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As state student aid falters, universities step in

State grants increase nationwide but drop sharply in Iowa

    Board of Regents President Mike Richards is pictured Sept. 13, 2018, speaking at a regents meeting at the Iowa Memorial Union in Iowa City. Last week, when the board met in Ames, Richards told reporters a tuition model that predicts future rate increases as a function of state appropriations was carefully considered. “We're projecting out for families for five years,” Richards said. “We're trying to be very moderate, and we're trying to be very honest in this world. And I think we're on the right track.” (Stephen Mally/The Gazette)
    Higher Education
    Mar 3, 2019 at 11:49 am

    Student financial aid from Iowa’s public universities continues to grow — as does aid from the federal government, mostly in the form of loans — while support from the state continues to recede, according to a new report provided to the Board of Regents.

    In the 2017-18 term, the University of Iowa, Iowa State University and the University of Northern Iowa reported providing a combined $277.1 million in aid to undergraduates, mostly in the form of grants and scholarships. That’s up from $264.9 million the previous year and from about $120 million a dozen years ago.

    Federal aid for students enrolled in Iowa’s public universities likewise has increased to $386.3 million, up from $373.7 million the year before and from nearly $248 million a dozen years earlier.

    But at the same time, state-approved financial aid for students at Iowa public universities ebbed from $9 million a dozen years ago to just $1.4 million in 2017-18.

     

    Financial aid has become a priority for Iowa’s public universities as they look for ways to battle student debt while increasing tuition rates in light of declining state appropriations.

    Total financial aid awarded to students enrolled at Iowa’s public universities in the 2017-18 term — including undergraduate and graduate aid in the form of scholarships, loans, grants and employment — totaled $1.1 billion, up about 1 percent from last year’s $1.09 million.

    That increase would have been bigger if not for a $29.2 million drop in university aid from graduate student employment — creating an overall $13.7 million dip in regent university aid from the 2016-17 term to 2017-18. Half of the graduate employment dip was the result of accounting rules changes and the rest “was due to normal fluctuations in graduate assistantships,” according to the Board of Regents report.

    Although all three of Iowa’s public universities have seen significant increases in undergraduate aid since 2006-07, Iowa State University — which has seen the biggest student enrollment gains in that time — similarly reported the biggest aid increases.

    ISU in 2017-18 provided the most undergraduate aid at $134 million, up nearly threefold over its $51 million in 2006-07. The University of Iowa last year provided $119 million in undergraduate aid, more than double its $54 million of 2006-07. And UNI reported $24 million in the most recent year, 1.5 times the $16 million from 2006-07.

     

    When comparing the 10-year percentage change in university aid for undergraduates with the rest of the country, Iowa’s regent institutions are 20 points higher — reporting a 98 percent increase over the decade, compared with 78 percent nationally.

    Iowa also tops national averages for increases in federal aid — which is predominantly loans that need to be repaid — reporting a 21 percent jump over the decade, compared with 10 percent nationally.

    The only category in which the regents enterprise shows a stark decrease — especially when compared with a nearly 16 percent increase nationally — is the change in state grant aid. The board reported an 84 percent drop in state financial aid over the decade.

    Today, tuition — not state appropriations — support a majority of the public universities’ general education budgets.

    Tuition increases, which regents recently announced will continue for at least five years, have been driving demand for student aid.

    In making their annual ask for state appropriations for the upcoming budget year, Iowa’s public universities promised to put the combined $18 million they’re requesting entirely toward financial aid.

    Some students — concerned with mounting debt exacerbated by the rising loan figures included in the regents’ annual financial aid numbers — last week asked the board meeting in Ames to scrap the five-year tuition model that would guarantee increases of at least 3 percent annually.

    The model creates what regents have called “guardrails” for increases at the UI and ISU of at least 3 percent or of 5 percent or more annually. Tuition increases are at the low end if lawmakers approve the regents’ appropriation requests — but go up from there otherwise.

     

    Naomi Runder, a sociology student at Grinnell College, joined a handful of peers during the regents meeting in pleading with the board to fight harder for state support and against shifting more higher education costs to students.

    “I’ve seen firsthand how destructive student debt can be,” Runder said, sharing about its impact on her childhood.

    “The only way for my mother to finish her education while raising two young kids was to take out massive amounts of student loans — student loans that she will never be able to pay off in her lifetime,” Runder said. “These loans are taking away money that could be going toward our bills. Taking away money that could be going toward food on our table.”

    Runder herself is attending Grinnell on a full-ride scholarship.

    “And even with that, the outside costs of food, materials for class and travel can threaten to financially overwhelm me,” she said. “This is why the multiyear tuition model upsets me. It’s placing an unimaginable amount of sacrifice on the shoulders of Iowa students by guaranteeing tuition raises of over 15 percent over the next five years.”

    Runder is part of Iowa Student Action, the state affiliate of Student Action and People’s Action — groups organized around the mission of fighting for economic, racial and gender justice on college campuses.

    During the regents meeting, Iowa Student Action speakers warned increasing tuition rates will drive away both in-state and out-of-state students, threatening not only the economic stability of the institutions but of the state.

    Board President Mike Richards told reporters after the meeting the model was crafted considering university needs, state support and tuition rates at peer universities.

    “We’re projecting out for families for five years,” Richards said. “We’re trying to be very moderate, and we’re trying to be very honest in this world. And I think we’re on the right track.”

    Addressing student worries about the burden of debt, Richards said that is one of the parameters the board continues watching closely.

    “Students who have debt, gradually their debt load has been decreasing,” he said. “The period of time to graduation is getting shorter. So we are really following it. We’re really paying attention to it, and we’re very sensitive to it.”

    During the financial aid presentation, officials reported student debt for graduates at four-year institutions in Iowa is among the lowest at the regent universities.

    UNI reported the lowest average debt for those graduates who have debt among the three public schools — $23,887, compared with $27,643 at ISU and $$28,405 at the UI.

    Just four private Iowa colleges had lower averages, including Iowa Wesleyan, the University of Dubuque, Grinnell College and Waldorf University.

    • Comments: (319) 339-3158; vanessa.miller@thegazette.com

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