University Star

More than two-thirds of the student body received financial aid in the form of grants, loans and scholarships for the 2011-2012 academic year, a record-high total for Texas State.

Approximately 56 percent of students received grants, loans and scholarships for the 2007-2008 academic year, according to statistics from the Financial Aid and Scholarships office. The most recently available data indicate an estimated 70 percent of students were granted financial aid from the university, state and federal government for the 2011-2012 academic year. Michael Heintze, associate vice president for Enrollment Management, said several factors contribute to a rise in requests for student financial aid. Heintze said these include the overall cost of higher education, the rapidly growing high-school population in Texas, an increase in first-generation college students and campus support needs.

Chris Murr, director of Financial Aid and Scholarships, said unfavorable economic conditions in the past few years have created stress for families because of job insecurity and layoffs. The fact the amount of financial aid available is not growing, and is in some cases shrinking, creates additional financial stress, Murr said.

The university encountered multi-million dollar budget cuts from the state legislature last session which have significantly reduced overall institutional operating funds and financial aid availability for students. Heintze said legislators in the 83rd session, which began Jan. 8 and will conclude May 27, are responsible for determining funding for state financial aid and loan programs. He said the future state of funding for financial aid programs, such as the Toward Excellence, Access and Success grants, is relatively unknown at the moment.

Cody DeSalvo, public administration senior and special assistant to Associated Student Government President Nathan McDaniel, said he is one of many students who would not be able to attend Texas State without financial aid. DeSalvo said he predicts a possible “student-loan debt bubble,” similar to the national housing crisis a few years ago, if legislators do not adequately address financial-aid funding.

The demand for financial aid is swelling, but the university has lower loan-default rates than many other Emerging Research Institutions, including Texas Tech University and the University of Texas-San Antonio. University administrators aim to keep loan-default rates—the percentage of borrowers who miss payments for 270 consecutive days—low, Heintze said. Texas State’s loan-default rate measures figures for three years after a student enters repayment. The rate is the lowest of the seven other emerging research campuses at 5.8 percent, according to College Scorecard statistics.

The median amount of federal loans Texas State undergraduate students borrow each month is $215.78, which is greater than six of the seven other emerging research campuses, according to the same statistics. This means Texas State students are borrowing more monthly federal funding on average than those enrolled at similar institutions. However, Texas State students are statistically more likely than average to continue making the payments without defaulting on the loans.

Heintze said he does not believe universities will be faced with a “tipping point” in the near future regarding demand for financial aid and availability of funding allocated by the state legislature. However, Heintze said a theoretical “tipping point” could occur eventually, in which some students may be deterred from attending college because of possible loan burdens.

“One of the things that we have to remember is that, still, even though costs are rising steadily, the value of a college degree is still very pronounced,” Heintze said. “That doesn’t mean that we shouldn’t try to contain costs, but there has been and will continue to be a strong push among students, parents and families to access higher education for their students because of the ultimate benefits.”