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Report Shows Long-Term Effects of State Cuts to Higher Ed

Feb 11, 2009

by Scholarships.com Staff

The loss in funding faced by state and community colleges this year may not be a one-time thing.  A report issued this week by the State Higher Education Executive Officers (SHEEO) indicates that state budget cuts to higher education made during recessions tend to become permanent.  With many attempting to eliminate multi-billion dollar budget shortfalls, cuts to education are almost certain to happen across the country, and based on data collected by SHEEO, they are likely to continue into the future.

Per-student state higher education spending peaked in 2001, when it hit the highest level in inflation-adjusted dollars since data was first collected in 1983.  A recession in 2001 prompted drops in education spending that continued until 2006, when spending began to grow again until 2008, though per-student funding did not return to 2001 levels before another recession interfered.

In response to cuts in funding of around 7 percent between 1998 and 2008 and increases in enrollment of around 25 percent over the same period, tuition revenue has risen 20 percent.  The report suggests this trend is likely to continue, with funding potentially falling off permanently and tuition hikes continuing as a result of this year's budget cuts.  Thus, the burden is passed on to already cash-strapped students and families, who are already facing the prospect of needing more student loans due to losses of income and declines in college savings plans.

The SHEEO expressed hope that the stimulus package currently moving through Congress might mitigate this effect.  However, the version passed yesterday by the Senate eliminated billions of dollars that would have gone to offset state budget cuts, so the positive impact on higher education could be less than is hoped.  Additionally, members of Congress have expressed frustration with rising tuition rates, especially given tuition's likelihood to continue to outpace increases in Federal Pell Grants, such as the new funding currently included in the stimulus.

Going to college doesn't have to break the bank or saddle you with tens of thousands of dollars in student loan debt. Check out the Scholarships.com free college scholarship search where you’ll discover you qualify for hundreds of thousands of dollars in scholarships in just a few minutes, then apply and win! It’s that easy!

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Study Shows Extent of Endowment Losses

Jan 29, 2009

by Scholarships.com Staff

College and university endowments plunged an average of 23 percent between July 1 and November 30 in 2008, with many sustaining further losses since then.  While almost everyone who's been reading higher education news or attending college knows that endowments have dropped, the depth and the breadth of the damage has largely been left to the realm of speculation.

Endowment losses had become a hot topic at some schools, including the one my youngest sister attends, even before the release of this study.  Undergraduate students previously unaware that colleges even have investments are worrying about the (admittedly slim) chance of their schools' investment funds disappearing, taking their scholarships, their degree programs, or their favorite instructors with them.  While such drastic cuts have not been made, schools are facing very real struggles to preserve their staff, their services, and their endowments in the face of a still-deepening recession.

The extent of losses varies, as does the extent of reactions to losses.  Several universities have instituted hiring freezes, while others have resorted to layoffs or mandatory unpaid furloughs.  Brandeis University and the University of Pennsylvania have both made unpopular moves to cut budgets. Penn has done so by cutting 18 campus museum staff positions, and Brandeis has announced plans to close the institution's art museum entirely and sell its collection. Some state universities battling shrinking endowments and drastic cuts to state funds have been forced to look at double-digit tuition increases.

Still other schools are making almost opposite responses.  Some institutions are looking into freezing tuition or increasing it by small amounts, such as Princeton University, which has announced a tuition increase of only 2.9 percent for 2009-2010.  Others are hiring new faculty as planned or launching additional searches, hoping to attract stronger talent.  Many schools are also increasing student financial aid to help families hit hard by the recession.  Even schools making budget cuts are reluctant to touch financial aid, recognizing its importance.  However, fears remain that students who need money for college may be unable to find it from their schools.  Whether these fears are justified remains to be seen, though many hope that the proposed economic stimulus package will allow schools to continue to fully fund or even expand essential programs.

