Friday, August 28, 2009

AICUO President Discusses HB 1 on "The State of Ohio"

AICUO President C. Todd Jones appeared on last weekend’s broadcast of "The State of Ohio," discussing the recently passed state budget on a panel with the presidents of the Inter-University Council, Bruce Johnson, and the Ohio Association of Career Colleges and Schools, David Rankin.

(The budget discussion segment starts at 08:45 of the broadcast.)

Monday, August 10, 2009

Ohio’s Latest Budget Cuts Student Aid, Provides Flat Grants for Remaining Eligible Students

Ohio’s biennial budget was signed by Gov. Strickland last month, and the details represent the biggest change in state-provided aid in four decades. The elimination of the Student Choice Grant, which had encouraged students to obtain their education in Ohio since the early 1970’s, and the radical redesign of the need-based Ohio College Opportunity Grant (OCOG) meant that aid for Ohio students is vastly different this fall than it was just twelve months ago.

OCOG is the state-funded need-based program for Ohio college students. Students become eligible for aid after filling out the federal government’s student aid application, the FAFSA form. In the past, OCOG students received a graduated amount according to their EFC (Expected Family Contribution). The size of the grant reflected how well a student could afford college—the less able to pay for college, the more state aid that was available.

This year’s budget made several key changes to this structure. First, the concept of “Pell First” was introduced, meaning that OCOG-eligible students would only receive OCOG funds after determining whether Pell grants meet their needs. In other words, if federal aid pays for college tuition and expenses, as it does for most students at community colleges, there would be no additional OCOG aid.

Second, OCOG grants are no longer graduated. Where previously, maximum amounts for annual grants were $4,992 for independent college students with a $0 EFC (and half that amount for students at publicly subsidized colleges) depending upon a family’s EFC, OCOG grants now accrue only as flat amounts. All eligible independent college students receive $2,256 per year, while public college students receive $1,008.

For almost all Ohio independent institutions, Pell First had no impact because tuition and other costs exceed a maximum Pell grant plus a “flat” OCOG grant. The law permitted the Ohio Board of Regents (OBR) to change this formula, but it is unlikely to do so. OBR believes that other alternatives would be less equitable in absence of enough money to pay for a student’s full need.

Interestingly, the flat grant will increase next year, even though funding remains the same because of two factors. First, the budget bill required OBR to backfill the shortfall in last year’s OCOG funding for both public and independent college students. Second, the bill permitted the chancellor to reduce OCOG funds for continuation of Ohio Academic Scholarships for those who had already received them (as there are no new grants in this program, which has been defunded). The chancellor chose to do so.

The cuts reduced the $41 million in OCOG funding for private college students by $8.5 million. If that money were not removed (as it will not be in 2010-11), the estimated grant would increase to almost $3,000 from $2,256 (assuming no increase in the number of eligible students).

SCG previously provided up to $1,080 per year for independent college students. Gov. Strickland pledged in his first State of the State address to eliminate “wastefulness and giveaways” and sought to reduce SCG funding by over two-thirds, making changes that would have effectively killed the program. A final legislative compromise in 2007 cut the grant to $660 per student. While AICUO backed a Strickland proposal to replace SCG with a block-grant aid program, neither that program nor SCG survived the budget process this year.

As a result, the poorest of independent college students saw their annual assistance to attend college drop from $5,658 to $2,256 this year. Just two years before, those same students with the greatest financial need would have received $5,988 to encourage them to choose an Ohio independent college.

--C. Todd Jones and Dustin Holfinger