Austin, Texas: The University of Texas flagship campus will cover full tuition for any student whose family income totals $65,000 or less beginning in fall 2020.
UT Austin officials estimate the new financial aid commitment will cover tuition and fees for an estimated 8,600 students, or 24 percent of the undergraduate student body. Graduate students and out-of-state students are not eligible, but transfer students are.
On Tuesday afternoon, the University of Texas System Board of Regents voted unanimously to move $160 million from the state’s Permanent University Fund — a state endowment for the UT and Texas A&M systems — for the purpose of UT Austin’s financial assistance program for low- and middle-income students.
The move will build on UT Austin’s Texas Advance Commitment program, which started in fall 2018 and covered full tuition and fees for students with families earning up to $30,000 a year. That program covered about 4,000 students.
UT Austin President Greg Fenves thanked the regents for making the university more affordable and accessible to lower-income students.
“Chairman (Kevin) Eltife understands that college affordability is one of the most critical issues affecting all Texans,” Fenves said. “Thanks to his leadership and the board’s action, this new endowment will go a long way toward making our university affordable for talented Texas students from every background and region.”
UT Austin officials noted that the expansion of need-based financial assistance extends to middle income families. The school noted that the average median household income in Texas in 2017 was $59,206.
Tuition and fees at UT Austin for an in-state undergraduate student is $10,314 a year.
The regents’ allocation will also finance partial tuition support for students from families with incomes up to $125,000, based on a sliding scale.
The financial commitment to cover tuition for students is an ongoing promise. The allocation will create an endowment where the money is invested and interest and earnings are used to fund the tuition costs in perpetuity.
The university’s new tuition program will supplement student awards covered by federal Pell grants and the TEXAS Grants program — a need-based state scholarship which is capped at $5,000 per student.
The TEXAS Grants program is the state’s signature financial aid program for public universities, however, those state funds are stretched thin. In 2018 the award, which went to 76,801 students, covered only 55 percent of the average amount of statewide tuition and fees.
The $160 million allocation to establish the endowment comes from the Permanent University Fund, an endowment created in 1876 from lands set aside in West Texas that generate income from oil and gas revenue, land rentals, royalties and leases. The fund has a market value of $22.3 billion. Two-third of the fund allocations go to the UT system, and one-third goes to Texas A&M system, per the state constitution.