A Bold Plan
University commits $16 million annually
to keep higher ed affordable
by Andrew Shurtleff
President John T. Casteen III unveils the new financial aid
plan at a Feb. 6 board meeting.
By Dan Heuchert
A college degree has long
been a launching pad to a better life. But increasingly, even
middle-income students and their families worry that college debts
will become a burden, limiting future career and educational opportunities.
In response, the University has unveiled “Access UVa,”
an ambitious financial aid program – unprecedented among
U.S. public institutions – designed to keep higher education
affordable for all students who qualify for admission, regardless
of economic circumstance.
“To learn, and by learning to become an informed citizen
in a democratic society, is a fundamental American right held
dear by Virginians,” said University President
John T. Casteen III. “Because access for students with need
is a priority for us, the University of Virginia has made a conscious
choice to allocate the resources to make this program work.
“Access UVa has the added benefit of allowing students the
freedom to pursue graduate study or public-service careers after
their undergraduate careers are completed, without the kind of
burdensome debt that might otherwise limit their options.”
At its Feb. 6 meeting, the Board
of Visitors committed $16 million annually for the program,
parts of which will unfold over the next four years, to ease the
debt burden of undergraduate students.
a board meeting in October, after the announcement of the University
of North Carolina-Chapel Hill’s “Carolina Covenant”
plan, Casteen had challenged the University’s financial
aid staff to create a new program tailored to the needs of U.Va.
students. The program he envisioned would not only keep a U.Va.
education affordable for the lowest-income students, but also
address the concerns of middle-income families that increasingly
have been squeezed by rising tuitions resulting from decreased
Access UVa’s combination of loan-free packages for low-income
students, caps on loans for all other students, and commitment
to meet 100 percent of need is believed to be the most comprehensive
program at any public university, said Yvonne Hubbard, director
of the Office of Student Financial Services and one of the program’s
architects. “This is a plan that looks at all of our students
on aid, at all income levels.”
Currently, a quarter of U.Va. undergraduates, approximately 600
students per class, receive need-based loans. Upon graduation,
the average debt load of those students is $13,500. That’s
below the national average of $16,200 at public universities and
$18,500 at private universities.
Still, approximately 200 members of last year’s graduating
class had each accumulated debt of more than $13,500. Of those,
almost 100 students graduated with need-based loan debt between
$14,000 and $20,000, while another 50 graduated with between $20,000
and $30,000, according to the Office of Student Financial Services.
“Every University educator could recount stories of students
whose choices are limited by financial constraints, who have made
choices which were designed to limit their debt or reduce their
financial obligations,” such as forgoing the chance to study
abroad or take summer school courses, or accepting higher-paying
but less satisfying jobs after graduation, Hubbard said.
“Equal access is not only about access to higher education,
but access to all the component parts of that education, and of
the choices and opportunities inherent in the culmination of that
Dean of Admission John A. Blackburn predicts that the new opportunities
offered by Access UVa will help the University attract a diverse
pool of applicants.
“My sense is that some very talented students do not even
apply to U.Va. because they think they cannot afford it,”
he said. “I hope that the word will get out to students
all over the nation that they can seriously consider U.Va. in
their college plans.”
The cost of the program will be phased in over a number of years,
drawing an additional $2.1 million from tuition revenue and private
resources this fall and $7 million by the time of full implementation
in the 2008-09 academic year, said Yoke San Reynolds, vice
president for finance. At that time, the University anticipates
spending $16.44 million annually of institutional funds on need-based
grants for undergraduates. This is in addition to $4 million of
endowment and gift resources already committed to need-based aid.
the New Financial Aid Plan Works
1 Replacing need-based
loans with grants in the financial aid packages of low-income
students. Beginning this fall, U.Va. will replace all need-based
loans with grants in the financial-aid packages of low-income
students — those whose family income is equivalent to 150
percent of the federal poverty line or less. In 2003, the federal
poverty line for a family of four was $18,400; for a family of
four at 150 percent of the federal poverty line, family income
National studies show that students from low-income families are
more likely to default over time and are less likely to receive
assistance from their families to pay off loans, according to
analysis from the U.Va. Office of Student Financial Services.
The no-loan financial aid packages apply only to a student’s
first eight semesters at the University, not including summer
school, which has its own financial aid programs.
2 Capping the amount of
need-based loans offered to any student. U.Va. will cap the maximum
amount of need-based loans for all students — in-state or
out-of-state — at approximately 25 percent of the anticipated
four-year cost of attendance for an in-state student, and will
meet all need above that amount with grants. The cost-of-attendance
figure includes tuition and fees, books and supplies, housing,
meals and personal expenses, and is currently calculated as $14,520
for the current school year.
The cap will be phased in with each entering class, beginning
in the fall of 2005, until it becomes fully implemented in the
2008-09 academic year.
The loan caps apply only to a student’s first eight semesters
at the University, not including summer school, which has its
own financial aid programs.
3 Meeting 100 percent of
demonstrated need for all undergraduate students. This fall will
mark the completion of a program launched three years ago to offer
financial aid packages that meet 100 percent of the need for all
undergraduate students who qualify for some form of financial
In 1985, the University committed to meeting 100 percent of the
need of high-need students. As a result, U.Va. traditionally has
received high marks for affordability in national surveys. U.S.
News & World Report ranks U.Va. No. 1 among public institutions
and No. 13 among all national universities in its Best Values
category, a distinction that includes calculations of need-based
aid, average cost after need-based grants and average discount
from total cost.
Under the Access UVa plan, students accepted for admission —
in a completely need-blind process — complete the standard
Free Application for Federal Student Aid. Using a standard federal
formula, the University’s Office of Student Financial Services
calculates each student’s expected family contribution.
That amount is then subtracted from the total cost of attending
U.Va. The resulting sum is the student’s demonstrated need.
Student Financial Services will then offer any student with financial
need, who is not low-income, a combination of grants and loans
equivalent to that amount. The commitment to meet 100 percent
of need applies only to a student’s first eight semesters,
not including summer school, which has its own financial aid programs.
4 Counseling on college
financing and debt management. Many families — low-income
families in particular — find the financial aid application
process daunting. Each year, a number of students either do not
complete the application accurately or on time, or do not apply
Under Access UVa, the Office of Student Financial Services will
add staff to offer additional one-on-one counseling to matriculating
students and their families, assisting them in the financial aid
application process and presenting them with financial options
outside of need-based financial aid. “I think this is one
of the most exciting parts of Access UVa,” said Yvonne Hubbard,
director of the Office of Financial Student Services. “People
simply don’t know what other options are available to them.”