The federal government may provide students with less financial aid next year, but Northwestern is prepared to pick up the slack.
“Federal and state governments haven’t been able to keep pace with rise in (college) costs,” said Rebecca Dixon, associate provost of university enrollment. “But because of (Northwestern’s) robust financial aid program, we have been making up the difference. We still meet full financial need.”
Nearly 90,000 financial aid applicants who would have been eligible for Federal Pell Grants based on old guidelines will not be eligible to receive them next year, according to the American Council of Education Web site.
The eligibility requirements changed when the U.S. Department of Education updated the tax figures used for the formula that determines a student’s Expected Family Contribution.
Tax figures from 2002 will replace figures from 1988, so students from states with lower state and local taxes in 2002 than in 1988 will be expected to have higher family incomes and, by consequence, more money to spend on college expenses.
Data from 2002 are used because they are the most recent figures available from the Internal Revenue Service.
Students from 21 states — including Delaware, Hawaii, Michigan and North Dakota — are at greatest risk of losing their grant money. Meanwhile, students from states such as New Jersey and Connecticut might see larger grants. Although some students will receive less aid, Dixon said it is appropriate to use the latest figures for the aid formula.
“They should update them. If they waited two years from now, the hit could be stronger,” Dixon said. “I don’t know if a lot of states are lowering their taxes, but the more time lapses, the greater the discrepancy (between expected and actual family income).”
About 42.3 percent of this year’s students received financial aid from NU through work-study, loans and university grants, Dixon said. But Dixon does not foresee a problem meeting students’ financial needs next year.
There was more than $2 million in NU’s Pell coffers this year, so “if it goes down by 1 or 2 percent, then we can adjust and maybe spread the dollars a bit further,” Dixon said.
Unlike loans, Federal Pell Grants do not have to be repaid, and individual grant awards range from $400 to $4,050 per year.
Out of the more than 5 million students who receive the grants, students who receive $400 may lose eligibility altogether, said Jacqueline King, director of the American Council on Education’s Center for Policy Analysis. About 1 million other students will receive approximately $100 to $300 less, King said.
The Department of Education projects that more students will receive Pell Grants next year, and half of those students are eligible for the maximum award amount. But these students will not be affected by the new formula, according to a Department of Education press release.
Some NU students said they weren’t concerned about losing their Pell Grant.
“My parents would take up the slack,” said Beth Fabijanic, a Weinberg senior. “As long as people who need it the most continue to get it, that’s OK.”
Other students who receive Pell Grants said they would find new ways to afford the rising costs of NU tuition if they lose their Pell Grant.
“It wouldn’t be detrimental,” said Audrey Klein, a Communication sophomore. “I’d probably look around for scholarships.”
Jim Boyle, president of College Parents for America, said he agrees that the least needy will feel the impact of the new formula, but he hopes it will spur debate for increasing the maximum Pell Grant award amount.
“It is a stubborn reality that the maximum Pell Grant amount has stayed flat,” Boyle said. “The changes in the tax tables may mean the redistribution of Pell Grant money, but again, more students (may) receive Pell Grants (if they reside in a state with higher state taxes in 2002 than in 1988).”
Reach Helena Oh at [email protected].
