The University recommended that the eating clubs institute financial aid programs to make them more accessible six years ago. Now, with the University’s new, expanded financial aid policy set to go into effect this fall, the University is asking the clubs to roll back any aid above the sticker price of membership, due to potential liability if students are “overawarded.”
According to a June 14 memo circulated to the Graduate Interclub Council obtained by The Daily Princetonian, the University requested that all clubs halt aid practices that grant awards above the University-determined cost of attendance. To ensure compliance with the new rule, in 2023–24, the University’s Office of Financial Aid (UFA) will conduct a review of “all external funding,” which may include an audit of the clubs.
While clubs that charge more than the University’s aid are allowed to give aid to cover the difference, this change affects programs that give grants beyond the cost of membership in order to accommodate students facing additional financial hardship.
Under the new aid structure, the University has factored in a $10,140 board allowance in its cost of attendance for juniors and seniors during 2023–24 academic year. This total “approximates the average cost of an eating club (excluding social fees).”
“It has come to our attention that some clubs have implemented internal aid programs which go beyond covering social fees and costs above the University board allowance for aid students,” the University wrote to the clubs. “From a financial aid compliance perspective, this practice raises concerns.”
Per an example provided by the University, that set-up would look like if a club’s fees are $10,000 (under the board allowance) and the club offers a $1,000 grant to the student.
This change in policy is a result of the enhanced financial aid program announced in September of 2022, effective for the upcoming academic year. The new program promises a zero family contribution for families with incomes under $100,000 and eliminates the estimated $3,500 student contribution.
In the memo, referencing their 2023–24 aid program, the University states, “this generosity will substantially increase eating club affordability for aid students and reduce demand for internal club aid.”
If the clubs do not comply, the University risks “overawarding” students with financial aid. In that case, the University and student would become non-compliant with Ivy League and Federal guidelines. Under Section 472 of the Higher Education Act, they could face liability for the excess amounts.
According to the Department of Education’s Federal Student Aid (FSA), an overaward occurs when “a student’s aid package exceeds his or her need or overall cost of attendance.” FSA cites an “outside scholarship or grant”— like an eating club’s internal aid program — as a common way for this to occur.
If a club awards aid above the difference between the cost of membership and the University’s board allowance, the University would reduce its financial aid to the student by the same amount. A similar practice has been applied to outside scholarships in excess of $3,500 student contribution in 2022–23.
A student who receives an overpayment greater than $25, can be held liable for the amount (unless the school is found responsible). The University’s aid packages also need to be calculated around federally determined Pell Grant awards, creating a precarious situation around this year’s unprecedented increase in aid.
Additionally, the University notes in the memo, that eating club grants for NCAA student-athletes may be deemed as an “impermissible outside scholarship,” standing to threaten an athlete's eligibility within the Ivy League.
Juniors and seniors with a zero family contribution who join eating clubs will receive a refund of around $14–15,000, including the $10,400 plus a grant for the $3,500 which was formerly the student contribution.
“This sum is sufficient to cover eating club costs, cover students’ books and personal expenses, and reduce demand on clubs to offer club-based aid,” University Spokesperson Michael Hotchkiss told the ‘Prince.’
This memo comes one semester after the University asked eating clubs to participate in the dining pilot — allowing upperclassman to take meals at other eating clubs and co-ops. At least some clubs pushed back against the pilot, with one club abstaining entirely. The final decision on changes to upperclass dining is still pending.
According to Hotchkiss, the University discussed their plans for the financial aid guidance with the Graduate Interclub Council before issuing the guidance.
What are the eating club financial aid programs?
In the 2017–18 academic year, the University assembled a task force to assess its relationship with the eating clubs, chaired by Vice President for Campus Life W. Rochelle Calhoun. The group's agenda was primarily concerned with the diversity and inclusivity of the clubs.
The final report issued by the task force included a series of recommendations to the clubs on those lines — including increasing affordability. According to the June memo, the UFA subsequently offered guidelines for the creation of financial aid programs in line with regulations.
At the time, the task force recommendations faced pushback from leadership of the ICC, over fears that it would lead to cost cutting at the clubs. Yet, by 2019, Quadrangle Club announced an internal aid program that would eliminate out-of-pocket costs for students on full financial aid.
As of 2022–23, almost all of the eating clubs offer some sort of grant or scholarship-based aid to assist members in affording their dues.
These programs have received applause from financial aid recipients, with the affordability of a club playing a sizable role in a bickeree’s decision, according to reporting from the ‘Prince’ earlier this year.
However, undergraduate eating club leadership has also noted difficulties in communicating with the University about financial aid. In February, Charter Club President Mia Beams ’24 said that “transparency around University financial aid has been low which has caused some difficulties, but no concerns have been voiced to club leadership.”
At the time, Beams noted that, although Charter fees were consistently below the University’s board allowance, members facing financial hardship could apply for grants ranging from $500 to $1,500. Under the guidance from the memo, this practice will likely be barred.
In 2022–23, Tower Club offered a grant of $200 to all members who qualified for their aid. Separately, while Tower’s dues also fell below the University’s board allowance at $10,017, members were subject to an under-the-table $140 charge known as “Milk Money.” The payment, made through a strictly cash transaction, is required for access to Tower nighttime events, verified through an internal message received by the ‘Prince.’
If the “Milk Money” continues to be charged, Tower will not be able to issue aid to help students cover it, since Tower’s $10,017 dues would continue to lie beneath the University’s allowance. (The ‘Prince’ has confirmed that Tower will maintain the same total in dues for 2023–24).
Charter and Tower Club did not respond to request for comment before publication time.
Many eating clubs have special funds dedicated to these programs. Cannon Dial Elm Club collects direct donations through its “Higgins Memorial Fund,” and Cottage Club awards single to multi-year grants through amounts raised in its “Glinka Scholarship Fund.” With the new rules, it’s unclear what will happen to these extra amounts in alumni donations to the clubs.
What are the eating clubs planning to do?
With the eating clubs rolling out 2023–24 contracts to members over the coming weeks, their responses to the memo vary.
Cannon Dial Elm Club’s Graduate Board Chair Charles Freyer ’69 told the ‘Prince’ that the club is still weighing how to best support its members through its Higgins Memorial Fund.
“Many recipients of our program in the past have been students on partial aid, but with family finances under particular stress. It’s not clear yet how the new policy will address these students’ needs,” he wrote in a statement.
On the other hand, Cap and Gown Club has already issued contracts to its members for the 2023–24 academic year.
In a statement to the ‘Prince,’ Adi Rajagopalan ’13, Co-Vice Chair of the Cap and Gown Board of Trustees, wrote:
“The Cap and Gown Board of Trustees has studied the University’s new financial aid policy carefully, and does not expect major changes to the planned Cap and Gown Financial Aid program for the 2023–2024 academic year. For the 2023–2024 academic year, the Cap and Gown Board of Trustees has approved a grant equal to $964 to students who receive any amount of Financial Aid from the University and verify with Cap their financial aid status with the University.”
That $964 grant covers the difference between Cap’s total fee and the University’s board allowance. While still a form of financial aid, the grant should not violate the University’s guidelines.
Despite the explicit messages of caution in the memo to the eating clubs, in a statement to the ‘Prince,’ University Spokesperson Michael Hotchkiss said that the University does not worry that the new aid program will risk overawarding.
He wrote, “The University has safeguards in place to ensure that students only receive aid within their determined need and the cost of attendance.”
Eden Teshome is a senior News writer for the ‘Prince.’
Please send corrections to corrections[at]dailyprincetonian.com.
Correction: The value of the University’s board allowance has been corrected.
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