Proposed Pell Grant Max Jumps to $14,800, But Congress Holds the Final Say

The “Degrees Not Debt Act of 2025” aims to significantly boost the maximum Federal Pell Grant, the major financial aid lifeline for low-income students. Starting with the 2026–2027 school year, the bill sets a new baseline maximum award at $14,800. This is a serious increase designed to help students cover the rapidly rising costs of tuition, housing, and books. For those juggling work and school, this could mean the difference between taking out massive loans or focusing on their studies.

The Big Number and the Catch

This bill introduces two major changes to how the Pell Grant is calculated. First, for the 2026–2027 and 2027–2028 award years, the maximum grant is pegged at $14,800. Second, starting in the 2028–2029 year, that $14,800 baseline will be adjusted annually based on the Consumer Price Index (CPI)—meaning it should keep pace with inflation. This CPI indexing is a big deal, as it helps prevent the grant’s purchasing power from eroding over time. Think of it as an automatic cost-of-living adjustment for financial aid, which is essential when everything from rent to textbooks keeps getting more expensive.

However, here’s the crucial detail that makes this whole section complicated: for every single year, the actual maximum amount a student receives will be $14,800 (or the inflation-adjusted amount) minus whatever the maximum Pell Grant was set to in the most recent spending bill passed by Congress. This means that while the bill sets a high statutory ceiling, the actual money disbursed is still dependent on Congress’s annual appropriations. If Congress decides to fund the Pell Grant at, say, $8,000, that $8,000 is subtracted from the $14,800 maximum, effectively making the final award $8,000.

Who Actually Gets the Benefit?

This structure creates a high-stakes scenario for students and their families. The intent is clearly to provide a much higher, inflation-protected grant. However, the bill explicitly allows Congress to override that maximum every year through the appropriations process. For a student relying on this aid to pay for a community college program or a four-year degree, the $14,800 figure is a great target, but the reality is that the actual amount they receive is still a political decision, not a guaranteed statutory one.

If Congress funds the grant near the proposed maximum, students benefit hugely by reducing their need for loans. If, however, Congress consistently sets the appropriated maximum significantly lower, the guaranteed benefit of the $14,800 baseline and the inflation indexing is effectively wiped out. The Secretary of Education is tasked with estimating the annual adjustment percentage based on CPI, introducing a small element of administrative discretion, but the real power remains with the annual Congressional budget.