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Meet the students who would be affected by Dan Patrick's plan to slash tuition grants One square = 10 students «

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How Dan Patrick’s plan to slash tuition grants could keep some Texans from college Thousands of poor and middle-income students could lose support if “set-asides” are eliminated — and others wouldn’t save as much as he claims, data show. RELATED Search: How could your school be affected? A few years ago, Jadzia Hardeman was a high school senior working full time at a McDonald's to help her sick mother afford cancer treatments. The Oak Cliff girl figured the cost of a college education, and a better career, a better life, were beyond her reach. But thanks to a state program that provides substantial grants to needy students, she was able to attend the University of North Texas. Now 20, she is set to graduate next year with a degree in social work. “It was kind of like a dream,” she said. “When I received the grant, it made me feel really good because it made me feel like I had a chance, an opportunity.” Jadzia Hardeman is an Emerald Eagle Scholar, a program that provides guaranteed tuition and fees to students with financial need. (Rose Baca/Staff Photographer) But hundreds of thousands of students could miss out on the opportunity that was afforded to Hardeman and generations of Texans before her, if Lt. Gov. Dan Patrick gets his way. Tuesday, lawmakers discuss the future of two financial aid programs, commonly referred to as “set-asides,” which require that up to 20 percent of all tuition collected by schools be used to subsidize students who demonstrate financial need. Patrick said the set-asides should be gutted and that money used to lower college costs. At a recent news conference he urged lawmakers “to end the 20 percent set-aside next session.” “That would reduce tuition 20 percent like that,” he said, snapping his fingers. But a Dallas Morning News analysis of state data and interviews with experts indicate Patrick’s plan would produce only modest savings for wealthier students — far less than the 20 percent he promised — while stripping away thousands of dollars in aid each year for students who, without the help, could lose access to a college education. After initially declining comment for this report, Patrick's spokesman sent The News the following statement late Friday. “In advocating the elimination of tuition set asides, the Lt. Governor has repeatedly said that if additional tuition dollars are needed for needy students, the Legislature should step up and provide those funds,” said spokesman Keith Elkins. Patrick has never touted any specific proposal to replace the lost grants. But for years, he’s said that the grants, a key tool used by universities to keep tuition affordable for needy students, unfairly strain the middle class. On Friday, Elkins reiterated this idea, stating, “Tuition set-asides, are a hidden tax on all students and should be eliminated.” Cutting set-asides would hurt families across the income spectrum, including many of the families and students Patrick has said he wants to help, according to an analysis of the most recent data kept by the Texas Higher Education Coordinating Board. If lawmakers roll back about $324 million a year in earmarked grants, more than 121,000 students from poor and middle-income families alike would each lose thousands of dollars in aid per year. Hispanic students would be hardest hit, losing nearly 75,000 grants totaling about $150 million a year. Texas’ historically black colleges could see drastic drops in enrollment, The News found, because at some campuses, 1 in 3 students count on this aid to pay the bills. About 31,000 students from extremely poor families, earning less than $10,000 a year, would lose funding. The poorest of the poor would lose the most aid — nearly 50,000 grants totaling about $80 million. Still, cuts would also hurt more than 18,000 students whose parents earn $60,000 a year or more, well above the state’s median household income. Those families would lose about $55 million in aid, data show. Awards by family income bracket SOURCES: Texas Higher Education Coordinating Board; Dallas Morning News research “If you want to ensure that only wealthy students and upper middle-class students can afford to go to Texas public colleges and universities in the future, do away with tuition set-asides,” said Tom Melecki, the former director of financial services at the University of Texas flagship in Austin. Last year, after 40 years working in financial aid and loan programs, Melecki founded College Affordability Solutions, a business that helps families find ways to pay for school. He’s blunt in his assessment of the plan to ax tuition set-asides, which were designed with the express purpose of ensuring lower- and middle-income families could send their kids to college. “There are people attending Texas’ colleges and universities who are financially needy who some people in Texas government feel should not be attending those institutions,” he said. On Tuesday, Sen. Kel Seliger, the Amarillo Republican who leads the Senate’s higher education committee, will lead the first of what’s likely to be several meetings on the topic. He said it’s too early to guess what lawmakers might do. The Legislature could end the set-aside requirement or focus more on financial aid programs like the TEXAS Grant, a more limited grant program funded through state appropriations. “The question is not the value of financial aid. It is absolutely essential,” Seliger said. “It’s a question itself of where the money comes from.”


