Small Price to Keep a Kid in College

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As a single mother of a small child with fragile health, and with no educational credentials except a GED, Denise Lee could scarcely afford any financial setbacks when she went back to college last fall.

But early in her first semester, as she headed to her remedial math class at Santa Fe Community College, in New Mexico, a policeman spotted her driving with license plates that were expired by one day.

For people with living-wage jobs, the encounter might have been only an inconvenience. For Lee, it threatened to derail her academic career.

The officer gave her a warning and an ultimatum: Update the plates or park the Jeep. Lee couldn’t afford to renew the registration; she had exhausted her student loans to buy the used vehicle. But the nearest bus route was too far from home, Lee said, especially for her 2-year-old daughter, Olivia, who has a congenital heart condition. And a condition of the free child care she was receiving for Olivia was that she remain in school.

“I had no money,” recalled Lee, now 26. “Everything goes to my daughter.”

Lee was rescued by an unusual program: Dreamkeepers. The same day she presented her case to her community college’s department of financial aid, where she works as a clerk, the program gave Lee the $268 she needed to update the Jeep’s registration and plates.

As jobs dry up, college costs rise and the economy sours, it’s not hard to find students who occasionally need emergency financial help to stay in school. But it’s rare to find programs like Dreamkeepers – one of two such programs studied for a recent MDRC report, Helping Community College Students Cope with Financial Emergencies: Lessons from the Dreamkeepers and Angel Fund Emergency Financial Aid Programs. MDRC is a nonprofit, nonpartisan education and social policy research organization.

Both programs were created in 2005 by the Lumina Foundation for Education, an Indianapolis-based private foundation whose mission is to expand access to and success in post-secondary education. Scholarship America oversees the programs and is conducting a survey of the 11 community colleges that participated in the pilot project of Dreamkeepers. Seven more schools have joined Dreamkeepers for this school year.

Angel Fund, which serves tribal colleges and universities, has 26 participating institutions.

Lumina continues to fund and expand the programs, but plans for them eventually to become self-sufficient.

The Need

While emergency loan programs and other in-house cash assistance programs are not unheard of, college administrators say it’s unusual for a private organization to initiate the creation of emergency assistance programs for college students. That’s what Lumina did by requiring participating institutions to match its Dreamkeepers grants.

Santa Fe Community College, for instance, got a $60,000 grant from Lumina once it agreed to match the grant, creating a $120,000 fund. The money is disbursed in one-time allotments of up to $500 for students who demonstrate a verifiable need for the financial assistance.

“This fills a gap and a need that sometimes goes overlooked, particularly for those students who are living on the edge, financially,” said Phil Day, a longtime community college chancellor and current president of the National Association of Student Financial Aid Administrators, based in Washington.

“Our own institutional research departments used to do a survey … as to what contributes to a student staying in school and what does not,” Day said, referring to colleges he has headed. “Financial constraints and barriers are no doubt the most significant factors determining whether students stay in school or leave.”

For that reason, it makes no sense for college administrators to do nothing for students who experience small financial crises. “Colleges should care, because the students are our reason for existence,” said Scott Whitaker, director of financial aid at Santa Fe Community College, where Lee is pursuing a general studies degree.

Colleges may not make money by giving it away, but they can stop the hemorrhaging of students who leave school because of monetary woes.

“It’s good business sense,” Whitaker said. “If you can retain a student by giving him a $500 scholarship and that student pays the school $2,500 in tuition over the next few years, that $500 investment was worth it.

“Also, it is good PR for the school. Word travels quickly among the students that the college cares about their welfare.”

How They Work

Indeed, the issues of publicity and student demand were among the aspects of the cash relief programs that MDRC considered in its study. It turns out that some colleges employed strategies to limit publicity about the programs, in order to curb demand.

“Instead of making public announcements, administrators relied on faculty and staff to communicate information about the program to students they knew,” the study states. “Administrators directed faculty and staff, via e-mail and in meetings, to consider Dreamkeepers as a program for promising students with unanticipated emergencies and to refer such students to the appropriate financial aid or student services staff for intake.”

Colleges took other steps to limit awareness of the program, the study states. One institution, Patrick Henry Community College, in Martinsville, Va., went so far as to require students who were awarded funds to sign an agreement in which they promised never to tell anyone else about the program. MRDC found that colleges should be open about the availability of funds and reach out to underserved populations, including Hispanics.

The study also explored:

• Who makes disbursement decisions? Some colleges opted for a committee of high-level administrators to make them, while others delegated that authority to the director of financial aid.

• Should the emergency cash assistance be limited to one-time allotments, or tied to academic performance and attendance? “To the extent that colleges decide to establish award limits or academically based eligibility criteria, they may want to do so with some discretion,” the report says. “A given student’s financial emergency, for example, may be greater or occur more often than the program’s parameters allow.”

• How does the college raise the matching funds? The study states that emergency cash relief funds are “appealing” to donors, such as college foundations. One college turned to its bookstore and a private business that has a relationship with the college.

• What is the definition of “emergency?” “Clearly,” the study states, “a student whose house burned down or was displaced by a hurricane would qualify, but what about more mundane situations, such as running out of bus fare or gas money?” The study doesn’t set specific criteria, but advises college administrators to “be sure to set aside adequate planning time for staff to grapple with these and other important design questions before they put a program into operation.”

The study recommends tracking the program’s impact by measuring results through surveys, monitoring graduation rates, interviewing students and evaluating data.

Contact: Lumina Foundation for Education (317) 951-5300,; MDRC (212) 532-3200. The report is at