With family investments and house values battered by the financial crisis, colleges and universities in California and around the nation are seeing an increase in students seeking financial aid and are bracing for even more.
At the same time, higher education's ability to meet that extra need is in question because the value of many college endowments has dropped as well, experts say.
"It's putting more demands on the system when the system can least afford the new demands economically," said Phil Day, president of the National Assn. of Student Financial Aid Administrators. "It's going to be tight."
Nationwide, applications for financial aid jumped 16% this fall compared to last year, said Day, a former chancellor of the City College of San Francisco. And that figure probably will rise again in the spring and next fall if Wall Street does not bounce back from its recent losses, he said.
Some schools may need to cut back on other spending to fund extra scholarships, Day predicted. "What's more important than making sure the students have access?" he asked.
Whittier College, Stanford University, Santa Clara University and many University of California campuses are among schools that have recently seen additional students asking for extra aid, officials said. They and others are expecting even more if the economy worsens.
"Like every individual American and every corporation, colleges are concerned about what is happening in the economy. We are well aware it might affect our enrollments," said Lisa Meyer, Whittier's vice president for enrollment.
Meyer said her office is increasing grants and boosting staffing to help students find loans if their families' college savings accounts have been hit by Wall Street losses or if they can no longer borrow against their homes.
But she said that Whittier, which enrolls about 1,300 students, cannot afford to meet all of the new need with grants. "There are fiscal realities we have to live within," she said. Whittier's relatively modest endowment was about $80 million on June 30, and officials there and at many other schools are awaiting figures on their portfolios' current, presumably lower, values.
Stanford University, which enrolls about 15,000 undergraduate and graduate students, had a $17-billion endowment on June 30. That allowed Stanford this year to expand its undergraduate financial aid to offer free tuition to most students from families earning less than $100,000 a year. It joined a small number of affluent schools giving such breaks to students from middle- and lower-income families.
