Who gets financial aid? Who pays for it?

Those two questions about college financial aid are being looked at by everyone nvolved with higher education — the colleges themselves, state and federal governments, students and parents, consultants, lobbyists… everyone. But especially, the governments.

Virginia State Capitol

Virginia State Capitol. Image via Wikipedia.

Kevin Kelly, who writes for Inside Higher Ed, just took a look at how state governments are trying to shape financial aid decisions, in Not From My Wallet,

Think of it as the latest iteration of the “not in my back yard” argument. Most people want higher education for their children, and most people think it’s a good idea for other people’s children to have higher education, too. Just don’t ask them to pay more for it.

I’d recommend reading the entire article. Here are a few state details.
Arizona (bill proposed, subsequently withdrawn):
A bill recently approved by a committee of the Arizona House of Representatives, House Bill 2675, would require full-time students at Arizona’s three public universities to pay roughly $2,000 toward their education costs, a price that could not be covered by grants, tuition benefits, or scholarships funded through public money, including federal aid.

Earlier this month, the governor of Virginia proposed in his budget to cap the amount of in-state tuition revenue that could be used to fund financial aid for other students. The state’s secretary of education, a position appointed by the governor, said the measure was designed to spark conversation about what aid polices should be and whether some students should be footing the bill for others.

North Carolina:

A few weeks later, members of the University of North Carolina system’s Board of Governors pushed to adopt a similar policy. When that was rejected by the full board, they began to push for a tax break for families who did not qualify for financial aid. Board members in favor of the tax break said that subsidizing other students’ education should be considered a charitable contribution, and therefore such families should be entitled to a tax break.

The UNC proposal is particularly interesting given that the state has a history of requiring institutions to funnel money from tuition hikes back into financial aid budgets.

New York:
he State University of New York system recently adopted a similar policy. When Governor Andrew Cuomo approved a $300 yearly tuition hike for the next five years, he required that students who qualified for the state’s aid program be held harmless. As a result, about 20 percent of last year’s hike became institutional aid for low-income students.
The question at the heart of these proposals is whether a college degree “is a public good or private good.” The answer may well depend upon when the question is asked. The Governor of Virginia has set a higher college graduate rate as a goal for our state. Yet with the higher education bubble continuing to expand — higher tuition leading to more financial aid and higher student debt — who pays for the increased numbers of grads?
Increasingly, the states are saying it’s not them.
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1 Comment

Filed under Paying for College, Reports

One response to “Who gets financial aid? Who pays for it?

  1. Pingback: Next Year’s financial aid « kepdavis

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