Task Force Recommends Considering Financial Need for Small Part of Applicant Pool; Treasurer's Report Gives Financial Framework for Proposals

An extensive report on the College's financial framework prepared by treasurer Mary Jo Maydew, and letters from President Creighton to faculty and student leaders, explain that "serious financial constraints" require the College to consider changes in its admissions and financial aid policies. According to Mike Robinson, professor of economics and chair of the Admissions and Financial Aid Task Force, change is needed to moderate skyrocketing growth in financial aid that has strained the College's budget.

A report to the Educational Priorities Committee (EPC) from the task force stresses that "Without an appropriate level of support for the education we offer, the goals of access to a Mount Holyoke education and having an excellent and diverse student body become empty." Both reports are the subject of meetings this week with the faculty and with the Student Government Association Executive Board.

RISING FINANCIAL AID PROMPTS CHANGES

According to Maydew's report, financial aid costs have increased in the last decade from $6.5 million to $21.4 million. The College's financial aid costs this year were greater than those for academic instruction. The report states, "Although most private colleges and universities have seen considerable increases in financial aid over this period of time, the level ... experienced by Mount Holyoke is significantly larger than those of its peers."

To accommodate rising financial aid, the College increased the amount of endowment spending, used more "unrestricted" funds, and reduced costs in other areas. While cost cutting continues to be important, the other methods of funding financial aid increases cannot continue if the College is to stay fiscally healthy. To reach financial equilibrium, the treasurer's report looks to a combination of financial aid changes, productivity improvements, cost reductions and stabilizations, and augmented marketing that would stimulate larger pools of inquirers and applicants.

"In the last five years, the endowment has been spent at a rate that is imprudent, and, in the long run, unsustainable because it would erode our status as one of the premier liberal arts colleges in this country," Creighton's letter to students noted. "We must strengthen our position financially in order to continue to do all the things we must do--for example: continue to attract and retain excellent faculty and students of diverse racial, cultural, and socioeconomic backgrounds; maintain the beauty of this campus and its facilities; and provide the technological equipment that our students and faculty need."

TASK FORCE RECOMMENDATIONS

The Admissions and Financial Aid Task Force's report to the EPC recommends that, to meet these goals, 90 to 95 percent of admissions decisions for future entering classes continue to be based on academic promise, regardless of an applicant's ability to pay for her education. However, for the remaining 5 to 10 percent--applicants rated the lowest academically--ability to pay would become a factor in admissions decisions.

If adopted as part of the Plan for Mount Holyoke College 2003 and approved by trustees, the policy would move MHC away from the admissions/ financial aid policies it has followed for U.S. students since 1983. In that year the College not only had "need-blind" admissions, but also began fully funding each student's demonstrated financial need. Under the new proposal, the College would continue to meet the full financial need of all students who were accepted, though some qualified students with high need and a low academic rating might not be accepted.

The proposal would not cut the amount of financial aid provided by MHC; it is the rate of growth in the financial aid budget that must be slowed. Indeed, MHC will continue to provide a significant amount of aid to students.

Before settling on this comparatively modest proposal, the task force carefully considered (but rejected) more radical changes to admissions and financial aid practices such as considering financial need when making all admissions decisions, or admitting some applicants without offering financial aid. Many of our peer institutions have already adopted policies similar to those in the task force's proposal.

SPECIFIC PROPOSALS

The task force proposes changes in the criteria used to accept students, and in the way aid for students is allocated. Key recommendations are summarized below.

• Any changes in financial aid policies would not affect current students. Any change in admissions policy would not affect the class of 2001.
• The College will still seek both academic quality and diversity in the student body.
• While continuing to make 90 to 95 percent of the admissions decisions based on academic promise alone, the final 5 to 10 percent of the decisions would consider financial need as well as academic promise. This would affect approximately fifty to one hundred admissions decisions.
• Every highly qualified candidate should be admitted regardless of her financial need. No unqualified applicant will be admitted regardless of ability to pay. Changes would affect only qualified applicants with the lowest academic ratings.
• The amount and kind of financial aid offered to students may vary, offering the best financial aid packages to the students the College most wants to attract. The College might expand current "preferential packaging" programs that offer, for example, more grant aid and less loan and work-study to applicants with the best academic records.

CAMPUS DISCUSSION

The task force's report has been endorsed by the faculty Planning and Budget Committee and the Admissions and Financial Aid Committee. The EPC is presenting it and the treasurer's report for campus deliberation as part of the overall planning process. If adopted, the changes would be in effect during the six years covered by the planning document (1997-98 through 2002-03), after which they would be reviewed and appropriate adjustments made.

Copies of both reports are available to the campus community; call the president's office at x2500 or send email to planning.