In unsure economic times, President Bush's proposed tax cuts might help Macalester's budget.

Macalester, a non-profit organization, pays no taxes and would not be directly affected by tax cuts. However, according to Vice President for Administration and Treasurer's Office David Wheaton, the equities that Macalester holds may see a positive impact.

Economics Professor Karl Egge explains that the elimination of the dividend tax could boost stocks with dividends, increasing the value of some holdings in the Macalester endowment.

This change would allow the college to harvest more money from its endowment, increasing the revenue flow. But perhaps more importantly, Egge says that Macalester's alumni who receive dividend income may be more inclined to donate additional money to the college.

Bush's proposal is in the planning stages and any benefits are purely speculative. More immediately, state budget cuts may leave some of the college's Minnesota residents searching for financial aid.

Governor Tim Pawlenty announced $281 million in wide-ranging cuts for the Fiscal Year 2003 on Friday, February 7. The cuts include more than $50 million taken from the state higher education budget. "It is my responsibility —and my obligation—to make the tough decisions and balance the budget," Pawlenty said, addressing the decision to make the cuts after the legislature failed to balance the budget.

The higher education cuts should not have a direct effect on Macalester's students because a majority of the cuts are being assessed on the University of Minnesota and the Minnesota State Colleges and Universities systems.

Both systems will lose $25 million in funding for the current fiscal year. The only direct impact felt by the Macalester community may be a cut in funding to MNLink.

This web-based "virtual library," which serves as a gateway to participating Minnesota library catalogs, electronic databases, and some Internet resources, will lose $200,000 from its original fiscal year 2003 budget.

Macalester's status as a private school will allow the college to avoid many of the direct higher education cuts that its public counterparts will feel. In that sense, the institution will remain, for the most part unaffected.

However, individuals in the Macalester community may have feel some of the effects of the cuts. For example, Metro Transit will lose $1.2 million in funding and is expected to reduce its routes. In addition, agencies such as the Historical Society and State Arts Board will also have their budgets cut.

While no one argues the impact that the statewide cuts will have, the immediate importance of Pawlenty's cuts takes a back seat for some Macalester students.

A Jan. 10 memo from Minnesota Higher Education Services Office (MHESO) announced that only students who filed FAFSA forms before the date of the memo would be eligible for aid from Minnesota State Grant Program during the 2002-2003 academic year. MHESO halted the program to keep from falling further into deficit.

Macalester's Director of Financial Aid Brian Lindeman says the announcement left some unsuspecting Minnesota students without an important source of financial assistance.

The grant program's announcement coupled with the broader state cuts are not promising for coming years but Lindeman seems relieved that it "will not affect a lot of Macalester students for 2002-2003."