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Colleges Prepare For Automatic Federal Budget Cuts

Colleges and universities are bracing for steep spending reductions in student aid and research funding due to the looming sequestration process. Financial aid offices are scrambling to offset the drop. University researchers say they're already seeing delays in federal grant making.

Transcript

RENEE MONTAGNE, HOST:

NPR's business news starts with higher education cuts.

(SOUNDBITE OF MUSIC)

MONTAGNE: The big federal budget cuts called sequestration start on Friday, but they're already being felt on college campuses.

Curt Nickisch of member station WBUR reports has this report from Boston, the city at the center of a cluster of higher education institutions.

LENNA DWYER: You can't get your diploma if you have a standing parking violation.

UNIDENTIFIED WOMAN: Really?

MATT SUCKOW: What?

CURT NICKISCH, BYLINE: Most of the two and a half thousand students at Stonehill College, a liberal arts school south of Boston, get some financial aid. After all, tuition is $35,000 per year.

Student Lenna Dwyer gets federal work-study money as part of her financial aid package. That means she has a part-time job as a tutor on campus.

DWYER: My work study money is pretty much my lifeline for getting the books that I need for classes the following semester, saving up if I want to go on a trip with the school, or with other students and class events and things like that.

NICKISCH: But work-study money is among the student financial aid that would drop as part of the automatic federal cuts. The White House says 33,000 student jobs would be cut nationwide.

That worries Stonehill freshman Matt Suckow, who applied to be a teaching assistant next year.

SUCKOW: I am a little afraid that they won't hire as many TAs, which would slim down the chance of my becoming one, which is not something I like to think about.

NICKISCH: Financial aid offices do have to think about it because the sequester is coming just as they're putting together financial aid offers. Some colleges are warning incoming freshman that their financial aid may shrink. Others are scrounging for funds to cover the gap.

Mike Famighette is assistant financial aid director at Babson College, a business-oriented school west of Boston.

MIKE FAMIGHETTE: We're already going out with our financial aid award letters, so we can't really issue a redaction. You know, we'll commit to the money that we've given.

NICKISCH: It's not just student financial aid. Colleges are also worried how sequestration will cut research funding.

SAM KESNER: This is the Harvard Biodesign Lab.

NICKISCH: Sam Kesner is a postdoctoral fellow at Harvard University. He's studying how to develop nano-robots for medical treatment. He just spent a month applying for a research grant from the National Institutes of Health.

Yesterday, he got a warning from them.

KESNER: Well, it's pretty brief. You know it does say things like: due to sequestration, we expect to make fewer competing awards.

NICKISCH: Kesner's now afraid that his proposal, which would pay for a lab of five people for five years, might not get funded.

KESNER: Depending on when they resolve all these issues, that could change the course of my entire career. So it is a little stressful I would say.

(LAUGHTER)

NICKISCH: Rich Doherty of the Association of Independent Colleges and Universities in Massachusetts says sequestration is sending students the message that the federal government is no longer going to invest in them. He says sharp researchers might decide to become Wall Street bankers instead, and some students might not graduate.

RICH DOHERTY: If they do not get that financial aid, they may have to take a semester off. And students that drop out find it a very hard time to sort of drop back in.

NICKISCH: The sequester threat is also sending a message to colleges. That, now or later, federal dollars for higher education are bound to fall. That's partly why Boston University yesterday said it is planning to cut its overall budget next year, regardless of what Congress decides this week.

For NPR News, I'm Curt Nickisch, in Boston. Transcript provided by NPR, Copyright NPR.

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