Increasing Postsecondary Access through State Financial Aid Programs

A 2010 report by the Advisory Committee on Student Financial Assistance shows the initial enrollment rates at four-year institutions among academically qualified low- and moderate-income students dropped from 54 percent to 40 percent between 1992 and 2004. In 2009-10, states awarded more than 4 million grants, representing nearly $9 billion in aid. Of this amount, 73 percent was need-based and 27 percent was merit-based.

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Cost is a primary barrier to postsecondary education access and degree or certificate completion, particularly for low- and middle-income families and historically underserved populations.
  • A 2010 report by the Advisory Committee on Student Financial Assistance shows the initial enrollment rates at four-year institutions among academically qualified low- and moderate-income students dropped from 54 percent to 40 percent between 1992 and 2004.1
  • Public four-year colleges charged, on average, $7,605 per year in tuition and fees for in-state students for the 2010-11 school year. That was a 7.9 percent increase over 2009-10.
  • Published tuition and fees increased 24 percent at public four-year public universities from 2005-06 to 2010-11. The average net price for full-time students, after considering grant aid and federal tax benefits, declined over this five-year period, after adjusting for inflation.2
  • Nationally, more than one-quarter of a typical family’s income was needed to pay for tuition and fees at public four-year colleges in 2008. That percentage ranged from 12.6 percent in Tennessee to 39 percent in Ohio and Vermont.3
  • A report by the National Center for Public Policy and Higher Education concludes states are making little or no progress in providing affordable college opportunities or improving college completion rates for their residents.3
In the 2009-10 academic year, states awarded $10.8 billion in state-funded financial aid, a 3.8 percent increase from 2008-09.
  • Grants account for a majority of state aid. In 2009-10, states awarded more than 4 million grants, representing nearly $9 billion in aid.4
  • Of this amount, 73 percent was need-based and 27 percent was merit-based.
  • State grant expenditures account for approximately 12 percent of the total state financial support for higher education.4
All states—plus Washington, D.C., and Puerto Rico—provide financial aid with a need-based component. All states except California and Alabama have programs that are exclusively need-based. Thirty states have programs that award grants based only on merit.4
  • Undergraduate state-based aid by type in 2009-10:

    • Based only on need: 47.4 percent
    • Based only on merit: 18.1 percent
    • Based on need and merit: 16.1 percent
    • Special purpose awards: 12.7 percent
    • Uncategorized: 5.6 percent4
  • Ten states—California, Illinois, Indiana, Minnesota, New Jersey, New York, North Carolina, Pennsylvania, Texas and Washington—collectively account for three-fourths of all state-funded undergraduate need-based financial aid.4
  • States also provided approximately $2 billion in nongrant financial aid, including loans, conditional grants, work-study and tuition waivers in 2009-10.4

References:
1 Advisory Committee on Student Financial Assistance. “The rising price of inequality: How inadequate grant aid limits college access and persistence.” (2010) Accessed at http://ed.gov/about/bdscomm/list/ acsfa/rpijunea.pdf on Aug. 3, 2011.
2 The College Board Advocacy and Policy Center. “Trends in College Pricing.” (2010). Accessed at http://trends.collegeboard.org/downloads/College_Pricing_2010.pdf on Aug 3, 2011.
3 The National Center for Public Policy and Higher Education. “Measuring Up 2008: The National Report Card on Higher Education.” State reports accessible at http://measuringup2008.highereducation.org/states/report_print.php.
4 National Association of State Student Grant and Aid Programs. “41st Annual Survey Report on State-Sponsored Student Financial Aid: 2009-2010 Academic Year.” Accessed at http://www.nassgap.org/viewrepository.aspx?categoryID=3# on Aug. 3, 2011.
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