Kent State risks losing federal aid

U.S. President Barack Obama gives the State of the Union address before a joint session of Congress, Tuesday, January 24, 2012, in Washington, D.C. (Olivier Douliery/Abaca Press/MCT)

U.S. President Barack Obama gives the State of the Union address before a joint session of Congress, Tuesday, January 24, 2012, in Washington, D.C. (Olivier Douliery/Abaca Press/MCT)

Rex Santus

In his recent State of the Union address, President Obama outlined a new proposal: If colleges and universities do not work toward decreasing net tuition prices, they risk losing federal money.

“For the last 3 years, our tuition increase has been about [3.5] percent. I believe two years prior to that, it was 0 [percent] because of state cap,” said Mark Evans, director of Student Financial Aid. “From what I recall, we could be going in a pattern of that [3.5] percent increase.”

According to the address, Kent State University is at risk of losing federal financial aid funding: Perkins loans, work-study programs and grants designed to assist students from low-income families.

“Kent State University has around 18,000 students who rely on a Pell Grant, as an example, throughout the eight-campus system,” Evans said. “So if there were any reductions in the federal grant program, obviously it would have a negative impact on access to higher education.”

Conversely, the president said universities that continue to provide more affordable options to students without increasing tuition would be rewarded with increases in financial aid funding. For example, the Perkins loan program would increase its funding from its current $1 billion to $8 billion.

“The federal government has not put any new money … in the Perkins loan program for the last six years, so any increase in the program would be welcomed, obviously,” Evans said.

The increase in Perkins loan funding, however, is a “two-edged sword” because students will be expected to pay the loan’s interest while enrolled at the university, Evans said.

“The proposal for a number of years was to convert [the Perkins loan program] to an unsubsidized one, meaning a student, then, is responsible for the interest while he or she is in school,” Evans said. “We’ll put more money into the program, but the student has to bear more of the interest responsibility.”

But with the national student loan debt continuing to climb—and the public becoming increasingly aware of this problem—it’s unsurprising financial aid reform is such a prominent issue.

Ohio, specifically, has drastically decreased its grant funding to its state universities over the last few years.

Four years ago, the maximum award amount for a state grant was $2,496, Evans said. That amount has decreased almost 75 percent to a maximum award of $672.

Despite the state’s drastic funding cuts and the increase in the university’s tuition, Kent State has worked to provide scholarships and other affordability options to students.

The university instituted the Last Dollar Scholarship fund two years ago, Evans said, through which President Lefton “challenged faculty and staff to participate in a new initiative … where they could contribute part of their income to a scholarship.” To date, over $100,000 has been collected and donated to the fund.

In fall 2011, the university created a scholarship-match program for incoming Pell Grant-eligible freshman, Evans said. If students obtained external scholarships, Kent State would match those scholarships as an “incentive to motivate students to go out and look for those local scholarships.” More than 200 students qualified and brought in close to $500,000 in scholarships.

The university also offers a variety of payment plans, including a three-month semester payment plan, a 10-month annual payment plan and a 42-month payment plan, Evans added.

“At Kent State, we really are following any opportunity that the federal government provides … to make it easier for students,” Evans said. “Kent State is definitely investing in students to make [college] more affordable.”

As for Obama’s proposal, Evans said it was too early to tell how it would affect Kent State students.

“We have been dealing with more changes in federal programs in the last three years than in the 30 years I’ve been working in financial aid, so the likelihood of changes continuing to occur is 100 percent,” Evans said. “Obviously, it won’t look identical to [Obama’s] proposal, but … this is a process to continue to make college affordable.”

Evans recommends, in the meantime, students focus on filling out the Free Application for Federal Student Aid for the next award year.

“This is the time of the year that you want to reapply for financial aid for next year,” Evans said. “We have a priority process date. We would like families to complete [the FAFSA] next week … so the student could be reviewed for the maximum amount of aid available.”

Contact Rex Santus at [email protected].