Bush’s proposed 2008 budget could affect financial aid

In the proposed $2.9 trillion budget for the 2008 fiscal year, President Bush’s spending plans could affect financial aid and research funding for many IU students and faculty.\nPerhaps the biggest change in spending for higher education will affect those students who depend on financial aid. The proposal calls for a 1.4 percent increase for Pell Grants but a decrease in spending for Perkins Loans, compared with the 2006 fiscal year budget. \n“You’ve really only got one (loan) program in Bush’s proposal that’s even going to be continued, and it’s going to be continued in a relatively small amount in comparison to what college cost is,” said Susan Pugh, director of the Office of Student Financial Assistance and associate vice provost for the Office of Enrollment Management. \nThe Pell Grant would grow to a maximum $4,600 next year, which Pugh said is a relatively small percentage of the cost of attendance.\nOriginally, the grant was designed to cover about half of the cost of attendance, Pugh said. However, due to the rising cost of tuition, that has not been achieved.\nPell Grants are awarded to students based on expected family contribution, the institution’s attendance cost, the student’s enrollment status and whether the student attends for a full academic year or less, according to the U.S. Department of Education Web site. Unlike loan programs, Pell Grants aren’t paid back. \nFor 2002-2006, IU filed $12, 028,001 in Federal Pell Grants, according to IU’s official federal report. \nWhile students who require Pell Grants will benefit from the new budget, this may come at the expense of the Perkins Loan program and the Supplemental Educational Opportunity Grant program, Pugh said. \nIU received $10,527,883 in Federal Perkins Loans and $1,264,557 in Federal Supplemental Educational Opportunity Grants, according to the official report filed for 2002-2006. Bush’s plan may reduce these numbers. \n“Federal Perkins Loans are slighted to be eliminated,” said Pugh. “That’s a huge issue.” \nWith a reported half-million students each year dependent on Perkins Loans, the Coalition of Higher Education Assistance Organizations worries that if the program is eliminated, many of these students will be forced to borrow from credit cards or other alternatives. \n“Indiana University doesn’t want Perkins Loans eliminated. We don’t want SEOG eliminated because there are students that need that money,” Pugh said. \nWhile the elimination of these loan programs may seem disconcerting to students, Pugh said it is unlikely that Congress will actually pass that aspect of the budget. \n“They will continue,” Pugh said, “They will just continue at the same level. We won’t get any increase.”\nAs for the other possible budget shifts in higher education, IU researchers could see an increase in National Science Foundation funds, but they might have to compete harder if the proposed $511,000,000 decrease in funds from the National Institutes of Health goes into effect. \n“The decreases to NIH (funds) aren’t going to be very good for Indiana University because most of our federal grants come through NIH,” said Doug Wasitis, director of Federal Relations for IU. Wasitis said $29 million of NIH funds for biomedical research were directed toward the Bloomington campus. \n“Our ability to attract dollars is going to depend on how much money is provided to those agencies,” Wasitis said. “So, it’s good that NSF was increased, but it’s not so good for our researchers that NIH was decreased.”