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How Elite Are These Kids? We'll Soon Find Out

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How Elite Are These Kids? We’ll Soon Find Out

Sources of Federal Aid for Students

Program                                                              Amount available at U-M         Change from last fall

National Direct Student Loans ............                $1,104,104                                  $297,310 less
College Work-Study Program...........                   582,203                                       $135,211 less
Supplemental Educational Opportunity Grants   $354,963                                      $132,680 less 


Basic Educational Opportunity Grants (Available only for newly enrolled freshmen)

Too few applications processed yet to determine how much of $122.1 million Congress provided will be received by U-M students. U.S. Office of Education estimates BEOG grants will average only $80 in 1973-74. Program did not exist last year.

National Defense Foreign Language Study Grants U-M’s Asian study centers had $350,000 for graduate fellowships last year. Applications for this fall are not being processed by U.S. Office of Management and Budget.

By Roy Reynolds
(Higher Education Reporter)

“This is sometimes called an elitist kind of program. How ‘elite’ these kids are we will soon find out, when we see whether they’re able to keep coming to school.”

That comment was made by Prof. Richard K. Beardsley, director of the University’s Center for Japanese Studies, as he was discussing this year’s drastic shrinkage in federal financial aid for students at five of the U-M’s specialized “area” centers. '

The situation he describes concerns the Centers for Japanese, Chinese, South and Southeast Asian, Near East and North African, Russian and East European Studies. ,

But it reflects a situation, brought on by cutbacks in federal aid, coupled with U-M tuition increases averaging 24 per cent, that affects all U-M students to varying degrees.

The U-M Office of Financial Aid now calculates the minimum two-term budget for freshmen and sophomores who are Michigan residents as $2,960. For resident juniors and seniors, the estimate is $3,060.

Thomas A. Butts, director of the U-M Financial Aid Office, comments, “When you start talking about $3,000 for two terms, middle-income families do demonstrate need. And they do get aid.”

This fall students needing financial help are clearly going to have to be more ingenious than ever in putting together enough money from various sources to cover their needs.

Beardsley recalled that the U-M’s Asian study centers were able to provide fellowships averaging $4,100 for 84 graduate students in 1972-73. Those were drawn from an approximately $350,000 share of $15 million Congress and the President approved for foreign language study grants at universities.

For the academic year now about to begin, the equivalent appropriation was reduced to $13.6 million — but the appropriation is not being dispersed by the U.S. Office of Management and Budget, he adds.

“We have been authorized by the U.S. Office of Education to write to applicants saying we are selecting them for fellowships contingent on the money being released. We are hoping some private national agency will bring a court suit,” Beardsley comments.

A grant of $1 million from the Japanese government for the U-M’s Center for Japanese Studies was announced in Tokyo a few days ago, and described by Beardsley as “assuring the permanence of the program.” That money, however, is not expected to start becoming available until fall 1974. Clarification is still being awaited as to whether it will be available for any use the U-M center selects or restricted to specific purposes such as library purchases or administrative costs.

This fall, Beardsley adds, the Asian study centers will be “sopping up the bottom” of what is expected to be the last in a series of Ford Foundation grants that have been major factors in paying the centers’ operating costs.

What about graduate fellowships for this fall’s students? “The Rackham Graduate School has managed to scrape up $80,000 to replace the national defense foreign language grants on an emergency basis,” Beardsley reports.

No “elite” knowledge is needed to recognize that $80,000 will not precisely replace $350,000. But it is superior to having nothing to offer serious students in these specialized fields.

At the campus-wide — and national — levels, there is also a sharp fall-off in aid available to students through longstanding federal programs.

Butts lists dollar figures:

—For the National Direct Student Loan Program (NDSL, designated national defense student loans, and requiring borrowers to take a loyalty oath, until last year), the U-M has $1,104,104 to allocate in loans carrying 3 per cent interest, repayable after graduation.

That is $297,310 less than last year, and is described by the U.S. Office of Education as about half what is needed by U-M students from this source. Nationally, NDSL loans for two semesters are expected to average $690 this fall according to that office. Butts expects the average to be “somewhat higher” at the U-M but well below the legal limit of $2,500, because of the cut in total funding.

