I had financial aid be displaced by private scholarships and never thought twice about it. I was a very, very poor student and if my private scholarships made it possible for other poor students (financial aid) to go to school with less debt, I was all for it.
I guess I’m strange. I never considered it “punishment.” I was raised to believe that when you find success, it is your duty to help others. For me, the scholarship/FA issue was an extension of that.
In cases where the college does not meet full need with aid, it would be unethical (in my opinion) to displace money earned by a scholarship.
I agree. Scholarship displacement is only okay if the college meets full need for low income students. For other colleges, it’s unfair indeed - and Maryland public universities don’t meet need at all, so that’s a welcome change.
The article does not clearly distinguish between grant aid and loan / work-study aid that is displaced by outside scholarships. Many colleges first displace the latter before displacing the former when a student brings an outside scholarship. Unlike some other colleges, Maryland publics do not make it clear on their web sites what they do (or did before this change).
Apparently they displaced grants, since an organization had a system whereby the students kept their scholarships till they graduates and used it to pay back loans, rather than have it cover scholarships while and school and still end up with loans…
I would question the ethics of reducing FA even if the student’s full need is met. For starters, if the FA package includes loans, private scholarships should be used to reduce the amount of the loans first (which I think a lot of schools do).
Even if there are no loans in the FA package, I think some consideration needs to be given to the fact that students often have to spend time and effort seeking out and applying for these scholarships. What’s the incentive for a student to even try for private scholarships if they won’t benefit from receiving them?
The law, as described in the article, seems to be a bit heavy-handed. There’s probably some middle ground that could be reached, such as Pitt’s approach to only reduce FA once the scholarships reach the full COA.
Even colleges that do not include loans in the FA packages assume a student work contribution. At least some of them apply outside scholarships to reduce the student work contribution before reducing grants. For example:
I’m OK with loans and work reduction. That really is money. But not OK with grant reduction when full meet isn’t met.
And if full need is being met, then what is the incentive for the college to redistribute the money? In the college’s eyes, those students don’t need any additional money either.
Also, it seems that it would discourage students from trying to work harder. If you aren’t going to benefit from scholarships, why apply yourself at all?
The Baltimore Sun article does mention Delegate Dana Stein; on his web page, a link to HB 231 is given:
http://mgaleg.maryland.gov/webmga/frmMain.aspx?id=hb0231&stab=01&pid=billpage&tab=subject3&ys=2016RS
with a related SB 313:
http://mgaleg.maryland.gov/webmga/frmMain.aspx?pid=billpage&stab=02&id=sb0313&tab=subject3&ys=2016RS
If the amended (third reading) version of SB 313 was the one enacted, it effectively means that outside scholarships must be applied in this order:
- Unmet need (where financial need is defined in 20 USCA 1087KK, https://www.law.cornell.edu/uscode/text/20/1087kk ).
- Loans.
- Work-study.
- Grants and scholarships.
It still is not obvious what Maryland public universities did before.