They are a taxpayer rip-off, as I see it. Yes, I am certain they help a few, but I know a Community College prof who tells me that the Black girls all know the game. You sign up for classes to get the grant, then the day after your check arrives, you drop all classes. Sign up again the following semester and do it all over again. If they have (B) or (F) after their name, it more than likely goes without saying there will be no further action, looking into whether this is fraud or not. This is thousands of dollars per student doing this.
The Pell Grant program has become overwhelmed with fraud and abuse.
The situation you describe is commonplace.
There is also collusion with the teachers and administration and pressure on teachers to provide passing grades to students who don't even show up for class so the students can keep their Pell Grants and financial aid.