Spring tuition grant cuts could cost Pennsylvania college students $20 million in funding
Several universities say they will dig into their resources to backfill a mid-year reduction in state grant awards that help underwrite costs for more than 100,000 Pennsylvania college students.
The need-based awards, known as PHEAA grants, capped out at a maximum of $4,318 for the 2017-18 school year. A PHEAA spokesman said the 55-year-old agency was forced to notify financial aid officers of the pending reduction recently after discovering that an unprecedented percentage of students who qualified for the awards actually enrolled in colleges and universities last fall. This is the first time PHEAA has ever cut grant awards in the middle of an academic year.
Locally, officials at Slippery Rock, California and Seton Hill universities say they will use their own money to cover PHEAA’s shortfall to students expecting their spring awards will match the amount their received in the first semester.
Elsewhere, colleges and universities are weighing their options.
Spokesmen for the University of Pittsburgh and Indiana University of Pennsylvania said they are assessing the amount of grant reductions and what, if any, action they will take.
Keith New, a spokesman for the Pennsylvania Higher Education Assistance Agency, said reductions to the spring semester grants could range anywhere from $23 to $200, depending on the total grant awarded to an individual student.
He said it appears that PHEAA faces an estimated shortfall of $18 million to $20 million in meeting approved awards this spring. The program was budgeted at $360 million this year.
While individual grant reductions are not large, university officials say the money can be critical to students scraping by on grants, loans and part-time jobs.
Officials at CalU said the cash-strapped public university, which has faced declining enrollment and stagnant state support in recent years, will cover PHEAA reductions that could total as much as $280,895 and affect 1,932 students.
“We understand that these students are on a tight budget,” Robert Thorn, vice president for administration and finance, said in announcing the decision.
“They planned on receiving this aid, and we don’t want the loss of PHEAA grant funds to derail their educational plans,” he said. “For some families, even a small cutback in financial aid can keep a student from earning a degree.”
Seton Hill officials also approved a plan to make up any PHEAA grant losses. School financial aid officers determined as many as 521 students at the private Catholic university could lose anywhere from $26 to $195 because of PHEAA cutbacks, spokeswoman Jennifer Reeger said.
“The university will in fact cover those reductions for students,” Reeger said.
At state-owned Slippery Rock University of Pennsylvania, officials say they will backfill awards for up to 2,346 students. Officials said students there face a combined reduction of $327,764 in PHEAA grants, ranging from $23 to $166.
“Many of our students rely on this funding to assist with their educational costs, and we decided to step in during this time of economic uncertainty as it pertains to state funding,” said Philip Way, Slippery Rock interim president.
PHEAA, a self-supporting agency that employs 3,600 people at five locations across the state, collected $321.4 million last year for overseeing collections on $367.2 billion in private and federal student loans. It poured $87 million in profits back into the student grant program.
New said students are provided an estimate of their annual awards when they are notified of their eligibility in the spring. Grants are distributed the next fall and spring.
“We’re very careful,” New said. “This is the only time this has happened.”
He attributed that to a combination of an increase in applications for aid because of a major PHEAA public relations campaign and a change in the deadline for filing required federal aid forms that made it easier for families to meet the application deadline.