Massachusetts spends millions of dollars annually to help students afford the high cost of tuition at some of the wealthiest colleges in the state, sparking a debate about whether the schools should dig deeper into their own $1 billion-plus endowments to help needy residents.
About a third of the $96 million the state spent last year on financial aid grants flowed to private colleges, including $1.8 million to Boston University, $1.2 million to Boston College, and $603,000 to Harvard.
At a time when state budget shortfalls have led to cuts in public colleges, critics argue that wealthy private schools should pay for the students’ education without state help.
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“We’re subsidizing some of these schools that have huge endowments, and I just don’t see the need to do that,” said state Representative Christopher M. Markey, a Dartmouth Democrat. “I think they can crack open a little bit of their money from endowments to do that.”
Last month, Markey pushed unsuccessfully for an amendment to the House budget that would have barred financial aid dollars from flowing to colleges with endowments of more than $1 billion – a group that also includes Amherst, the Massachusetts Institute of Technology, Tufts, Smith, Wellesley, and Williams.
Private college advocates strongly oppose any effort to stop financial aid from flowing to those institutions, saying it would punish students and limit their college choices.
“It’s very unfair to talented low-income Massachusetts students if the state were to say, ‘We’re not going to give you any financial aid if you get into one of our outstanding private colleges,’” said Richard J. Doherty, president of the Association of Independent Colleges and Universities in Massachusetts, which represents 60 private colleges and universities. “I think that’s pretty perverse, from a public policy perspective.”
Doherty said such a move would be particularly harmful in Massachusetts, where private colleges award two-thirds of the state’s bachelor’s degrees.
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In return for getting $31 million in financial aid from the state, the colleges, he said, spend $608 million of their own money to defray the high cost of tuition for residents. And many of the private colleges that receive state money are struggling financially.
Bridget Terry Long, a professor of education and economics at the Harvard Graduate School of Education, said Massachusetts lawmakers and officials will have to consider both arguments as they weigh how best to disburse financial aid.
“Given the limited funds we have to deal with, if we were not to give this money [to private colleges], would the students have gotten the resources from their institution?” she said. “That may be the case at, say, Harvard, but that’s not true at all the privates.”
The state hands out about 92,000 grants every year.
The largest program, called MASSGrant, provides an average of $650 annually to students whose families demonstrate financial need. Students at public and private colleges are eligible for the award, which costs the state $45 million annually.
The state spends another $16 million on Gilbert Grants, which are available only to needy students attending private colleges. Those grants range from $200 to $2,500 annually.
Public higher education advocates argue the MASSGrant money would go further if it were spent only on students attending lower-cost public institutions.
Last month, Vincent Pedone, a former state lawmaker who represents the presidents of the state’s public colleges, pushed unsuccessfully for an amendment to the House budget that would have capped at $16 million the amount of state financial aid that could flow to private colleges. That’s about half of what the state currently sends to those institutions.
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“The rationale was so that we could start the conversation about the most effective use of those financial aid dollars,” Pedone said. “Maybe it is exactly the way it is laid out; maybe it isn’t.”
The dwindling buying power of the grants may be fueling some of the competition.
In 2013, MASSGrant funding covered just 9 percent of a student’s tuition and fees at a public higher education institution, down from 80 percent in 1988, according to a 2014 report by the state Higher Education Finance Commission.
The report said Massachusetts ranked 28th in the nation in the percentage of its public higher education budget devoted to financial aid. And Massachusetts’ average annual grant of $657 paled in comparison to the national average of $2,400.
Zac Bears, executive director of PHENOM, a public higher education advocacy group, said he got a $1,200 MassGrant when he attended the University of Massachusetts Amherst. But he said he doesn’t believe he should have received the award if he had gone to a wealthy private university.
“If I was making the choice to go to a $60,000-a-year private university with a large endowment, I don’t believe the state should be obligated to help me make that decision,” Bears said. “I think the state should focus on making the public system, which is designed to be affordable for working people, as affordable and as high quality as it can be.”
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Harvard points out that 20 percent of its students attend the college tuition-free because their parents earn less than $65,000 annually. Harvard also says 84 percent of its $38 billion endowment is restricted by the terms of the donors’ gifts.
Patricia A. Gentile, president of North Shore Community College in Danvers, said the state should spend more on financial aid, but not limit it to students attending public colleges.
“You can’t take individual choice away from students,” Gentile said. “Quite frankly, if I had a student who had the academic ability to go to Harvard, I would encourage them to go. How could you deny folks that opportunity?”
Michael Levenson can be reached at mlevenson@globe.com. Follow him on Twitter @mlevenson.