Scholarship Fund Falls Short of Its Promise, Families of Sept. 11 Victims Say

An enormous college scholarship fund set up seven years ago for children of people killed in the Sept. 11 terror attacks is doling out only a minuscule amount of its cash to a small number of students, families of 9/11 victims say.

And former President Bill Clinton, who helped lead the public campaign to raise money for the fund, hopes he can help them get the money they say they deserve.

The Families of Freedom Fund, which was established in the wake of the Sept. 11 attacks, has raised more than $128 million, but only $27.3 million has been distributed to only 1,000 students.

Clinton and former Sen. Bob Dole campaigned to get funding from several top U.S. corporations, including Ralph Lauren, DuPont and NIKE. But the fund, managed by Scholarship America, has been criticized for using unfairly stringent standards to determine who receives scholarships.

On the eve of Thursday's seventh anniversary of the Sept. 11 attacks, Clinton met with family members in New York to hear their concerns about the handling of the fund. Afterwards, he met with Scholarship America president, Dr. Clifford L. Stanley.

"There are a lot of real problems here," Clinton said. "From my point of view, this is your money. This money was given for your benefit, for your children."

Scholarship America spokeswoman Janine Fugate said the group was aware of the problems and were trying to work them out.

"The three key points from Dr. Stanley's meeting with the President were being committed to even greater transparency in communications, working together with the Clinton Foundation to work out this out as equitably as we can for all the families involved, and that our focus is on the families," Fugate said.

Debra Roberts, a mother of four whose husband Leo died in the World Trade Center attacks, said she hopes Clinton's involvement will make a difference. She applied for grants from the fund when her son Jeff, now 19, got accepted to Montclair State University last year.

"Right after September 11, we were all told that if these kids went to any state school it would be paid for, but things changed," she said.

"We're getting screwed. We're getting screwed for money that was collected that should've put my kids through school. It's infuriating."

She said the fund hasn't come close to covering the more than $17,000 she had to pay for her son's tuition. "I put [the] application in. I'd heard about other widows getting thousands of dollars -- full tuition. When I got a check for $1,000, I was shocked," she said.

Roberts said she was being penalized for interest earned on the money she received from another fund -- the September 11th Victim Compensation Fund, created to compensate victims in exchange for their agreement not to sue the airlines whose jets crashed into the Twin Towers.

The Families of Freedom Fund used income earned from Roberts' payout to calculate how much tuition money it should grant. Roberts said that interest is her main source of income since the death of her husband, who was a municipal bonds trader at Cantor Fitzgerald.

Fugate said the fund never said it would be able to provide full tuition for every applicant, which she calculated would cost at least $443 million.

"We are trying to do as much as we can for each family, while being careful that we have enough money down the road," she said. "In the cases of a number of families, their incomes are simply too high to demonstrate need."

But many family members say the way the fund determines income is too stringent to allow it to delivery the help it had promised. "My kids didn't ask for this to happen. If this is someone's way to say, 'Let me help you get an education,' the money should be there no matter what," Roberts said.

"People just think we were given a gazillion dollars and our lives were made easier, but if my husband were alive we'd make more money."

Clinton told family members on Wednesday that the fund should not use accrued interest or liquid assets to determine applicant income, as long as nobody was using the money to live in an exorbitant fashion. He pledged to resolve many of the issues the victims' families have raised.

But Fugate said it was unlikely that they would stop counting the interest. "We feel that in order to be equitable to all families we have to count interest declared on income taxes," Fugate said. "We may not be able to change our needs formula, but clearly we need to communicate more with the families and I know they have some concerns."

"The scholarship fund -- I worked so hard to get you the money for it -- is not doing the job that's consistent with what I though I was doing," Clinton said. "This is your money."

Citigroup, DaimlerChrysler, Major League Baseball, the National Collegiate Athletic Association and Citigroup have each contributed $5 million or more to the fund, according to its Web site.

Ralph Lauren, DuPont, BP America, NIKE, PGA Tour and Harvard University have also made million-dollar donations. Thousands of other individuals and corporations also contributed.

Roberts has two younger children who plan to go to college within the next five years. As for her son Jeff, Roberts said she'll keep reapplying for more support.

"Bill Clinton is trying to fix this and I appreciate his and everyone else's help," she said.

"Honestly, I do think it'll get sorted out. I think it will get addressed and sorted out and if it doesn't, then shame on them," she said.

"God forbid, if there's another tragedy in this country, people will be hesitant to help. That's what terrifies me."