaders in higher education right now,” Jim McHale, president and CEO of Woodward Hines, said.

In 2024, Mississippi had the highest student loan default rate in the country, according to a study by the Federal Reserve Bank of New York, with 44.6% of student loan borrowers in the state more than 90 days past due on their payments.