Michigan college grants

ANN ARBOR, MICH.

Nearly 3,000 needy undergraduate students at the University of Michigan would see their tuition bills lowered under a new grant program.

The program, called M-PACT, would allow the students to tap into $3 million a year in grants, in addition to any other scholarships or loans they might receive. The students would receive between $500 to $1,500 a year.

Students from families earning $20,000 a year or less would be helped the most. By adding the $1,500 M-PACT grant to other financial aid and work-study payments, a low-income student could cover up to 80 percent of the $18,200 annual cost of tuition, room and board and other expenses.

But some students with household incomes as high as $70,000 would also receive assistance under the program, depending on their family situation and assets, the Detroit Free Press reported last month.

"About 18 percent of our students come from homes of very modest means," said university president Dr. Mary Sue Coleman, who announced the program at the Midwest regional forum of the College Board in Chicago.

"We need to reach these families by talking about the program so they will encourage their sons and daughters to apply to the University of Michigan. We are determined to tear down the barrier of cost for Michigan students of every financial circumstance."

Recent changes in the federal formula for awarding Pell grants, the principal federal grant program for college, will cause 1,677 of Michigan's 3,335 undergraduates receiving the grants to lose about $400, says Margaret Rodriguez, senior associate director of the university's financial aid office.

About 300 students will lose the grants. The maximum Pell grant for students from households with annual incomes of $20,000 or less is $4,050.

Low-income students at Michigan were the subject of much discussion during the legal battle over the university's admissions policy, which took race into consideration. In 2003, the U.S. Supreme Court upheld the use of race to achieve diversity but threw out the university's undergraduate admissions system, which awarded extra points to under-represented minorities.

Critics of the old policy said the university should do more to reach out to low-income and socio-economically disadvantaged students. In designing its new undergraduate admissions policy, Michigan officials began asking students more about family income and other questions designed to identify disadvantages.

Currently, about 55 percent of Michigan freshmen come from homes with annual incomes of $100,000 or more, while just 14 percent are from households with incomes of $50,000 or less.

Michigan Provost Paul Courant says 20 percent of in-state undergraduates will qualify for the program.

About $9 million in donor funds will be used to fund the program for the first three years. Special efforts will be made as part of the university's $2.5 billion Michigan Difference campaign to raise a $60-million endowment to permanently fund M-PACT, Courant says.

--Associated Press