More College Scholarships

More financial aid is available for college than ever before. Since 1993, new college tax credits and national service programs—as well as the greater availability of federal scholarships for low-income families—have opened the door to higher education for millions of students who otherwise could not afford it. The federal government will provide over $60 billion in 2001 aid, including the Hope Scholarship and Lifetime Learning tax credits, compared to only about $25 billion in 1993. Today, students are going to college in record numbers.

College and lifelong learning are more important than ever before. One hundred years ago, we passed laws requiring every child to attend school. Fifty years ago, we extended public schools to 12 years and passed the G.I. Bill to open the doors of college to middle-class Americans. Today, as we enter the 21^st century—stepping confidently into the Information Age and an era of global economic competition—we must expand postsecondary education opportunities for everyone.

• President Clinton proposed the Hope Scholarship to make two years of college affordable for all families. A $1,500 tax credit for the first two years of college, the Hope Scholarship will pay for nearly all of a typical community college’s tuition and fees. When proposing the credit in 1996, President Clinton declared that "our goal must be nothing less than to make the 13th and 14th years of education as universal to all Americans as the first 12 are today." In 1998, 2.6 million families received $2.6 billion in tax relief for higher education through the Hope Scholarship.
• President Clinton also proposed the Lifetime Learning tax credit to complement the Hope Scholarship and promote lifelong education and worker training. The $1,000 Lifetime Learning credit reimburses families for 20 percent of their tuition and fees (up to $5,000 per family) for college, graduate study, or job training. Starting in 2002, the credit will reimburse families for 20 percent of their costs up to $10,000, for a maximum value of $2,000. In 1998, 2.3 million families saved $800 million on higher and continuing education through the Lifetime Learning credit.
• These credits make a difference for American families. For instance, a family earning $60,000 with one child at a community college (with a tuition of $2,000) and another child who is a sophomore at a private college (with a tuition of $11,000) would receive as much as $3,000 in tax relief under the Hope Scholarship. An automobile mechanic with an income of $30,000, taking courses at a local technical college (with a tuition of $1,200) to upgrade his computer skills would save as much as $240 using the Lifetime Learning credit.

The Clinton Administration has been dedicated to expanding scholarships for needy students. The cost of college makes a difference for students from low-income families. Some scholars believe, for instance, that a $100 increase in the cost of college decreases the enrollment of lower-income students by about 1 percent.^[10]

• Pell Grant scholarships for low-income students are the federal government’s single largest commitment to equalizing college opportunities. Pell Grants—more targeted to meet financial need than any other of the Department’s student aid programs—help ensure financial access to postsecondary education. Over the past quarter century, 30 million students have used a Pell Grant to help pay for college or career training.^[11]
• The Clinton Administration restored the financial integrity of Pell Grants. The Clinton Administration inherited a $2 billion funding shortfall in the Pell Grant program. During the next several years, this funding shortfall was eliminated—restoring this important program's solvency—even while increasing the amount that the lowest-income students receive.
• The Clinton Administration has increased the federal investment in Pell Grants by over 40 percent. Today, 3.8 million students receive grants of up to $3,300. When President Clinton took office in 1993, the maximum Pell Grant was $2,300. In contrast to this $1,000 increase, the maximum grant increased by only $630 during 12 years of the Reagan-Bush Administrations.
• Supplemental Educational Opportunity Grants, which provide scholarships up to $4,000 to low-income students, have also been expanded under this Administration. This year, 1.1 million students will receive nearly $800 million in SEOG scholarships.

Since 1994, AmeriCorps has allowed more than 150,000 Americans to strengthen their community while earning help to pay for college. AmeriCorps members tutor children, fight crime, build houses, and do countless other things to improve lives and bring people together. AmeriCorps has made available nearly $400 million dollars to help participants achieve their dream of a college education while improving their communities.

[Executive Summary]

[More Affordable Student Loans]