State agency proposes student financial aid cuts

Courtney Lewis

The Minnesota Higher Education Services Office passed a proposal Tuesday that could cut financial aid for thousands of University students.

The measures are in response to the Minnesota Department of Finance’s recent memorandum instructing state agencies to anticipate budget cuts of 5 percent to 10 percent.

MHESO administers financial aid to all Minnesota colleges and universities.

The agency outlined plans for either 5 percent or 10 percent cuts from state work-study and grant programs and interstate tuition reciprocity.

A state grant budget reduction of 5 percent for the fiscal year 2003 would cut $9.7 million and affect approximately 3,400 University students. A 10 percent cut would save $23.8 million and pull aid from approximately 9,300 students.

The largest cuts would occur in state grant programs, but cuts would also be made in administrative expenses, learning networks and MINITEX library services.

Smaller cuts were also scheduled for several programs -including work study and state grants – in the fiscal years 2004-05.

“We turned this over in every way possible at the staff level, and we looked at what would be philosophically appropriate,” said Bob Poch, executive director of MHESO.

The proposal must be approved by the state Finance Department and Gov. Jesse Ventura before final review by the state Legislature after its session resumes at the end of January.

The Legislature has until April to determine MHESO’s funding ability.

“I’m distressed at it, but it’s a reality we have to face. We have a very difficult budget to work with,” said Regent Michael O’Keefe.

MHESO officials lamented having to slash funding, but said the state’s financial woes left them with no choice.

“The proposal they made is the fairest they could give to hurt as little people as possible,” said Aaron Street, a first-year law student at the University who is a member of MHESO.

Because, as a state agency, the University might also have to make 5 percent to 10 percent reductions, Street said, tuition might increase by 15 percent to 20 percent for the 2002-03 school year.

“The governor has made it clear that we’re all going to have to make cuts. The question is by how much,” said Richard Pfutzenreuter, associate vice president of the University’s Office of Budget and Finance. “It will be unfortunate for students.”

Poch said lower-income families will be less affected by the prospective cuts, and families that make $30,000 to $60,000 a year will be hit hardest.

“This is going to prevent some students from going to college,” Street said. “With the last tuition increase, Mark Yudof said that he’d ‘hate to say the sky is falling, but it is.’ That’s just an understatement of the current budget status.”

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