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Need-Based Financial Aid in Wisconsin

State Policy and Student Pathways

by Drew M. Anderson

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Research Questions

  1. Who receives Wisconsin Grant aid, and where do they enroll and complete college?
  2. What are the effects of shortages in Wisconsin Grant aid, and how might scarce funding be allocated to provide meaningful aid to low-income students?

States around the U.S. are increasingly shifting higher education funding away from supporting public institutions and toward providing individual students with need-based financial aid to offset tuition and living expenses. This strategy could diversify and increase the number of students obtaining college degrees, but inherently presents challenges in choosing which income levels are eligible to receive aid, identifying the eligible population at those income levels, and delivering aid at a time and in an amount that will meaningfully support college attainment.

This report describes the policy design, implementation, and outcomes of the Wisconsin Grant. In partnership with the state of Wisconsin, RAND Corporation researchers created and analyzed a new database connecting state grant aid applications to the educational attainment of applicants. The author explores the pathways of aid recipients and the effects of recent funding shortages.

Key Findings

  • Lower-income students have lower college graduation rates than their higher-income peers, and this gap persists regardless of demographics.
  • The design of financial aid programs imposes complex procedures to target those who need aid the most; unfortunately, many who need aid the most are likely to miss deadlines or face other application challenges.
  • State funding for financial aid has increased, but it has not kept pace with student demand following economic recessions; shortages disproportionately affect older adult students returning to college, because they apply for aid later.
  • Aid programs seeking to maximize impact should allocate funding increases more heavily toward the lowest-income applicants.
  • States should allocate funding so that all students who are financially eligible can access aid, remove barriers to aid application and renewal, and support comprehensive data systems for continual program improvement.

Table of Contents

  • Chapter One

    Challenges for State Need-Based Aid Programs

  • Chapter Two

    Student Pathways in Wisconsin

  • Chapter Three

    Design of the Wisconsin Grant

  • Chapter Four

    Implementation of the Wisconsin Grant

  • Chapter Five

    Building Evidence for Wisconsin Grant Policy

  • Chapter Six

    Ways Forward and Report Implications

Research conducted by

The research described in this report was funded by the Ascendium Education Group and conducted by RAND Education and Labor.

This report is part of the RAND Corporation research report series. RAND reports present research findings and objective analysis that address the challenges facing the public and private sectors. All RAND reports undergo rigorous peer review to ensure high standards for research quality and objectivity.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.