The Office of Scholarships and Student Financial Aid is currently looking for a way help need-based grants catch up with the rising cost of tuition.
Normally when tuition goes up, need-based grants go up proportionally, said Michael Scott, director of scholarships and student financial aid. However, this is not always an effective solution to rising costs, he said.
“The percentages go up, but your out-of-pocket expenses go up more,” Scott said.
For example, if a student had a $5,000 need-based grant and tuition increased 11.9 percent, the grant would also increase 11.9 percent, to $5,595. The grant increase of $595 would not be enough to cover the $2,110 tuition increase.
The financial aid office is working on a way to avoid this imbalance for next fall by disproportionately increasing need-based grants. When grants are increased disproportionately to the cost of tuition, many need-based grants will increase a larger percentage than tuition increased.
“That’s where you look to financial aid to maintain access for students that are most impacted,” said Carol Campbell, vice chancellor for finance and administration.
The Board of Trustees set aside an additional $4.5 million of the 2004-2005 budget to increase financial aid. That 11.5 percent increase in financial aid will help compensate for next fall’s tuition increase, Scott said.
“You have this huge influx of new need every time you raise tuition,” Scott said.
With the increase, TCU will give out at least $43.6 million in financial aid, including federal loans, grants and TCU scholarships.
When new income is generated, it can be dispersed into one of three categories, Scott said. The new income can go to academic merit aid (scholarships), awards for activities like band and choir or need-based grants. The financial aid office chose to increase need-based grants.
“You can increase all of these areas a little bit, or one area a lot,” he said.
Need-based grants are awarded based on factors reported in the Free Application for Federal Student Aid (FAFSA), including number of people in the household, number of children in college and family income. Students do not need to fall into a specific income range to qualify for need-based grants.
“The calculation includes a number of factors,” said Sandra Tobias, associate director of scholarships and student financial aid.
Approximately 70 percent of TCU students receive some form of financial assistance, Scott said.
During the 2002-2003 academic year, 4,417 students applied for financial aid. Of those students, approximately 74.4 percent were awarded some form of aid. The average total financial aid package totaled $11,036.
TCU students receiving need-based grant aid totaled 2,973, while 841 students received non-need-based grant aid. This includes academic scholarships awarded on merit.
Need-based grants averaged $7,260 and non-need-based grants averaged $6,365.
Many low-income students are eligible for grants, Scott said, whereas middle-income students are not. Those students must compensate with loans.
“What’s more concerning in some ways are the middle-income students,” he said.
The tuition increase has already forced some students to take out more loans.
“I actually increased my loan amount by about 20 percent,” said Kathalina Nguyen, a junior nursing major.
Families also are feeling the effects of the increase.
“My parents are upset about paying more,” said Jill Carlton, a senior art history major. “I think they just want me to hurry up and get out.”
It is unknown whether the tuition increase will discourage students from less well-off families from attending TCU, Scott said.
“You change your market a little bit,” he said, “but I don’t think the current student we attract will change a lot.”
Although TCU keeps figures for overall student retention, the university does not keep specific figures on students who leave the university for financial reasons, Campbell said.
Students have been taking out more loans in recent years, Scott said. Students took out $18.3 million in loans during the 2000-2001 school year, but they have taken out approximately $40 million to date for the 2003-2004 year.
“Taking out a student loan isn’t a bad thing in my mind,” he said. “You just have to be realistic about it.”