Student financial aid has comprised a rising share of states’ funding for higher education over the past two decades. In the midst of the COVID-19 pandemic, states are making consequential budget cuts that will impact higher education institutions and the students they serve. States have responded to recessions by slightly increasing the amount of aid disbursed based on financial need, though that has not changed the overall trend of states prioritizing merit-based aid over need-based aid. This brief examines changes in the share of funds states allocate toward need-based financial aid and the amount of state and local funding students receive at various institution types over the past two decades.
