Gov. Jerry Brown’s latest budget proposal might cut $110 million from the Cal Grant system, which would affect financial aid for students enrolled in public and private California universities during the 2012-2013 school year.
As part of the $12.5 billion in reduced state spending, the cuts to the system would reduce the amount offered to students who choose to use Cal Grants at private institutions and would raise the minimum requirements for students to qualify for a Cal Grant.
The Cal Grant system consists of Cal Grant A and Cal Grant B, which are offered to students based on merit and demonstrated financial need. The grants do not have to be paid back.
Cal Grant A provides for tuition and fees in the California State University and University of California systems, as well as tuition support at private, nonprofit schools such as USC. Up to $12,192 is offered to each eligible students in the UC system, up to $5,472 to students in the CSU system, and up to $9,708 to students at private schools.
Brown is proposing cutting the award money offered to students at private schools by 44 percent to the CSU level in addition to raising the minimum GPA requirement for Cal Grant A from 3.0 to 3.25.
The USC Financial Aid Office could help make those cuts manageable for students attending USC, despite worries that such cuts would make it more difficult for low-income students to cover the cost of attending a private school, said Thomas McWhorter, the dean of financial aid.
“In a place like USC, where we still meet the full determined need of the students, I wouldn’t anticipate [a drop in the number of low-income students], but any time you have a reduction in the amount of gift aid that’s given I can understand that there may be some changes in attendance,” McWhorter said.
McWhorter, however, said that with a reduction in either state or federal money offered to students as part of their financial aid package, the additional money would have to come from either increased university resources or more loans included in the financial aid package.
“USC has a commitment to meet the full need of our students,” McWhorter said. “When a major source of aid changes like this, it means the money has to come from somewhere else.”
The possibility of Cal Grant cuts would be especially worrisome for students hoping to attend a private university as a freshman in fall 2012, said Veronica Villalobos, the executive director of state government relations for USC in Sacramento.
Because the finalized state budget isn’t constitutionally due until June 15 and incoming freshmen must confirm their college decision by early May, students could have to make their decision before knowing how much aid they will receive from the state.
“The impact of a 44 percent cut [for Cal Grants at private schools] would be particularly dramatic,” Villalobos said. “Sometimes students choose not to go to a private university because it looks like their grant is going to be cut significantly. There’s a lot of uncertainty.”
Zarkhi Palmer, a freshman majoring in business administration, is a recipient of a Cal Grant who said that if the state had offered him less money while he was making his decision and his financial aid package was unable to offset the difference, he would have had to think twice about attending a private university.
“If the school financial aid didn’t cover [tuition], I probably would not have come [to USC],” Palmer said. “I would have gone to a cheaper school.”
Approximately 1,900 undergraduate students, or just over 10 percent of the undergraduate population, are currently recipients of a Cal Grant as part of their financial aid package, alongside other aid such as loans, scholarships and the Federal Work-Study program.
According to Villalobos, these students would have their grants cut for 2012-2013 as well, and a large enough cut might even have some students deciding to transfer.
To avoid this situation, Villalobos said USC has been partnering with other California private schools to push for changes to the budget proposal that would not hit their students as hard.
Villalobos said former Gov. Schwarzenegger proposed a similar cut in 2004, but schools and students were able to fight back and have the cut reduced to 14 percent.
“Because the budget is so bad and there’s not much room to make cuts, it’s really going to be a big fight this year that students have to initiate to protect their financial aid,” Villalobos said.