Because they need the money to send their children to college?
Considering how expensive colleges are today, a $1,000 grant might pay for a third a semester tuition at a good public university. The money isn't a handout, because good, lower income students wishing to attend college would still have to get a job/ other scholarships in order to pay for their tuition and room and board.
The money isn't a handout...
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Then where does it come from? The tooth-fairy? Try the taxpayers.