Bush's budget plan could nix Perkins Loan

Many Eastern students could soon be scrambling to find another way to pay for college. The reason: President Bush's new budget proposal calls for the elimination of the Perkins Loan, which has long been used by college students to help foot their bill for school.

Bush's theory says the elimination of the Perkins Loan, along with other cuts, will generate some $19.8 billion to help other forms of student aid, specifically the Pell Grant, according to government Web sites.

The amount of money made available to students under the Pell Grant would increase to $4,600 for 2008 and continue to rise by about $200 each year until it tops out at $5,400 in 2012, according to the Web sites.

But the loss of the Perkins Loan, which may give some students up to $4,000 a year, would be a stab in the pocketbook for some Eastern students, according to Shelley Park, Eastern's director of student financial assistance, scholarship and veteran affairs.

"The Perkins Loan program has always played a critical role in financial aid awards for Eastern's neediest borrowers," Park said. "It would be a real disappointment to lose this program."

Thousands of Eastern students have benefited from the Perkins Loan program since it began in 1958, Park said.

About 368 Eastern students received Perkins funds during the 2006-2007 school year, she said.

Currently, the Perkins Loan is reserved for exceptionally needy students, Park said.

A student's financial need is determined by the Department of Education, a student's FAFSA (Free Application for Federal Student Aid) and the expected family contribution.

For the Perkins Loan, Eastern requires that the family contribution be zero. In other words, students eligible for the Perkins Loan are paying their tuition bills themselves.

And the loan is important for those seeking careers in public, military or teaching services because those professionals can get exempt from paying all or part of their loans.

But those who must repay the loan have little reason to fear the debt sharks.

The Perkins Loan has a five percent interest rate, making it a more affordable way for students to help pay for school.

Perkins funds consist of government funds, matched by participating colleges and monies repaid by loan holders. As students repay, the funds are used to grant other loans.

Still, the Perkins Loan has not been eliminated. And this isn't the first time it's been targeted. Within the last few years, the loan has repeatedly been placed on the table for possible cuts, only to be rescued by lawmakers eager to see it continue.

In addition, many education organizations, such as COHEAO (the Coalition of Higher Education Assistance Organizations), are fighting to keep the loan in place. The COHEAO's Web site offers specific ways people can help keep the Perkins Loan available such as writing to state and federal lawmakers and asking them to save the Perkins Loan.

"I hope for the sake of the students at Eastern and all other colleges that Congress continues the funding for the Perkins loan program," Park said.

For more information on Eastern's financial aid programs, call 859-622-1754 or log on to www.finaid.eku.edu.

Reach Marie at progress@eku.edu