While state lawmakers negotiate the future of funding the Pennsylvania Higher Education Assistance Agency, they’re addressing a national issue, said Matthew Stokan, director of financial aid. 

“The problem of higher education, not just in this state, but across the country, is what they call a financial aid gap,” said Stokan. 

As the cost of education rises annually, without the support of federal aid or proportionate loan limits, many Pennsylvania students turn to PHEAA grants to pay for school. That option was put in danger in December 2017, when the agency announced it had depleted much of its funding and would have to rely on a sizeable allocation from the state.

While students will not receive the same amount of PHEAA grant money next academic year as last year, the proposed state budget does alleviate some of the problem, but Stokan said it is too soon to celebrate.

“It’s never the initial proposal,” he said. “I’d be surprised if we hear anything before May, as far as final numbers.”

In the meantime, PHEAA is searching for new sources of revenue to put toward its state grants. 

“That’s where alternative loans come in,” Stokan said.

PHEAA is launching a new alternative loan program, offering loans that do not require credit and have competitive interest rates. The program, PA Forward, will be available to students beginning April 22. 

PA Forward will include student loans, which require a co-signer, and parent loans. Stokan said the loans will be available for Pennsylvania students attending schools both within and out of the state, and out-of-state students attending schools in Pennsylvania.

“PHEAA sees alternative loans as a necessity for a lot of students and families trying to pursue higher education in this day and age, because of that funding gap,” Stokan said. “And so, PHEAA decided to get into the business.”

The hope is, Stokan said, PHEAA will be able to use some of the revenue from PA Forward to put back into state grants. This would take at least five years to generate, he predicts. Eventually, he said, the program could help bring PHEAA grants back to their former level of aid.

That won’t happen for a while, though. The proposed state budget allocates enough to make the maximum grant amount for next year $3,232, Stokan said. While that allocation won’t be made official until at least May, Dr. Shari Payne, vice president for enrollment, said lobbyists are doing all they can to sway legislators.
“Now is where the rubber hits the road,” Payne said. 

Since the budget was proposed, Payne said this is the most important time to meet with legislators, this is when the final decisions are being made.

That’s why Payne will travel to Harrisburg next Tuesday, with junior accounting major Heidi Dziak, a PHEAA recipient. The two will share information and personal testimony about how grant dollars affect students. Payne said nearly 40 percent of Waynesburg University students receive grant funding from PHEAA. 

The lobbying event, called Student Aid Advocacy Day, will be hosted by Association of Independent Colleges and Universities of Pennsylvania. It will include a rally in the morning, followed by speakers from both the organization and students. AICUP hosted a similar event last year with great success — PHEAA was allocated enough state funding for a maximum grant of $4,122 per student. 

It’s important to try just as hard this year, Payne said, though there will be new challenges. Last year, an election year, gave AICUP the benefit of lawmakers trying to please constituents in order to remain in office. This year, Payne thinks they will be harder to convince.

Stokan and Payne agreed that when it comes to the future of PHEAA, it is hopeful, yet tentative.

“I don’t want to say I’m pessimistic,” Payne said. “But I’m uncertain.