The Argument Over What Works Best in State Scholarships

The Argument Over What Works Best in State Scholarships

There is well over $11 billion dollars in state financial aid awarded to students each year. While it is great that students are getting this aid, there is a tremendous deal of argument over the ways in which aid is awarded. This seems to be somewhat unfair to students.

Vast Differences

According to the Wall Street Journal, many states like New York, California, and Michigan make financial need a top priority in determining financial aid, other states are choosing to award funds based on merit and with no consideration for financial need. This trend started with Georgia in 1993, but 27 states have made similar moves since that time.

Proponents of this merit-based funding state that this approach to financial aid encourages the best and brightest students to stay in their home states. Unfortunately, as states try to control how much money is spent as tuition increases, many are raising the GPA requirement to receive aid. Georgia, for example, now requires students to have a 3.7 GPA and an ACT score of 26 or higher to receive full tuition assistance. This leaves many bright students, such as those with a GPA of between 3.0 and 3.7 with very little financial assistance.

Why It Is a Problem

Upon studying the zip codes of scholarship recipients in Georgia, the Wall Street Journal discovered that affluent students received most of the scholarship money, while those with the greatest financial need often received much less.  Many people are now noticing that students who receive full HOPE scholarships are turning up for classes with brand-new cars while many other bright students are working two jobs or selling everything they own and taking on tremendous student loans to pay for an education.

This disparate distribution of financial aid is sure to cause continuing debate over coming years, and increasing numbers of people are likely to protest strict merit-based guidelines. What can states do? While there is little doubt that something must be done, the answer will not be a simple or easy one. Neal McCluskey, of the Cato Institute, says that states need to take a mixed approach to distributing funds in order for programs to do the most good. Only time will tell how this situation will be resolved for the benefit of all students.


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