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Need grants falter; tuition hike likely

Students may face fewer financial-aid opportunities in the coming year due to ballot Measure 19. The measure, which passed in the September election, was intended as a way to fund K-12 schools by diverting funds from the state’s $278 million education endowment fund into an emergency fund.

That education endowment fund helped to fund the Oregon Opportunity Grant, a need-based program initiated in 1995 in order to help lower-income students afford college expenses.

As the principle has been diverted to K-12 funding, there will be less interest to fund the Opportunity Grant. An Oregon Student Assistance Commission committee is discussing what actions to take in response to the loss of funding. They’ll decide Oct. 24.

“In the past when we’ve faced this kind of shortage, the committee has elected to reduce individual grants instead of reducing the number of students eligible,” said Kathleen Hynes, grant and scholarship director for the commission. “The commission will be analyzing the disbursements to schools for fall term right now.”

If the committee decides to reduce the number of students eligible, it could mean 95 students statewide wouldn’t be able to apply for grants.

In addition to Measure 19, in this special session the legislature reduced opportunity grants by $1.6 million.

“In the next biennium, it’ll be a $3.5 million reduction as a result of Ballot Measure 19 and reduced interest earnings,” Hynes said.

The Grant has never had enough funding to provide aid to all low-income students who meet its eligibility requirements. In 2001-2002, the grant was awarded to 71 percent of eligible students. Since then, 12,840 low-income students have missed qualifying. Since 1996, the percentage of students receiving the grant has declined.

“I think that the message is that we are not able to serve all who are eligible and the gap is widening,” Hynes said.

The timing for this reduction in grant money couldn’t be worse. Without an income-tax surcharge passing this January, students will most likely see a $120 increase in tuition.

The National Center for Public Policy and Higher Education recently released a report grading college systems in the United States. The group assigned letter grades “A” through “F” in five different categories. Oregon’s grade for affordability was an “F.”

According to a recent study by the student assistance commission, the Oregon Opportunity Grant enhances college enrollment and graduation rates.

The Oregon Opportunity Grant was awarded to eligible dependent students from families with an average household size of four and an average annual income of $19,067 during the study period of 1995-2000. Eligible independent students had an average household size of 2.4 and an average annual income of $5,967.

In order to limit the number of students who are awarded the grant, the commission has cut-off dates.

“It’s a first-come, first-serve basis,” Hynes said. “We have set our cutoff dates in a manner to anticipate some reduction in funds, otherwise these reductions would have been greater.”

At the end of the last legislative session, the legislature appropriated an additional $5 million in general-fund dollars. But that isn’t enough to put the grant ahead.

“We’re quickly losing that ground in loss of earnings,” Hynes said. “The combination of loss of earnings, Measure 19 and the reduction of general funds have significantly impacted the program, despite efforts to bolster it.”