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Aid cuts would burden Institute

analysis

By David P. Hamilton

President Ronald Reagan has proposed budget cuts in federal student financial aid that, if approved, would adversely affect MIT undergraduate students and the Institute.

The proposal would cut $2.3 billion from federal financial aid. It would deny guaranteed student loans to students whose families' gross incomes exceed $32,500 per year.

Students whose families earn more than $25,000 would be denied federal aid such as direct grants, loans, and subsidized jobs.

Students whose families' incomes fall below the $25,000 cutoff would be limited to $4000 per year from those federal aid programs.

About 60 percent of MIT undergraduates receiving financial aid fall above the $32,500 mark. Only 16 percent of aid recipients fall below the $25,000 mark.

With the loss of federal aid, MIT would be forced to place more students on its aid rolls, increasing the burden on the Institute financial resources. About 55 percent of MIT undergraduates currently receive MIT financial aid.

If the cuts occur, MIT would either have to absorb the financial aid burden, causing tuition to rise, or raise the equity level. Either way, the students would pay for government cut.

Some students might be able to compensate for the increased burden through the ROTC program. But the number of full ROTC scholarships is limited.

MIT practices "need-blind" admissions. The Admissions Office does not use a applicant's financial status as a factor in making an admissions decision.

The Institute instead guarantees financial aid to any student who meets the Institute's qualifications.

Reagan's cuts could force MIT to reconsider its "need-blind" philosophy. If financial aid requirements exceed the tuition and equity levels MIT is willing to set, the Admissions Office might have to consider prospective students' finances in order to admit students who will be able to pay tuition.

Many minority students rely on financial aid to attend MIT. An end to need-blind admissions would work against MIT's goal of attracting more minority students.

In order to maintain its need-blind policy, MIT will have to search for funds from external sources other than the government.

The Institute might find that many large companies interested in maintaining the quality of their applicant pools will be willing to make money available.