Hispanic-Serving Institution (HSI) Funding and Policy: The Quick Guide

Cristian Reyes

Hispanic-serving institutions play a crucial role in fostering academic and personal success among Latinx students by providing culturally relevant support and resources tailored to their needs. The institutions are degree-granting institutions with an enrollment of at least 25% full-time undergraduates identifying as Latinx and a high concentration of students with Pell Grant eligibility. They often offer programs to assist students in their college-going journey-and life after college, such as financial aid, mentorship, and community-building initiatives. By creating an inclusive environment that celebrates Latinx culture and heritage, these institutions help to boost student engagement, retention, and graduation rates.

I am a first-generation, Mexican-American student who attended one of two California State University campuses that is not federally designated as a Hispanic-Serving Institution (HSI). In my time as an undergraduate, I was heavily involved in campus diversity, equity, and inclusion initiatives and collaborated with staff, faculty, and administration as we worked towards moving our university to become an HSI. I balanced being a full-time student, part-time employee, and student leader out of necessity. I wanted to ensure that the voices of students were heard.

The desire to improve the college experience for students was among the practical reasons for pushing my own institution to become an HSI. According to the Urban Institute, students across racial and ethnic groups are more likely to complete college and earn baccalaureate degrees from institutions that have been designated Hispanic-serving. Asian students and Latinx students, at eight percent and seven percent respectively, showed the largest gains. HSIs' focus on culturally competent education and support not only enhances academic achievement but also empowers students to thrive both in their educational pursuits and future careers.

Over the past several decades, both funding for Hispanic-Serving Institutions (HSIs) and the number of such institutions have significantly increased. Congressional appropriations for HSIs have grown from $42,250,000 in 2000 to $350,641,000 in 2024, marking a substantial rise from earlier years, including a notable jump from $193,256,000 in 2008 to $239,429,000 in 2010. The Biden Administration has requested $376,000,000 for the institutions in FY2025 (Figure 1). Meanwhile, the raw number of HSIs and Emerging HSIs has expanded significantly, according to the Hispanic Association of Colleges and Universities and Latinos for Education. The total rose to 1,012 institutions by 2022/23-up by 40 from 2021/22-and more than tripling in the last three decades (Figure 2). This growth underscores the vital role HSIs play in higher education and a strengthened commitment to supporting their development.

The journey to becoming a HSI should not merely be about gaining a designation but about fundamentally transforming the educational environment to better serve diverse student populations. We must ensure that institutions follow the concept of "servingness"- a multidimensional and conceptual way to understand what it means to move from simply enrolling Latinx students to actually serving them. Additionally, as universities work to receive-and as they hold the designation-they must listen to the voices of students, staff, and faculty to assess what is working efficiently and what can be changed or improved.

Despite the growth in federal investment and sheer number of institutions, there is still work to be done. Addressing the educational needs of HSIs requires a multifaceted approach that tackles various barriers. Federal policies aimed at supporting these institutions are critical in providing more educational opportunities for Latinx students. There are several key initiatives that would help expand and build an equitable educational landscape: simplifying the financial aid process to make it more accessible, expanding eligibility and award amount for the Pell Grant, and diversifying the academic workforce. These policies form a comprehensive framework aimed at addressing systemic challenges and ensuring that all students have the opportunity to thrive in higher education.

Perhaps the most critical part of attending college-after getting accepted-is figuring out how to pay for it. So, simplifying the financial aid process is a fundamental step to ensuring all students have equitable education opportunities, particularly for students who may face language barriers. Having submitted an application for federal student aid for all four years of my undergraduate studies, I recall dreading the time of the year when the FAFSA was launched; I did not know who to ask for help. I knew my parents could not help me because, like myself, they did not have enough information on how to apply. According to data from the 2020 National Postsecondary Student Aid Study, among the reasons that students did not apply for federal financial aid were their belief that they were ineligible (20.4 percent) or that they simply did not have enough information about how to apply (25.1 percent). By offering outreach and services in multiple languages, institutions can better assist students and families, ensuring that the financial aid application process is accessible to all, regardless of their primary language.

Completing the FAFSA opens the door to Pell Grants, which, according to The Institute for College Access and Success, half of Latinx students rely on to attend and complete college. But the purchasing power of Pell has not kept up with the cost of college. The maximum Pell Grant amount for the 2023/24 school year was $7,395. In 2022-23, the average total cost of attendance for first-time, full-time undergraduate students living on campus at 4-year degree-granting institutions was larger than the amount of aid provided by the Pell Grant at private nonprofit institutions ($58,600), private for-profit institutions ($33,600), and public institutions ($27,100). I did not receive financial support from my family for my pursuit of higher education and therefore had to work multiple part-time jobs as a full-time student. Though receiving a Pell Grant helps with finances, the reality is that nearly 40 percent of undergraduates still have to work either part time or full time while receiving aid, according to data from the 2020 National Postsecondary Student Aid Study. Increasing the Pell Grant to cover a broader range of expenses, as well as reexamining eligibility criteria, would greatly benefit students from low-income backgrounds by alleviating financial burdens beyond just tuition-such as textbooks, transportation, and living costs. This would make higher education more attainable and reduce dropout rates due to financial strain.

Finally, diversifying the academic workforce is key to providing role models and mentors who reflect the diverse backgrounds of students. Data from the Integrated Postsecondary Education Data System (IPEDS) indicates that just 6 percent of full-time faculty at degree-granting postsecondary institutions are Latinx, divided evenly between male and female. The lack of full-time Latinx faculty in higher education presents several issues. It undermines the representation of diverse perspectives in academic discussions, which can limit the inclusivity and breadth of the educational experience for all students. This underrepresentation also affects student recruitment and retention, particularly for Latinx students who may benefit from having role models and mentors who share their cultural background. Furthermore, the absence of Latinx faculty can perpetuate systemic inequities in academia, reinforcing barriers that hinder the advancement and success of underrepresented groups in the academic workforce. Additionally, the lack of a diverse faculty may perpetuate biases in hiring and evaluation processes. As a result, systemic barriers are maintained, making it more challenging for underrepresented groups to thrive and advance in academia. Addressing these disparities is crucial for fostering a more equitable and enriching academic environment. A more representative teaching staff can enhance student engagement and improve educational outcomes.

The growing support and funding for HSIs reflect a broader commitment to enhancing educational equity, yet there remains much work to be done. My personal experience as a first-generation, Mexican-American student underscored the critical need for institutions to prioritize diversity, equity, and inclusion and tackle systemic inequities within higher education. Simplifying financial aid processes, increasing support through programs like Pell Grants, and diversifying the faculty are essential steps toward creating a more inclusive and supportive academic landscape. These efforts not only benefit Latinx students but also enrich the educational experience for all, ensuring that every student has the opportunity to succeed and contribute meaningfully to their communities and beyond.