Friday, August 30, 2013

Texas Law Forces College Students to get Loans to Pay for Other People's Tuition

Update: New Article "Stop Texas 20% Tax on College Students! Repeal Tuition Set Aside Law!" explains in detail how and when we got this tax.

You probably think I am kidding but I am not. In TEXAS of all places there is an Obama-Style share the wealth program that requires students going to college to pay thousands of dollars in extra tuition to pay for other people’s college tuition assistance. It does not matter if you are working double jobs to pay your way through school, you still get to pay for someone else. Even if a Texas college student is getting student loans to pay for school, they still have to pay extra for someone else. In other words, a Texas student getting student loans has to borrow money and pay interest on a loan in order to pay thousands of dollars in extra tuition so that someone else can go to college for free!

This tuition set aside program is required by Texas Education Code sections 56.011 and 56.012. The program must not be very old because I know when I went to Texas A&M University I did not pay extra tuition for someone else. In the 81st Texas Legislature, Senate Bill 1304 was passed that requires schools to inform students of the amount they paid in tuition that will be set aside to pay for someone else. Transparency is good, but students should not have to borrow money to pay for someone else’s tuition in the first place!

I would never have even known about this if it were not for a concerned parent who forwarded me an email that he got from his son who is attending the University of Houston and paying his tuition via student loans. This UH student was shocked to get an email from the University letting him know how much money he had paid in tuition to pay for someone else. Before he graduates he will have had to borrow over $6000 in loans in order to pay for someone else’s tuition assistance!

Don’t get me wrong, I am all for college access for everyone, even the poor. That is what student loans are for though. Even poor people can get a student loan with a low interest and not have to pay anything until after they graduate and get a job. Sure the state or federal government will incur some costs to pay for financial aid programs and to pay to run student loan programs (assuming the loan programs do not already pay for themselves from student loan interest), but this cost should not be passed down to the students simply because they decided to go to college. One student should not have to get a student loan and pay interest in order to pay for someone else to go to college for free.

Below is the email I got from this concerned parent. Also below is the email this concerned parent got from his son explaining how the school had charged him extra tuition to pay for someone else:

From: *****
David Bellow,
Have you ever heard of a program like this before? For a couple of years my youngest son **** who is in his third year of law school at U of H has been telling me about a state policy/law where a portion of every student loan he takes out goes to a fund for OTHER students. In other words when he’s borrowing money for his own education he is being mandated by the state of Texas to borrow a certain amount for someone else to get to go to school. Then he gets to pay it back with interest!  This is incredible to me. And from his message to me below it started in the 81st Legislature and was called Senate Bill 1304. The students who can least afford it (they have to borrow money to go to school in the first place) are having to pay for other students’ tuition! Talking about spreading the wealth – and from those who can least afford to have it taken away from them! This wasn’t passed by Democrats. It was a Republican led legislature and signed by a Republican governor. Unbelievable. This needs to be given the light of day to have this rescinded.
Have you ever heard of such?

Begin forwarded message:
From: *****
Subject: Fwd: University of Houston: Set Aside Notice
Hey Mom and Dad,
Below is the email I have told you about.  I just received it this evening and thought I'd forward it to you to see for yourself.  
By the time I graduate, I will have been forced to BORROW roughly $6,000 to pay for someone else's tuition.  The state of Texas is forcing me to borrow money which will take me years to pay back (with interest) to pay for someone else.  Completely outrageous.  
I don't see how this would hold up in court.  The State should cut me a check for $6,000 plus interest.

Begin forwarded message:
From: "University of Houston Office of Student Financial Services"
Date: July 26, 2013, 5:05:05 PM CDT
To: ****
Subject: University of Houston: Set Aside Notice

Dear ****

Please note: This email is not a bill.  No action is required.
This message is for informational purposes only and complies with Senate Bill 1304, passed by the 81st Texas Legislature, which requires that Texas public universities report to each resident student the amount of his or her paid tuition that has been set aside to provide financial assistance programs for qualified students at that institution.  
The total amount of your paid resident tuition for the Summer 2013 term that was set aside by the University of Houston to provide financial assistance programs for qualified students was 452.93.
Office of Student Financial Services
University of Houston

The University of Houston, 4800 Calhoun Road, Houston, Texas 77004



  2. We need to find out the Representatives that introduced and voted on this bill. This is nothing more than socialism and I am sure against the constitution. The more illegals that we bring in the more we will have to pay. We need to stand up now while we have a chance and voice our opinion , plus get rid of all these Socialist lawmakers. Its going downhill every day.

