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S.D. Success Story Clouded by Plans to Cut Student Aid

March 03, 1985|SCOTT HARRIS | Times Staff Writer

Victor and Luz Escobedo live in a modest home in one of San Diego's poorer neighborhoods. They immigrated here from Mexico five years ago, bringing with them eight sons and a dream for each.

Victor, who had gone to work at age 9 to help support his family after his father died, wanted his boys to have something he was denied: the opportunity for a good education and a career.

Already, America has worked out very much the way the Escobedos hoped it would. Five of their sons--there are no daughters--are students at either UC San Diego or San Diego State University. Another is a high school senior who will enter UCSD in the fall. The remaining boys, ages 14 and 13, seem certain to follow.

Several factors have contributed to the Escobedos' success. One is the work ethic: The five college students each hold down part-time jobs and have earned several academic honors, and one was an all-American soccer player in community college. Another factor is the family bond that makes it seem natural, not to mention frugal, for the brothers to live at home throughout their college days.

A third factor--the only one that appears in jeopardy--is college financial aid. Four of the brothers have received or qualified for tax-supported government grants or loans that so far total more than $10,000. "Here, you get paid to study," said a Victor Escobedo, with a son providing the translation from Spanish.

But now, President Reagan has proposed a $2.3-billion cut in federal aid for college students. And the Escobedo family would be among the victims.

The problem is that Victor Escobedo, a welder at National Steel and Shipyard Co., makes too much money. Under the Reagan Administration proposal, eligibility for grants, direct government loans with 4% interest, and subsidized work-study jobs would be limited to students from families with an adjusted gross income of $25,000 or less. Escobedo figures his adjusted gross income for 1984 to be $25,657.

The present system for aid to students places the direct grant and loan cap at $27,700 and provides flexible rules that take into account the size of a family, the number of children attending college and other expense factors. The Reagan proposal does not provide such flexibility; the rules are the same, regardless of family size and other factors.

Adjusted gross income, unlike taxable income, does not include deductions for dependents and interest payments. For example, the Escobedos' adjusted gross income for 1983 was $24,448; their taxable income, with seven of the children declared as dependents, was $10,610. Six sons are declared as dependents in their 1985 statement.

The President's plan also would limit to $4,000 a year the amount a student could receive from federal grants, loans and subsidized jobs--a rule that would especially affect students at more expensive colleges and universities.

The Administration also wants to make federally backed student loans with 8% interest available only to students from families with incomes of $32,500 or less. The Escobedos still would qualify for those loans.

Education Secretary William J. Bennett has said the purpose of the new guidelines is to limit aid to low-income students and require the middle-class and upper-class families to cover more fully their educational costs.

But critics wonder if the Escobedos are what the Reagan Administration means by "middle class." Advocates of strong financial aid programs argue that society as a whole benefits by investing in higher education for industrious, capable and needy people such as the Escobedos.

Few expect Congress to adopt the President's plan without substantial revisions. In previous years, Congress has largely protected student aid programs against massive cuts proposed by Reagan.

But college and university officials say they are worried. "The people spearheading our efforts are really afraid," said Tom Rutter, director of student financial services at UCSD. "They are very concerned that Congress might cave in because of the pressure to decrease the budget deficit."

Here is how Reagan's proposed student aid plan would affect just one of the Escobedo brothers, 19-year-old Jaime, a freshman at UCSD:

The UCSD financial services office figures that Jaime, as a student living in his parents' home, needs $4,450 for the 1984-85 school year.

After analyzing information provided in Jaime's student aid application and his parents' tax forms, the university expects Jaime to personally contribute $800 and his parents to contribute $18, for an overall family contribution of $818.

That leaves $3,632 to be provided through financial aid. Jaime qualified for money through four programs: $1,425 in a federal Pell Grant, $982 in a state Cal Grant, $775 in a federal Supplementary Educational Opportunity Grant and $450 in a federal National Direct Student Loan at 4% interest payable in 10 1/2 years.

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