Ohio State could lose more than $15 million in state and federal financial aid next year under budget proposals from Gov. John Kasich and Republicans in the U.S. House of Representatives, said Diane Stemper, director of Student Financial Aid at OSU.
“This year is exceptionally challenging,” she said. “Because Congress can’t get a budget passed, it just continues to make it uncertain for us.”
The bulk of the cuts would come from a proposal by congressional republicans that would: eliminate summer Pell Grants and subsidies for graduate student loans; reduce the maximum annual award by $845, from $5,550 to $4,705; and reduce the number of students eligible to receive partial Pell Grants by 1.7 million.
Stemper estimated those proposals could take $9.6 million from OSU students. Currently, 15,000 students on all OSU campuses receive a combined $55 million in Pell Grants, she said.
The proposal, part of the Republicans’ initial budget proposal in response to President Barack Obama’s budget proposal, passed the House by a vote of 235-189, with three Republicans joining all Democrats against it. It then stalled in the Senate.
In his budget, Obama proposed eliminating summer Pell Grants and graduate student loan subsidies, but maintaining the maximum award at $5,550.
According to the Office of Enrollment Services, 2,380 students currently receive about $3.4 million in year-round Pell Grants.
Stemper said Kasich’s budget proposal would cut funding for state-based financial aid to OSU by about $5.5 million, including 5 percent reductions each in the Ohio College Opportunity Grant, or OCOG, and the War Orphans Scholarship.
OCOG provides money to Ohio residents demonstrating the highest levels of need based on FAFSA results, according to the Ohio Board of Regents.
The Office of Enrollment said 120 OSU students currently receive the War Orphans Scholarship, which covers 80 percent of tuition and fees for children of deceased or permanently disabled veterans.
The governor’s budget does, however, increase the National Guard Scholarship Program, which covers full tuition at main campuses at public universities, and partial tuition at private universities, for members of the Ohio National Guard, by $2 million, or 13.4 percent. Kasich also proposed doubling the amount of vouchers to help parents pay for their children to attend private K-12 schools.
Lucas Kamholz, an undecided first-year, said they had to get the money from somewhere.
“But it’s not really fair to take money from students,” Kamholz said.
Even with a 3.5 percent tuition increase – the maximum allowed in Kasich’s budget proposal – the financial aid department is still likely to lose millions in funding.
Stemper said her eyes are on the Pell Grants because cuts there would affect more students than at the state level.
“I’ve never seen the Pell Grants this uncertain at this stage in the game,” she said.
Because incoming freshman have until May 1 to formally enroll in the university, Stemper said the department had to get the financial reward letters out despite the funding uncertainty.
On March 30, the Student Financial Aid department mailed financial award notices to 16,000 students, offering about $168 million in financial aid, Stemper said. Those letters did not include any state-based funding or summer Pell Grants.
Two years ago, Stemper said the department issued award letters including state aid based on the amounts in former Gov. Ted Strickland’s budget proposal. The funding didn’t make it through the General Assembly, however, and OSU had to replace the money with $5 million from the university.
“We decided to be conservative this time and not put it in until we know for sure,” she said. The state legislature has until June 30 to pass next year’s budget.
The department did, however, base Pell Grant awards on the current $5,550 maximum. It did not include summer Pell Grants.
“If the federal or the state government changes anything, then we would have no choice but to go back and edit that award,” she said.
Whether that will happen is unclear.
U.S. Rep. Steve Stivers, R-Columbus, voted for the Republicans’ budget stripping more than $5.7 billion in funding from the Pell Grant program.
But in an emailed statement, Stivers vowed to stop cuts to the program.
“While many programs will be cut, I will work hard to maintain the current level of Pell Grant funding,” he said.
Sen. Rob Portman, R-Ohio, said in an email that the country is at “a fiscal crossroads.”
“We can either take meaningful steps to stop the out-of-control spending that’s impeding economic growth and threatening American competitiveness or we can maintain the status quo that Democrats are calling for and follow in the footsteps of countries like Greece,” Portman said.
Ohio’s other senator, Democrat Sherrod Brown, said the Republicans’ plan would eliminate Pell Grants from more than 58,000 Ohio students, and cuts in education would hurt the still-fragile economy.
“Education and economic development go hand-in-hand, which is why I refuse to let the budget be balanced on the backs of college students,” Brown said in an email.
Kasich spokesman Rob Nichols said the cuts in state-based aid were necessary to balance the budget.
“The decisions we make aren’t necessarily reflective of our priorities,” he said. “You have to remember, the governor walked into office staring down both barrels of an $8-billion-deficit gun.”
The General Assembly will have to pass Kasich’s budget by June 30. With Congressional lawmakers in Washington locked in a debate that could result in a government shut-down if a budget is not passed by Friday, it’s unclear just how big a cut the Pell Grant program could take.
Democrats have vowed to maintain funding for the Pell Grants, and most republicans are holding firm in their desire to cut the program.
The politicians might be worried about cutting spending, but Stemper has her own worries.
“We worry about the students,” Stemper said. “We want to make them aware what financial aid is available to them so they can make good decisions based on what they can afford.”
Students are worried, too.
Dan Reilly, a second-year in aerospace engineering, said he understands the need to reduce the deficit, but it’s not fair to punish students.
“I’m already broke,” Reilly said. “It makes more sense to raise taxes on the rich than to make students pay more.”