Community college funding is recovering, but two-year college systems remain under stress in many states, according a new survey, Halfway Out of Recession But A Long Way to Go. The Education Policy Center of the University of Alabama at Tuscaloosa surveys community college directors annually.
Only directors in five states — Connecticut, Georgia, Hawaii, Louisiana and Wyoming — reported mid-year budget cuts in 2012-13. In 2008-9, two-thirds of states were reporting such cuts.
Looking ahead, most state directors are predicting increases for this year for community colleges, with the average increase projected to be 4 percent. Only five states — Georgia, Louisiana, Missouri, North Carolina and West Virginia — are projecting decreases in 2013-14.
The state directors report considerable worry about the ability of students to pay for college. Most states are projecting tuition increases, and a majority expect state student aid programs to either be cut or to increase at less than the rate of inflation for higher education.
Many directors expect rising enrollments as four-year institutions impose enrollment caps.
Ohio’s community college students are “second-class citizens” when it comes to Ohio College Opportunity Grants, editorializes the Toledo Blade.
Community college tuitions average $3,800 a year — about one-third that of those at four-year schools — in Ohio.
In 2009, the General Assembly cut the OCOG budget from roughly $395 million to $171 million. Making matters worse, it also forced low-income students to use federal Pell grants to cover tuition expenses at community colleges before tapping state grants. Those changes made nearly all community college students ineligible for OCOG.
Unlike Pell grants, state grants cover tuition only. And because tuition is low at community colleges, Pell grants typically cover students’ tuition.
Before the changes, 20,000 community college students in Ohio received state grants.
Ohio needs legislation that would permit community college students to, first, use OCOG to cover tuition costs, thereby enabling them to tap federal Pell grants for other college-related expenses. That change also would call for setting aside another $20 million a year to cover the more than 20,000 newly eligible community college students.
Last year, as Ohio began to refund OCOG, money was set aside to fund for-profit college students but not community college students, reports Inside Higher Ed.
Community college would be tuition-free for two years for most Oregon high school graduates, under a proposal by Sen. Mark Hass, D-Beaverton, reports the Statesman-Journal.
“There are thousands of kids who come out of our schools that don’t go on to higher education, and that’s just not a viable path into the middle class,” said Hass, who is the chairman of the Senate Education & Workforce Development Committee.
Preliminary estimates show that funding tuition could cost about $250 million if 31,962 high school graduates attended an Oregon community college full time for two years. Average cost for a credit at a state community college is an estimated $85.94.
High school graduates would need a 2.0 grade point average to qualify.
It’s not clear how Oregon would fund the idea, but Hass says the state will save money in the long run if more young people are educated.
Elizabeth Cox Brand, the director of communications and research at the state department of Community Colleges & Workforce Development, called the state’s community colleges the “heart and soul” of Oregon’s “40-40-20” goal.
The goal is that 40 percent of adults will earn a bachelor’s degree or higher, 40 percent earn an associate’s degree or post-secondary credential and the remaining 20 percent earn a high school diploma or equivalent. By 2025, that would mean all Oregonians would earn at least a high school diploma.
Gov. John Kitzhaber’s education policy advisor, Ben Cannon, said the governor supports the idea of funding community college tuition for high school graduates. “What’s very clear is that the combination of rising tuition, fees, and cost of living has meant that too few Oregon school students see post-secondary education as a viable option,” he said.
If President Obama really wants to “shake up” higher education, he should start by scaling back student loans, writes economist Richard Vedder on Washington Monthly‘s College Guide. That means dropping loans to affluent parents and the federal tuition tax credit, limiting student borrowing and, ultimately, getting the federal government out of the student-loan business.
Colleges that benefit from student loans and grants should share some costs of high default rates, Vedder argues. That would discourage colleges from enrolling students with little chance of success. (Politically, this is a big loser.)
Next, consumers need better information, he writes.
Lots of students enter college based on bad advice, often from guidance counselors and school marketing efforts. Politicians make things worse with a “college for all” mantra, implying life will be a failure without a college degree to provide the ticket to the moderately affluent middle class.