And remember, there’s no need to rely on expensive student loan options to pay for your college education. For more information on finding free scholarship money for college, conduct a Scholarships.com free college scholarship search today, then apply and win! It’s that easy!

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Paying Tuition on Time Getting Tougher in Recession

Jan 13, 2009

by Scholarships.com Staff

While the focus for many students right now is planning for and paying for the next year of college, some students are still struggling with bills from the current or previous semester.  An e-mail survey by the American Association of Collegiate Registrars and Admissions Officers reports a perceived increase in unpaid tuition bills in the 2008-2009 academic year.  While being caught short on one semester's tuition can seem stressful enough, it can carry serious consequences for college students.

For students with the funds to easily cover tuition, either through family income, college savings plans, or financial aid awards, the figure on their bursar bill may be unpleasant, but it is soon forgotten.  However, carrying a bursar balance--in some cases, even a small one--can cut off your ability to register for classes, request transcripts, and even graduate, among other consequences.  Students who are unable to pay for a semester by the school's deadline may even find themselves dropped from their classes and kicked off campus.  These consequences can essentially derail your education, and many students who take a semester off from college to save money and pay off bills never go back to finish.

Luckily, as Kim Clark stresses in an article on the subject in U.S. News and World Report, universities are willing to work with students to keep them enrolled and get their bills paid, especially in the current economic climate.  Many schools are establishing or adding to emergency loan and grant funds to help students stay in school.  Federal student financial aid is also still available mid-term.  You can still complete the FAFSA for 2008-2009 anytime before June 30.  Even if you've already applied for the current year, talking to the financial aid office could still come through big time, especially if your circumstances have changed. Federal grants, as well as some campus-based programs may be available to students whose family contributions have significantly dipped.  While Clark's article emphasizes the surprising success networking and asking family for donations can bring, conducting a scholarship search may be a safer bet. Most importantly, be sure to stay in communication with your school. You may have to deal with three different offices on campus, but don't get discouraged.  The process may be more streamlined than you'd expect.  It is possible to stay enrolled regardless of the financial troubles you're facing.

And don't forget, you should pay for your college education with as much free money as possible! Find as many scholarships and grants as you can before turning to student loans. Visit the Scholarships.com free college scholarship search today where you'll get matched with countless scholarships and grants for which you qualify, then apply and win! It’s that easy!

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State Higher Ed Spending Growth Slows Significantly

Jan 9, 2009

by Scholarships.com Staff

The Illinois State University Center for the Study of Education Policy released its annual report on state tax support for higher education today.  According to the Grapevine report, the best case scenario is that for fiscal year 2008-2009 (July 1, 2008-June 30, 2009), state higher education spending grew by an average of 0.9 percent across the country.  The report acknowledges this figure is likely rather optimistic, as many states are still in the process of trimming budgets for the current fiscal year, and some are requesting that colleges not spend appropriations they've already received.

While almost flat growth in state spending nationwide is bad enough, the picture looks even worse compared to last year's growth of 7.5 percent, the largest year-to-year increase in higher education spending since 1985.  Some states have cut education spending significantly, such as South Carolina and Alabama, whose state education budgets have seen decreases of 17.7 percent and 10.5 percent respectively.  Some states still are showing substantial increases in higher ed spending for the current year.  The two biggest increases, in Wyoming and Hawaii, are 10.9 and 10.6 percent.

Coupled with shrinking endowments and more student requests for financial aid, this news isn't good for state colleges and universities.  Tuition increases, including some substantial ones, are becoming increasingly likely for 2009-2010, despite families' increasing inability to pay for school out of pocket or access lines of credit such as private student loans.  This is yet another reason to fill out a FAFSA and do a scholarship search today.

And don't forget, you should pay for your college education with as much free money as possible! Find as many scholarships and grants as you can before turning to student loans. Visit the Scholarships.com free college scholarship search today where you'll get matched with countless scholarships and grants for which you qualify, then apply and win! It’s that easy!

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