GW is urging students to contact their congressional representatives and express their support for the federal Perkins Loan program, which President Bush scheduled for elimination in his 2006 budget. More than 2,141 GW students receiving $3.8 million in Perkins Loans as part of their financial aid packages could be affected by the move.
Ruth Hoch, senior assistant director of the Office of Student Financial Aid, sent letters to all Perkins Loan recipients at GW urging them to write their representatives. Hoch said GW has given out more than $72 million in Perkins Loans since the early 1960s. As a result of the cuts, GW will have $380,000 less to give out in 2005-06.
“It’s a program that’s worked efficiently for over 40 years,” Hoch said. “The idea that future generations would not get this money because of the short term goal of deficit reduction is just short sighted.”
Under the Perkins Loan program, the federal government gives GW money to finance tuition costs. GW matches one-third of the funding amount and administers loan repayments. Repaid loans go back into the $4.5 million revolving fund from which GW loans money to subsequent students.
Students begin paying back the loans at a 5 percent interest rate per year after leaving school. Loan payments are deferred or forgiven for students engaged in service in the Peace Corps, military, medical and law enforcement professions.
“Students and families calling their members of Congress is what really makes the difference,” said Stephanie Giesecke, director for Budget and Appropriations at the National Association of Independent Colleges and Universities. Dozens of schools, including Georgetown, have called for the loan program’s reinstatement.
Giesecke said that when $120 million in education cuts were proposed in 1995, the Student Aid Alliance organized college, students wearing their school’s sweatshirts to pack budget committee meetings on Capitol Hill. According to the Alliance’s Web site, the federal government provides aid to 73 percent of all U.S. students.
“There are lots of proud Perkins recipients,” said Richard Sawaya, the University’s vice president for government, international and corporate affairs.
In 2004, 673,000 students at more than 800 colleges and universities across the country received $1.3 billion in Perkins Loans. The average Perkins Loan recipient at GW receives $1,500 while students nationwide receive an average of just under $2,000.
If the Perkins Loan program is ultimately cut, colleges and universities would give federal money back to the Treasury Department through the Department of Education. The $6 billion saved from cutting Perkins Loans would be used to increase Pell Grants and fund a $1.5 billion expansion of the No Child Left Behind Act into high schools.
The White House budget calls for a $100 increase in the maximum individual Pell Grant over five years, and an $834 million overall increase for Pell Grants. Pell Grants, however, are not available to graduate students, and typically grant money is distributed before loan money.
The Pell Grant changes as they stand would lower the income threshold for recipients and leave between 100 and 150 GW students without a total of $100,000 in federal funds next year, University officials said in February. Bush’s budget also proposes freezing federal work-study funding and Supplemental Educational Opportunity Grants.
The White House’s press office did not return multiple phone calls from The Hatchet for this article. Brian Reidl, a budget analyst for the conservative Heritage Foundation, told the Yale Daily News that the loans assist only 3 percent of students.
“Those who perpetually want even more spending will never be happy,” Reidl said.
Sawaya said his office lobbies GW alumni serving in Congress to increase education funding. “Each legislator has to consider pros and cons,” Sawaya said. “People tend to forget that the budget is first and foremost a legislative function.”
He added, “A legislator is much more likely to be impressed if a GW student shows up at his or her town meeting and speaks to a policy issue concerning that student.”
-Michael Barnett and Ryan Holeywell contributed to this report.