College & Workforce Readiness

Colleges Angry About Financial-Aid Rules

By Julie Blair — May 24, 2000 3 min read

Higher education officials are angry over new regulations that will change the way colleges and universities structure financial-aid packages for needy students in the $200 million federal Gear Up program.

The Gaining Early Awareness and Readiness for Undergraduate Programs, created two years ago, are designed to create partnerships between the federal government, states, institutions of higher education, school districts, community organizations, and businesses to help poor students prepare for and do well in college. The focus of the programs is on providing mentoring and scholarships, among other activities, to between 650,000 and 700,000 students, beginning in the middle school years.

According to the new regulations, published in the April 27th edition of the Federal Register, Gear Up scholarships can be used by colleges and universities only if the funds are the final component, or the so-called “last dollars,” added to students’ financial-aid packages. All other scholarships or grants will have to be tapped first. The rules also demand that states and partnerships that receive Gear Up money enforce this policy.

The problem, higher education officials say, is that many private donors already stipulate that their money should be used for the “last dollars.” If the federal government usurps that role, they argue, it could render the private offers useless.

“Private charities have a right to give funds out by whatever standards they set,” said Sarah A. Flanagan, the vice president for government relations at the National Association of Independent Colleges and Universities, a membership organization based in Washington that represents 910 institutions.

Targeting the Money

“This is a huge change in student-aid policy,” added Terry W. Hartle, the senior vice president for the American Council on Education, a Washington-based organization that represents 1,500 colleges and universities. “The agreements we’ve entered into with private donors can’t simply be tossed aside by the [Education Department].”

Department officials, however, see the regulations as a way to make sure colleges and universities award the scholarships to students who participate in Gear Up.

Without the policy, institutions and donors might decide to allocate the money to other students, said Maureen McLaughlin, the department’s deputy secretary for postsecondary education. Gear Up scholarships are worth a maximum of $3,300—not nearly enough to pay for college by themselves, she said. That would mean that many Gear Up participants would be forced to take out loans.

Higher education lobbyists have other complaints about the regulations.

They say they are worried that the rules will be interpreted broadly and extended to all of the nation’s 3,500 colleges and universities, not just the 260 or so that participate in Gear Up. Such a change could complicate the financial-aid packages of millions of students, critics say.

The preamble to the regulations specifies that the rules apply only to Gear Up institutions, but language in the actual regulations is unclear, Mr. Hartle said.

Ms. McLaughlin said the Education Department intends the regulations to apply only to Gear Up institutions. A letter will be mailed to all participating colleges and universities to clarify the matter, and a notice will be published in the Federal Register, she said.

The regulations cannot be amended this year and institutions must comply with them, Ms. McLaughlin said. Discussions about the regulations will continue, however, and negotiations could be reopened next year, she added.

Department officials said they could not specify how much of the $200 million allocated to the program this fiscal year was spent on scholarships, because states and partnerships that receive Gear Up money have some discretion over how to distribute the funding.

Some 670 partnership and state proposals representing all 50 states applied for grants this school year, according to the Education Department. One in every five colleges in the nation and more than 4,500 organizations applied for funding.

Related Tags:

A version of this article appeared in the May 24, 2000 edition of Education Week as Colleges Angry About Financial-Aid Rules


This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Student Well-Being Webinar
Equity, Care and Connection: New SEL Tools and Practices to Support Students and Adults
As school districts plan to welcome students back into buildings for the upcoming school year, this is the perfect time to take a hard look at both our practices and our systems to build a
Content provided by Panorama Education
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Classroom Technology Webinar
Here to Stay – Pandemic Lessons for EdTech in Future Development
What technology is needed in a post pandemic district? Learn how changes in education will impact development of new technologies.
Content provided by AWS
School & District Management Live Online Discussion A Seat at the Table: Strategies & Tips for Complex Decision-Making
Schools are working through the most disruptive period in the history of modern education, facing a pandemic, economic problems, social justice issues, and rapid technological change all at once. But even after the pandemic ends,

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

College & Workforce Readiness Opinion There’s Insurance for Homes or Cars—Why Not College Degrees?
Rick Hess talks with Wade Eyerly, the CEO of Degree Insurance, about the company's plan to make investing in a college degree less risky.
7 min read
Image shows a multi-tailed arrow hitting the bullseye of a target.
DigitalVision Vectors/Getty
College & Workforce Readiness Fewer Students in Class of 2020 Went Straight to College
First-year college enrollment dropped steeply last year, a study finds, and the declines were sharpest among poorer students.
6 min read
Image shows University Application Acceptance Notification Letter with ACCEPTED Stamp
College & Workforce Readiness Letter to the Editor Are Students Ready for Post-Pandemic Reality?
Schools must make improving students' essential skills a priority for college and career success, says the CEO and president of CAE.
1 min read
College & Workforce Readiness This Is Not a Good Time to Fall Off the College Track. Students Are Doing It Anyway
Fewer students in the Class of 2021 are applying for college financial aid, continuing a drop that started last year.
6 min read
Applications for the Free Application for Federal Student Aid (FAFSA) form are on the decline.
Applications for the Free Application for Federal Student Aid (FAFSA) form are on the decline.
Jon Elswick/AP