Ripon College Days

As a part of President Bush's budget proposal, the Perkins Loan program, which about a quarter of Ripon students utilize, could be eliminated.

Director of Financial Aid Steve Schuetz says that the elimination of the loan would greatly affect Ripon.

"We have over 200 students receiving Perkins Loans, and based on what [Bush is] proposing, it would essentially cut the program in half immediately," says Schuetz.

For students at Ripon, the Perkins Loan typically pays for between $500 to $4,000 for just one year.

This 40-year partnership between the federal government and participating colleges and universities is a loan program that is aimed at helping low and middle-income families pay for the rising tuition of a higher education.

If the Perkins Loan were cut, the government would save approximately six billion dollars. Schuetz argues that the benefits the Perkins Loan provides are more important than its price tag.

"With the Perkins Loan you have deferred payments while in school, the interest is subsidized, there is a fixed interest rate, and for some students if they go into a certain area of study, they can have portions of the loan forgiven or cancelled altogether," says Schuetz.

Also, this loan is unique because it acts as a "revolving account"; when the loans are repaid, the money goes directly into new loans for current students.

In attempts to make the cut of the Perkins Loan more acceptable, Bush proposes to increase the limits for the Pell Grant, a need-based grant for students in the lowest income range that does not have to be repaid.

While this would provide another source of money for students, the proposal would still require schools to give back money to the government as the Perkins Loans are repaid. Therefore, the school would be losing out on money that could be used to help students pay for their tuition.

Although there are other loans students can obtain, the differences between them and the Perkins Loan are significant.

"There are a number of ways students could get additional loans, but they would be private institutional loans and this would require students to apply based on credit," says Schuetz.

The Perkins Loan, however, provides for students who have no established credit, as well as financial needs.

"The alternative is a private loan, and not all students are able to do that because the bank can turn them down," says Schuetz.

Based on the amount of opposition the proposal has received, it is unclear as to whether it will be passed or not.

"I think it has a 50/50 chance. There is a lot of support in Congress, but there are a lot of lobbies who are fighting it," says Schuetz. "It's going to affect each and every school, literally thousands upon thousands of students."

Article Tools