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Dr. Richard Barke
POL 1101A
April 19, 2005
Financial Aid at Georgia Tech: Need vs. Merit
Whereas merit aid (dependent upon academic performance) has an extensive history at private colleges and foundations, it has not previously existed as a major function in the public sector (Dynarski 2002, 2). “Historically, federal aid for college has been strongly focused on low-income students…Recently, however, the rules of the game have changed,” declared Susan Dynarski, as the focus has been shifted from need-based aid to merit aid (Dynarski 2002, 2-3). Even though 2,918 full-time undergraduate students were determined to have financial need, while just 685 were determined to have no financial need in 2004-2005, the majority of financial aid at the Georgia Institute of Technology is currently delivered on the basis of merit, rather than need (Common Data Set 2004-2005). Georgia Tech’s 2004-2005 Common Data Set indicates that the distribution for need-based financial aid is only $17,655,387, while non-need-based financial aid totals $19,458,113, a difference of nearly two million dollars. Within these total figures, the state of Georgia provided merely $6,099,377 for need-based aid, but $14,058,668 for merit aid, drastically favoring merit scholarships by almost eight million dollars (Common Data Set 2004-2005). Yet lower income youth, who are just as intelligent and deserving of a college education as those who have wealthy families, are depending on need-based financial aid as their admission ticket to college.
This recent emphasis on merit-based financial aid is disadvantageous for Georgia Tech’s needy students for several reasons. Merit awards decrease need-based aid dollar-by-dollar, and since recipients of only merit-based scholarships do not depend on their award to pay for college the merit money is often spent on non-educational related investments and consumption, while poorer students’ need-based aid will pay for college necessities because it is genuinely needed in order to attend college, and (lastly) the cost of college room and board is increasing, but Georgia’s most popular merit-based scholarship, HOPE, does not provide for this rising cost. Therefore, financial aid at Georgia Tech should be disbursed primarily according to need, rather than merit.
All Georgia residents have the equal chance to receive the merit-based HOPE scholarship, which is the primary source of merit aid in Georgia and at Georgia Tech. The HOPE scholarship generously offers full tuition/fees for attendance at public universities or $3,000 at private institutions. Because students of all income levels are equally evaluated for the HOPE scholarship, critics of need-based aid may say that HOPE is enough to ensure that all worthy intelligent students (able to maintain a 3.0 GPA) receive the opportunity to attend Georgia Tech if admitted. However, the amount offered by the HOPE scholarship is offset by additional sources of financial aid and scholarships dollar-by-dollar (Dynarski 2002, 28). For example, those who receive the maximum Pell Grant, which funds the most needy students, are not awarded any HOPE scholarship money but simply receive a meager annual allowance of $400 for books, although the costs of books and supplies as defined by the Office of Student Planning and Services is $1,000 annually. In other words, poor students who are undoubtedly worthy of merit aid are denied the HOPE award that they deserve simply because they are poor enough to have tuition covered by grants that are specifically for underprivileged persons. Susan Dynarski said, “As a result, upper-income youth received substantially larger HOPE scholarships than their lower-income counterparts” (Dynarski 2002, 28). Obviously, those needy students could use the HOPE to supplement other college necessities that they lack the money to fund, just as students who do not actually need the money often use the merit aid to pay for other proceedings.
What often happens to merit-based scholarship money? Generally speaking, most recipients who are meritorious enough to earn the admired title of “President’s Scholar,” and so forth, do not tend to be the students who demonstrate true lack of finances and family support for their college education. Thus, the most meritorious students (frequently those who attended a private high school) typically have a family financially stable enough to fund their college education already, so they are likely to attend Georgia Tech despite whether or not they receive merit-based awards (Dynarski 2002, 3). Studies suggest that when students are able to attend college regardless of the receipt of financial aid, at least a portion of the merit aid is used for investments, or to increase leisure activities and consumption. One study by Cornwall and Mustard (2002) investigates the correlation between the number of HOPE scholars per county and the amount of new cars that were bought there. This revealed that the purchase of new cars in Georgia increased significantly with the introduction of the merit HOPE scholarship program, suggesting that a sizable portion of the reward money is indeed going to causes other than school (Dynarski 2002, 33).
