A college education costs more than ever before. At this point, most students enrolled in any sector of postsecondary education receive some form of financial assistance. But the availability of aid has not risen with tuition bills. As a recent three-year examination of federal PLUS loans shows, when access to money disappears, so do students.

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The PLUS program provides loans to the parents of undergraduates to help pay for costs not covered by other means of financial assistance. In 2011, the U.S. Department of Education tightened the credit standards for these loans, making it harder for families with less than perfect credit to access them. While the department recently moved to relax the standards, a report from REL Mid-Atlantic, as part of the research agenda of its HBCU Research Alliance, shows how badly colleges and universities and students — especially historically black colleges and universities (HBCUs) — were damaged by the loan scarcity.

Despite an available arsenal of financial aid (Pell Grants, Perkins and Stafford loans, federal work-study, institutional grant aid, state grant aid), students and families still struggle to afford the postsecondary price tag. PLUS awards have been especially important to parents of HBCU students given the large numbers of low-income students at these institutions.

The report concludes that the limiting of credit standards for PLUS loans in 2011 led to a sharp decline in PLUS loan participants throughout higher education, but especially at HBCUs. The decline in PLUS borrowers corresponded to decreased enrollments among black students throughout all higher education. However, the decline was steepest in HBCUs. The researchers found no increase in alternative sources of financial aid to make up for the cut. The authors emphasize that their claims are not causal. Yet their statistical methods suggest a strong link between PLUS loan changes and declining enrollments.

Roughly 13 percent of HBCU full-time students currently have parents receiving PLUS loans (the average amount is $13,000 per year). PLUS loan recipients decreased by 28.7 percent across all higher education and 45.7 percent at HBCUs the school year following the tightened restrictions (2012-2013). The drop was especially sharp for students enrolled in college for the first time. Those receiving PLUS loans at HBCUs saw their total dollar amount decline by 36.4 percent.

As the report demonstrates with data, reducing financial aid reduces enrollment. The authors note a 3.4 percent decline in enrollment at four-year HBCUs in 2012-2013. As they illustrate, this is an average of 97 students per HBCU. Enrollment rose at non-HBCUs the same year, though black undergraduate enrollment also fell at non-HBCUs. Further complicating the enrollment picture at HBCUs, enrollment of non-black ethnicities increased. This reflects an ongoing trend in the shifting enrollment picture at HBCUs. Yet the steeper decline in 2012-2013 appears to be directly related to the decline in PLUS loan recipients.

Though families can and do receive other forms of aid, the authors of the report argue that alternative financial aid accounted for approximately one-tenth of the decrease in PLUS loans. Many education researchers emphasize the correlation between ability to pay with both enrollment in and completion of postsecondary education. The increases in tuition and related college costs are not being matched by commensurate increases in other financial assistance (such as other federal loans and work-study awards). The PLUS program is indicative of not only the increasing unaffordability of higher education, but the shift from need-based to loan-based financial aid.

The parent PLUS loan imbroglio is another symptom in the sickness of U.S. higher education finance policy at the federal, state and institutional levels. While media and politicians relish lambasting colleges and universities for fleecing students and families, policymakers are increasingly allergic to any policies that prioritize publicly funded benefits over privately subsidized goods. Though state allocations to higher education plummeted after the 2008 recession, state support for higher education has been declining since the 1970s. This has driven tuition increases and saddled a generation with metastasizing student debt.

The impact on HBCUs is more severe. HBCUs have smaller endowments, lower tuition and less state support on average. The impact of the 2011 policy change represents one of many challenges faced by (and imposed on) HBCUs. Chronically underfunded institutions are consistently asked to do more with less. Limiting financial assistance cuts what the United Negro College Fund calls "a critical lifeline to a college education for hundreds of thousands of students" and injures institutions such as HBCUs.

Financial aid serves as the key for many students to unlock the door to a higher education. That door remains closed when the keys are denied students and families who strive to obtain them. That the Department of Education revised the PLUS program credit requirements in 2014 to once more benefit students and families shows the power of collective and cohesive calls to action on behalf of students, families, educators and concerned citizens. Yet it is important to question why loans now outpace grants as the primary (and costly) key to college access and attainment and how this is having a detrimental impact on HBCUs and all colleges and universities.

This piece has been revised to correctly note that the report in question is from REL Mid-Atlantic. 

Boland is a Ph.D. candidate at the University of Pennsylvania's Graduate School of Education and a research assistant at the Penn Center for Minority Serving Institutions. Gasman is professor of higher education at the University of Pennsylvania and director of the Penn Center for Minority Serving Institutions.