Government shrinking financial aid

Jennifer Knight

Wednesday, July 23, 2003 | 9:34 a.m.

Hundreds of college students in Nevada will likely see their federal financial aid grants shrink or disappear entirely under a new set of formulas being considered by the government, according to a new report.

Formulas that determine how much money a student receives in Pell grants are being revised by the Education Department, according to a recent report released by the Congressional Research Service, a research arm for Congress.

State financial aid officials say that the net effect of the new formulas will cause many Nevada families to contribute more to their child's education, push students into loans they would have not otherwise taken out and cause a ripple effect in other areas of financial aid.

"Our student population is growing and state dollars are shrinking," said Chemene Crawford, director of financial aid for the Community College of Southern Nevada. "It just doesn't make sense."

As of 2001 Nevada had 14,112 students receiving Pell grants ranging from $400 to $4,000 a year, according to the Education Department. Nationally the changes to eligibility, which become effective in 2004, will end up barring 84,000 college students from receiving any award at all. There are no estimates statewide for how many students will be impacted.

"We looked at the congressional data and it appears that it would impact certain students only," said Judy Belanger, executive director of student enrollment and financial services at the University of Nevada, Las Vegas.

Students receiving $400 or less in Pell grants will likely be cut from the program. Belanger estimates only 200 out of 4,000 students attending UNLV would fit into that category. At CCSN, about 56 out of 6,500 students would likely be without aid, Crawford said.

Students who will not be cut from the Pell grant program will likely see their amount of aid reduced.

One national financial aid official said the reduction will create a domino effect that will drive up family contribution rates which are in turn used to set other forms of financial aid.

"This is sort of the canary in the coal mine," said Brian Fitzgerald, staff director of the Advisory Committee on Student Financial Aid, a congressional advisory committee. "(Pell grants) are sort of a predictor of what could happen at the state and institutional level. Even seemingly insignificant or minor changes in Pell can have significant cumulative effects across state and institutional aid at a time when tuition is on the rise." Next semester, tuition is set to rise at all Nevada institutions, making the stretch even more difficult for some students.

"It just doesn't add up," Crawford said. "We are trying so hard to have students borrow only what they need. Realistically, what you are going to see happening is that more students are going to take out loans. And if they qualify, we will accommodate them."