Rice eliminates borrowing for low-income undergraduates

CONTACT: Margot Dimond
PHONE: (713) 348-6775
E-MAIL: mdimond@rice.edu

RICE ELIMINATES BORROWING FOR LOW-INCOME UNDERGRADUATES

Expanding access to the highest-quality education, Rice University has announced that it will no longer require students from families with incomes under $30,000 to finance part of their undergraduate education with loans.

For such families, the previously obligatory borrowing – standard practice at most institutions – will be replaced by scholarship grants.  Rice also will severely limit loan requirements for students from middle-income families.

The actions are effective for new undergraduates entering in the fall of 2005.

"Rice’s first president, Edgar Odell Lovett, set a goal of ensuring that qualified students ‘of slender means’ would have access to the best education," Rice President David W. Leebron said. "We remain dedicated to that goal.  By eliminating loan obligations for low-income students, Rice sends a message that the best education remains within reach of the best students regardless of their ability to pay."

Rice has long been among the few dozen colleges and universities to practice need-blind admissions – that is, students are admitted without regard to their ability to pay and then financial aid is made available to meet 100 percent of demonstrated need.

The "demonstrated need" of a student is calculated according to federal and institutional formulas.  Students are expected to provide a small portion of "self-help" — usually in the form of work and loans — with grants making up the rest not covered by family contributions.

By eliminating the loan requirement for undergraduates from families with less than $30,000 total annual income, Rice removes a formidable barrier – both real and psychological – to those whose circumstances make any borrowing daunting.  The new loan policy, combined with tuition that is significantly lower than Rice’s peers and generous financial aid, will help keep Rice affordable for all students.

In addition to eliminating loans for undergraduates from the lowest-income families, Rice will continue its practice of limiting loans to an affordable level for students from other low- and middle-income families.  Students from families with between $30,000 and $60,000 household income will receive financial aid packages expecting no more than a four-year total of $11,600 in loans.  Students qualifying for financial aid whose family income is more than $60,000 will get packages limiting their four-year loan obligation to a total of $14,500.

Including outside sources, about 80   percent of all undergraduates receive some form of financial aid.
   
The university also will be increasing its budget for need-based financial aid for fall 2005 to keep pace with tuition increases and continue to meet 100 percent of demonstrated need.
        
In rates approved by the Rice Board of Trustees, increases in tuition and fees for returning students, including fifth-year students, will average 3.8 percent. Returning juniors, seniors and fifth-year students are the last classes covered by a policy, being phased out, that linked tuition increases to the Consumer Price Index.  
    
Returning students’ tuition and fees will be:

• Seniors – to $19,796, from $19,156, an increase of $640 or 3.2 percent.
• Juniors – to $20,746, from $20,056, and increase of $690 or 3.3 percent.
• Sophomores  – to $22,266, from $21,206, an increase of $1,060 or 5.0 percent.

The sticker price for tuition and fees for entering students will be $23,746.  The room-and-board rate for academic year 2005-06 will total $8,980.
       
Tuition for Rice graduate students will be $22,700. At Rice’s Jesse H. Jones Graduate School of Management, tuition will remain at $30,000 for continuing MBA students and rise 3 percent to $30,900 for entering MBA students.
       
In another change, Rice joins the majority of its peers in consolidating most student fees into the undergraduate tuition price, rather than billing them separately.  The move is intended to ensure that all student charges are eligible for financial aid, simplify the university’s pricing structure and make the total costs of attendance more easily apparent.