Jacksonville State University sophomore Tara Foster says federal aid is crucial to her ability to pay for a college education. (Anniston Star photo by Bill Wilson)
She said that’s because her parents simply couldn’t afford to send her off to a four-year school. That means financial aid is enabling Foster to do more than buy books, pay for tuition and afford housing. It’s funding a dream.
“It means a lot because I’m the first one in my family to go to college,” she said.
According to the Institute for College Access and Success, which publishes data about college affordability, more than half of JSU students use federal loans or other aid to pay for college. As a result, the university is dependent upon those federal funds, which JSU students such as Foster use to pay tuition, university officials said.
“If students didn’t have access to federal funds, there would be a large percent of them that would not, could not, afford to go to school,” said Clint Carlson, JSU’s vice president of administrative and business affairs. “They probably wouldn’t be able to go out on the street and qualify for a loan to fund their education.”
College students, who most often are young and have little credit history, are not always good candidates for private student loans, which require credit checks and have unforgiving repayment schedules, said Vickie Adams, the school’s director of financial aid.
By contrast, federal student loans are available to students without substantial credit, and have flexible repayment options.
Federal loans are easy for young students to obtain, easy to pay back and allow many college students to acquire an education that might otherwise be unattainable, Adams said. That’s important, experts say, if America is to advance in the world economy, where many consider an educated workforce to be the key to progress and economic standing.
It’s also important to regional institutions like JSU, which are increasingly dependent on tuition as state funding slips away. Since 2008 JSU has seen its state funding decline by 27 percent, or about $13 million, according to Susan Cagle, director of finance and facilities for the Alabama Commission on Higher Education.
JSU President Bill Meehan said the loss of state money represents a fundamental funding change for the university. It’s no longer a state-supported institution, but a state-assisted institution, he said.
JSU and other regional institutions rely heavily upon revenue from tuition to fund operations, whereas universities known better as research institutions (e.g., University of Alabama in Birmingham) operate on a comparatively larger percentage of federal funding, Meehan said.
“We are tuition-driven,” Meehan said.
What the institution has lost in state funding over the years, it has made up for in tuition, which has risen 31.2 percent since 2009. And with the ailing economy, more of that funding for students is being drawn from federal grants and loans.
At JSU, 51 percent of students use federal loans to help pay for college and 37 percent use Pell Grants, which are provided by the federal government and do not have to be repaid. Students use that money to pay for tuition, housing and books.
Determining how much of the tuition and board revenue the institution takes in ultimately from students’ federal aid is almost impossible, according to Carlson. But, university officials say, the loss of any percent of those funds would have a significant impact on JSU and on other institutions like it across the country.
The problem, said Gregory Fitch, executive director for the Alabama Commission on Higher Education, is that if students can’t access enough federal funding to ensure they can attend college, they might not enroll. If a large enough percentage of students were unable to attend, it would affect institutions across the country.
“The impact would be direct on institutions because as they lose the student, they lose the funding source,” said Fitch.
Officials at colleges and universities are acutely aware of the impact that a reduction in funding for personal loans and grants would have on the nation’s academic institutions.
When federal student aid funding sources came under fire in Washington this summer, JSU officials contacted Alabama’s congressional delegation to explain how such cuts would affect universities and colleges. Additionally, a national association that supports financial aid officers lobbied Congress to ensure lawmakers from across the country understood the same thing, Meehan said.
The lobbyists were successful, for the most part.
They were able to stave off proposed cuts to the Pell Grant program in August but could not retain subsidized loans for graduate students, or a repayment incentive for the government’s student loan program.
“I was afraid Pell would be cut,” Adams said. “I think we would have seen a decrease in students.”
In subsidized loans, the government pays for the interest that accrues while the borrowing students are still in school. The change approved by Congress means that graduate students now will be responsible for paying any interest on their federal loans while they’re enrolled.
Meanwhile, the loss of the incentive program removes a plan that relieved students of 0.5 percent of their debt for making loan payments regularly during the first 12 months of repayment, Adams said.
The money saved by the two cuts will be used to spare the Pell Grant program of cuts, Adams explained. Any significant cuts to federal funding for students, she emphasized, would affect the institution as a whole.
“If student funding is cut, it’s not just going to affect us, it’s going to affect every student,” Adams said.
Star staff writer Laura Johnson: 256-235-3544.
