"If more money isn't allocated to the program, the awards will have to be rationed, meaning that many students will receive less aid next academic year than last. Grants will be slashed by about 38 percent over all, according to the Minnesota Private College Council, although students with more need will see smaller cuts; 18,000 students will lose their grants completely."
"It's going to be very challenging for students to stay in college if they lose thousands of dollars in their need-based financial aid. Colleges, public or private, generally do not have the resources to make up these kinds of losses in financial aid,"
"There would be real threats to enrollment, which would be very hard on institutions and would be a disaster" for workforce needs in the state."
"Minnesota isn't the only state that has faced aid shortfalls in recent history; a miscalculation in South Carolina this year led to a $25 million deficit, while in Indiana, the simplified Free Application for Federal Student Aid formula made too many students eligible for aid last year. Research has shown that even a small dip in a student's financial aid can increase the likelihood that they stop out of college."
College enrollment in Minnesota has risen after a decade of declines, but state financial aid has not met demand for two years. A budget bill is expected to underfund grants by $131 million, with the program slated to serve 88,000 students. Without additional funding, awards will be rationed, reducing grants by about 38 percent overall and eliminating grants for 18,000 students. Students with greater need would face smaller cuts, but many would still lose thousands of dollars in aid. Colleges generally cannot replace lost state aid, creating threats to student persistence and enrollment. Similar shortfalls in other states have produced deficits and eligibility errors, and research indicates even small reductions in aid can increase the likelihood that students stop out.
#higher-education-enrollment #state-financial-aid #budget-underfunding #need-based-grants #student-persistence
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