In hindsight, senior Hannah Hendricks doesn’t doubt her choice to come to Belmont University.
But it was a decision the Clarksville native almost derailed when she sent an email to the college she nearly went to – Northwestern University – saying she made a mistake by committing to Belmont.
Now though, Hendricks said that “mistake” is something she would never regret. Four years later, she is set to graduate from Belmont with a bachelor’s degree in English and with some level of student debt – an amount she wasn’t willing to reveal publicly.
Even with the combination of merit- and need-based aid she received from Belmont, she knows she probably would have actually gotten a better deal at Northwestern, a school with higher admission standards – 18 percent of applicants are accepted in contrast to Belmont’s 81.5 percent. Northwestern’s tuition is nearly twice as much as Belmont’s, but the Illinois school has a larger financial aid pool that it reports covers all of a freshman’s demonstrated need.
“That did come into play before I made a decision,” Hendricks said. “But I ended up at Belmont because of that gut feeling you hope for.”
While Hendricks knows she made the right choice by coming to Belmont four years ago, the institution she came to was one that valued and compensated her more for the merit of her application rather than the need she exhibited.
According to Belmont’s 2011 Form 990 IRS tax form, the document the university files annually because of its non-profit status, every dollar allocated for need-based aid is reflected with two dollars for scholarships based on merit. When government and institutional aid is factored in, Belmont students with greater financial need pay a net price 15 percent less than the average student, a smaller percentage than many of the schools the university compares itself to.
The university’s allocation of scholarship funding is also reflective of a larger, nationwide focus on awarding scholarships based on previous work instead of current need. A federal study shows the level of university-driven need-based aid has been overpassed in private schools by the amount of merit-based aid given in a 12-year period.
That push for merit aid has come as several top-ranked private institutions, especially ones with major endowments like Northwestern and Vanderbilt, try to minimize student debt post-graduation. To do this, they allocate funds to give grants that would cover all college costs beyond the expected student’s or family’s contribution determined by Free Application for Federal Student Aid.
A 2011 Department of Education report showed the level of students receiving merit aid at private schools nearly doubled from 1996 to 2008, surpassing the number of students at the same schools who receive institutional need-based aid. The level of students who received need-based aid was stable during the same period.
Belmont has only recently reached that 2-to-1 level of scholarships the average private school has. According to the university’s 2011 Form 990 tax return, the school gave more than $9 million in merit-based scholarships in the 2010 fiscal year, compared to about $4.3 million that was need-based.
That ratio of merit to need was actually Belmont’s lowest in the three-year period where tax returns are available. The 2008 return showed the level of funding given based on need equaled 37 percent of the $6.6 million that went to need-based aid, and the 2009 return showed a 3-to-2 merit to need ratio.
Vice President for Development Bo Thomas said that since 2008 attending Belmont has become more of a challenge for mid- and low-income families. At the same time, donors seem to be more aware of need than in the past, he said.
“We really do see the need,” Thomas said. “It’s hard to beat the message of scholarships. They’re the difference maker for a lot of students.”
With or without scholarships, the net cost to attend Belmont for low-income students has also become much closer to what the average student pays than before.
Figures from the National Center for Education Statistics showed the average net price for an incoming freshman at Belmont who has received some kind of grant or aid was $27,205 in the 2010-2011 school year. For students or families making less than $30,000 a year, that figure is $23,264. Tuition, fees, room and board for an incoming freshman that school year was $32,710.
“It’s an enormous part of a family’s income,” said Mamie Voight, assistant director for Education Trust, a national education advocacy group. “You can see how it could really impair access for people.”
In Voight’s mind, university funding used could be more effectively distributed to students who wouldn’t already have access to the costs of tuition.
“They need grant aid to just pay the bills and advance toward their degree and graduate,” she said.
For Hendricks, employment during the school year has been a constant for her.
Between her work-study position at Feedback Clothing and her part-time job at the YMCA, she makes enough money to pay her bills and not have to take out additional loans.
Even with her federal loans, the senior is confident the field she’s going into will help her debt-paying prospects.
“I have a passion for education, and there are a lot of programs for loan forgiveness there,” she said.
No matter how effective a loan forgiveness program is, Belmont’s level of aid is one several university officials believe is effective and appropriate given the numbers of applicants and enrollees the school has received and the type of aid they received outside the institution.
In an emailed response to questions from the Vision, Dean of Enrollment Services David Mee said when people consider the amount of money the university allocates for need-based aid, they must realize funding is combined with any federal aid students receive.
“Thus, it would be important to consider the millions of dollars of state and federal assistance that Belmont awards in addition to university-funded need-based grants to have a true picture of the important role that need-based aid plays in the administration of financial aid at Belmont,” he said.
Merit scholarships are not uncommon on campus – publicized university figures show a third of students receive them – and Mee said many students in financial need receive aid because of the work they did before coming to campus. The average merit award given in 2010 was $4,783, while the typical need-based scholarship was $2,736.
“Financial aid (need and merit-based assistance) is one important component of achieving overall enrollment goals – helping to bridge the gap when financial need exists, as well as acknowledging merit accomplishments such as academic achievement through merit scholarships,” Mee said.
Mee said the university offers the best financial aid packages they can within their resources to combine with tuition he said was below the average for private schools. He also said that since the data in most recent tax forms was published, the university has increased all “institutional-funded financial aid programs” by 20 percent.
“It is clear to those of us who work in Enrollment Services that students are often thankful for the financial aid they receive while attending Belmont,” Mee said in an email. “At the same time, we know that students do not routinely enroll at Belmont simply because it represents the lowest net cost of attendance among their options. Thousands of students every year weigh the value of a Belmont education, the aid they have received to make Belmont a possibility, and the life-long benefits of a Belmont education.”
A large portion of the funds Belmont uses to fund scholarships, Thomas said, come from the university’s endowment as a way to keep cost from becoming an issue for enrolling students.
Through their endowments, schools such as Harvard and Vanderbilt universities and Davidson College offer a no-loans financial aid policy where any demonstrated need is matched with grants or work study. By allocating large amounts of their funds, these schools say they can fund any student’s cost of attendance above the Estimated Family Contribution as determined by the FAFSA.
Colleges that can offer such awards are typically ones with established histories and endowments that top out at hundreds of millions or even billions of dollars. Belmont, which began its current incarnation as a college in 1951, is still developing both major keys to growth, Thomas said.
Vanderbilt, for example, was founded in 1873 and its 2011 endowment was $3.4 billion. Belmont’s neighbor Lipscomb, more than a century old, has an endowment of more than $60 million.
“We are really young in that respect, so our endowment is this small,” he said.
By 2010, tax forms showed Belmont’s endowment had returned to its pre-recession levels around $75 million. Now, Thomas said the school’s endowment fund is around $80 million not including planned contributions or gifts from future estates.
At the same time, he said that endowment has seen interest from donors who want to give specifically to need-based students.
“It seems to me we have more donors who want to give an endowed fund for needy students or into unrestricted funds,” he said.
But for Voight, the higher education expert, current endowment levels are no excuse for Belmont to not focus more on offering need-based aid.
“It’s important to make sure the aid is well distributed to those who need it as opposed to those who could probably afford going to a school like Belmont,” she said.
Hendricks, a graduating senior, sees choosing how to allocate scholarships as more than an either-or decision.
“I don’t know what’s fair,” Hendricks said. “It would be nice if both would be equal, but would that be fair either?”