Nearly $1.4 billion in Tuition Aid Grants has been given out by New Jersey over the past five years to help low-income students pay for college, making it one of the most generous state financial-aid programs in the nation.

Yet the state agency charged with managing the grant program and the colleges that receive the money do not keep any public data on how many of the students who receive the grants actually graduate.

Officials at the state Higher Education Student Assistance Authority, or HESAA, which manages the TAG program, said there was a requirement that students make satisfactory progress to continue receiving the grant, and there is a limit to how many grants they can receive.

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But HESAA Executive Director Gabrielle Charette said there was no state requirement that HESAA track completion rates.

“The cap (on the number of grants a student can receive) provides an incentive to finish,” she said.

Celeste Riley, D-Salem, Gloucester, Cumberland, chairwoman of the state Assembly Higher Education Committee, was surprised to learn that HESAA did not track graduation rates for TAG recipients.

“They should be doing that,” she said. She called TAG essential to making college more affordable for thousands of students. But she said that there should be a way to track completion rates and that she would investigate.

The state Office of Higher Education referred all questions back to HESAA.

National advocates for more college accountability question why there isn’t more data when billions of dollars are spent annually on federal Pell grants and state programs such as TAG. Groups such as the Lumina Foundation and the Bill & Melinda Gates Foundation are supporting more research.

“Are enough students getting through? We are shooting in the dark,” said Mark Schneider, vice president of the American Institutes for Research, or AIR, which has done analysis in other states using available data. “Why isn’t there an answer to that question?”

Zakiya Smith, strategy director for the Lumina Foundation, said that when most aid programs began, the concern was access to college. But since the recession, the focus has turned to accountability, and the 2012 national college completion rate of less than 60 percent after six years is unacceptable.

“We need to know how to get aid programs to incentivize completion,” she said, citing federal Pell grants, state grant programs and the GI Bill as examples of programs that don’t have sufficient data to show whether they are effective.

“We’re not saying these students shouldn’t go to college,” Smith said. “The goal is to help the colleges and students do better.”

Established in 1978, New Jersey TAG funds were originally supposed to pay 100 percent of public college tuition and 50 percent of independent college tuition. As college costs and TAG demand have risen, the grants have not kept pace, averaging about 40 percent of tuition at all four-year colleges, according to an analysis by The Press of Atlantic City.

Charette said every student eligible for TAG received some funding.

TAG grants have no set income limit. Eligibility is based on factors such as income, family size, the number of family members attending college and the amount of state funds available.

For the 2012-13 academic year, an estimated 74,000 students are expected to receive grants of as much as $2,534 at community colleges, $6,704 at state colleges, $9,104 at Rutgers University and $11,550 at private colleges in New Jersey. HESAA estimates the total expenditure at just more than $331 million, more than twice the $150 million allocated in fiscal 2000.

In 2010-11, the average grant was about $1,266 at community colleges, $4,900 at state public colleges and $7,000 at state private colleges, according to an analysis by The Press of data colleges provide to the U.S. Department of Education. About half of the total funds that year, almost $150 million, went to the public four-year colleges.

The money goes directly to the colleges, which also rely on TAG to supplement their budgets, making it an indirect source of state aid.

Students can receive grants for five semesters at community colleges and a total of 10 semesters including four-year colleges. Additional semesters can be funded for specific programs or remedial courses for a total maximum of 12 full-time semesters, or six years of full-time college attendance.

In 2004, the state’s county colleges successfully lobbied for TAG funds for their part-time students, arguing that some students were dropping out because they were forced to attend full time to get grants but, because of work or other obligations, could not carry the course load.

A 2010 report by AIR found that despite a high retention rate in the sophomore year, the number of New Jersey students who attended a four-year college for just one year, then dropped out, still cost an estimated $173 million over five years in state and federal aid.

The state Higher Education Task Force in 2012 recommended that the state maintain its current aid policies, noting that: “Significant changes in policy that reduce aid can cause some students to no longer be able to afford their college education and can jeopardize the financial strength of the institutions themselves.”

Darryl Greer, former director of the New Jersey Association of State Colleges and Universities, said that in all the years he worked in Trenton, he never saw a statewide report on the TAG program’s effectiveness. But, he said, there is a perfect storm of higher-education issues brewing in the state that is forcing the issue to the surface, including college costs, limited state aid, college student debt and unsatisfactory graduation rates.

“The bigger question is, how does all of the aid work together and how do we use it better,” said Greer, who is now a senior fellow for Higher Education Strategic Information and Governance at Richard Stockton College’s William J. Hughes Center for Public Policy, where is he developing a paper on changing higher education.

Just how dysfunctional New Jersey’s finance system for higher education is can be demonstrated by two seemingly opposing facts:

n New Jersey gives out the most need-based financial aid per student in the nation, an average of $975 per undergraduate in 2010-11, according to the National Association of State Student Grant and Aid Programs.

n New Jersey student college debt increased 11 percent in 2011 to an average of $27,610, the 10th-highest in the nation, according to The Project on Student Debt 2012 report.

Greer said the problem was that New Jersey state college tuition had risen while state aid had been reduced. Middle-income students don’t qualify for need-based aid such as TAG and must rely more on loans, and since need-based aid does not cover all costs, low-income students are supplementing with loans.

Students who don’t graduate still must pay back the loans without having a degree that might lead to a better-paying job.

Taxpayers are left to wonder how much money was spent on grants to students who did not graduate.

“Taxpayers have a right to know what they’re getting,” said AIR’s Schneider.

Greer said financial aid could no longer afford to be a “one size fits all” model and should be adapted to fit different programs and student populations. College costs must also be controlled.

“How can we sustain a program if middle-income families don’t think it will help them?” he said. “We do need to protect TAG for those who need it, but we have to look at the total picture.”

That picture includes keeping college doors open for all, regardless of income.

“If it weren’t for financial aid, there are many students who would have no chance to ever attend college,” said Jacob Farbman, spokesman for the New Jersey Council of County Colleges.

AIR did a report on Louisiana’s state grant program that suggested targeting grant amounts to a level that helps students stay in college, typically about 55 percent to 60 percent of the total cost. The report said reducing grants to those getting 80 percent or more of college costs paid won’t force them to drop out, while increasing grants to students getting only 30 percent or 40 percent funded will help them remain in college. The plan could save money and improve completion rates.

Linda DeSantis, Atlantic Cape Community College director of financial aid, said the college had awarded TAG funds based on number of credits taken, rather than a blanket grant, though it was a headache to administer. She said TAG had been crucial in making college accessible and affordable.

Students who get the grants appreciate them but say the process is confusing, especially for first-time college students.

“I really wasn’t aware of the grant opportunities. I just knew how much it cost,” said Chelsea Lucas, 18, of Galloway Township, who decided to attend Atlantic Cape because it was more affordable than a four-year college. She is getting Pell and TAG funds.

Lucas also works in the financial-aid office at Atlantic Cape and said she thought some students took grants for granted because they don’t understand how aid works, what it covers and when it ends.

“I really do appreciate it,” she said. “It’s helping me work toward my goal (of becoming a teacher). But you have to understand what you are getting and why.”

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