To counteract the propaganda, a bill proposed by U.S. Senators Ron Wyden, an Oregon Democrat, and Marco Rubio, the Florida Republican, would mandate the disclosure of information regarding post-graduation earnings of students by college and major. Polls show that college students’ single biggest goal is achieving financial success.
Colleges are expensive screening devices, writes Vedder. There should be other ways to demonstrate potential workplace competence.”Why doesn’t someone (College Board? Educational Testing Service? Google Inc.?) develop a national college equivalency examination that tests for the critical learning skills, literacy and basic knowledge that all college graduates are expected to have?”
A credible exam would reduce the worry about low-quality online courses and make it easier for students to assemble courses from multiple providers.
Finally, Vedder calls for eliminating barriers to entry to higher education.
The single largest obstacle is the dysfunctional accrediting system, which is rife with conflicts of interest and gives consumers little information. . . . Arguably, we should eliminate accreditation as such, with the government simply defunding programs that fail to meet minimum standards (such as institutions with student-loan-default rates greater than graduation rates).
Lowering the demand for college slots and increasing the supply of higher ed providers would bring costs down.
The “enrollment boom that swelled American colleges — and helped drive up their prices — is over, notes the New York Times.
College enrollment fell 2 percent in 2012-13, the first significant decline since the 1990s, but nearly all of that drop hit for-profit and community colleges; now, signs point to 2013-14 being the year when traditional four-year, nonprofit colleges begin a contraction that will last for several years. The college-age population is dropping after more than a decade of sharp growth, and many adults who opted out of a forbidding job market and went back to school during the recession have been drawn back to work by the economic recovery.
The most prestigious colleges aren’t affected, but less-elite private colleges, which tend to be dependent on tuition revenue, could have trouble staying afloat.
President Obama vowed to “shake up” higher education and “tackle rising costs,” in a speech Wednesday at Knox College. “It is critical that we make sure that college is affordable for every single American who’s willing to work for it,” said Obama, stressing college affordability for middle-class families.
“Families and taxpayers can’t just keep paying more and more and more into an undisciplined system where costs just keep on going up and up and up. We’ll never have enough loan money, we’ll never have enough grant money, to keep up with costs that are going up 5, 6, 7 percent a year. We’ve got to get more out of what we pay for,” Obama said.
“Now, some colleges are testing new approaches to shorten the path to a degree, or blending teaching with online learning to help students master material and earn credits in less time. In some states, they’re testing new ways to fund college based not just on how many students enroll, but how many of them graduate, how well did they do,” he said.
In the 2012 State of the Union address, Obama put colleges “on notice” that federal funding would be linked to controlling tuition increases, notes Inside Higher Ed. That hasn’t happened. At other times, Obama has blamed rising tuition on state budget cuts.
Amy Laitinen, deputy director for higher education at the New America Foundation, and a formerly a policy adviser in the Obama administration’s Education Department, agrees with the sentiments of the president’s talk Wednesday, but was unsure how much change higher education will see. “I think it’s encouraging rhetoric, but pulling it off will take serious political will and capital,” she said. “I’m wondering if his tone suggests he’s going to try to do this with executive authority.”
Laitinen said that there may seem to be a consensus on the issue of tuition rates, with college leaders and politicians alike worried about the impact of rising sticker prices. But she said this consensus only goes so far. “All of the solutions you are seeing don’t force institutions to change at all,” she said.
As an example, she noted that there is widespread interest in expanding options for income-based repayment of loans. In part, she said, “that’s because it does not fundamentally require a rethinking of the business model. It allows institutions to charge as much as they want.”
Becky Timmons, assistant vice president of government relations at the American Council on Education, suggested the president might offer federal grants to colleges that limit tuition increases. ”I don’t see any tool or leverage available to him to set price controls.”
Early reaction on Capitol Hill was mixed, reports Ed Week.
Sen. Lamar Alexander, R-Tenn., cutting campus-based financial aid hurts students, not colleges. “Federal taxpayer funding for colleges and universities is almost all through grants and loans that go to about 20 million students, so his threat to reduce federal spending for colleges is really a threat to cut federal aid to students,” Alexander said.
