Top Oregon officials have responded in recent days to a big drop in college savings by dropping a fund and investigating the fund manager.
Late last week, experts told lawmakers that problems with the fund had been impossible to predict, and overall long-term performance looked good. That didn’t console parent Ed Gadell, who says he’d invested $16,000.
Ed Gadell: “We lost $5000. We’d been better off putting that money under a mattress.”
The savings’ fund is just one dimension of how the financial troubles facing parents, students, and college administrators. Rob Manning has this look, through the eyes of Portland college students.
College freshman Hilary Langley lives in Clackamas. She wanted to go to Oregon State, but the high cost of room and board kept her close to home.
Hilary Langley: “I decided to go here, mainly with my mother’s influence, because she didn’t want me to have financial strain during college. So I chose Portland State, and I’m majoring in political science.”
Langley’s financial aid package includes the Oregon Opportunity Grant, which is in trouble. Three public universities - U of O, Oregon State, and Western Oregon - recently backfilled a shortfall for the spring term - but not PSU, says president, Wim Wievel.
Wim Wievel: “Portland State has far more students starting this term than the other institutions do, so our number is much larger, and also our students have very significant financial need. So we’re affected very greatly.”
Wievel estimates there are 4000 students who could see their grants cut next term. Portland State couldn't covering the grant shortfall for many recent transfer students, like Alex Colby.
To save her family money, Colby says she transferred away from the U of O just months into her first term.
Alex Colby: “Every month I get a statement on the internet of what my Mom paid, and I was just like ‘ok, the one month that my Mom paid, I could go to one term at PSU’.”
Colby doesn’t qualify for an Oregon Opportunity Grant. And while she didn’t mind leaving Eugene, she really wanted to go to a private college.
Alex Colby: “And I got accepted to Willamette, and I got a $15,000 a year scholarship, but that’s not enough to cover, you know, anything. That, like, covers my living expenses.”
Both public and private colleges are struggling for another reason. Endowments have taken a huge hit - 20 to 30 percent - with the stock market plunge.
Paul Marthers at Reed College says he’s worried that schools like his will have an even harder time competing for middle-income students.
Paul Marthers: “You end up with more of a population of families that are higher income with no need, and lower income with enough need that the financial aid packages are very, very, very generous.”
Limited resources put even more pressure on parents and students. PSU student Katherine Turley says she’s run up well over a thousand dollars in credit card bills just since last fall. She’s fed up.
Katherine Turley: “I am actually moving to San Luis Obisbo, at the end of this term. I feel like if it’s expensive to go here, I might as well go somewhere I might as well want to go. It sucks, financially.”
Not everyone can run off to California, though. Oregon State University president Ed Ray is worried that the problems throughout higher ed will lead to an undereducated generation.
Ed Ray: “I think the bigger risk is a lot of people are just not going to go on, and that gap we have in terms of how much of the younger population is moving on to community colleges and public and private colleges and universities is going to go down, during these difficult economic times.”
Higher education advocates are encouraged that the governor’s proposed budget protected public university budgets - but a lot can change during the legislative session.