    1. From what I can tell after a cursory investigation, the bill that actually forced "institutions of higher education" to set aside 15% to 20% of tuition (depending upon whether said student is graduate or undergraduate) was passed in 2003.

      HB 3015 from the 78th Legislative session :

      The bill THIS article is talking about is SB 1304 (81st Session), which forces these "institutions of higher education" to inform the students just how much they are being forced to pay.

      SB 1304 from the 81st Legislative Session:

  3. Yes indeedy......who wrote this one?

  4. Notice that the Texas Bill/law requires this be reported to the student. It doesn't require that the money be "set aside" from one student's tuition, to pay that of others. The Bill was passed in 2009, so it's hardly a new thing. The requirement to set a fraction of tuition payments aside is obviously even older.

    That said, I did not know about it. But my daughters went to a private college for their undergraduate work. Both did attend THE University of Texas for post graduate work. One got an LlD, the other got a PhD.

    Here is the actual text of the law requiring the set aside:

    Sec. 56.011. RESIDENT UNDERGRADUATE STUDENT ASSISTANCE. (a) The governing board of each institution of higher education shall cause to be set aside not less than 20 percent of any amount of tuition charged to a resident undergraduate student under Section 54.0513 in excess of $46 per semester credit hour. The funds set aside under this section by an institution shall be used to provide financial assistance for resident undergraduate students enrolled in the institution.


    In the 1970s, the state paid for 85% of the cost of running the University of Texas, now it's under 20%. Students make up much of the difference, but not all of it.

    About 8.5% of tuition goes to scholarships and other financial aide. The flat rate tuition, anything over 12 hours per semester is around $5,000, more or less depending on what college the student is in, Liberal Arts being the least at $4,673 and Business being the most at $5,369. (I'm surprised, business school only requires classrooms and computers, as do all the others) while Engineering requires labs and lab equipment, as do the Sciences)

    It's different at each school, since they set their own tuition rates, since the Leg allowed them to do that starting in 2003.

    UT is probably the most expense state school. Others will be less, although A&M and Houston might be close.

  5. That's why I have always stated PRESENCE IS A PROBLEM. Republicans are practicing crony capitalism with the cheap-labor donor class and sending us the bills.Unless Americans learn how to corner their reps and stop being distracted by border chat...we will all continued to get hammered as they seek to replace us.

  6. I call BS on this....My wife works at a two year community college in financial advising. It is a Texas Public College she says that it does not go to other students. This is just another example of Conservative "News" organizations willing to tell any lie necessary to get their way. I notice that this piece of journalistic trash did not attempt to contact U of H or ANY other institution to verify the claim.

    It goes to show you that a news source like this will print anything that is pro-conservative... truth is not necessary.

    1. Dear Anonymous,

      By now, you are probably aware that this Senate Bill 1304 is not BS. It is a fact! I can send you my notification letter. They have forced college students to foot the bill for their so-called "set aside" program. It has only been recently that students are notified about this stealth funding. Currently, I borrow money to fund my education, and I am required to repay this money WITH INTEREST, six months after my graduation date. Why should I borrow money to fund someone else's education, who may or may not be serious about their education? And, who are these students that are so privileged that they get a free ride off of my money, without my consent? Why weren't there any public hearings on this? Who decides the criteria for the fortunate recipient, and how much do they receive? Am I able to write off this as a donation on my taxes? Here's my major question. How many politicians have children in college, and how much are they taking out of their pockets for this "set aside?"

  7. To pay for Illegal Aliens Education , What else .

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