The complex economic stimulus bill President Obama signed Tuesday Feb. 17 includes one nugget that will directly impact a majority of Pepperdine students: a lower college price tag.
Of the $787 billion in new spending and tax cuts approximately $30 billion funds financial aid and other measures to lower the cost of attending college in the 2009-2010 and 2010-2011 school years according to Janet Lockhart director of financial assistance. This means the total cost of attendance may be lower beginning in the fall 2009 semester for the 75 percent of Pepperdine students who receive some form of financial aid.
“Overall the Stimulus Package is a win win situation for schools and families wrote Lockhart in an e-mail to the Graphic. Need-based students would not be able to attend Pepperdine without Financial Assistance.”
However tuition is projected to increase by 3 percent for the 2009-2010 school year so depending on their financial aid package some students may pay more than they did this year.But the jump should be more manageable. Usually Pepperdine tuition rises by about 6 percent each year but in January administrators said they decided to limit the increase in light of the current economic climate.
Congress split its new education spending between several programs according to the Chronicle of Higher Education.
The plan will increase the maximum Pell Grant from $4731 to $5500 by 2010. The Pell Grant a need-based loan for lower income students was used by 17.6 percent of Pepperdine students in the 2001-2002 school year according to the Center for the Study of Higher Education. Despite its reputation as a school for the wealthy Pepperdine is one of the largest recipients of Pell Grants nationwide Benton said to the Graphic in a November 2008 article.
Other students will benefit from a larger tax credit for tuition which currently stands at $1800. The credit will increase to $2500 and for the first time will cover the cost of textbooks.
The federal work-study program also grew by $200 million which senior Alan Reynolds said he particularly supports.
“It’s good that it’s not just free money – it’s available but you have to earn it and get involved with your school said Reynolds, who earns work-study funds by working at Payson Library and the HAWC.
However, the final version of the stimulus package, negotiated by both the House of Representatives and the Senate, removed some potentially beneficial education programs that appeared in earlier versions of the bill. For instance, the Senate voted to boost funding for the low-interest Perkins Loan, which students begin repaying nine months after graduation. Likewise, the House favored a $2,000 increase in borrowing limits for the Stafford Loan, which student groups opposed because they say it will saddle low-income students with more debt than they can afford to repay, according to the Chronicle of Higher Education.
Both proposals were rejected in the version that became law, which trimmed billions of dollars in spending and tax cuts from the bills passed by the House or the Senate.
Lockhart said the loss of these measures will make it harder for some students to afford college.
The impact of not including Perkins funding and an increase in Stafford loans in this package will limit the amount of federal loans a student can borrow which may affect the students ability to meet the total cost of attendance she wrote.
She also noted that the size of the Pell Grant has risen more slowly than tuition costs.
But Lockhart praised the educational assistance in the package, which some criticized for spending too much on programs they say will not immediately improve the economy.
Others said the bill was too rushed.
I don’t really know that much about it considering they didn’t have it available to read for 48 hours said junior Alexander Waters, a financial aid recipient. But it sounds good – tax credits are always nice.”