Class Action Month sponsored an open discussion on financial aid with the Financial Aid Office and other administrators today, answering any questions students asked. Director of Financial Aid Laura Talbot did most of the responding, but President Al Bloom and Dean of Admissions and Financial Aid Jim Bock also spoke. The questions covered most of the topics brought up in recent discussions of financial aid.
Both the organizers and Talbot wanted to make it clear that if students had any questions that weren’t answered at the discussion, or if there were more personal questions, students should feel comfortable in coming to the Financial Aid Office and talking to Talbot or another financial aid officer.
Anonymity and Worries of Retribution
Some students, in venues ranging from signatures on the Swarthmore Financial Justice petition and comments on the Gazette to the recent testimonies posted in Parrish, have expressed worries that complaints or “stirring up the muck,” as the linked commenter put it, will lead to reductions in that student’s financial aid package.
Talbot said that these sentiments made her “very upset,” and stressed more than once in the discussion that “no matter what’s going on, Financial Aid is trying to help.” She said that if she were at a school where people she knew were experiencing problems with financial aid, she would certainly sign a petition. “Go ahead and use your name,” she said.
One of the early questions regarded obtaining funding for outside scholarships. A student said, “It seems like the school should be encouraging people to get outside scholarship money, but the way the system is set up, students don’t really seem to get any benefit out of them.” She then asked if there would be a better way to organize the scholarship system, so that students have more incentive to bring outside money into the system.
Talbot responded by laying out the way that the current system works. The first $500 of any outside scholarship is counted directly as part of the student’s contribution, money which would otherwise be earned from a campus or summer job or maybe borrowed. Any scholarship money on top of that goes half into the student’s contribution, half into funding the Swarthmore scholarship. So if a student gets $1,000 in scholarships, the expected “self-help” contribution is reduced by $750, but the Swarthmore grant is also reduced by $250.
Said Talbot, “I know that on an individual basis, it doesn’t feel good if you got this scholarship and so there’s less in aid for you.” Even so, she said, “We’re all in this together…we expect students will do the best they can in looking for outside scholarships, so we don’t mean for our policy to cause incentives or disincentives in that regard.”
The Idea Behind Financial Aid And Student Need
More than once, Talbot laid out the fundamental concept behind Swarthmore’s financial aid policy (along with that of most of our peer schools). As she put it, paying for school is “first the family’s responsibility, but we’ll fill in the gaps if the parents’ capacity, and the student’s capacity, doesn’t meet our costs.”
The Financial Aid Office gives out exactly the amount that they determine a family needs, without factoring in how much money they have in their budget to give to other students. If they spend more than their expected budget, there is a rolling fund to pull from; in years when they don’t spend as much as expected, they put the excess into that fund.
The basic financial aid calculation is done through the College Board’s PROFILE service, as it is at most of our peer schools. The Department of Labor decides on a number with which a family of a certain size can live comfortably; any resources on top of that are treated as discretionary income, most of which is expected to go to paying for college. After this baseline is calculated, however, the Financial Aid Office takes into consideration a variety of factors, including (but by no means limited to) siblings’ educational expenses, healthcare costs, retirement planning, and the like.
One thing that the office does not take into account, however, are parents’ choices on how they spend their money.
Depending on a family’s spending, Talbot said they might be able to pay based on the past (their already-extant assets), the present (their current income), or the future (by borrowing). If two families have exactly the same incomes, assets, and critical expenditures, Talbot said, they will receive the same expected contribution. If one has been living well within its means and saving, while another has been borrowing to buy nonessential things, the first would probably be able to pay mostly out of savings and current income while the latter would have to take out loans.
Similarly, if a students’ parents are not willing to pay, that is not taken into account. In these situations, Talbot said, students might be able to take out enough loans to pay their expected share; otherwise, they simply will not be able to attend. It is an unfortunate situation, she said, but it’s not fair to others to take into account parents who simply do not want to pay their share.
Sometimes, Talbot said, students and families decide that they cannot afford the contribution that is expected of them. In those cases, there is an appeals process, in which the entire application is re-read and re-judged. Because it is the same office reading the application, though, the decision is unlikely to change unless there is new or changed information. There is, she said, one set of criteria for everyone; threatening to leave won’t change that.
Bloom said of those few families who don’t think they can afford what’s being asked of them: “I’m not questioning that there are a lot of pulls on their money, but we don’t feel we’re asking too much.” He asked, “When there are a few kids whose parents don’t think they can do it, and 95% of the parents who feel that they can, what do you do with a system like that?”
Talbot said that students “often want different decisions, which means they want different decision-makers,” but to do so would be unfair: why should some students be judged by one group of people and others by another, who won’t be as familiar with the process particular to Swarthmore? She compared this to having English teachers grade chemistry exams.
A few students questioned the language used by the Financial Aid Office when talking to students. One student cited an example where he felt that the office was being somewhat rude; another talked about the loaded term “demonstrated financial need,” which can make students uncomfortable when they disagree about their need.
