The Indiana Commission for Higher Education has put forward a recommendation that may lead to reduced financial aid for students attending colleges within the state. This proposal, finalized on Thursday, specifically impacts the Frank O’Bannon Grant, which offers financial support to eligible students at public, private, and proprietary institutions.
Proposed Reductions in Financial Aid
The suggested reductions in financial aid range from 14% to 86%, contingent upon the institution and the financial circumstances of individual students. During discussions, commission member Nancy Jordan raised concerns about this decision, highlighting the discrepancy between the current recommendation and the commission’s previous reports on increasing enrollment in financial aid programs.
Submission and Consideration
This recommendation will be submitted to the State Budget Committee for consideration, where it may undergo modifications. Although state lawmakers could opt to increase funding during the legislative session, staff members have indicated that significant changes are not expected.
Importance of the Frank O’Bannon Grant
Josh Garrison, chief of staff for the commission, noted that despite the proposed cuts, the Frank O’Bannon Grant continues to be one of the most substantial financial aid programs in the country. Currently, eligibility for the grant requires students to be enrolled full-time and complete at least 24 credit hours, with higher awards available for students who earn 30 credit hours or more. Changes to the Free Application for Federal Student Aid (FAFSA) have resulted in increased eligibility for students seeking federal, state, and institutional assistance.
Impact on Award Amounts
Under the proposed changes, the maximum annual award for high-need students attending public institutions would decrease from $6,200 to $5,300. Similarly, those attending private institutions would see a reduction from $12,400 to $10,600. Students at Ivy Tech Community College or proprietary institutions would face a drop in the maximum award from $4,700 to $4,050.
Potential Losses for Students
Mary Jane Michalak, senior vice president for legal and public affairs at Ivy Tech, indicated that approximately 7,200 students at Ivy Tech could potentially experience a total loss of around $6 million, with about 400 students losing their eligibility entirely.
Annual Awards and Funding
Despite the reductions, the commission plans to maintain the annual number of awards at about 30,000, with an estimated total funding cost of roughly $175 million. The current year’s budget has increased to approximately $225 million, largely as a response to earlier funding challenges linked to issues with the FAFSA process.
Future Considerations
While the proposed reductions have raised concerns among some commission members, there remains an acknowledgment that the financial aid available continues to be considered generous compared to earlier periods. The commission has expressed intentions to explore funding options if additional resources become available in the future.
(Source: Indiana Capital Chronicle)
