A higher education official from Wisconsin who attended the recent Council of Independent Colleges conference in Florida made a remarkable statement during a question-and-answer session.

There is a group of students who enter college with such dire financial need that the amount the federal government expects their families to contribute to college is effectively zero. In Wisconsin, that zero-pay population has grown by half in a single year: from 42,641 students in the 2008-09 academic year to 65,800 in 2009-10.

The data come from Rolf Wegenke, president of the Wisconsin Association of Independent Colleges and Universities, and surely they mirror a national trend.

Incoming college students have grown markedly more needy since the 2008 economic downturn.

“The precipitous increase in student need represents a genuine crisis for these students and their families—a crisis which is replicated across the country,” Wegenke told me. “The opportunity for this country to meet the goal to return to first place in educational attainment and to be competitive in the ‘Knowledge Economy’ will be compromised if we have a ‘lost generation’ who—from lack of resources, not lack of ability—are denied opportunity.”

It’s also a crisis for colleges. The federal government, through its Free Application for Federal Student Aid, has determined that many more students bound for Wisconsin colleges should have their expenses covered entirely through aid: Their “expected family contribution” is zero. But the federal government doesn’t stipulate where that aid will come from.

The neediest students are eligible for $5,550 in federal Pell grants. Beyond that, grant and scholarship dollars come mostly from individual schools. It’s no surprise that the national student aid budget has skyrocketed since 2008. Grant aid per full-time student has risen from $4,706 to $6,539 in five years, after inflation, according to data from the College Board.

Aid awards are rising faster than tuition at private colleges, with the net result that a private institution costs about the same now, after adjusting for grant aid and inflation, as it did five years ago. The wealthiest colleges have pledged in recent years to meet every student’s full financial need without loans, which makes those schools far more affordable to low-income students -- although more affluent families quip that they cannot afford the “expected family contribution” yielded by the federal formula. Colleges are diverting much more aid money to needy students because many more students are in need.

“We’ve had a 30 to 40 percent increase in need-based aid since 2008 at some of our institutions,” said Christopher Nelson, president of St. John’s College in Annapolis, speaking at the Presidents Institute on Marco Island.