—For the College Work Study Program, the U-M has $582,203 for providing students with campus jobs.

That is $135,211 less than a year ago and is described by the U.S. Office of Education as 46.6 per cent of what could be legitimately allocated to U-M students. Butts expected about 625 U-M students to receive help from this program this fall, about the same as a year ago, but foresees problems meeting demand for full-time summer jobs in 1974.

—For the Supplemental Educational Opportunity Grants program — designated by the U.S. Office of Education as intended for “needy students” who, although they may be receiving financial aid from other sources, “would be unable to continue their education” without further help — the U-M has been allocated $354,963. That is $132,680 less than last year, and is described by the Office of Education as 42.6 per cent of what is needed at the U-M.

Although funding for these longstanding federal programs is higher than President Nixon favored this year, their reduced levels “will cause students to lean a lot more on guaranteed loans,” Butts comments.

Those are loans by banks and other private financial institutions, granted on the basis of need and carrying federal subsidies on interest up to 7 per cent, repayable after graduation. Lending institutions generally limit such loans to families who are established customers before seeking a federally guaranteed loan.

In addition to these established sources of federal student aid, there is now a federal program of Basic Educational Opportunity Grants (BEOG).

In sponsoring this program of direct loans to students, Nixon made clear that he intended BEOG’s first year as the beginning of the end for the older approach of providing colleges and universities with federal funds to loan or grant to students. Congress continued the older programs at reduced levels and set funding for the new BEOG program at $122 million, available only to freshmen enrolling for the first time.

This, Butts explains, basically means the new “basic” grants have an upper limit of $452 for two semesters and a minimum of $50, rather than the maximum of $1,400 and minimum of $200 proposed by the President. The actual amount is intended to reflect the difference between actual costs of a students's two-semester costs and the amount his family can reasonably be expected to pay.

Calculations of eligibility are being made by the U.S. Office of Education and financial aid offices at colleges, based on BEOG Application forms available from those offices, and from Post Offices. Family income data provided on the forms is checked by the Office of Education against Internal Revenue Service records.

About a dozen BEOG application forms have been arriving daily at the U-M’s Financial Aid Office, Butts reports.

Because the BEOG program is designated for freshmen this year, Butts expects needy students in higher class levels to get most aid available from the older federal sources. No promises of aid have been made yet to U-M students above the freshman level because the federal aid appropriations, and the U-M’s 1973-74 tuition rates, were not known until recently.

“Every returning upperclass undergraduate who has applied for financial aid will have his need assessed with the new fee schedule considered,” President Robben W. Fleming has promised in a letter to all students admitted for this fall.

His most encouraging words in that letter were addressed to incoming freshmen who are residents of Michigan. He said “Every entering resident freshman who has received an award of financial assistance from the University did so based upon an anticipated two term tuition rate of $740, and each award will be adjusted to take account of the new increase (to $800).”

That promise, Butts points out, reflects the U-M regents’ decision this summer to allocate $1 million from U-M earnings on short-term bank notes to an emergency student aid fund.

Michigan’s Higher Education Assistance Authority, he adds, has agreed to raise awards of the 2,500 winners of state scholarships expected on the U-M campus this fall to the new $800 level for freshmen and sophomores and also to the new $904 level for juniors and seniors.

Aid that covers only tuition does not, of course, come close to covering all costs of attending the U-M or any other university.

The U-M’s Financial Aid staff calculates the minimum two-term budget as $2,960 for freshmen and sophomores who are Michigan residents, $3,060 for resident junior and seniors.

Among other rising costs, U-M dormitory fees will be up 5.1 per cent this fall. A double room — the most common type — now carries a two-term lease of $1, 298.44, including two meals daily but not including linen service or breakfast, which are optional as added expenses.

Butts and other U-M officials have been saying emphatically in recent weeks that no academically qualified student should feel compelled to turn away from the U-M because of the costs.

No one will know with certainty until the official enrollment count is completed after the third week of classes, late in September, how many students and parents successfully found means of meeting that goal.