Brown University News Bureau

The Brown University News Bureau

1998-1999 index

Distributed February 20, 1999
Contact: Mark Nickel

Larger grants, smaller loans

Brown to spend $5 million on undergraduate financial aid improvements

Beginning with the Class of 2003, all students who qualify for Brown University scholarship aid will receive larger grants and smaller loans. On average, students with the greatest need will receive approximately $17,000 in additional grant support during their four years and will graduate with an estimated $7,000 in loan debt. The new policy will cost approximately $5 million when fully implemented.

PROVIDENCE, R.I. -- At its winter meeting today (Saturday, Feb. 20, 1999), the Corporation of Brown University approved a new financial aid policy that will increase grants and reduce debt for all incoming students who qualify for University scholarship aid.

The $5-million plan, to be phased in with the entering Class of 2003 this fall, will provide a four-year total of approximately $17,000 per student in additional grants for students with the greatest financial need. Those students also will receive corresponding reductions of up to 70 percent in the loan portion of their financial aid packages, leaving them with an estimated $7,000 in educational loan debt upon graduation. The amount of additional scholarship and loan reduction will vary with financial need, but all students who receive University aid will receive significantly improved financial aid packages.

"Our new financial aid policy will allow students to choose Brown for the right reasons - our curriculum and faculty - without undue worry about their debt burden at graduation," said Brown President E. Gordon Gee. "The changes we are announcing today will ensure Brown's continued success in recruiting our nation's most promising young scholars."

The new policy will provide additional resources for incoming students from middle-class families who may qualify for smaller amounts of aid. Where many of these students would have received financial aid packages consisting entirely of educational loans, all qualified incoming students will now be eligible for a minimum scholarship of $1,000 per year. Approximately 4 percent of students in the Class of 2003 will benefit from the new minimum grants.

The new policy also provides improved financial aid packages for many current students who receive University scholarship aid. All students can now apply 100 percent of any outside grants toward the self-help portion of their financial aid packages, reducing loan or campus work expectations.

"The social and economic diversity of our undergraduate student body is and must remain an essential element of campus life at Brown," said Gee. "Our new policy will help keep a Brown education accessible and affordable for applicants from the widest possible economic spectrum."

The new policy will require a permanent budget increase of more than $2 million in the first year. Smaller incremental increases in the second, third and fourth years will bring the total budget increase to approximately $5 million.

In 1990, Brown adopted a policy of indexing its financial aid base budget to increases in total student charges so that financial aid resources would keep pace with prices. In practice, the financial aid budget has risen much faster than tuition and fees, averaging about 9 percent annual growth over the last 10 years. Projected annual increases plus the $5-million cost of the new financial aid policy will result in a 53-percent rise in the financial aid budget over the next five years, from $26.8 million in fiscal year 1999 to $41 million in fiscal 2004.

"A $5-million commitment to improved financial aid is an extraordinary step for Brown to take," said William S. Simmons, executive vice president and provost, "but we intended these policy changes to make a significant difference for incoming students. The new policy will provide a substantial benefit to students who have financial need, but it is just as important to the University's own future. Access and affordability are essential to maintaining the talented student body that is so essential to the Brown experience."

Brown intends to fund the new financial aid policy through a combination of newly budgeted resources, budget reallocations and fund-raising. For fiscal year 2000, when the new policy will have its most significant budgetary impact, the University anticipates growth in non-tuition revenue, including growth in endowment income, a higher level of annual gifts from alumni and other sources.


Related documents:

98-070q Questions and answers about Brown's new policy
98-074   Brown announces tuition for 1999-00 academic year