Official newspaper of The University of Texas at Austin

The Daily Texan

Official newspaper of The University of Texas at Austin

The Daily Texan

Official newspaper of The University of Texas at Austin

The Daily Texan

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October 4, 2022
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Bill to end B-On-Time loans held pending in committee

Rep. Helen Giddings (D-DeSoto) filed a bill, HB 700, that would eliminate the state’s B-On-Time student loan program.

The B-On-Time loan is a state forgivable loan funded by 5 percent of student tuition, according to Thomas Melecki, the University’s director of student financial services. Students on the loan receive $4000 per semester. The loan requires students graduate in four years with no more than six credit hours than needed by their degree plan.

The House Higher Education committee left the bill pending after a public hearing held Wednesday. The bill would stop enrollment for the loan in September 2015, but current borrowers would be eligible for continued funding.


Under HB 700, funds previously used for the loan would be granted directly to the institution from which they were collected to establish other aid programs, such as grants, loans or work-study programs.

“In many cases, it’s virtually impossible for students to get out in four years,” Giddings said. “We believe that a better outcome will be received if universities are able to structure a financial aid program from these dollars that will meet the needs of students at their institutions.”

Portions of the funds go unused statewide, and universities are not allocated the full value collected from student tuition. Giddings said these factors motivated her to file the bill. In 2014, more than $11 million of the B-On-Time fund were not used.

Melecki said part of the discrepancy is because of universities’ inability to advertise the loan. B-On-Time is classified as a private loan, preventing universities from prompting the funding, Melecki said. Student’s must know about the loan and ask for it to be considered.

“The B-On-Time loan program is a fabulous program from a student’s point of view,” Melecki said. “But, with that gag-rule, there are too many students who don’t know about it, and, with the way the legislature has been sitting on B-On-Time money that is collected by the state, we send money down that our students spend in tuition that we never get back to help our students.” 

Roshni Varghese, applied learning and development senior and one of 716 students at UT using B-On-Time loans, said most people do not know about the loan.

“I actually told one of my friends about it when she was a senior in college, and she had never even heard of it,” Varghese said. “I’ve only had one other friend who has ever tried or gotten it, ever.

The House budget, as currently written, would cut B-On-Time funding by $25.3 million. The Senate budget would decrease it by $12.2 million.

“The Appropriations Committee does anticipate, in the House anyway, that the B-On-Time loan is just going to fund renewals,” said Giddings, a member of the Appropriations Committee. “If someone has already enrolled, we’re not going to jerk the rug out from under them.”

Varghese said the loan is beneficial for students, such as herself, who do not qualify for need-based loans and grants because of their parents’ incomes but are essentially paying their way through school.

“The good thing about the B-On-Time loan was that it didn’t matter if you technically needed it or not; it was still there for you to get,” Varghese said.

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Bill to end B-On-Time loans held pending in committee