CHARLOTTE, N.C. — North Carolina students who are having a problems getting a federal loan to cover their community college tuition and books may need to blame other students who got those loans and defaulted on them.
Raquell McCullough works 30 to 40 hours a week as a server just to pay her tuition now.
"I have financial aid, but that only goes so far," the Central Piedmont Community College student said.
She has attended CPCC since 2012, working to get an associate in science degree to transfer to University of North Carolina at Charlotte. She has gotten some financial aid grant money that she doesn't have to pay back, but it doesn't cover all of her tuition and books. She used to get what's known as a Stafford loan -- a federal student loan that covered the rest of her expenses. But CPCC stopped offering them, in the 2014-15 school year.
"The loan was helping me to also get my books, because now sometimes (the money has) to come out of pocket to pay for them because financial aid doesn't give me enough," she said.
Before 2010, North Carolina community colleges weren't required to offer Stafford loans. Lawmakers voted that year to make them a requirement, but the Legislature changed its mind in 2012 -- allowing community colleges to opt out and CPCC decided to do that.
List of North Carolina community colleges in the area that offer federal student loans (Stafford Loans) as of 2015-16:
- Carolinas College of Health Sciences
- Catawba Valley Community College
- McDowell Tech Community College
- Wilkes Community College
Jeff Lowrance with Central Piedmont’s Community Relations and Marketing Services said the program is bad for colleges, because it's punitive in nature.
He said the school stopped offering Stafford loans, to protect itself. Lowrance said the federal government punishes colleges when too many students default on those loans -- something he says colleges can't control.
The punishment? The government takes away the school's ability to offer Pell Grants, federal grant money that students don't have to pay back.
Before CPCC decided to opt out, its student default rate was 21.5 percent -- well-below the rate that would put the school at risk of losing Pell Grants. But Lowrance said the school didn't want take any chances.
"If you reach a certain default rate for three consecutive years, you then lose your ability to provide Pell Grants for your students," Lowrance explained.
Debbie Cochrane authored a report on the controversy. She said community colleges that do not offer federal loans put students at risk.
When her report came out in 2014, only five of the 12 community colleges in our area made federal student loans available. Now it's down to four. Cochrane said those loans are essential for students, because they have an important option -- repayment based on their income and not just the amount they've borrowed. She said not only students are suffering.
"Ultimately, there are impacts on the workforce when students aren't able to complete. The workforce isn't as well educated as it could or should be," Cochrane said.
Raquell wants to be a physical therapist. Right now, she doesn't know when that will happen. She still has six classes to take before she can transfer with fewer loan options than before.
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