Degrees Not Debt Act of 2025
The Degrees Not Debt Act of 2025 would dramatically increase the maximum Federal Pell Grant and change how future grants are adjusted for inflation. For the 2026-2027 and 2027-2028 award years, the bill sets the total maximum Pell Grant per student at $14,800, reduced by the amount specified in the most recent enacted appropriation Act for that award year. Starting with 2028-2029 and for subsequent years, the maximum Pell Grant would be equal to $14,800 plus an inflation-based adjustment (the annual adjustment percentage, tied to the Consumer Price Index) and then reduced by the most recent appropriation Act amount. The new adjustment method relies on CPI changes to maintain purchasing power, and the provision would take effect July 1, 2026, applying to award years defined by the Higher Education Act of 1965. In short, the bill aims to substantially raise Pell Grant levels while tying future increases to inflation and annual appropriations.
Key Points
- 1For award years 2026-2027 and 2027-2028, the maximum Pell Grant per student is set at $14,800, minus the amount specified by the last enacted appropriation Act for that year.
- 2For award year 2028-2029 and later, the maximum Pell Grant per student is $14,800 plus an annual adjustment percentage (CPI-based) minus the amount specified by the last enacted appropriation Act.
- 3The annual adjustment percentage is defined as the estimated percentage change in the Consumer Price Index (CPI), using the CPI definition tied to the year before the award year.
- 4Effective date is July 1, 2026; the changes apply to award years defined under the Higher Education Act of 1965 beginning after that date.
- 5The bill amends specific provisions of the Higher Education Act to implement these changes and to define how inflation adjustments are calculated.