Each year, the National Association of State Student Grant and Aid Programs (NASSGAP) completes a survey regarding state-funded expenditures for postsecondary student financial aid. This report, the 35th annual survey, represents data from academic year 2003-04. Data highlights include: (1) In the 2003-2004 academic year, the states awarded about $7.3 billion in total state funded student financial aid, an increase of more than 6 percent in nominal terms from the $6.9 billion in aid awarded in 2002-2003 and an increase of about 4 percent in constant dollar terms; (2) The majority of state aid is in the form of grants. In 2003-04 almost 3.4 million awards were made representing about $6.2 billion in need and nonneed-based grant aid, an increase of close to 7 percent from the $5.8 billion in grants awarded in 2002-2003. Of the grant funds awarded in 2003-04, 74 percent was need-based and 26 percent was nonneed-based. Need-based aid represented about 73 percent of grant aid awarded in 2002-03; (3) Funding for undergraduate need-based grant aid increased $290 million nationwide from slightly less than $4 billion in 2002-03 to more than $4.2 billion in 2003-04, an increase of almost 7 percent; (4) Seven states (California, Illinois, Indiana, New Jersey, New York, Pennsylvania, and Texas) collectively awarded more than $2.7 billion in undergraduate need-based grant aid, accounting for about 64 percent of all aid of this type; and (5) States provided about $1.2 billion in nongrant student aid, including loans, loan assumptions, conditional grants, work-study, and tuition waivers. Loans and tuition waivers accounted for 63 percent of nongrant funds awarded. Forty-three reporting entities identified state-funded undergraduate programs with awards based solely on need, while 23 identified programs with awards based only on merit. Exclusively need-based aid constituted 51 percent of all aid to undergraduates, exclusively merit-based aid accounted for 17 percent, with the rest, 32 percent, accounted for by other programs and by programs with both need and merit components. The amount of undergraduate aid awarded in 2003-04 through programs with a merit component increased from slightly more than $1.8 billion to about $2 billion. This compares to $3.2 billion awarded to undergraduates through programs based only on need. South Carolina, Washington DC, Georgia, New York, and Indiana, provided the greatest amount of grant aid on a per capita basis and the largest amount of aid per capita for the population between ages 18 and 24. Georgia, South Carolina, New York, New Jersey, and Kentucky provided the most undergraduate grant dollars compared to undergraduate full time equivalent enrollment. Georgia, South Carolina, Vermont, New York, and Pennsylvania had the highest proportion of total expenditures for state-funded grants compared to appropriations for higher education operating expenditures. (Contains 14 tables and 6 figures.) [For "34th Annual Survey Report on State-Sponsored Student Financial Aid, 2002-2003 Academic Year," see ED528298.]