Get Herald RSSWith America's richest universities waging a financial aid war, some are concerned that colleges and universities with smaller endowments may not be able to remain competitive.
Less-wealthy institutions "are scrambling for additional sources of funding ... but are not going to have blanket programs. They are going to have to target much more narrowly at students they really want," said Donald Heller, director of the Center for the Study of Higher Education at Pennsylvania State University. This could decrease the resources available to aid lower-income families, he said.
The pressure among elite universities to remain competitive with each other, along with the pressure Congress is placing on wealthy universities to spend a greater portion of endowment earnings, has caused many schools to review their policies and make changes, Heller said.
Critics worry that wealthy institutions' expansion of financial aid to middle- and upper middle-class families may make it harder to maintain socioeconomic diversity, Heller said. When universities with large endowments offer more financial aid and the number of applicants from middle-income families increases, it could mean that fewer low-income students will be accepted because of the "strong correlation between socioeconomic status and academic achievement," he said.
At the same time, institutions with smaller endowments will be unable to appeal to students from middle-income families because they cannot offer competitive aid packages, he said.
Dean of Admission James Miller '73 said colleges have always been spread across the economic spectrum and competition for students exists in many arenas other than financial aid. "I don't think that huge numbers of schools will divert aid from low-income students," Miller said. "I don't see institutions' priorities changing."
Over the last 10 years, there has been a national shift from need-based aid toward merit-based aid, Miller said, but it's unclear whether some schools' policies will exacerbate this trend.
According to Haley Chitty, a spokesman for the National Association of Student Financial Aid Administrators, the new policies could eventually mean an increase in government funding for higher education. "It shows that institutions are having to make up for the lack of federal and state aid," he said.
This is especially true for less-wealthy schools, which may have trouble competing in the aftermath of heavy increases in financial aid spending among the wealthiest schools. Following Harvard's lead, Brown and a number of other universities announced financial aid initiatives that make higher education less expensive for students from low- and middle-income families and reduce student debt. Most schools eliminated or reduced loans and did away with parental contribution if a family's income falls below a certain level - usually $60,000.
Some of the wealthiest schools, such as Harvard and Yale, went a step further by offering additional tuition breaks to students of families making as much as $200,000.
Trying to compare the details of each program "can be like comparing apples to Volkswagens," Miller said. "Each institution has put together a financial aid initiative that is appropriate for it. ... Harvard, Yale and Princeton's initiatives are a function of their resources."
Miller said though other schools' initiatives were an "accelerant," Brown has made a series of financial aid policy changes over the last six or seven years that led to the most recent initiatives. The new program is "bigger than a lot but smaller than some," he added.
Since the initiatives were announced after applications for the class of 2012 were submitted, it is impossible to predict how admissions and enrollment will be affected, Miller said. Hopefully, more talented students from middle- and low-income families will enter the applicant pool, he said.
Brown's new policy "seems in line with what other institutions are doing," Chitty said.
