cIcu | Commission on Independent Colleges and Universities

For Immediate Release

Contacts:    Dennis Kennedy, Director of Communications, (518-436-4781; dennis@cicu.org); Terri Standish-Kuon, Vice President for Communications, (518-436-4781; terri@cicu.org)

CICU Statement on State Budget FY 2009-10: Higher Education Student Aid Programs Protected by Legislative Leaders; State Offers “Help” through Low-Cost Loans

Albany, NY – “Maintaining state support, particularly for low- and moderate-income students, and creating a new, low-interest student loan program – for those attending either private or public colleges – is a necessary investment in our current economic climate,” said Abe Lackman, president of the Commission on Independent Colleges and Universities (CICU).”

Today, the New York State Legislature voted to:

•    Keep the Tuition Assistance Program (TAP) maximum award/full-time status at the federal standard of 12 credits to aid students most in need. Six in 10 TAP recipients come from families with annual incomes of $20,000 or less, and nearly 310,000 students rely on TAP this year.

•    Enact the New York Higher Education Loan Program (NYHELPs) to provide $350 million per year in low-interest student loans at a time when many traditional lending sources have left the market or have higher borrowing rates.

•    Restore full-funding for Graduate TAP and the Collegiate Science and Technology Entry Program (C-STEP), ensuring greater access to advanced degrees and increasing the number of graduates in high-need fields.

•    Maintain the Higher Education Opportunity Program (HEOP) and Liberty Partnership Programs that serve nearly 18,000 students in high-need or high-risk for dropout situations.

•    Fund economic development entities including the New York State Foundation for Science, Technology, and Innovation (NYSTAR), Centers for Advanced Technology (CATs), and Focus Center that facilitate research, innovation, and the growth of new firms and emerging industries – critical to professional, scientific, technological, and economic progress.

While most state student aid and economic development programs were restored or unharmed, Direct Institutional (“Bundy”) Aid received a six percent cut. In addition, the Legislature accepted one change to TAP, allowing public pension funds to be counted as income when calculating grant awards. This change provides a $15 million cut to the program and will affect certain families.

“With economic uncertainty and growing rates of unemployment, more individuals are turning to higher education to start a new career path, re-train, or earn an advanced degree. Further, more areas of the state are relying on higher education to develop jobs and to stimulate the economy. Restoring access to student aid and economic development programs, while offering families the option of a low-cost loan to finance higher education, will yield high dividends in the short term and long run, for individuals and for communities throughout the state,” continued Mr. Lackman.

The new state student loan program, NYHELPs, will provide $350 million per year in fixed rate loans at interest rates estimated at 7.5-8 percent, as well as variable interest rate loans to undergraduate and graduate students who are state residents attending private and public colleges and universities. Participating campuses offering the loans to students will pay one percent of the total volume borrowed which will then be added to a reserve fund to secure the loans. Until now, New York was the only large, urban state in the nation, and the only state in the Northeast that did not offer students attending college in the state a low-cost student loan option. For more information, see the Higher Education Services Corporation’s proposed program overview: http://capwiz.com/cicu/go/NYHELPs

“In a year when so many families must confront difficult financial choices, the creation of the state-backed NYHELPs loan program is very welcome news – a true bright spot in an otherwise dark picture. It will prove to be invaluable in enabling young men and women of talent to fulfill their promise and ambitions in our state's outstanding institutions of higher learning,” said John Sexton, president of New York University and chair of CICU’s Board of Trustees.

“The benefits of funding essential financial aid programs, such as the Tuition Assistance Program (TAP) and the state’s successful student opportunity programs extend far beyond our campuses. The 340,000 New Yorkers who rely on state aid each year become productive graduates who give back to our communities and economies ten-fold, filling much needed roles as teachers, doctors, journalists, entrepreneurs, artists, scientists, engineers, and business leaders,” added R. Mark Sullivan, president of The College of Saint Rose, chair of the Capital Region Center for Economic Growth (CEG), and chair of CICU’s Board of Trustees’ Legislative Committee. Private colleges and universities contribute $47.5 billion to the state’s economy each year. Independent Sector institutions are major employers, especially in those Upstate communities hit by losses in manufacturing jobs.

“Higher education is a one of New York State’s best assets and bright spots. With more than one million students attending more than 250 college and university campuses in every corner of the state, our unparalleled higher education enterprise is an important investment for state leaders, especially in challenging times,” said Abe Lackman.