The Office of Student Financial Assistance administers 29 financial
aid programs for Florida residents, which totaled about $114 million
dollars in 1995-96. Four of these programs have a major impact
on public and private higher education in Florida (see Table 3).
Financial Aid Program Funding (Dollars in Millions) |
||||
| Resident Access Grant | ||||
| Undergraduate Scholars | ||||
| Public Assistance Grant | ||||
| Private Assistance Grant | ||||
| Source: Consolidated from State Student Financial Aid Report (Tallahassee: PEPC, 1996), and Annual Report on State Financial Aid Programs: 1993-1995 (Tallahassee: Florida Council of Student Financial Aid Advisors 1996). | ||||
The largest of all the financial aid programs is Florida's Undergraduate
Scholars Fund, which totaled more than $33 million dollars in
1995. The Undergraduate Scholars Fund is a merit-based aid program
for students attending either public or private colleges and universities
in Florida. In order to be eligible, students must have a 3.5
(out of 4.0) high school GPA and an SAT score of 1270 or above.
In fact, Florida's merit program is one of the largest in the
country, exceeded only by Georgia's HOPE Scholarship. In 1994-95,
over 36 percent of Florida residents entering the State University
System received a merit scholarship. The award amount for merit
scholars in 1994-95 was $2,280.
The second largest state financial aid program is the Public Florida
Student Assistance Grant, which totaled about $29 million in 1995-96.
This program provides need-based financial assistance grants to
full-time students (attending any state university or community
college in Florida) who have met state requirements and who have
also applied for a Pell Grant. The average award amount for community
college students in 1994-95 was $646 and for state university
students $1,030. The 1996 Legislature substantially increased
funding for this program. In 1996-97, the maximum award was expected
to be approximately $1,700.
The third largest state financial aid program, or voucher, is
for Florida residents attending a private college or university:
The Florida Resident Access Grant, which totaled close to $20
million dollars in 1995. This program provides tuition assistance
to any full-time undergraduate student registered at an accredited
independent nonprofit college or university. To be eligible, a
student must reapply each year, be a state resident, and maintain
a 2.0 GPA. The maximum award equals 30 percent of the cost to
the state for a student in the State University System for an
academic year, or a lower amount as specified in appropriation
language. The award amount in 1994-95 was $1,090.
The fourth largest program in the state, the Private Florida Student
Assistance Grant, is a need-based financial aid program for students
attending a private college or university in the state. During
the past two fiscal years the state has appropriated approximately
$7 million with an average award of about $1,020.
The Office of Student Financial Assistance is not the only agency
providing financial aid to Florida residents. Staff mentioned
that the office faces stiff competition from guarantee agencies
in other states (USAF in particular). The competition is focused
on private colleges and universities with high loan-volume. Because
increasing numbers of student loans are guaranteed by out-of-state
agencies, the collection of data on student borrowing trends in
the state is incomplete.
More than one state official complained about the number of grant programs in the state and said they need to be consolidated. But each program, we were told, has vocal supporters who are influential with legislators.
The Department of Education provides summary totals for state-funded
program dollars that flow to the private sector and public community
colleges. Aggregated data from these summaries show that the private
sector received approximately $30.6 million through indirect state
funding mechanisms in 1991-92. The estimated amount grew to $32.4
million in 1994-95, a meager growth rate that was affected by
the increased participation of the public sector in these programs.
Public community colleges received $10.8 million and $17.8 million
for 1991-92 and 1994-95 respectively.
Florida students also contribute to their own financial aid, through
"recycled" tuition revenue. The state authorizes the Board of
Regents to contribute five percent of the matriculation and tuition
fees as a source for student aid. These funds are distributed
by the institutions. About 70 percent of aid from tuition dollars
is awarded on a need basis. In 1994-95 the student aid generated
from tuition dollars was about $16 million for the State University
System. The Legislature also authorizes the community colleges
to collect five percent of the matriculation and tuition fees
for financial aid. In 1994-95, this amount came to about $11 million.
In addition, local community colleges have the authority to grant
tuition waivers in order to encourage student enrollment.
A number of state officials mentioned the rapid increase in merit-based financial aid in Florida. Between 1990-91 and 1995-96, the state budget for merit aid increased from $19 million to $33 million, an increase of 74 percent. Because legislators and others believed that Florida was losing talented students to out-of-state institutions, the merit aid program was increased to "keep talent in Florida." One state official mentioned that there seems to be a growing consensus, at least among policy leaders, that the state must begin to invest more state dollars in need-based programs. A university administrator, however, cautioned that constituent support for merit aid is very strong in Florida and said it would be difficult for legislators to back away from their support of merit aid in the near future.
The study also shows that compared with public four-year institutions, the private sector had a greater proportion of families with incomes above $90,000 and below $30,000. For the public four-year system as a whole, more than 36 percent of all dependents came from families with incomes above $65,000 and 20 percent from families with incomes under $30,000.
The primary policy instrument to encourage parental savings is
the Florida Prepaid College Program. Among the families in Florida
who saved for their children's education, 16 percent used the
program. For families earning less than $30,000 who saved, 21
percent used the program.
The program allows families to begin paying for the cost of college at a guaranteed fixed rate-the cost of tuition is locked in. If the beneficiary of a plan attends a community college instead of a state university, the difference in tuition is refunded. All funds paid by Florida residents are invested in a trust fund set up by the state. The fund is administered by the seven-member Florida Prepaid Postsecondary Education Expense Board. The program is guaranteed by the State of Florida. The Florida Legislature is obligated to maintain the program's financial soundness. Under the 1988 IRS rulings, any tax liability is deferred until the student enters college. At that time, the difference between the amount paid in and the value of the benefits received is taxable to the student over his/her college years. Payments into the tuition plan are not tax deductible.
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