In keeping with the administration's latest budget cut request, the Education Department has proposed regulations that would lop more than 700,000 college students off the list of those eligible to receive federal higher education grants for the needy.
The regulations assume Congress will accept the Reagan administration's funding level of $2.187 billion for the program this fiscal year. Congressional aides and higher education lobbyists said yesterday that they doubt the administration figure will be approved.
Under the proposed rules for the so-called Pell grants, about 1.958 million students would be eligible for the eight-year-old program, according to a department spokesman, compared with the 2.7 million students who received $2.4 billion in grants this fall. The maximum grant would remain at $1,670 a year.
A typical family of four, with both parents working and one college student, would be eligible for a grant only if its income was less than $15,860, according to the regulations. Currently, the same family can make up to about $28,000 and still be eligible.
Secretary Terrel H. Bell has offered an alternate plan, requiring congressional approval, to "create a more equitable distribution of limited Pell grant funds." He said that if changes were approved that would count more family assets in determining need, more students could get grants and families of four making up to $27,054 would be eligible. The spokesman said the changes would mean 2.5 million students would be able to get grants, but the grants would be smaller.
Bell said he rejected an option for a pro-rated cut in Pell grants because those with the largest grants, the neediest students, would receive the largest cuts.
In the budget reconciliation act, Congress put a $2.6 billion ceiling on Pell grants. The House Appropriations Committee has approved a $2.5 billion figure and a Senate appropriations subcommittee has set it at $2.3 billion.
Several college presidents testified against cuts in student aid programs at a House hearing last week, calling them "a revolutionary reversal of the national commitment to educational opportunity."
Office of Management and Budget Director David A. Stockman told the House Budget Committee earlier this month: "I do not accept the notion that the federal government has an obligation to fund generous grants to anybody that wants to go to college . . . . In the 1960s, we didn't have Pell grants . . . or any of the others . . . yet, tens of millions of college students from lower-, middle- and upper-income families alike found their way through college."
But the college presidents cited a 1979 Harvard study that found that 41 per cent of those who had received Pell grants wouldn't have been able to attend college without them.
An aide to Sen. Robert T. Stafford (R-Vt.), chairman of the Senate education subcommittee, said hearings will be scheduled on the regulations to hear the department's justification and allow interested parties to comment.