BIRMINGHAM, Ala. — Alabama’s high school graduating class of 2024 left $72 million in federal Pell Grants on the table, according to a new report from the National College Attainment Network. That’s up from $60 million left behind by the class of 2023 – a loss that education officials could have long-term consequences for individuals and local economies alike.
Nationally, unused Pell Grants totaled $4.4 billion, up from $4 billion the year before.
In Alabama, part of the increase in unclaimed federal aid is being partly blamed on the troubled rollout of a redesigned Free Application for Federal Student Aid in fall 2023.
Only about 56% of Alabama’s eligible 2024 high school graduates successfully completed the FAFSA, according to NCAN. Filling out the form is the crucial first step to unlocking Pell Grants and other types of federal financial aid.
Those are dollars that could have been used to get graduates more training and more education so they can better contribute to their local economies, Alabama Commission for Higher Education Executive Director Jim Purcell told Alabama Daily News.
Beyond the missed opportunities for individuals, Purcell said, communities also lose out when fewer residents pursue post-secondary education.
“I think it’s not only about what the individual benefit is, but it’s also about the benefits for a community,” he said. “If you have one additional year of college, of the percentage of people who have gone to college in a community, it increases gross domestic product and wages in those communities because you’re building a community that’s more capable of being economically prosperous in a new economy.”
Research backs up those claims. Bureau of Labor Statistics data shows that as education levels increase, so do weekly earnings, while unemployment rates fall. NCAN’s research also links higher education levels to broader economic benefits, including increased spending on housing, higher home values, greater transportation spending and expansion of a state’s tax base.
The maximum Pell Grant, awarded based on a student’s financial need and other factors, is $7,395 for the 2025-26 academic year. The minimum award is $740, according to the U.S. Department of Education.
State Superintendent Eric Mackey said he’s optimistic that recent fixes to the federal FAFSA system could help more students access financial aid in the future.
“We are pleased to see that the federal officials seem to have fixed the numerous issues that FAFSA experienced in the transition to a new platform last year, and over time the number of FAFSA applications will probably rise,” Mackey said.
Still, he acknowledged that the recent problems caused frustration for many families and may have discouraged some from applying for aid.
Mackey said the state remains committed to requiring FAFSA completion prior to graduating high school so students can take advantage of available grants and scholarships. But he also stressed the importance of students carefully weighing the risks of taking on debt beyond what Pell Grants cover.
“Taking on student debt can be a real issue for young people,” he said.
Efforts to boost FAFSA completion rates have been underway in Alabama for several years. ACHE’s data shows a 57% completion rate among the class of 2024, slightly higher than the figure cited by NCAN.
The Alabama State Board of Education made FAFSA completion a graduation requirement beginning with the class of 2022. Alabama is one of 12 states with that requirement, though students can opt out with a signed waiver from a parent or district official. According to ACHE’s data, about 35% of seniors in the class of 2024 exercised that waiver option.
Mackey said the opt-out provision has been an important part of the state’s approach.
“Our policy to grant exemptions for any student who wishes not to complete the FAFSA has been very important to our Board, and we have no plans to change that policy,” he said.
Purcell said he believes the FAFSA requirement has had a positive impact, especially for students who might not have otherwise considered higher education.
Many students are realizing – maybe for the first time – that college, whether two-year or four-year, might be financially within reach with the help of federal aid, he added.
District-level data shows several school systems have made big gains in FAFSA completion rates. According to ACHE’s database, more graduates are filling out the FAFSA in many areas – a hopeful sign for education officials working to reverse last year’s decline.
Year-to-date numbers show the class of 2025 is ahead of last year’s rates at this point in the year, Purcell said. But national reports show that federal student aid is being impacted by cuts to the office that oversees FAFSA’s and Pell Grant funding.
On top of that, the Congressional Budget Office in January predicted a $2.7 billion shortfall in Pell Grant funding by the end of the 2025 fiscal year. It’s unclear how or if that shortfall will be filled.
The table below shows each Alabama school district’s FAFSA completion rate beginning with the class of 2021, the year before the state board made it a graduation requirement. Click here if you are unable to see the table.