Scholarship Committee Revises Its Methods for Determining Stipends

Disgruntled freshman scholarship applicants about this time of year are wont to repeat a Harvard legend of somewhat recent vintage. The story describes a supposedly poverty stricken young man, who, after a tear jerking visit to the scholarship offices, hied himself to Mt. Auburn St. and drove off to a Country Club in his Buick convertible.

It is a fine Harvard tale and for the purposes of later year nostalgia it belongs somewhere near the story of the ice cream fund donation. The determination of scholarship size, for the dedicated group of men who work in Weld and University Halls has become almost as scientific a job as the study of electronics in a nearby Cambridge institute.

At a time when costs of education are constantly increasing, when the College's tuition has jumped $200, these men are striving for the most equitable distribution of scholarship funds. Over 1000 men were awarded scholarships last year, yet few understand the actual process in determining the size of stipends, as outlined by John U. Monro '34, Director of the Financial Aid Center, in a recent report to the College Boards.

The Gap

The scholarship at Harvard in the difference between expenses, and what a student can afford--the total of his savings, what he can make in the summer and what his parents can contribute. The main problem for the College is determining how much the family can and should contribute.

Up to three years ago Monro and his associates used a nice simple mathematical equation known as the "15 per cent" rule. The administrators would calculate 15 per cent of the not family income as a basic expected contribution. From this expected amount they would subtract $100 for each child in public school, and $200 for each one in private school or college. But the dean reading the folder was also expected to use his own judgment in evaluating family assets. The rule might have worked, had one person read all the applications. But with several readers all making recommendations, there was a difference of style. Because of this, both the individual reader and the committee gradually moved their decision to what Monro calls the "traditional center of scholarship gravity--tuition." As Monro says, "A tuition scholarship was usually safe enough. It might be $100 or $200 more than a man actually needed, or less, but nobody but the student was likely to know the difference." Estimated Need  Average Stipend $200-299  $228 300-399  260 400-499  307 500-599  356 600-699  442 700-799  467 800-899  540 900-999  573 1,000-1,099  630 1,100-1,199  683 1,200-1,299  683 1,300-1,399  748 1,400-1,499  930

These figures represent the amount the committee decides is needed compared with the amount it awards in scholarships. Loans and part-time employment are generally used to make up the difference.

Because of this disparity--too much money to some students, too little to others--the scholarship office three years ago decided to junk the old rule and introduced instead a more probing system which incorporates more facts and less haphazard chance into the final stipend.

First of all under the new system, the office asks for information about the parents, name of employer, kind of job. The office asks for the names and ages of brothers and sisters who are not yet in school or college, and whether they are dependent upon the family or hold any scholarships. A parent must fill out his total income for the last year and estimated income for the coming year, besides a listing of business expenses charged against this income. As added proof, Harvard requires an Income Tax statement, and a listing of all extraordinary expenses. The administrators also want information on assets; they ask parents to put down the present value of real estate holdings and the present mortgage, a listing of savings, and the total cash value of stocks and bonds.

The Scholarship office--which used to employ credit checks on the return sheets but which since has given it up--finds that few parents object to the particular form. Approximately 300 fill out the blank each year, only about 10 complain, and one or two refuse to fill it out.

"As to determining income," according to Monro, "we have two lines of attack. Our first assumption is that a family is obliged to maintain a child to provide food, shelter, clothing etc. We calculate this cost of basic maintenance at 12 per cent of the net family income for one child; at 10 per cent for two children; and eight per cent if there are more than two children. Because our expense budget covers the maintenance cost for about nine months out of the year, we count on receiving three-fourths of our "obligatory maintenance" figure for the year. For example, taking a family with $6,000 income and two children, the main- tenance calculation for one child would be 10 per cent, or $600 and we would want 75 per cent of that, or $450."

To this large sum, the committee adds another figure, a varying percentage of what the family had left over after its commitments and bills have been paid. When the "remainder" is $1,000, the percentage taken is only 2, when the remainder rises to $7,000 or more, the percentage jumps to 10.

This total equals the amount of need, before any loan is made and before any form time employment is awarded. The committee then decides how much of the gap will be filled by scholarship funds (see box).

In its first year with this system, the committee found that most scholarships were either raised or lowered $200-300. As Monro says, "We moved up the stipends of the needy at the expense of those men relatively well off. How important is this? Terribly important, if we gave a very needy student, out of old habit a $600 scholarship when he really needs $800 it may be very hard for him indeed. It leads him perhaps, to work 25-30 hour's a weeks for wages, sacrificing academic work, extra-curricular activities, even his health in the desperate effort to cope with a financial problem we have carelessly set for him. Two hundred dollars extra means much to this man.

These figures represent the amount the committee decides is needed compared with the amount it awards in scholarships. Loans and part-time employment are generally used to make up the difference.

Because of this disparity--too much money to some students, too little to others--the scholarship office three years ago decided to junk the old rule and introduced instead a more probing system which incorporates more facts and less haphazard chance into the final stipend.

First of all under the new system, the office asks for information about the parents, name of employer, kind of job. The office asks for the names and ages of brothers and sisters who are not yet in school or college, and whether they are dependent upon the family or hold any scholarships. A parent must fill out his total income for the last year and estimated income for the coming year, besides a listing of business expenses charged against this income. As added proof, Harvard requires an Income Tax statement, and a listing of all extraordinary expenses. The administrators also want information on assets; they ask parents to put down the present value of real estate holdings and the present mortgage, a listing of savings, and the total cash value of stocks and bonds.

The Scholarship office--which used to employ credit checks on the return sheets but which since has given it up--finds that few parents object to the particular form. Approximately 300 fill out the blank each year, only about 10 complain, and one or two refuse to fill it out.

"As to determining income," according to Monro, "we have two lines of attack. Our first assumption is that a family is obliged to maintain a child to provide food, shelter, clothing etc. We calculate this cost of basic maintenance at 12 per cent of the net family income for one child; at 10 per cent for two children; and eight per cent if there are more than two children. Because our expense budget covers the maintenance cost for about nine months out of the year, we count on receiving three-fourths of our "obligatory maintenance" figure for the year. For example, taking a family with $6,000 income and two children, the main- tenance calculation for one child would be 10 per cent, or $600 and we would want 75 per cent of that, or $450."

To this large sum, the committee adds another figure, a varying percentage of what the family had left over after its commitments and bills have been paid. When the "remainder" is $1,000, the percentage taken is only 2, when the remainder rises to $7,000 or more, the percentage jumps to 10.

This total equals the amount of need, before any loan is made and before any form time employment is awarded. The committee then decides how much of the gap will be filled by scholarship funds (see box).

In its first year with this system, the committee found that most scholarships were either raised or lowered $200-300. As Monro says, "We moved up the stipends of the needy at the expense of those men relatively well off. How important is this? Terribly important, if we gave a very needy student, out of old habit a $600 scholarship when he really needs $800 it may be very hard for him indeed. It leads him perhaps, to work 25-30 hour's a weeks for wages, sacrificing academic work, extra-curricular activities, even his health in the desperate effort to cope with a financial problem we have carelessly set for him. Two hundred dollars extra means much to this man.