(Urbandale, Iowa/Iowa Capital Dispatch) – For the first time ever, financial aid given to undergraduate students by state universities has surpassed the amount provided by the federal government, according to the Iowa Board of Regents.  According to a board financial aid report, in the 2023-2024 academic year, institutional financial aid for undergraduate students grew by more than 5% to $319 million, the fourth consecutive year of increases. Federal undergraduate aid sat at just over $311 million in the same year.

With federal, state, institutional and other forms of financial aid combined, students received a total of $1.18 billion in financial aid, an increase of $600 million from the previous year.  The board discussed its annual financial aid report at its Thursday meeting after hearing presentations from financial aid experts at Iowa’s public universities.

Iowa State University Student Financial Aid Director Chad Olson said in Iowa, as well as across the U.S., federal financial aid has decreased due to less support provided for federal work study programs and the Federal Supplemental Educational Opportunity Grant. Regent David Barker called the change in federal financial aid allocations “striking,” as it has dropped from almost $246 billion in 2010-2011 to just under $141 billion last academic year.

State aid grew by $6.5 million in the 2023-2024 academic year due to the implementation of a state workforce grant program, according to the report. According to the report, students with the most financial need receive the most financial aid, on average. Students with an adjusted gross income (AGI) of $30,000 or less paid an average of $12,254 in 2023-2024, an increase of almost $350 from the previous year. The only income level to not see an increase in net price was the $30,001-$48,000 range, which decreased by just over $350.

The average net cost of all public university students at all income levels in Iowa was $18,660, according to the report. The University of Northern Iowa has the lowest average net price of $15,931, with Graceland University in Lamoni in second place and ISU in third with $17,374. The University of Iowa ranks fifth behind Buena Vista University in Storm Lake with an average net price of $20,121. UNI Director of Financial Aid Tim Bakula said during the meeting the net price of a public university education in Iowa is, on average, around $6,000 less than the net cost of attending a private university.

Presenters also spoke about the debt incurred by some Iowa college students, which UI Director of Student Financial Aid Brenda Buzynski said the total average has decreased from previous years due to fewer students graduating with debt.  According to the report, debt levels have generally remained steady, but the percentage of students who borrow funds for college decreased at each university, all sitting between 50% and 60%. Nonresident debt remains higher than resident debt, the report stated.

University students in Iowa have dealt with changes that have come about with the new FAFSA, presenters told the board, from more Pell grants to fluctuating aid amounts due to new assets that must be listed and the removal of consideration of siblings also in college. The Family Farm and Small Business Exemption Act, introduced by Sen. Joni Ernst and Sen. Michael Bennet of Colorado in early February, would exempt farmland and operational equipment, as well as small businesses with fewer than 100 employees, from being listed on the federal student aid form as assets.