Phonenix, Ariz., March 2, 2005—A new research report recommends that Arizona give a higher priority to financial aid to help low-income students pursue education or training after high school. Prepared by the Washington, D.C.-based Institute for Higher Education Policy and by the Latina/o Policy Research Initiative at the University of Arizona, the report, “Investing in Arizona’s Future,” was released by the Arizona Commission for Postsecondary Education during a March 2 event marking the 25th anniversary of USA Funds®’ service as Arizona’s student-loan guarantor. USA Funds provided funding for the report. “Investing in Arizona’s Future” concludes that enhancing the state’s investment in access to postsecondary education and training will go a long way toward ensuring a stronger economic future for the state and its citizens.
Limited State Financial Aid, Rising Tuition
The report notes the Arizona ranks in the bottom-five states nationally in total financial aid awarded by the state. Furthermore, the report notes that support for the state’s two main student grant programs—the Leveraging Educational Assistance Partnership and Private Postsecondary Education Student Financial Assistance Program—has been declining. Compounding this limited investment in financial aid for needy students, the report notes that the higher education sector in Arizona has experienced declining support resulting in significant increases in tuition in the Arizona University System and the state’s community colleges. For example, the report notes that between the 2002-2003 and 2003-2004 academic years, tuition in the state university system rose an extraordinary 39 percent. During the same period, the average increase in tuition at the community colleges was 16 percent.
Higher Loan Averages
One consequence of these factors is that Arizona students borrow more to attend college. According to “Investing in Arizona’s Future,” Arizona was among the top-10 states with the highest average loan amounts among students. Arizona undergraduates borrowed an average of $3,622 in 2003, compared with the national average student-loan amount of $3,344.
Growth in College-Age Population, Changing Demographics According to the report, the state also needs to face these challenges to higher-education access because of the burgeoning growth in its college-age population. The report notes that Arizona will experience a 58 percent increase in the number of high school graduates between 2001-2002 and 2017-18. Most of the growth in this college-age population will occur among students who are most in need of grant aid for college—minority, low-income and first-generation students. For example, the number of Hispanic high school graduates is projected to grow by 166 percent and the number of black high school graduates by 80 percent through 2017-2018.
“Investing in Arizona’s Future” recommends that Arizona take the following three key steps to enhance financial access to postsecondary education and training:
- Develop a statewide clearinghouse of information on all forms of financial assistance to provide the public with a comprehensive tool to research every dollar available to pay for postsecondary education.
- Create a statewide financial literacy program to assist families in planning for postsecondary expenses and reinforce the concept of the investment in education and the significant return on that investment.
- Enhance the partnership between business, philanthropy, government, Native American tribes, as well as individual donors, to expand the funds available to assist low-income students.
“We hope that these findings will have a direct impact on the manner in which our state views financial aid for postsecondary education,” said Dr. April L. Osborn, executive director, Arizona Commission for Postsecondary Education. “We believe that this important research can be the first step in helping Arizona achieve a workforce that can support economic growth.”
USA Funds Response
In response to the report, USA Funds has announced it will more than double its scholarship support to Arizona residents to $500,000 for the 2006-2007 academic year. USA Funds will establish a special USA Funds Arizona Silver Anniversary Scholarship program to provide scholarships to students whose household incomes are $35,000 or less.
Detailed information about the scholarships will be distributed this fall to financial-aid professionals at all Arizona colleges, universities, and career schools, well as to high school counselors throughout the state.
The Arizona Commission for Postsecondary Education works to increase access and success in postsecondary education for Arizonans. As a state higher education agency, ACPE administers state financial assistance programs, assists parents and students plan for and transition into postsecondary education, and serves as a forum for private and public universities and colleges, community colleges, and proprietary schools to dialogue, partner and problem solve issues of mutual interest. For more information, visit AZhighered.org.
USA Funds is a nonprofit corporation that works to enhance postsecondary-education preparedness, access and success by providing and supporting financial and other valued services. USA Funds annually supports education loans totaling $710 million to help Arizona students and parents pay for college. USA Funds also supports other philanthropic initiatives to benefit Arizona higher education. More information about USA Funds can be found by visiting USAfunds.com.