Public colleges and universities have shifted their financial aid priorities away from need-based to merit-based awards. Low-income students are feeling the brunt of this change, but pressure on schools to admit only college-ready students and to raise revenue will probably cause this trend to continue.
Public colleges are turning away from their mission to offer access to an affordable college education for all students.
A ProPublica analysis of new data from the U.S. Department of Education shows that, from 1996 through 2012, public colleges and universities gave a declining portion of grants—as measured by both the number of grants and the dollar amounts—to students in the lowest quartile of family income. That trend continued even though the recession hit those in lower income brackets the hardest.
Universities feel the dual pressures of raising their revenues and ratings.
Why have public universities across the nation shifted their aid?
“For some schools, they’re trying to climb to the top of the rankings. For other schools, it’s more about revenue generation,” said Donald R. Hossler, a professor of educational leadership and policy studies at Indiana University at Bloomington.
To achieve those goals, colleges use their aid to draw wealthier students—especially those from out of state, who will pay more in tuition—or higher-achieving students, whose scores will give the colleges a boost in the rankings.
Private colleges have been using such tactics aggressively for some time. But in recent years, many public colleges have sought to catch up, doing what the industry calls “financial-aid leveraging.”
The math can work like this: Instead of offering, say, $12,000 to an especially needy student, a college might choose to leverage its aid by giving $3,000 discounts to four students with less need, each of whom scored high on the SAT and who together will bring in more tuition dollars than the needier student will.
Those discounts are often offered to prospective students as “merit aid.”
The student profiled in the Chronicle of Higher Ed article offered a clue to the reason many low-income students are losing out. They are academically unprepared for college-level work.
Ms. Epps had a combined SAT score of 820 on mathematics and critical reading…
That score is below the College Board SAT College and Career Readiness Benchmark, indicating a lack of “skills and knowledge that research demonstrates are critical to college and career readiness”. The same low SAT scores that disqualify some students for merit aid also signal they are at high risk for dropping out of college.
Problem should be addressed before the college years.
The answer is not to give more need-based aid to students who are not prepared for college, but to do a better job of educating students to be college and career ready. That is the job of K-12 education and community colleges.
Related: Increasing college merit aid decreases enrollment of minority and low-income students (Cost of College)