Asbury Theological Seminary in Kentucky has become the first confirmed collegiate ministry program to phase out federal student loans after the Trump administration cut aid for low-paying degree programs.
The Wesleyan school in Wilmore, with roughly 1,700 graduate students from 75 Protestant denominations, said it will stop accepting Title IV loans in May, as it transitions to “scholarship support and other financial options better suited to how students experience seminary today and how they will serve after graduation.”
“We continue in our mission to train those who are called to ministry and support them in doing so by increasing financial sustainability,” Asbury Theological President David F. Watson said.
The school said the share of students relying on federal loans declined steadily from 30% in recent years to 17% this fall, following a “proactive approach” to help graduates pay off education debts with service-level wages.
The new federal earnings test became effective July 1. It restricts loans for programs whose alumni don’t earn more than the average high school graduate.
The Federal Reserve Bank of New York says the average theology and religious studies graduate earns $41,600 a year, versus $40,000 for high school graduates. But theology earnings, the lowest of all college degrees, vary widely by ministry or teaching job.
The Association for Biblical Higher Education Commission on Accreditation opposes the earnings test. It projects 53% of religion bachelor’s students and 89% of religion master’s students could lose access to loans.
The Department of Education estimates that about 370 of the nation’s 3,700 religious programs, or 10%, will be affected. The agency says some programs opted out years ago, while others don’t graduate enough students to calculate earnings.
“If the religious programs don’t participate in federal student loans, they’re not subject to the earnings test,” the department said in an email. “A vast majority of religious programs don’t participate, but they take Pell dollars. Excluding them from the calculation preserves their Pell eligibility as well.”
Religious experts are divided on how the earnings test will affect programs.
“I would not be surprised if other seminaries seriously examine the approach Asbury is taking,” said Rita Mkrtchyan, an attorney in Burbank, California, who studied biblical principles and law at Pepperdine University. “Moving away from federal lending, however, is only workable if an institution can replace that financing with something meaningful.”
The Rev. John Belmonte, superintendent of Catholic education for the Diocese of Venice in Florida, noted that some bishops have more money to support students for the priesthood.
“We need more support and resources for this vital area of our society, not less,” Father Belmonte said.
Protestant theologian Simon Cunningham, a Calvin Theological Seminary graduate who received private aid for his studies, predicted most affected programs would find the money to stay open.
“The fact is that these communities have longstanding systems in place to raise funds for religious training, which has always been known to not be a profitable path,” said Mr. Cunningham, founder of the ecumenical theology website HolyGround.com.
Still, some experts say few theological programs can sustain current enrollment with donations alone.
“No way,” said Dick Startz, an education economist at the University of California, Santa Barbara. “Very few schools have spare funds in their budgets.”
Asbury graduate Michael W. Halcomb, a professor of Bible and writing at Montreat College in North Carolina, said reliance on federal funding is the deeper issue.
“This comes down to whether religious institutions should build their future around government funding that gives perpetually changing administrations influence over institutional policies and practices,” Mr. Halcomb said.
Some conservative seminaries have long rejected federal aid. Phil Ginn, president of Southern Evangelical Seminary in South Carolina, said his online school of roughly 250 students prefers to discount tuition by up to 25% per class.
“We’ve seen our sister institutions going ’woke’ on LGBTQ issues solely based on government funding requirements,” Mr. Ginn said. “We’re not going down that path.”
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