Federal student aid cuts on hold

PORTLAND – A proposal that would have cut Maine’s share of federal student aid money is stalled in Congress, but university officials warn the question of redistributing the funds will come up again.

“If it is indeed postponed, it doesn’t make the issue go away for the state of Maine,” said Keith Dubois, director of financial aid for the University of Maine System. “It’s a huge loss of resources.”

The Bush administration and the National Association of Student Aid Administrators have endorsed a proposal to reallocate $1.8 billion in federal funding for work-study jobs, Perkins loans and Supplement Educational Opportunity Grants.

The redistribution would cut funding to New England colleges and universities and increase the amount distributed to institutions in the South and West.

The legislation that will establish how financial aid dollars are distributed is not expected to be reauthorized before 2005. Maine stands to lose more than any other state if the dollars are reallocated, according to an analysis by the American Council on Education.

The reallocation would cost Maine’s colleges and universities $8.2 million annually. The state’s four-year public institutions would suffer the greatest drop, 66 percent.

The University of Maine could lose 61 percent of the $3.5 million it now receives, while the University of Southern Maine would see its funds go from $2.9 million to about $700,000. The state’s private colleges and institutions would suffer a 31 percent loss and community colleges would lose 23 percent of their funding.