Although the University of Virginia recently instated an "Access UVa" plan to replace student loans with scholarships, Penn State officials say the university has already implemented a similar program.

"The UVA plan is consistent with what we're doing," said John Romano, vice provost and dean for enrollment management at Penn State.

The University of Virginia (UVA) will put a $16,000 cap on loans for needy students, said Yvonne Hubbard, director of financial aid at the University of Virginia.

"We don't want to produce a group of graduates that are so in debt they are constrained economically," she said.

Starting in the fall, money will be given to freshmen whose families meet poverty guidelines, and the next year students who are eligible for such financial aid will receive enough money to reduce their debt load to about $14,520 -- the cost of about one year's education, The Washington Post reported.

According to a University of Virginia press release, the scholarship money will come from endowments, private donations and tuition.

Hubbard said there has been a gradual drop in black and low-income student applications due to a financial barrier.

"We want to encourage everybody to apply," she said.

Romano said the Penn State Board of Trustees developed the Trustee Scholarship Program in July 2002 to grant scholarships to students who demonstrate financial need and academic success.

"What is troubling many of us at Penn State and at other schools is the level of debt that some students are experiencing," Romano said.

The goal of the Penn State program is to raise $100 million from endowments by June 2007, which would increase the amount of privately funded aid to undergraduates by 40 percent.

"The program should be reached within the next four years," said Elaine Rhodes, director of planned giving and endowments at Penn State.

Romano said the university's plan is in its earliest stages and is in the process of raising money.

"We are in the investment and people stage," Rhodes said.

David Catalogna, a freshman at UVA, said although he will not benefit from the scholarship, he thinks his school's initiative is a positive one.

"It's a really good idea," he said. "It's not fair if students are in debt for 20 years. The school has a lot of money for scholarships."

Mike Deaven (freshman-electrical engineering) said Penn State's scholarship program is a good idea because it will help eliminate student debt.

"It's good that students won't have to worry about money after graduation," he said. "It may also promote economic growth after graduation."

Other universities, such as George Washington University, a private university, and the University of North Carolina, a public university, have also implemented similar plans.

However, Hubbard said unlike the University of North Carolina plan, "Access UVa" will not require students to participate in a work-study program.

She said the plan would open doors for low-income students.

"We want equal access to life," she said.