Thursday, February 25, 1999
More loans, fewer grants available
GRANTS: Proposal may promote debt among low-income students
By Barbara Ortutay
Daily Bruin Staff
The Clinton administration’s budget proposal for the year 2000
places an emphasis on outreach programs and loans, while decreasing
funding for federal grants.
A gradual shift in priorities from grants to loans has
characterized federal financial aid programs. This, according to
USSA board members, leaves low-income students in debt after
graduating.
"In the past, the ratio of grants to loans was three to one;
now, that has flip-flopped," said Undergraduate Students
Association Council (USAC) President Stacy Lee. "Now the fees have
increased, and the grants have decreased, so it’s a lose-lose
situation."
According to White House officials, however, the new components
that have been added to the budget will help ease the financial
burden on students.
Programs that have received an increase in funding include an
outreach program that provides mentoring and outreach for middle
and high school students in low income communities. Gaining Early
Awareness and Readiness for Undergraduate Programs (GEAR-UP) will
reach 318,000 students, according to the Department of
Education.
Lee said UCLA will be one of eight schools applying for GEAR-UP
funding.
"It’s different from UCLA’s current outreach programs because it
targets all students, and not just the ones who are doing well,"
she said.
Funding for this program has been doubled in the new budget
proposal to $240 million.
"Last year was GEAR-UP’s first year, and $120 million was
proposed for its budget," said Kendra Fox-Davis, vice president of
the United States Student Association (USSA), a national student
lobbying organization based in Washington.
"This increase is exactly what we were looking for, and these
are the only numbers we are happy with," she added. "The rest is a
step backwards."
Clinton’s balanced budget did not increase the funding for the
Leveraging Educational Assessment Partnership (LEAP) grant. This
program gives states a matching fund for financial aid, such as the
Cal grant in California.
For the past two years, LEAP has received a steady $25 million
from the government, which does not take into account rising
tuition fees, according to USSA members.
"LEAP is only funded $25 million each year," said Fox-Davis. "If
they level funding grants and tuition rises, students will have
less purchasing power."
Fox-Davis said USSA would like to see the federal government
fund grants rather than loans.
"Students who see themselves graduating with thousands of
dollars of debt are less likely to be wanting to graduate," she
said. "Loans also require students to spend more time outside the
classroom while they are in college.
According to the 2000 White House budget, low-interest federal
loans, such as the Perkins loan, provide students with lower
interest rates than loans from banks and other agencies.
"USSA’s position has always been that the federal government
should provide students with low interest loans," Fox-Davis said.
"The Perkins loan helps students graduate with less debt; however,
students still end up spending the years after they graduate paying
off loans."
USAC External Vice President Liz Geyer said USSA is campaigning
for an increase in federal grants, as well as a loan forgiveness
program.
Currently, Clinton’s 1997 Balanced Budget Act provides loan
forgiveness for students involved in community service for
non-profit organizations, according to the Department of Education
website.
The Taxpayers Relief Act of 1997 offers a federal scholarship
called HOPE, which provides tax breaks for the first $1,500 of
tuition for students in their first two years of college.
With reports from Anand Patel, Daily Bruin contributor
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