On the other hand, students who truly demonstrate the need for aid do not have the means to spend their financial aid selectively, and they are much more likely to attend college and do so successfully with financial help. This is because youth who are unfortunate enough to come from a family which was unable or unwilling to save money for their college education, or even minutely contribute to it, are usually faced with many more hardships and financial obligations that they must endure throughout college. Wealthier parents normally pay for their child’s expenditures while he/she is in college. The poorest students, however, do not receive any allowance from their family for daily living expenses, bills, transportation, or leisure activities. Consequentially, needy students are frequently forced to work excessively while attending school full-time, and often times they must burden themselves with loans to pay for school and expenses, unless the government offers some sort of guidance where their parents could or would not.
According to Susan Dynarski, the government proposes two alternatives to merit- based aid to subsidize an education for (needy) students: “low public tuition prices and need-based aid” (Dynarski 2002, 35). However, the predominance of merit aid has reduced these two options without regard to the mounting burden upon poverty stricken applicants. Long (2002), like Dynarski (2000), has examined the effect of merit aid on tuition fees and found that, “The full cost of attendance at public four-year schools rose faster in GA than in comparable states after HOPE was introduced” (Dynarski 2002, 32). Since the HOPE scholarship program began in 1993, the total cost to attend a four-year public school in Georgia has risen significantly. The cost has been increased specifically (but not solely) for room and board, but the merit-based HOPE only provides for other tuition/fees, which leaves low-income families even further in despair. The Georgia Institute of Technology Office of the Associate Vice President, Budget and Planning reported that in 1997-1998 the undergraduate resident cost of a dormitory room and board combined was $4,563. The following year (1998-1999) the cost of room and board had risen to $4,848. At present, Georgia Tech’s Common Data Set 2004-2005 shows the cost of on-campus room and board, not included in the HOPE scholarship, to be notably elevated to $6,150.
Since public universities, rather than private institutions, are the historical preference for lower and middle-income (needy) citizens, the Georgia Institute of Technology should strive to make it possible for all students to have an equal opportunity to attend (Dolloff 2004, 4). Every individual possesses the right, and thus deserves the chance, to pursue a college education that will prepare him/her for entry into a sophisticated degree-requiring career. However, Georgia Tech’s emphasis on merit aid often equates to less impoverished students obtaining a technical education at our prestigious university, and therefore fewer capable students are able to obtain an esteemed technical career. Citizens with college educations productively contribute to the economy, since increased knowledge equips humans with the ability to make better choices and endeavors. Therefore, it is unfortunate for the individual, as well as society, that many youth who are eager to further their education simply cannot financially afford to enjoy their right to an increasingly expensive college education. They will have the opportunity to attend college, however, if they receive need-based aid.


Works Cited
Dolloff, Holly J. “Merit vs. Need.” [web page] Aug 2004;
http://www.bizjournals.com/nashville/stories/2004/08/09/focus1.html [Accessed 25 Jan 2005].
Dynarski, Susan M. “The Consequences of Merit Aid.” [web page] Nov 2002;
http://ssrn.com/abstract_id=364521 [Accessed 23 Jan 2005].
Georgia Institute of Technology: Financial Aid. “Costs.” [web page] 2004;
http://www.finaid.gatech.edu/costs/# [Accessed 19 Apr 2005].
Georgia Institute of Technology: Institutional Research & Planning. “Common Data Set
2004-2005: Financial Aid.” [web page] 2003; http://www.irp.gatech.edu/Common_Data_Set_2004/Comm_Data_Set_H.html
[Accessed 19 Apr 2005].
Netz, Janet S. "Non-Profits and Price-Fixing: The Case of the Ivy League." [web
page] Feb 1998; http://ssrn.com/abstract=115812 [Accessed 23 Jan 2005].


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