This story was originally published on Jan. 19, 2010.

After coming under scrutiny by Ivy League officials earlier this month, Cornell has retreated from parts of an initiative launched in November 2008 that gave more lucrative financial aid awards to athletes, among other groups of students that the University deemed "enrollment priorities."

While the initiative was aimed at aggressively recruiting students of academic excellence, diversity and athleticism, the Ivy League saw the inclusion of athletes in the program as a violation of the league’s ban on athletic scholarships.

Although Cornell and the Ivy League administrators disagreed on the legality of Cornell’s financial aid program, their confrontation seemed to be somewhat amicable.

“Cornell fully cooperated, publicly announced the program and provided all requested information, and when the Ivy League decided that it did not comply, the University modified its rules,” Ivy League Executive Director Robin Harris said.

With the smallest endowment and the largest student body in the Ivy League, Cornell administrators were looking to find a way to remain competitive both in the classroom and on the field. Deputy Provost David Harris estimated that roughly 10 percent of students admitted to the Class of 2013 were selected for participation in the initiative during last year’s admissions process.

For the vast majority of students receiving financial aid, the 2008 initiative did not change how they received aid. The University continued to meet 100 percent of the demonstrated financial need of those families with a combination of work study, loans and grants.

However, for students deemed "enrollment priorities" — which Associate Provost for Admissions and Enrollment Doris Davis said included students of color, students from farm families and athletes, among others — the University met 100 percent of their families' financial need with a more favorable aid package that included more grant money and fewer loans.

Though the University maintained that its policy continued to represent a "need-based" approach to financial aid, some people argued that the initiative leaned closer toward a "merit-based" distribution of aid.

“We felt as a University that our practices were in accordance with Ivy League practice but they disagree,” Deputy University Spokesperson Simeon Moss said. “There was no investigation. The Ivy League just informed us that part of our practice [needed to be changed] and we changed it.”

Cornell will still look to its new financial aid as a way for the University to remain competitive against schools like Harvard, Yale and Princeton, whose greater endowment-size and more generous financial aid packages place them into a league of their own.

Harvard’s $26 billion endowment portfolio and Yale’s $16 billion — as compared to Cornell endowment that hovers around $5 billion and serves a much larger student body — free those schools from having to discriminate financial aid packages amongst their students, providing all students with no-loan aid. Cornell's inability to offer athletes financial aid that is on par with the aid being distributed by its Ivy League peers has placed the University at a competitive disadvantage in athletic recruitment.

“The financial aid policies at Yale, Harvard, Princeton and to some extent Dartmouth are much more generous,” said. Prof. Ronald Ehrenberg, economics, Cornell Trustee and higher education economics expert. “For students coming from low-income families, Cornell is very competitive … Where the problem comes in is if you’re coming from an upper middle-income family. Harvard makes students whose families earn $180,000 only pay $18,000 a year and Yale only has students with a family income of $200,000 only pay $20,000.

Thus, the problem that Cornell faces in their financial aid for athletes does not just pertain to athletes. “Athletics is just the most visible,” Ehrenberg said. “If you lose someone interested in economics, it’s just not as visible.”

While Cornell has agreed to the Ivy League’s directive, the University said it remains committed to leveling the playing field and promoting competitive equity in the Ivy League.

“We are going to work with our colleagues to address the issue of competitive equity,” Moss said. “These changes in financial aid policy can affect competitive equity and they are part of an ongoing discussion to address that issue.”

Harris, the executive director of the Ivy League, said that she recognizes the inevitability of differences among schools but explained that the Ivy League ensures that such differences are not systemic.

“The Ivy League recognizes the importance of interleague competition, so that league and every team in every league has a chance to be successful,” Harris said. “Every school is going to have unique advantages over other schools. There is never going to be complete equity. What we’re making sure is that every school has the opportunity to be competitive.”

Ehrenberg, however, sees the problem facing the competitive equity of the Ivy League as systemic.

“The dilemma that the University faces is that there are two conflicting principles of the Ivy League,” Ehrenberg said. “The first is ‘no athletic scholarships’ and the second is that ‘we’d like the competition to be on equal footing and on average we’d like each school to win 50 percent of their games.”

As college tuition continues to rise and the national economy remains stagnant, financial aid becomes a major concern for a growing number of prospective college students.

Princeton University, which was the first to offer a comprehensive no-loan aid program in 2001, has continued to offer its students the program, despite the rising need of financial aid. From Princeton’s entering first-year class of 2012 to 2013, not only has the percentage of students who need financial aid increased from 55 to 59 percent, but this year's average grant has also increased from $33,000 to $36,000.

Despite these recent setbacks, Cornell administrators remain optimistic in the University’s ability to attract high quality scholar athletes regardless of financial aid.

“It helped in our recruiting but we can move forward and still recruit at a high level,” Moss said. “We have a lot to offer as a University to enroll a consistently excellent class, including scholar-athletes.”

Since Cornell already promised these financial benefits to selected scholar athletes in Cornell’s Class of 2013 and Class of 2014, these students will continue to receive the agreed-upon benefits, Moss added.

In addition, although student athletes will no longer receive preferential treatment in financial aid consideration based solely on their status as an athlete, some of those students will still qualify for the more lucrative aid packages with other criteria, according to Moss.

"We are still continuing with our enhanced financial aid with our priority students,” he said.