Local College Officials: Financial Aid Up In Air

Tim Goral's picture

College-bound students may be left waiting a little longer to hear about financial aid while higher-education officials figure out how sequestration will affect the availability of funding.

There is no danger to funding for the current fiscal year, which ends June 30, but next year's funding is still a question mark, said Ann McDonald, executive vice president at Mount Wachusett Community College.

"More significant is the impact for next year," McDonald said. "None of it is definite."

Funding for next year is a good-news-bad-news situation, she said. The bad news is, there could be a slight increase in loan fees, while the good news is that Pell Grants could be increased, McDonald said.

Jane Glickman, a spokes-man for the U.S. Department of Education, agreed that Pell Grants are safe.

"Pell Grants are not affected at all," she said. "Pell Grants are the main program for needy students for grants."

But there will definitely be less federal money available, due to an overall 5 percent cut in the federal budget, Glickman said. But Glickman said it's unclear how this will impact financial aid.

"I think we don't have answers yet," Glickman said.

Many schools are holding off on announcing financial-aid packages because they do not know what will be available, McDonald said. Student loans through commercial lenders are not affected by sequestration.

Origination fees for Stafford Loans could rise 1 percent as a result of sequestration, McDonald and Glickman said.

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