The Senate debated education reform legislation last week. So what did I learn? The Regents Universities have a set aside scholarship program. Big deal? Starting in the late 1980s the University of Iowa, Iowa State University and the University of Northern Iowa implemented a practice of setting aside a portion of tuition payments to offer as scholarships to other students. In September 2004 the State Board of Regents formalized the practice by approving a policy. The policy requires the three public universities to set aside a minimum of 15% of gross tuition proceeds for student financial aid. Each university establishes the amount of tuition set aside for scholarships of other students. The percentage and amounts vary between each school, undergraduate, graduate, resident, and nonresident tuition. My understanding is the following percentages of resident tuition are set aside for each institution – Iowa 24%, Iowa State University 18.6%, and University of Northern Iowa 15.3%.
For undergraduate resident students the current effect of the policy is that $1864 of the $7,765 tuition bill at the University of Iowa is used to offset scholarships for other students. At Iowa State University $1392 of the $7,486 tuition bill goes to other students. At University of Northern Iowa $980 of the $6,408 tuition bill is applied to other students’ scholarships rather than the direct costs of the paying student.
If an individual family saved or borrowed to send a student to an Iowa Public University, a significant (21.3% average) portion of the tuition went to other students. Even if your student received an award from a local service club, a percentage of that award went to some other student. In fiscal year 2011 approximately $150 million of tuition proceeds was set aside and awarded to other students as need based or merit based aid. That was YOUR money, intended for students in your family, which went to someone else.
The regents’ universities probably feel they have done proper public disclosure. But I bet if you wrote a tuition check you didn’t realize where the money was going. You probably thought you were paying the education expense for your student. If you are about to send a student to one of Iowa’s three public universities, please have school officials clarify how much of your check is being set aside for some other student.
I believe this policy is wrong. Especially wrong for a state where student loan debt is considered unacceptably high. The cost of these scholarships should not be borne on the backs of Iowa families who choose to send their children and grandchildren to the regents’ universities. The tuition rate should be reduced sooner not later. Iowans deserve better from their state government. As a parent of a son that attends the University of Northern Iowa I am outraged.
I am told, with considerable emphasis, that the Board of Regents is addressing this issue and no legislative action is required. I will be watching closely.
State Senator Brad Zaun (R-Urbandale) represents Iowa Senate District 32