Merit-based aid funding at risk

At a meeting Tuesday, the committee on scholarships, awards and student aid discussed a potential repeal by the N.C. General Assembly that could make merit scholarship funds more scarce.

Eyeing a potential repeal of a 2004 law that allows out-of-state students receiving full scholarships to be given in-state status for tuition purposes, committee members expressed concern for the future of the Morehead-Cain and Robertson scholarships.

Members said fewer out-of-state students would benefit from those scholarships, as offering them to non-residents would become considerably more expensive — and take a higher toll on the scholarships’ respective annual budgets.

“It would kill our ability to recruit high-achieving out-of-state students,” said Dan Thornton, associate director of scholarships and student aid.

Committee members said the problem began when the University’s endowment, a significant private resource for scholarship funds, fell 19.6 percent in 2009.

“Those hits to endowment affect our scholarship payouts,” Thornton said.

“There’s a lot of confusion about merit scholarships,” he added. “Some people believe the money comes from special scholarship trees.”

Faced with both definite economic and possible legislative challenges, the committee is considering some major changes.

“There’s potential for really re-thinking some of what we do here,” said Shirley Ort, associate provost and director of scholarships and student aid.

The committee debated whether it should continue to offer many small scholarships or begin to offer fewer awards at greater amounts.

UNC offers a number of small merit scholarships that provide $2,500 to $6,000 in aid, Thornton said.

Although these scholarships can be provided to more students for less funding, they produce lower enrollment yields than full scholarships, he said.

Thornton said the value of partial scholarships also declines over time because of annual tuition hikes.

Steve Farmer, director of admissions, said that if UNC can’t offer as many full scholarships, it should attract high-achieving students by channeling funds toward enrichment opportunities such as research and study abroad.

“This would offer another educational opportunity to students, not just a financial one,” he said.

Meredith Bazemore, assistant director of scholarships and student aid, said she agreed.

“Top-tier students, I think, would really benefit, and see that as an additional resource,” she said.

Ort said she believes the federal and state government will continue to provide adequate amounts of need-based aid.

“I want more focus on merit-aid in order to support recruitment,” she said.

The Morehead-Cain Foundation has extensively lobbied against the legislation change, Ort said.

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