Boost for Need-Based Aid

States last year doled out roughly the same amount of student aid money in 2012-13 as they did the previous year, but they increased the share of money flowing to students based on financial need, according to a new survey published Monday.

The annual survey, conducted by the National Association of State Student Grant and Aid Programs, found that although the top-line number of state aid -- $11.28 billion -- actually declined just slightly from the previous year when adjusting for inflation, states collectively boosted their investment in need-based grant aid.

States increased their spending on need-based grant aid by 3.5 percent in the 2012-13 academic year, while non-need-based grant aid declined by 2.1 percent. In inflation-adjusted dollars, states reduced their spending on aid with a merit component to $3.98 billion last year from $4.02 billion the previous year. (An earlier version of this paragraph incorrectly said spending on grants with a merit component was in the millions; in fact, states spend billions on such aid.)

Among the states that saw increases in spending on need-based grant aid were Arizona (35.1 percent), Washington (18.3 percent increase), North Carolina (24.1 percent), and Minnesota (12.7 percent). 

The amount of need-based grants that states funded per each full-time equivalent student increased by 5.7 percent, from $482 in 2011-12 to $509 last year. Sixteen states also increased the maximum amount a student can receive in their need-based grant program.

Of all grant aid awarded by states last year, a full three-quarters of the aid was awarded to students on the basis of need, which is the highest rate in at least the past five years, the survey found. 

Total Grant Aid Awarded, 2012-13 (in millions)