Valley administrators fear cuts to financial aid could slow enrollment

Jared Janes | The Monitor

July 19, 2010

EDINBURG — The saving grace for Hidalgo County’s two higher education institutions may be their students.

South Texas College and the University of Texas-Pan American both saw summer enrollment increases of about 30 percent, a skewed figure because this year is the first time that low-income students can use Pell Grants for summer classes. But administrators at both campuses are still projecting modest enrollment increases of at least 5 percent in the fall that could offset the loss of state dollars with additional tuition revenue.

Unlike the University of Texas at Austin, where staff layoffs occurred with student enrollment at the maximum allowed, UTPA can cover some of the shortfall by getting more students on campus.

"We don’t have an expense problem. We have a revenue challenge," said Juan C. Gonzalez, UTPA’s assistant vice president for business affairs. "Because our academic cost is low, we can’t go very far before we start hitting the muscle when we face reductions."

The Valley’s higher education administrators are most concerned cuts to financial aid programs could eliminate enrollment gains seen statewide.

The state’s student financial aid program was exempt from the 5 percent cut this year, and state leaders vowed not to touch it in the 10 percent cut under consideration.

But even administrative changes in the TEXAS Grant — the need-based grant — could affect UTPA students, said UTPA President Robert Nelsen. An additional $10 million to $13 million is given to UTPA students each year from universities elsewhere that don’t use the full allocation.

There’s no guarantee that redistribution of TEXAS Grants will continue.

While state legislators may not need to make sweeping changes with a rainy day fund estimated at $9 billion and a shortfall that could be as low as $12 billion, higher education officials are still preparing themselves for adjustments, said STC President Shirley Reed. Because higher education is among the state’s discretionary spending — unlike mandatory contributions to Medicaid or the Children’s Health Insurance Program — it’s especially vulnerable to cuts.

All state agencies were asked to prepare budgets reflecting the additional 10 percent cuts to help legislators identify reductions when those decisions are made in January, said state Sen. Juan "Chuy" Hinojosa, D-McAllen, who sits on the Legislative Budget Board. But he pledged to look at the whole structure from the spending side to the taxing side to prevent drastic cuts that damage the state’s higher education system.

Shifting more of the cost for higher education toward students by raising tuition or cutting financial aid could lead the state to lose waves of students, especially in low-income areas like the Valley, Hinojosa said.

"Texas depends on an educated workforce," Hinojosa said. "If we close the doors to students, then not only do the students suffer, but our economy and the business community suffers."

Jared Janes covers Hidalgo County government, Edinburg and general assignments for The Monitor. He can be reached at (956) 683-4424.