Barriers for poor, minority students Hardeman is just the kind of student lawmakers intended to help when they created tuition set-asides more than four decades ago. She was smart enough and worked hard enough that she was preparing to graduate from high school early and get a job to help her mother, whose job didn’t provide enough to pay the bills and cover her treatments. She remembers thinking that her mother didn’t go to college and that she, too, would be priced out of higher education — the “cycle,” she called it. She couldn’t pay the fees to take the SAT or ACT entrance exams or application fees for college. But a college counselor told her about the financial aid program and found money to pay for the applications and tests. Hardeman was admitted to 10 schools. She chose UNT, which gave her enough set-aside funding and other scholarships to cover her entire education. She took a full-time job at a drug rehab center to help her mother pay the bills and save for life after college, when she hopes to enter the Peace Corps. “I didn’t know there was people out here actually trying to help people like me to get to college,” Hardeman said. “I thought you had to be more well-off to qualify for things like that.” That’s exactly what lawmakers wanted to prevent in 1975, when they approved the Texas Public Educational Grant. What are set-asides? The Texas Legislature has created two grant programs, commonly known as tuition "set asides," which provide financial aid to needy students by tapping into tuition revenue. The Texas Public Educational Grant is funded by "setting aside" between 15 and 20 percent of the "statutory" tuition paid by all students attending Texas colleges and universities, including Texas State Technical College. Statutory tuition is any amount students pay up to $46 per credit hour. Community college students contribute less: between 6 and 20 percent for residents and $1.50 of each nonresident student's hourly tuition. To be eligible for a TPEG grant, you must demonstrate financial need, although returning students can be held to certain academic standards. The grant was created in 1975. The set-aside created in 2003, commonly called the House Bill 3015 grant, is funded by setting aside no less than 15 percent of the "designated" tuition paid by resident students attending Texas colleges and universities. Designated tuition is any amount students pay in excess of $46 per credit hour. To be eligible for a HB3015 grant, you must demonstrate financial need. Students whose tuition and fees are not met by funding other than student loans get priority, and the awards can be doled out in the form of scholarships and work study at the school's discretion. In 2003, even as lawmakers cut higher education spending as they tried to close a budget shortfall without raising taxes, they doubled down on the idea that non-wealthy students should get help paying for school, creating a second set-aside grant. Both grants are funded by collecting no less than 15 percent of tuition paid by students. Community college students pay in less, 6 percent. That money is then redistributed to students who demonstrate financial need. More than 121,000 of them got an average award of $1,247 through the public educational grant in 2014, the most recent data available. The newer set-aside provided nearly 85,000 students an average award of $2,033 that same year. Many students receive both. Unlike federal grants, there is no income ceiling, so a diverse pool of students are eligible. For instance, while 36 percent of recipients of the newer grant are Hispanic, about 35 percent are white. But schools with large minority and poor populations rely on the grants to keep enrollment up. Almost 1 in 3 students at Texas Southern University, a historically black college in Houston, count on set-asides to pay for school. What’s more, about 1 out of every 10 students at Texas Southern are public educational grant recipients who hail from families whose income is less than $10,000 a year, more than any other school. Wiping out set-asides could create instant financial hardship for a quarter of students at Texas A&M International University in Laredo, whose student body is more than 90 percent Hispanic, the most of any school in the nation. Four-year schools with most to lose from TPEG cuts University Percent Student Body Awarded Total Grants Awarded Average Award Amount Texas Southern University 32% 2,482 $1,163 Tarleton State University 27% 2,490 $862 University of Houston - Victoria 25% 793 $812 Texas A&M International University 25% 1,347 $866 Prairie View A&M University 25% 1,808 $1,437 Four-year schools with most to lose from HB3015 cuts University Percent Student Body Awarded Total Grants Awarded Average Award Amount Tarleton State University 37% 3,426 $624 University of Houston - Victoria 28% 878 $1,226 University of Houston - Clear Lake 27% 1,543 $1,425 University of North Texas 26% 7,763 $1,839 Texas State University 26% 7,741 $2,064 SOURCES: Texas Higher Education