As Obama was speaking, the Senate passed a bipartisan student loan bill that will lower interest rates now, but will let them rise with government borrowing costs. Undergraduate loans are capped at 8.25 percent, graduate loans at 9.5 percent and PLUS loans at 10.5 percent. The House is expected to pass the compromise bill, which has Obama’s support.
Student aid fuels tuition inflation by encouraging “students to demand stuff they otherwise wouldn’t” and enabling colleges to raise their prices, argues Neal McCluskey on Cato @ Liberty. He links to a list of studies that show schools “capture aid money rather than becoming more affordable.”
The Senate has reached a bipartisan deal on student loans, reports CNN. ”Under the compromise measure, undergraduate students would pay a rate of 3.85% next year on subsidized and unsubsidized Stafford loans. The plan would cap rates on loans to undergrads at 8.25%, for graduate students at 9.5% and parents at 10.5%.”
Under Oregon’s Pay It Forward, Pay It Back plan, students would pay no tuition at state universities – if they agree to pay 3 percent of their earnings for 24 years. Community college students would pay 1.5 percent. The bill tells a state commission to study how to make the idea work. A pilot plan is possible in 2015.
Be wary of no-money-down offers, warns Inside Higher Ed.
It won’t work, argues Sara Goldrick-Rab on Education Optimists. Tuition at the University of Oregon is $9,830 a year, but students would have to pay another $14,000 for room, board, books and supplies. So even those who postpone tuition will have to borrow to pay college costs. Lower-income students still face “sticker shock” that may dissuade them from enrolling.
While Pay It Forward is supposed to be self-sustaining — eventually — the estimates are off, writes Goldrick-Rab. Students will earn less than projected and will resist a 24-year “mortage” on their education. Collecting will require using the IRS.
Students who plan careers in medicine, law, business and engineering will do much better paying the tuition up front, leaving Pay It Forward to collect only from low-paid graduates and dropouts.
It’s a terrible idea, writes Jordan Weissmann in The Atlantic. Advocates say Oregon will need to spend $9 billion over the next 24 years to cover the costs, but that assumes students in high-earning majors won’t opt out. If they know math, they will. Furthermore, “only half of Oregon public college students finish a B.A. within six years.” Dropouts are expected to pay too for whatever years of free tuition they received, but they earn far less and will pay less. “The whole idea could turn into a financial albatross for taxpayers” or a nightmare for former students.
What will college cost? The U.S. Education Department’s updated College Affordability and Transparency Center shows institutions with the highest and lowest tuition prices and net prices (cost of attendance minus financial aid).
Students can find the community colleges with the lowest net prices. Those with the lowest tuition are all in New Mexico and California. Southwestern Indian Polytechnic Institute in Albuquerque is the cheapest at $675 a year.
University of Pittsburgh-Titusville tops the list of the most expensive community colleges with tuition of $11,118 a year. New Hampshire community colleges also are costly, averaging more than $7,000 a year. Florida Keys Community College posts the highest net price at $22,933 a year because of high local living costs.
There’s also an option to search for job training programs, but it’s not very complete. College Navigator is a better source.
Students can track which colleges are raising tuition and net prices the fastest. For example, Fort Berthold Community College in North Dakota tripled its net price from $2,163 in 2008 to $6,675 in 2010. South Texas College more than doubled tuition from $2,148 to $5,160 in two years. Of course, even community colleges that have hiked tuition or net price rapidly are still cheaper than most for-profit or four-year alternatives.
While Massachusetts colleges and universities say they’re trying to hold down costs, they’ve increased the number of administrators three times faster than enrollment growth according to an analysis of federal data by Jon Marcus for the New England Center for Investigative Reporting.
Over the last 25 years, enrollments have grown by 26 percent, on average, while the ranks of full-time administrators have risen 75 percent. Nationwide, four-year university tuition went by 85 percent in real dollars in the same period.
“Where is that money going? It’s going to fund these bureaucratic empires,” said Andrew Gillen, research director at Education Sector.
University officials said administrators are needed to deal with government regulation and greater requirements from students for support services, such as remediation and mental health counseling.
Even community colleges added administrators, though at a slower rate than four-year institutions.