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Candidates Seek Financial Aid Reform

This story was written by Marissa Lang, The Diamondback

Students unhappy with financial aid - its availability, application process and eligibility requirements - have yet another factor to consider on Election Day. Sens. Barack Obama (D-Ill.) and John McCain (R-Ariz.) both plan to reform the financial aid system but have different priorities.

Both presidential candidates want to simplify the system and lower the financial burden on families, but they differ on the specifics. Obama has focused on new plans, including the introduction of a refundable tax credit toward higher education and the elimination of the Free Application for Federal Student Aid. Meanwhile, McCain is pushing to eliminate the reliance on federal loans and consolidate existing aid programs and applications.

A key feature of Obama's plan is creating a fully refundable tax credit that will ensure the first $4,000 of a college education is "completely free for most Americans," according to his website. The credit would be contingent upon the completion of 100 hours of community service per year.

Some students say this requirement would not deter them from participating in the program.

"No money is free money," University of Maryland senior kinesiology major Sarah Easterwood said. "There's always fine print in everything, but if there really was a chance to do community service to help fund college - I did 100 hours to graduate high school - I would definitely do it. With something like that, you're giving back to the community. It's a win-win."

McCain, on the other hand, looks to reform the federal student loan system, making it a last resort for students and shifting more accountability to the private sector.

A spokesman for the Republican National Committee pointed to the platform outlined on McCain's website, which states a "more effective program" will result from increasing the availability of private sector loans and holding lenders to the "highest standard of integrity."

Edie Irons, a spokeswoman for The Project on Student Debt, an independent think tank that studies financial aid, said that while, ideally, the government should look at expanding programs that do not require students to pay back money, student loans continue to be a reality for more than two-thirds of college students and should be an issue that candidates consider.

"[Private sector loans] are riskier, more expensive loans, and should be used as a last resort," Irons said. "We don't anticipate a problem being able to get federal loans, but there needs to be a combination of better advice and counseling, so that as students are making those decisions so they don't borrow too much and they are able to choose the safest, most affordable options."

Both candidates identify a need to simplify the application process students and families must undergo to obtain financial assistance.

Obama's call to eliminate the FAFSA is a step the Democratic National Committee officials said will simplify the process and encourage more people to apply for aid.

McCain does not explicitly mention the overhaul of FAFSA in any of his proposals, but he emphasizes the need for a simpler process, so students aren't deterred from applying for aid. He aims to consolidate grant and award programs to reduce confusion and the need to fill out multiple, complicated applications.

The FAFSA asks 127 questions across five pages, which is more than many federal tax returns.

"I've always thought the FAFSA was kind of B.S.," Easterwood said. "My father was a pastor for 20 years, and we have three kids in our family that need to be put through college, and he doesn't get paid a lot. [My parents have] made a lot of sacrifices so that we could have a childhod and [the FAFSA] bases everything off of numbers that just aren't accurate."

According to a report published by the Institute for College Access and Success, an estimated 1.5 million low-income students who were likely eligible for Pell Grants did not apply for aid in 2004, an increase of 76 percent from 2000.

"Instead of digging through piles of papers, doing calculations with various lines of data, and transferring numbers by hand from a tax form to a worksheet to an application, students and parents could give the Department of Education direct access to needed income information," the report states.

Vice President of the institute, Lauren Asher, said if the Internal Revenue Service is allowed to directly forward data to the Education Department, more students would likely apply for federal aid and it would reduce processing costs paid by colleges.

Students, however, remain skeptical of candidates' proposals.

Many students who are forced to take on multiple jobs and loans in both the federal and private sector in order to pay for school are hesitant about the proposed shift in emphasis and think instead, the next president should look at the root of the problem: rising college tuition rates.

"The government should do whatever they can to find a way to lower the interest rates on these loans that exist, but also just make college affordable," said Kevin Mawyer II, a sophomore criminology and criminal justice major. "College students are going to come out thousands of dollars in debt ... that they only have to pay because it's so expensive to begin with. I honestly don't understand why the same classes at different institutions cost more just because of the name that gets put on your degree."

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