Tighter federal lending standards yield turmoil for historically black colleges

Nick Anderson:

Tighter standards in a federal loan program have dealt a significant blow to Howard University and other historically black colleges and universities over the past year, curtailing funds for thousands of students and contributing in some places to a sudden decline in enrollment.
The change in federal lending to parents of college students had an acute impact at Howard, where finances are also under pressure from the federal budget sequester and expenses at its hospital. Howard President Sidney A. Ribeau announced budget cuts in January in response to shortages in revenue from tuition and other sources.
Federal data show that parent loans for Howard students fell by at least $7 million in the 2012-13 academic year compared with the previous year, a 17 percent decline.
Howard’s 5 percent enrollment drop and loss of revenue fueled a debate over fiscal issues that has roiled the university community. The vice chairwoman of the board of trustees, Renee Higginbotham-Brooks, warned in a letter to trustees disclosed June 7 that the school “is in genuine trouble.” Days later the board chairman, Addison Barry Rand, countered that it remains “financially and operationally strong.”