Washington, DC - At a time when the economy is changing faster than ever before, real opportunity requires that every American get the postsecondary education and training they need to find a good-paying job. President Obama believes that we must help many more Americans graduate from college. Still, far too many students never complete their degree — only 60 percent of those enrolled in a bachelor's degree program complete their education. Even for those who do complete, at least a third take longer than expected to graduate, forcing them to carry additional costs and leave school with higher debt burdens.

The consequences of not completing college are especially severe for students who leave school with debt; borrowers who drop out of college face a three times greater risk of defaulting on their student loans compared with those who graduate.

Since 2009, the Obama Administration has made historic investments in student financial aid that have helped ensure college stays within the reach of American families. It has increased the maximum Pell Grant by more than $1,000, and created the American Opportunity Tax Credit, worth $10,000 over four years of college. It has cut student loan interest rates, saving students up to $1,000 this year, and allowed more borrowers to cap their loan payments at 10 percent of their income through the President's Pay As You Earn and related income-driven repayment plans. In total, the Obama Administration has increased total aid available to students by over $50 billion from 2008 to 2016, and selected tax benefits by over $12 billion, which has helped our Nation ensure more students are graduating college than ever before. At the same time, the Administration has sought to drive innovations that increase college completion, value and affordability by investing $135 million over the past two years under the First in the World program to scale evidenced-based practices to improve student outcomes and bring down college costs.

Building on this record of progress, today the Administration is calling for significant new investments in the federal Pell Grant program—the cornerstone of college affordability. The two new Pell proposals will help students to accelerate progress towards their degrees by attending school year-round and encourage students to take more credits per term, increasing their likelihood of on-time completion. In fiscal year 2017, these changes would mean an additional $2 billion in Pell Grants for students working toward their degrees.

• Pell for Accelerated Completion would allow full-time students the opportunity to earn a third semester of Pell Grants in an academic year, enabling them to finish faster by taking additional courses year-round and better meeting the diverse needs of today's students. Many full-time students exhaust their annual Pell eligibility after just two semesters and, as a result, are unable to pay for summer courses and must wait until the beginning of the next academic year to continue their studies. This proposal will provide nearly 700,000 students next year who are making real progress toward on time graduation with an additional $1,915 on average to help pay for college and complete their degrees faster.

• On-Track Pell Bonus would create an incentive for students to stay on track or accelerate their progress towards a degree through an increase in the maximum Pell Grant award of $300 for students who take 15 credits per semester in an academic year. The bonus would encourage students to take the credits needed to finish an associate degree in two years (60 credits) or a bachelor's degree in four years (120 credits). Finishing faster means more students will complete their education at a lower cost and likely with less student debt. This proposal would help an estimated 2.3 million students next year as they work to finish their degrees faster.

Key Administration Proposals to Support College Access and Success:

Today's new initiatives would complement existing Administration proposals designed to help more students from all backgrounds succeed in college, by helping to improve student outcomes and increase the number of students who graduate, accelerate degree completion time, make college more affordable, help lower student debt, and ensure students graduate with the knowledge and skills needed in today's economy. Those include:

• Making two years of high-quality community college free for responsible students through America's College Promise, letting millions of responsible students earn the first half of a bachelor's degree and the skills needed to succeed in the workforce at no cost. America's College Promise would create a new partnership with states and would require everyone to do their part: Community colleges must strengthen their programs and increase the share of students who graduate, states must invest more in higher education and training, and students must take responsibility for their educations, earn good grades, and stay on track to graduate.

• Ensure Pell Grants keep pace with rising costs by continuing to index the Pell Grant to inflation beyond 2017 with mandatory funding to protect and sustain its value into the future. The Health Care and Education Reconciliation Act signed by the President increased the maximum award by the Consumer Price Index from 2013 to 2017. Without permanent CPI indexing, the purchasing power of Pell will erode, making it harder for students and families to afford college. Indexing the Pell Grant means that, compared with current law, the maximum Pell Grant award will increase by $1,300 in the 2026-2027 award year, resulting in larger awards for 9.2 million students.

• Rewarding colleges that successfully enroll and graduate students from all backgrounds. The College Opportunity and Graduation Bonus program would recognize and provide a bonus to high-performing colleges that enroll and graduate a significant number of low- and moderate-income students, as demonstrated by high graduation rates for Pell Grant recipients and low cohort default rates, and encourage all institutions to improve their performance.

• Building effective community college programs in high-demand fields through the American Technical Training Fund. The program would provide competitive grants to support the development, operation, and expansion of innovative, evidence-based, and tuition-free job training programs in high-demand fields. It will enable youth and adults, particularly from low- and moderate-income families, to complete education and training that lead to jobs in high-demand industries and occupations.