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Reagan Cuts Would Deny College Aid to More Than A Million Students

February 3, 1985 GMT

WASHINGTON (AP) _ President Reagan is asking Congress to reduce financial aid to college students by $2.3 billion - a 27 percent cut that would force more than 1 million students to fend for themselves.

The biggest cuts in Guaranteed Student Loans and Pell Grants would be at the expense of middle-income students. They would be denied the heavily subsidized loans if their families’ adjusted gross income exceeded $32,500, and they would be knocked out of the grant program at $25,000.

Students from the poorest families would feel the pinch of a Reagan proposal to put a $4,000-per-student annual lid on total federal aid from loans, grants and subsidized campus jobs.

Sen. Claiborne Pell, D-R.I., father of the Pell Grant program - which would lose 808,000 of its 2.8 million recipients - said half the 430,000 students that would be affected by the $4,000 ceiling come from families with incomes of less than $12,000.

″It is hard to believe the administration could seriously propose such draconian changes,″ he said. ″How can we build an ‘opportunity society’ if we deny so many young people educational opportunity?″

Acting Education Secretary Gary L. Jones said the cuts were part of ″a major philosophical shift″ to return ″to the traditional emphasis on parent and student responsibility for financing college costs.″

In his proposed fiscal 1986 budget, to be sent to Congress on Monday, Reagan asked for a freeze on the Education Department’s main elementary and secondary education programs, including a $3.2 billion remedial program for the poor; a $532 million block grant; $1.1 billion to teach handicapped children; $838 million in vocational and adult education, and the $143 million bilingual education program.

The department’s outlays, $17.4 billion this year, would drop to $16.9 billion in fiscal 1986, or $1.2 billion less than the total if no cuts were enacted.

The department’s budget authority - a statutory ceiling on appropriations - would take a steeper dive, from $18.4 billion to $15.5 billion, a 16 percent drop.

Jones said the 1985 spending includes almost $750 million to pay for prior year overruns in the Pell Grant and loan programs. Putting that sum aside, the proposed 1986 budget is down $2 billion or 11 percent, he said.

Reagan also wants to rescind $169 million from 10 school programs for fiscal 1985, and to scrap 38 programs - including several in student aid - to save $1.1 billion next year.

Some 5.3 million students, or one of every two attending college half-time or more, now get help from one or more programs - Pell Grants, Supplemental Grants, Work-Study, National Direct Loans, State Incentive Grants and Guaranteed Loans. Reagan’s blueprint would aid 4.25 million students, or 1,027,000 fewer.

All students would have to come up with $800 on their own before they could get a grant or loan.

Students with family incomes above $25,000 would be denied National Direct Loans and Work-Study jobs, as well as Pell Grants.

All students could borrow from an auxiliary program called PLUS, but at much less favorable terms than the regular guaranteed loans. PLUS charges interest and requires payments while students are in school.

The maximum annual PLUS loan would climb from $2,500 to $4,000. Also, borrowers would pay a 1 percent guarantee fee to help cover defaults.

Students under age 22 would be considered dependent on their parents, unless they were orphans or wards of the court.

The so-called TRIO programs to groom minority teen-agers for college would lose $93 million of their $175 million. A $24 million school desegregation advisory program would be phased out over two years, and $75 million for magnet schools would be rescinded.

Libraries would lose $125 million in aid. Migrant education would be cut by $41 million. Impact aid for school districts with heavy enrollments of federal employees’ children would be cut by $152 million to $543 million. Other rescissions would knock $79 million from higher education programs.

Reagan vowed to press again for a tuition tax credit that would start at $100 in 1985, costing $359 million, and a modest tax break for parents who save money for college. They could put $1,000 into accounts each year and avoid taxes on the interest.