Educational cuts may affect U. financial aid

The House of Representatives voted to pass a spending bill on Friday that contains several educational cuts, including some which could have an affect on the level of government funding the University will receive for student aid. One of the cutbacks is with the Perkins loan program. According to David Morse, assistant vice president for policy planning and federal relations, the University receives "a reasonable substantial allocation of these loans." "If [the loans] go away, it will make it more difficult for students to finance their educations reasonably cheaply," he said. Morse added that, as a result, students might be required to borrow more under a bank-based program, which is at a higher interest rate. But he said even if these cuts become a reality, the University will still receive a large fund of Perkins loans. The University provides a little over $10 million in Perkins loans to undergraduates and graduates each year, he said, adding that the capital contribution that is threatened represents a little over $1 million. "So we would still have $9 million to loan each year," Morse added. There were also some changes proposed for the Pell Grant program, which will help some students while hurting others. "Financially needy students will get a larger grant," Morse said. "Students with a limited need who would have otherwise been eligible for a Pell Grant don't get one." Associate Vice President for Finance Frank Claus said he does not see these cuts as having a major effect on the University. "Obviously we never like to see any cuts," he said. "But at the moment there doesn't seem to be any that would have a serious impact on the undergraduate program." Most of the financial aid programs the University offers is funded by the University itself, he explained. One positive aspect of the bill is that it retains the Supplemental Education Opportunity Grant and work-study programs at their current levels. "That is very favorable," Morse said. "Those are programs that are very important to Penn students." But the bill also contained cuts in other areas that could affect the University. Vice President for Government, Community and Public Affairs Carol Scheman said she is concerned about the level of discretionary funding. Scheman said it is important for Congress to differentiate between expenditure and investment. "Investing in education and research are investments that pay off many times," she said. Scheman added that the significant program cuts will "affect the University across the board." On a more positive note, the National Institute of Health was given a $643 million budget increase under this bill. Morse said he sees this increase as a good sign. "The National Institute of Health provides a substantial amount of support at this and other universities," he said. "This increase suggests that members of Congress think that basic research done by universities is a very good thing." While Scheman said while she believes the University is "very much at risk," she stressed that the bill has not even completed the first third of the checks and balances process. And Morse predicted that this bill will undergo significant changes before President Bill Clinton has to vote on it. Claus said he does not think the Senate or the President will pass such a severe bill in its current form. He added, though, that he expects more tension from Congress in the near future. "I don't think we are done," he said.