Financial aid tide rises

LINCOLN — More Nebraska students are turning to Uncle Sam for help with their college expenses.

The University of Nebraska system has seen increases in every financial aid category: grants that don't have to be repaid, government-financed loans and work-study programs.

University of Nebraska-Lincoln students, for example, took out a record amount of federally financed student debt in the 2008-09 academic year: $101 million.

That was a 16 percent increase, with UNL topping $100 million in loans for the first time. The university expects to match that total again in the current school year, said Craig Munier, director of financial aid.

Almost half of UNL's 24,100-student body borrowed money for college expenses last school year.

Creighton University is experiencing a similar trend, although the dollar amounts are much smaller at the private Jesuit institution in Omaha.

Need-based aid at all four major NU campuses was a combined $151 million last school year and projected to exceed $161 million for 2009-10, said Kristin Yates, director of institutional research.

Those figures don't include unsubsidized student loans, which are awarded without regard to family income.

NU President J.B. Milliken pointed to these reasons for the increase in financial aid: the economic downturn's effect on family income and college savings account balances; increases in maximum loan and Pell Grant amounts; and a universitywide emphasis on ensuring that all Nebraskans can afford to go to college.

The NU system, for example, is at its highest enrollment level since 1996.

Anna Pearson, a UNL junior from Seward, Neb., majoring in textile and clothing design, took out student loans for the first time this school year.

In past years, when her older brother also was attending college, her family qualified for grant assistance. That ended after he graduated last year. She now has two unsubsidized loans totaling $10,000.

“It's a lot of money to be taking out,” Pearson said.

But with a favorable interest rate locked in, she said, she isn't too worried about borrowing the money, whether the economy recovers or continues to falter.

At the University of Nebraska at Kearney, borrowing surpassed the $20 million mark for the current school year, a $1.5 million increase over last year, said financial aid director Mary Sommers. Borrowing in the past typically has risen by about $100,000 annually, she said.

But the number of individual loans has not substantially increased.

Sommers said the larger dollar figure results primarily from the federal government raising the maximum amount students can borrow, depending on their situation, to as much as $7,500 a year.

She said her office has aggressively encouraged families to apply for aid, saying she worries that the economy will prevent students from even considering college because they don't think they can afford it.

At Creighton, the financial aid office has disbursed about $26 million in federally subsidized loans this school year, compared to $24.5 million for 2008-09.

Pell Grants at Creighton increased by 7 percent this year, to $2.9 million, said Bob Walker, student financial aid director.

Both Creighton and the University of Nebraska say they have more students seeking emergency help this year. NU set aside an extra $1.2 million to help students through unforeseen financial crises, such as a parent losing a job or getting sick or injured.

UNL already has depleted its $647,000 share of the funds, said Munier. A relatively small number of students needed the money — 200 or so this year, compared to about 100 in past years — but still, it's a telling barometer of the economy, he said.

Sommers said UNK held back a portion of its $100,000 share of the additional emergency aid to address situations that may arise later in the school year.

She said the planned closing of the Tenneco shock absorber plant in Cozad, eliminating 500 jobs by the end of 2010, could affect some UNK students.

“The economy doesn't always accommodate family or academic calendars,” Sommers said. “We would encourage families with any concerns about keeping their kids in college because of economic problems to talk to their financial aid professionals on campus.”

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402-473-9581, leslie.reed@owh.com