Fnday, May 30, 1997 Today's EditoE http ://www.b usinesstoday.

com/cAi-b in/editors

F-riday, May 30, 1997

12:31:13 PM EST

(lo ntributing editorsilohn O. Harney

Two congressmen do the right thing for needy college students

Two fieshman Massachusetts congressman have wasted no time in trying to do the right thing lor the Bay State's neediest college students and
their families.

While the White House touts tuition tax breaks for middle-class families, and the general poticy fuift in Washington steadily replaces student
granrs with studenr loans, Democrats Jarnes P. McGovem of Worcester and John Tiemey of S4gm. ale pushing bills to dramatically expand the
ibrm ol federal student aid that best helps students from lower-income families: the need-based Pell Grant.
president Clinton's budget package, which calls for a S 10,000 rax deduction and S 1,500 tax credit for middle-income families struggling with
tuition bills, would rais6 thf maxlmum Peil by a measly 5300 from its cLrrent level of $2,700 to $3'0m.

McGovern's legislation would shoot the mar(imum to 54,500 next academic year and $5,000 in a^cademic year 1998-99. A separate bill
cosponsored Uf Tiemey would hike the maximum to 53,300 next year iurd then increase it by 5300 annually until the yeu 2402. AU the plans
would also make Pell Grants available to more students.

To be sure, if Washington is bent on middle-class tax relief, tuition-paying families are logical beneficiaries, After all, the knowledge economy
t1e mands higher levels"of education. And at S100,000-plus for a foui-year college edu-cation, even relatively cornfortable
families need help
rvith collegJbills. But the lact remains: tax breaks help those who irgbetter able to afford college Irlore than they help those who are least able.

pell Grants, on the other hand, target students from low-income families, as well as middle-income families with several children in college at
rhe same time. And unlike tu benlfits, grart money is available when students and families need it most - when term bills are due.
Ip acldition, grants have proven to be crucial in motivating students. According to a study by the General Accounting Office, a $1,000 increase
in grant ald translates into a 14 percent decrease in college dropout rates.

Yet. as college costs rose twice as fast as fanuly income over the past decade or so, the Pell Grant's buying power deteriorated. The
inflation-adjristed value of the maximum Pell has decreased by 13 percent since the early 1980s. N-ationally, the maximum grant now covers
costs are anything but
iust l0 percent of average costs at private universities. down fiom 20 percent a decade ago. And Massachusetts college
average.

At the University of Massachusetts at Arnherst, tuition and rapidly growing 'mandatory fees" have grown from 5 percent of atlpical-Bay
Stato's family iniome to more than 12 percent. Meanwhile, stlte lrant aid [o Massachusetts studenls has plunged from nearly $93 million in
1989 to less than S55 million.

Loiu1s ue a poor substitute for grants. As the federal student aid portfolio has shifted from 80 pglc-ent grants in the.mid-1970s to about 80
perccnt loan.s totlay, student de5't has mushroomed, lorcing highly leveraged graduates to put off big purchases and to make job choices based
()n pay instead ol personal interests or societal needs.

Moreovcr. the disappcariurce of grants has becn especially hard on low-income families. In 1979. a student from the top one-fifth of tamtly
income was about lour times moie likely than a student fiom the bottom fifth to earn a bachelor's degree by age 24, according to in analysis by
Iowa higher cducation consultant Thomas G. Mortenson. By 1994, the student from the top fiith was l0 times more likely.

Propxlsals to dramatically increase Pell Grants may prove mostly symbolic. It will be hard enough to follow through on President Clinton's
modest 5300 hike.

What's retieshing is the two rookie lawmakers' instinct that what's good for students and their families is good for New.England and
parriculaly goodfo. places like Worcester and Saiem that may lacklhe college-town verve of Cambridge and Amherst, but nonetheless host
large student populations.

McGovern and Tierney may find that a continued commitment to the neediest students will be remembered long after they leave Washington.
.Iust ask students and families if the narne Claiborne Pell rings a bell.

.lrthn (). Homet, i.s the erecutiye editor of Connection; Ney, England's Journal of Higher Educatio-n and Economic Development. Conneclion
it ttrc qL,niierit, jit,ialof tie New Engiand Boord oJ'Higher ilducation. BusinbssTbda))'s contributing editors appear on Tuesdal's and
l: rid tt's.

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