The Carolina Covenant will enable low-income students to come to UNC and graduate debt-free if they work on campus 10 to 12 hours a week throughout their four years at the school, instead of borrowing, in a federal work-study job. Moeser said the university will meet the rest of students' needs through a combination of federal, state, university and private grants and scholarships.
UNC already meets 100 percent of the documented financial need of all students who apply for aid on time. But about a third of that need is being met through loans.
To fund the Carolina Covenant, the university will make modest reallocations of existing funds in the Office of Scholarships and Student Aid and pledge growing private gifts dedicated to low-income students. The initiative is expected to cost about $1.38 million annually when fully phased in four years from now.
Moeser said UNC may be the first public university in America to launch such an initiative to make college more accessible. Princeton, a private university, also has done much to alleviate the need for student borrowing.
The Carolina Covenant will go into effect next fall for the freshman class of 2004. Eligible students must be at or below 150 percent of the federal poverty level.
Under current federal poverty levels, a family of four with an annual income of about $28,000 would qualify. For a single parent with one child, the eligible income would be about $18,000.
Moeser announced the innovative-access initiative in his annual State of the University speech to the campus community.
"College should be possible for everyone who can make the grade, regardless of family income," he said.
"A covenant is a promise. With the Carolina Covenant, we are telling students that, despite what you may see in the news, college is affordable, no matter how much money your family makes."
Moeser credited Shirley Ort, associate provost and director of scholarships and student aid, and Jerry Lucido, vice provost for enrollment management and director of undergraduate admissions, for their vision in crafting the initiative.
"We know that too many prospective students -- especially first-generation students -- may not be pursuing the opportunity because they don't think their families can afford college," Ort said. "This initiative will help reverse that trend."
Studies show that the cost of college is rising steadily for low-income families. Nationally, the average student loan debt has nearly doubled to $17,000 over the past decade.
About one-fifth of full-time students work 35 or more hours a week. As a result, many low-income youth abandon plans for college -- or drop out -- because the burden of that debt and workload is too much.
Moeser cited the state of the economy and the rising number of families living in poverty as evidence of the need for the Carolina Covenant. Because one in four North Carolina children live in poverty, Moeser said, the need for an accessibility initiative like the Carolina Covenant will remain strong.
According to the North Carolina Children's Index of 2002, more than one-third of North Carolina's families made less than $28,000 a year in 1999, the last year data were available.
This fall, 281 of UNC-Chapel Hill's freshmen -- 8 percent of the freshman class -- came from low-income families. Most of those -- 89 percent -- were from North Carolina. More than half were minorities.
Federal and state financial aid covered about 60 percent of the college costs of those students.
UNC-Chapel Hill has worked hard to bring low-income students to campus, Lucido said. In the last three years, the number of low-income students enrolling as freshmen rose by 20 percent.
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