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Financial Aid

Financial Aid: High Access, Low Priority

The rhetoric related to the importance of student aid does not match reality.
University Business, Jun 2006

Lawmakers' rhetoric suggests they understand the value of giving low-income and minority students the opportunity to attain a higher education. Given this apparent awareness by legislators, it is a bit puzzling that need-based student aid remains such a low funding priority in local, state, and federal budgets.

Local and state spending per student on higher education is at a 25-year low, forcing students and families to shoulder a greater share of the cost of college, according to the annual report of the State Higher Education Executive Officers.

Federal lawmakers are clearly not backing their words with meaningful investments to expand college opportunity. Recent federal policy actions-the president's FY2007 budget request, program funding levels, the reconciliation bill, and reauthorization of the Higher Education Act-all place additional burden on the shoulders of those who are trying to afford a postsecondary education.

"Whatever the rhetoric may be, the reality is that we have lost the debate about the public good that higher education contributes to our society," said Jamie Merisotis, founding president of the Institute for Higher Education Policy (IHEP), at a recent conference in Washington, D.C. "We in higher education have been sorely ineffective in our task of making the case for investment in higher education opportunity."

"We have lost the debate about the public good that higher education contributes to our society."
-Jamie Merisotis, Institute for Higher Education Policy

It is widely known that when states and the federal government are strapped for cash, education is one of the first budget items to be cut, but speakers at the April conference hosted by the National College Access Network (NCAN) and the Council on Opportunity in Education (COE) argued that there is little pressure for politicians to increase spending to improve college access.

Joe McCormick, the executive director of the Kentucky Higher Education Assistance Authority (KHEAA), argued that policy to expand college opportunity has suffered because politicians have a hard time seeing past re-elections, thus leading to education initiatives designed to secure votes, not actually improve educational opportunities for underserved students.

McCormick cited the recent explosion of merit-based aid as an example of this trend, arguing that access for low-income students is not a top priority for politicians because low-income populations are generally not as active in politics.

"Merit-based aid is not popular because it is good policy. It's popular because it gets votes," he said.

In addition, the general public has misperceptions about higher education opportunity-misperceptions that make need-based financial aid less of a priority than it should be.

Marty McGough, vice president of research and polling at Widmeyer Communications, found that college access for low-income students is a high priority for most Americans, but many don't perceive a problem, believing that the current state of college access is adequate.

In a survey he conducted to determine the public's perceptions of higher education access, McGough found that nearly half of those surveyed think a majority of low-income students aren't academically qualified to attend a four-year public university. According to McGough, need-based financial aid is not a priority because many believe low-income students would not be able to go to college anyway.

According to a 2002 report published by the Lumina Foundation, more than 20 percent of academically qualified, low-income students (not a majority) do not attend any postsecondary institution.

In general, most Americans also mistakenly believe that the average federal Pell Grant covers about half the cost of attending a public four-year university. According to the College Board's 2005 annual report, the average Pell Grant award was $2,469 during the 2004-2005 academic year, while the average cost of tuition and fees at four-year public institutions was $5,126 and the average cost of room and board was $6,250.

McGough's survey also revealed that the public generally believes the average debt load of a college graduate is around $10,000. The College Board estimated that the typical student graduates from a four-year public institution with $15,500 in student loan debt; the debt amount rises to $19,400 for a student graduating from a four-year, private college.

The public also generally believes that colleges are increasing need-based scholarships as opposed to merit-based scholarships, according to McGough. Conversely, the College Board's annual report shows that at the state level, the percentage of merit-based grant aid increased from 10 percent of all aid during the 1993-1994 academic year to 26 percent of all aid in 2003-2004.

Considering these misperceptions, it is understandable that most Americans don't pressure their legislators to make college access more of a funding priority.

In addition, McGough found that higher-income Americans and those identifying themselves as Republicans were the least likely to support policy to increase access for low-income students.

"The people who speak the loudest, have the most money, have the most political influence, and are heard the most, are the very people who are less likely to support higher education," McGough said.

Merit-based aid is not popular because it is good policy. Rather, it is popular because it gets votes.
-Joe McCormick, Kentucky Higher Education Assistance Authority

Speakers at the conference pointed out that higher education leaders need to convince the American public and policy-makers of this reality: All Americans will benefit from having more low-income and minority students achieve a higher education-not just the individuals receiving the education.

Interestingly, McGough's survey found that messages touting higher education's benefits to all members of society were the most effective in winning over those with the least enthusiasm for greater postsecondary funding to aid low-income and minority students.

The rising cost of a college education is another factor that makes the public and lawmakers hesitant about investing more in higher education opportunity.

William Kirwan, chancellor of the University System of Maryland, made this argument: Institutions of higher education must demonstrate they can be cost-conscious, cost-effective stewards of the public's money in order to gain public and political support.

Kirwan recognized that colleges cannot be held to the same type of cost control as the business world because of the nature of colleges, but he warned that higher education leaders cannot simply manage their way out of reduced support and growing enrollment.

"Ultimately, if America is going to continue to lead in the global economy, an infusion of public funds into higher education is essential," Kirwan said. "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."

While Kirwan advocated stretching existing dollars to make higher education more efficient, he recognized that efficiency could not compensate for dwindling support among lawmakers.

Other conference speakers echoed this sentiment. They argued that the only way to avoid the bleak predictions about the future of American higher education-which several lawmakers have been highlighting in recent speeches-is to find ways to convince both the public and policy-makers that investing in need-based financial aid is important.

"We have to invest in need-based financial aid, as the best and most important way to promote access to higher education," IHEP's Merisotis said. "Let's not pretend that efforts to do more with less or to do less with less will do anything to dramatically narrow the opportunity gap. Meaningful investment is the only thing that has worked in the past and it is what needs to be done now."

Haley Chitty is assistant director of Communications at the National Association of Student Financial Aid Administrators,

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