Improving Affordability in Higher Education Term Paper

("House Passes Bill to," 2006, p. A06)

Another general false conception is that "colleges are increasing need-based scholarships as opposed to merit-based scholarships... (however,) the College Board's annual report shows that at the state level, the percentage of merit-based grant aid increased from 10% of all aid during the 1993-1994 academic year to 26% of all aid in 2003-2004." These and other misperceptions, perhaps contribute to the fact most Americans don't pressure legislators to insure college access funding becomes more of a priority. (Chitty, 2006) "Ultimately, if America is going to continue to lead in the global economy, an infusion of public funds into higher education is essential," William Kirwan, chancellor of the University System of Maryland, insists. (Chitty, 2006) "If we in higher education take the lead in cost control, efficiency, and effectiveness, then we're going to have the chance to restore public trust and justify an increase in public investment."

Goral (2005) notes that due to recent tax tables which define family contributions to tuition, many students will not qualify for Pell grants. In addition, the Perkins loan program may be eliminated. Many students currently qualifying for Pell do not have any other resources.

He recounts thoughts from several "tuition experts" on panel of tuition experts discussing upcoming changes for higher education. Gloria Nemer0wicz, president, Pine Manor College (Mass.) notes statistics for income of college educated vs. non-college educated people confirms the value of higher education. "But that's a distant deal," she admits. "It doesn't matter how good the deal is if you can't afford to take it. Our concern is the accessibility to the deal." (Goral, 2005) Although the report by Fischer and Blythe (2006) reveals concerns regarding grant funds allocated to the lower education arena, similar questionable scenarios likely exist in the realms of higher education. "Public records show that educators used district credit cards to buy thousands of items of questionable educational value, spending money awarded to help educate the district's neediest kids." When any part of grant money is spent on prohibited items of purposes other than its intended purpose, fewer students are enabled to pursue higher education benefits. Another recommendation is that funds allocated as grants for low-income students be monitored to insure they reach their intended destinations and serve their proposed purposes.

Fear of jeopardizing his/her personal, as well as his/her family's financial situation frequently keeps a low income student form applying for higher education loans. Experts report that all races of economically disadvantaged students of all races fare worse when they only aid receive aid in student loan forms as when many of they students graduate, they are confronted with staggering loan debts. (Horwedel, 2006) When the he Tomas Rivera Policy Institute (TRPI) at be University of Southern California surveyed 400 Hispanic Californians from 18 and 24 years old regarding their college financial aid perceptions, 38% thought college costs outweighed the benefits. Hispanic students, Horwedel (2006) notes, remain one of the under-represented lower-income groups in higher education. The point, however, crosses racial and ethnic lines that traditional college-age youth frequently perceive college costs to be more expensive than they actually may be. The need exists to clear up misperceptions and requirements related to college costs, Dr. Estela Zarate, research director for TRPI, says,.".. so students don't inadvertently forfeit the opportunity to get a higher education. A separate TRPI study, "Perceptions of College Financial Aid Among California Latino Youth," found that many Hispanics mistakenly thought U.S. citizenship was a requirement for financial aid." (Horwedel, 2006) A study completed in March 2006, entitled "Looking for Relief: Americans' Views on College Costs and Student Debt," notes differing ethnic and racial attitudes toward student loans and found: "Only 15% of the White students declined loans, compared to 28% of Blacks and 27% of Hispanics.... say (ing) repaying that debt is too hard."(Horwedel, 2006) Grants constitute less of a financial burden, while "loans have too much of a detrimental impact on students and families," Dr. Gumecindo Salas, vice president of government affairs for the Hispanic Association of Colleges and Universities, states. HACU currently lobbies the federal government to increase the dollar amounts awarded by Pell Grants awarded. Along with debating this option, Congress also considered raising the amount of student loans, which Salas opposes, preferring the Pell Grant be increased. (Horwedel, 2006) David Breneman, Curry School of Education Dean, University of Virginia, who also writes economics of education and public policy toward education, stresses, " The core issue is a very real one:... Even though there may be student aid out there, we've made such a complicated process of finding it and working your way down to a net price that, for a lot of kids who don't have sophisticated parents or go to schools with poor counseling systems, I think many of these kids get discouraged and never bother to apply." The government, Breneman insists, has a positive socially responsive answer to that question and needs to implement this and other answers. (Goral, 2005)

Although some remedies for federal funding for higher education are a "no-brainer," some proposed procedures would make the situation worse. Instead of being an engine of or door to opportunity, Kirp (2003, p. 17) argues, public higher education currently generates inequality. "Government's first priority should be to put a thumb on the equity side of the scale in order to narrow the access gap." Closing the gap does not mean billions of more dollars have to be spent, David Ellwood and Thomas Kane, economists, state. Instead, financial aid may just needs to be aimed more effectively. (Kirp, 2003, p. 17) The college cost crisis Kirp (2003, p. 17) notes during 2003 continues in 2006. During 2003, a report from the education subcommittee led by John Boehner GOP Representative is deemed to be a joke, with an "analysis' that does not have substance or merit.

Mark Yudof, president of the University of Texas System, reports on the value of a college education. Male college graduates in 2003 were reported to earn $32,000 a year more than an individual with just a high school diploma, a $15,000 differential rise from1975, confirming that the BA is not only a social investment but an investment in a graduate's personal financial security. Financial aid for higher education is not merely a response to students' needs, it serves as an investment in the state's productivity.

Students from low-income families are the biggest losers in this market-driven higher-education world. The extent of the impact of a family's income on educational opportunity, albeit, is appalling. "At elite universities, a study by the Century Foundation finds, almost three-quarters of the students come from the top quartile of socioeconomic status; fewer than 10% come from the bottom half." (Kirp, 2003, p. 17) Even in less selective colleges, discrepancies regarding students from lower income is blatant. A 2003 Congressional committee reports that less than half of college-qualified high school graduates, whose families have less than $25,000, enroll in four-year colleges. Approximately one fourth of these individuals do not pursue higher education, compared to five of six students with families earning more than $75,000, enroll in a four-year institution. Only 4% of these students remain at the high school level. "Smart poor kids go to college at the same rate as stupid rich kids," Terry Hartle, senior vice president at the American Council on Education, states. (Kirp, 2003, p. 17)

Even thought the reported intent of federal scholarship and loan programs is to close the gap for students from low income families to secure higher education, intricate eligibility rules frequently discourage low income students from applying. In addition, the Pell Grants' $4,050 ceiling does not begin to counter escalating college costs. A recent College Board report admits federal financial aid is not equal to tuition increases. (Kirp, 2003, p. 17)

Because students with low-income families frequently hesitate to borrow money, due to qualms about how they will adapt and progress in college, it makes more sense to present these students with initial scholarships instead of loans to help them past personal and financial hurdles. Simplifying seemingly pointless eligibility rules for federal aid would also help this situation. (Kirp, 2003, p. 17)

III. Results and Recommendations

The Door to Higher Education (Empirical evidence confirms that federal and institutional aids complement each other. When federal aid increases, the door to higher education is opened for more students, and consequently private institutions will be more likely to supplement federal aid by providing price discounts. Goral 2005) Heavier-than-anticipated student demand caused the Pell Grant program to have a $4 billion shortfall. In 2005, however, the Pell Grant program was reportedly running a surplus. Simultaneously with the surplus, Congress began seeking new revenue to shore up the federal budget. (Dervarics, 2005) Higher education leaders aim to ensure lawmakers utilize savings to expand the Pell Grant program, not spend.....