The L.A. Times is reporting that California’s financial assistance program, which gives cash grants to low and middle-income university students, could be on the chopping block as the state faces a skyrocketing deficit.
The plan emerged in testimony by the state’s administration at a hearing today following Gov. Arnold Schwarzenegger’s turnaround on a week-old plan to borrow $5.5 billion to help balance the state’s budget. One nonpartisan analyst estimates the deficit at around $24 billion (USD).
Under the new proposal, 77,000 new grants costing $180 each year would be cut, but savings would eventually grow as high as $900 million as students graduate and the grants are phased out entirely.
Other programs at risk include the state’s main welfare program and health insurance for low-income families.