“The word ‘demonstrated financial need,’” Talbot said, is “a word I don’t want to use any more…When we say ‘demonstrated financial need,’ we mean demonstrated to our system: our system has assessed in a uniform way what your share should be.” But when the office is talking to “a particular student who says ‘This doesn’t feel right,’” the phrase is a very loaded term, and so “it’s a longer sentence that we need to say.”
With Such A Large Endowment, Why Don’t Students Get More Aid?
One student questioned why, when the College has one of the largest per-capita endowments in the country, and considering “the opulence we live with here,” some students are still being forced to leave. Why can’t we spend more money on financial aid, and less on “pizza at every event”?
Al Bloom addressed this question, and that of endowment spending in general. He spoke at length on the balancing act necessary between providing equal access to Swarthmore and making sure that in doing so, the quality of the program isn’t compromised.
Spending from the endowment is vital to the College’s day-to-day operation. “If you take tuition and fees”, said Bloom, “minus what we spend on financial aid, you get essentially the price of meals plus faculty salaries. That leaves everything else needed to run the College unaccounted for.”
Endowment spending is, as Bloom said, a complex topic. Some schools choose to spend a fixed percentage of their endowment, but this can lead to wild fluctuations in budget when the markets shift. (Said Bloom: “Bryn Mawr did this, and five years ago they had to fire ten percent of their staff because of it.”) Instead, Swarthmore chooses to spend the previous year’s budget, plus the inflation index, plus 1.5%. This allows for a more level increase in spending while not denying future generations of Swatties the same resources that we enjoy now.
Of this endowment spending, a significant portion funds financial aid, which receives priority in allocation. It is enough to cover what the College calculates to be demonstrated need for all students. Spending more than the allocated amount however, would sacrifice allocation of resources from a different item in the budget.
Departmental budgets, he said, have been flat for the last few years, without even being adjusted for inflation. Asking them to cut back, which he said could be necessary if the economy continues on its current trajectory, could compromise the quality of the academic program. It’s a fine balance, he said, and one that is certainly open to discussion – but the College believes it has struck the best possible balance between having a high-quality program and allowing everyone to partake of it.
Several students asked questions about transparency in financial aid decisions. “If students had access to more information about how decisions are actually made,” one student said, “we would feel more empowered in our conversations with the Financial Aid Office, and be able to say, ‘oh, I think this is underemphasized, this is overemphasized in your estimation.’”
Talbot said, however, that everything she has access to in the process is given to students. The aid letter, she said, explicates everything the office has considered in their decision. She repeated that she herself doesn’t have access to numbers about exactly how much different aspects are weighted, but if a student were concerned about a particular issue, she would be happy to talk about how that issue could affect aid for next year.
Timing of Aid Decisions
Some students have expressed concerns about when aid awards are sent out. Talbot said that, if all the forms are in on time, students should receive their letters by the end of June, six weeks before bills are due. She said that this year there were a few “unlucky mistakes” where students received their letters later, but the first ones were mailed on June 20th.
Students who get their paperwork in late are read after all students who were on time have been dealt with, so they might not receive their awards until July or August.
The reason the process takes this long is that there are 5,200 financial aid applicants yearly. (All but 800 of them are prospective students, whose applications are read first, so that they can make an informed decision when it comes time to choose colleges.) If a student has some kind of special circumstances, however, the office is very willing to bump them to the top of the line so that arrangements can be made earlier. This, of course, requires that the student actively ask for an early reading, rather than just filing out their forms.
International Students and Need-Blind Admissions
For international students, there is enough funding for about twenty students per class to be admitted regardless of need. After that, only as many students as can be funded will be admitted.
Once students have been admitted, however, the aid process works identically for all students.
When the Board of Managers committed to the no-loans plan, they also committed to move towards need-blind admissions for international students, once there is enough money for it. (In order to sustainably fund the no-loans commitment, the College needs to raise $40 million; it has raised only about $7.4 million. Funding need-blind admissions for internationals would require even more.)
One student asked why, if domestic admissions is truly need-blind, the percentage of aided students has stayed within three percentage points of 50% for so many years. Laura Talbot called it “magic,” and Al Bloom suggested that the student write his thesis on it. It seems that the percentage of qualified applicants who choose to attend just always has that makeup.
Students and administrators both seemed to be satisfied with the forum. Talbot said she was glad to see such a good turnout; she commented that “this was basically what we would say to an individual who came in to talk to us, just to a group.” She added, though, that the recent focus on financial aid has certainly “heightened tensions.”
Dermot Delude-Dix ’09, a student in attendance, called it “really helpful.” “The administration showed that they’re really interested” in the issues, he said, which is a necessary first step for doing anything about them.
Madeleine Case ’09, one of the organizers of the event, called the discussion “very constructive.” “Personally,” she said in an email, “I feel that Swarthmore financial aid is extremely good, but that does not excuse us from pushing ourselves even further living up to the liberal values that this institution upholds. I hope that students and administrators can work together to devote more of our budget to financial aid.”
Next week, Al Bloom and Jim Bock will do more of the talking at a chat sponsored by Student Council. It will take place at 7pm next Tuesday, the 25th, in Sci 101.