Education: Tuition Blues

To ease them, Carter seeks aid

The memo from Secretary of Health, Education and Welfare Joseph Califano to President Carter was urgent. "We must move quickly if we are to seize the initiative on this very hot issue," warned Califano. The issue: tuition aid for middle-income families with children in college, a form of relief that has become increasingly popular on Capitol Hill with campus costs accelerating at dizzying rates—up 77% from 1967 to 1976— and voters appealing for help. With two different plans already under consideration by Congress, each offering aid in the form of direct tax credits, which Carter opposes, the President heeded Califano's counsel and jumped in last week with his own variant: a $1.5 billion Middle Income College Assistance Act.

Carter proposed an automatic $250-a-year grant for college students from families with an annual income of $16,000 to $25,000. Such grants, part of the federal Basic Educational Opportunity Grant (BEOG) program, had previously been limited to students from families that earned under $16,000 a year. The increased aid, according to Administration estimates, would cost $700 million.

Additionally, Carter's package calls for expansion of the Guaranteed Student Loan program, under which the Federal Government pays the interest on loans for students from families with an adjusted income of $25,000 or less a year while those students are in college. That ceiling would now rise to an adjusted family income of $40,000 a year. A third form of federal aid, a work-study program that subsidizes 80% of the wages for student part-time jobs, would be expanded from $435 million to $600 million to cover 280,000 newly eligible students. In all, the Carter plan would aid 5 million students in 1979, 2 million more than present, and cost $500 million over the $1 billion that Carter originally hoped to earmark for such aid in fiscal 1979. "Increasingly, middle-income families, not just lower-income families, are being stretched to their financial limits by the growing costs of a university or college education," said Carter. In 1978, he pointed out, tuition, room and board will average $4,800 a year at private colleges and $2,500 at public universities.

Carter's hastily worked-out measure was designed to counter the popularity of the two rival aid proposals now before Congress. One plan, introduced in the Senate last fall by Oregon Republican Robert Packwood and New York Democrat Daniel Patrick Moynihan, would allow a taxpayer to deduct up to 50% of the money paid for his children's tuition fees at private elementary and secondary schools and at colleges and universities, up to a limit of $500 per child. In comparison, the College Tuition Tax Relief Act proposed by Delaware's Republican Senator William Roth is, like Carter's plan, limited to college students. It calls for an income tax credit of $250 for a dependent's first full-time year in college, $300 for the second year, $400 for the third and $500 for the fourth. Neither of the plans sets a limit on family income.