Coordinating Board; Dallas Morning News research Pablo Arenaz, the university’s Interim President, said cutting the aid altogether “could immediately and dramatically impact our enrollment and retention and graduation rates.” A&M International business administration student Ana Jimenez, 20, relied on the grants for just one year, when her father lost his job. But the $500 she received saved her from cutting back on her course load while her dad looked for work. Ana Jimenez (Teresa M. Renn/Texas A&M International University) “To you it may just be a dollar, but to them, it may mean whether they go to college or not,” Jimenez said. “If I can afford to share time or share money to help someone who is far worse off than I am, I will do it. If you have something to share, share it.” Will it help the middle class? No. Patrick argues cutting set-asides altogether would lower tuition by 20 percent. An analysis of state data and interviews with experts indicate any savings would be much less than that. In fact, many middle-class families would probably find it harder to pay for school without set-asides. If the money given in grants in 2014 were used to buy down costs for everyone, full-time students at four-year schools would see savings of about 7 percent. Such a cut would save them about $482 a year on average, according to The News’ analysis. Meanwhile, a student who received the average award from both grants could lose more than $3,500 each year in aid. More than 21,000 students fall into this category, according to the Texas Higher Education Coordinating Board. Recipients like Hardeman at UNT could lose as much as $3,813 a year so that wealthier students could save about $687 a year. At the University of Texas in Austin: $4,327 in aid would be stripped from poorer students to lower overall tuition by about $722. At Texas A&M University in College Station: About $6,072 in aid per student would be sacrificed for about $546 in overall tuition cuts. Experts disagree with Patrick’s contention that the grants are “hidden,” especially after 2009, when Patrick won passage of a law that requires schools to send every student a letter saying how much of their tuition was used for the grants. “I could not imagine why this program is under attack, because it is beneficial to all of Texas that we continue this program,” said UT provost Maurie McInnis, who said it’s unfair to call the grants a hidden tax. In recent decades, the Republican-controlled Legislature has been loath to give more state money to keep tuition low, leaving more and more costs for students and families. The result is that set-asides, though originally intended to help the poorest students, have over time become one tool that universities and colleges use to keep costs low for middle-class students. Luke Ingram, 20, is one of those students. The junior economics major acknowledges he’s probably better off than many of his peers at UT-Austin who also get set-asides, but Ingram’s family took a major financial blow when his dad was diagnosed with cancer when both he and his twin sister were in college. The grants let him stay in his hometown and attend a prestigious university his parents couldn’t have afforded while his dad battled the disease, he said.



“I don’t understand how they would just be able to take it away like that,” Ingram said.


‘A Bizarro World’ Sen. Kirk Watson, an Austin Democrat on Seliger’s higher education committee, said he’s skeptical that lawmakers would spend enough on the state’s other leading financial aid program, the TEXAS grant, to fill the void left by set-asides. The most recent grant program was created, he noted, precisely because lawmakers didn’t want to use state money to reduce costs for middle-class students. “This is our true middle class that this would impact. It is almost a Bizarro World situation to say, ‘Let’s cut a program that’s helping the students and the families that need the aid the most.’ “All in the name of making college more affordable?” he said. “That’s just upside down to me.” As for Seliger’s suggestion that school administrators could choose whether or not to use set-asides, Watson said they’d be making that choice with a proverbial gun to their heads. He suspects that Patrick or another lawmaker could say: “Don’t come to us asking for money if you haven't done away with tuition set-asides.” “What will happen is they will go away, but it won’t go away in a way that makes it look like the Legislature did it,” Watson said. “It will go away in the dead of night.” Editor's Note: After publication of this story, the Texas Higher Education Coordinating Board provided additional data that indicated students who received both set-asides could lose on average $3,519. The story originally reported “about $3,600” based on the state data originally provided. Slightly different numbers by school are updated throughout. Back to main story RELATEDLook up a school SOURCES: Texas Higher Education Coordinating Board; Dallas Morning News research