Student Aid

The American Recovery and Reinvestment Act of 2009 includes extensive investments in the higher education sector that will have a direct impact on the University and its students including expansions in college affordability funding.

Boosts to federal aid programs have a significant effect on UC students, as our students receive nearly $1.2 billion in federally authorized support, which includes more than $200 million in grants and almost $900 million in loans.

UC students will have additional resources as a result of the expanded financial aid provisions, which include boosting the maximum Pell Grant and expanding the federal tuition tax credit and extending it to students from higher-income families.

Changes to the Pell Grant Program

The maximum value of a federal Pell Grant will increase by $619 in 2009-10 (from $4,731 to $5,350) and by another $150 (to $5,500) in 2010-11.

This will translate into an estimated $33 million in new grant funding for UC students over the previous Pell Grant funding level of $196 million.

Changes to Federal Higher Education Tax Credits

The Hope Tax Credit has been expanded and renamed the American Opportunity Tax Credit. The current UC student estimated tax credit eligibility of $78 million will more than double by adding up to $88 million in additional tax credit eligibility to middle-income UC families.

Tuition tax credits benefit UC students below the credit income cap if their fees are not already fully covered by grants or scholarships – generally middle-income families. The new credit increases the maximum credit from $1,800 to $2,500 for the first $4,000 in qualified expenses and raises the income ceiling from $116,000 to $180,000 for married filers and from $48,000 to $90,000 for single filers.