Fewer college students to get financial aid under House and Senate proposals

Number of Texas Grant recipients would drop from 86,830 to 27,135

By Ralph K.M. Haurwitz | AMERICAN-STATESMAN STAFF
Monday, Jan. 24, 2011

The Texas Legislature allocated enough money for 86,830 college students to receive the need-based Texas Grant in the current academic year. Under the proposed House and Senate budgets, the number of students receiving the state's main form of financial aid would decline to 27,135 by 2013.

That's because funding would be cut 41 percent, to $366 million, for the upcoming two-year budget, closing the program to students entering college but allowing those already receiving the grant to continue to do so.

The state's other financial aid programs also would take substantial hits. Work-study aid would be cut 41 percent. A scholarship program for students ranking in the top 10 percent of their high school graduating classes would be cut 79 percent.

All told, spending on financial aid — just over $1 billion in the current two-year budget — would decline by $431 million under the House proposal for 2012-13 and by $381 million under the Senate version, according to the Legislative Budget Board.

Higher Education Commissioner Raymund Paredes, who had asked the Legislature to increase financial aid in light of growing enrollment, expressed a mixture of dismay and optimism Monday. He noted that much of the enrollment growth involves students who are poor, the first generation in their families to attend college, and Hispanic or members of other minority groups.

"I am hopeful that we can make a compelling argument that we have an awful lot of poor students coming through the system, and they won't be able to go to college unless we provide some financial aid," Paredes said. "It would be tragic if we have to tell these poor, first-generation students of color as they're showing up in high school graduation classes that we've run out of money."

It's not as if Texas has been generous with financial aid all along. Paredes' agency, the Higher Education Coordinating Board, estimates that only about 70 percent of students meeting financial and academic eligibility requirements currently receive a Texas Grant. That's despite the fact that lawmakers increased spending on financial aid by about 35 percent two years ago.

Thomas Melecki, director of student financial services at the University of Texas, said eliminating Texas Grants for new students would keep some of them from enrolling. Currently, about 4,800 UT students receive a Texas Grant, including about 1,200 freshmen.

UT would try to redirect other grants to students who would otherwise receive a Texas Grant, as well as put more loan money into their financial aid packages, Melecki said. Many low-income students are leery of taking out loans, which, unlike grants, must be repaid.

A Texas Grant can be worth as much as $6,780 a year for a student at one of the state's universities, said Andy Kesling, a spokesman for the Higher Education Coordinating Board. Only students whose families can afford to pay no more than $4,000 toward their education are eligible, he said. The maximum grant for a community college student is $1,780.

Lashaila Mitchum, a sophomore majoring in social work at UT, said of her Texas Grant, "It makes financial hardship a little more sustainable."

She predicted that many students wouldn't apply for admission if the grant program is closed to entering students. "How can you expect people to work, pay taxes and be productive citizens if they can't go to school?" Mitchum said.

Two years ago, the Select Commission on Higher Education and Global Competitiveness, a panel authorized by the Legislature, noted that insufficient financial aid can prompt students to forgo college or to spend too much time working while they are enrolled. Nationwide, only 8 percent of freshmen who work full time earn a bachelor's degree within six years. In Texas, 35 percent of undergraduates work full time, the commission reported.

Rep. Mike Villarreal, D-San Antonio, referring to GOP majorities in the House and Senate, said: "The Republican budget proposals read like blueprints for making college more expensive. By eliminating financial aid for new students, and pushing up tuition through cuts to colleges, the Republican proposals would put higher education and high-paying jobs out of reach for tens of thousands of young Texans."

GOP leaders say the proposals are intended to ensure that the state lives within its means. The proposals avoid new taxes and use of the rainy day fund.