Obama Highlights 'Free' Community College Plan, Tax Reform In State Of The Union Address

By Megan McClean, Policy and Federal Relations Staff 

In his sixth State of the Union address, President Obama last night focused on the value and affordability of higher education, highlighting his recently announced proposal to make the first two years of community college free and his plan to reform higher education tax benefits

America’s College Promise, the president’s proposal to make two years of community college free, was the main focus of his higher education remarks in the address. Obama described the plan as a much-needed partnership between key stakeholders: the federal government, states, institutions and students.  

“By the end of this decade, two in three job openings will require some higher education,” stated Obama.  “And yet, we still live in a country where too many bright, striving Americans are priced out of the education they need. It's not fair to them, and it's not smart for our future. That's why I am sending this Congress a bold new plan to lower the cost of community college - to zero.” 

The plan would provide two years free community college for students who are at least half-time, maintain a 2.5 GPA, and make steady progress toward completing their program. Under the proposal, the federal government would cover three quarters of the average cost of community college tuition and fees. States would serve as partners and be expected to contribute the remaining funds needed to eliminate tuition for eligible students.

President Obama stated in the address that the proposal, which is estimated to cost $60 billion dollars over 10 years, would be paid for by his plan to reform the tax system. Announced just this past weekend, the tax reform plan would raise taxes for the wealthiest Americans and also simplify and consolidate the higher education tax benefits. The crux of the higher education portion of the plan, covered by NASFAA in yesterday’s issue of Today’s News, would consolidate existing tax credits into, and make permanent, the American Opportunity Tax Credit (AOTC). It would also expand AOTC eligibility to non-traditional students, increase the refundable portion, and allow students to claim the credit for up to five years. In addition, the plan would simplify the AOTC process for Pell Grant recipients. 

“Let's close the loopholes that lead to inequality by allowing the top one percent to avoid paying taxes on their accumulated wealth,” Obama stated. “We can use that money to help more families pay for childcare and send their kids to college. We need a tax code that truly helps working Americans trying to get a leg up in the new economy, and we can achieve that together.”

The president’s remarks will likely be expanded upon in his FY 2016 budget, which is slated for release Monday, February 2.


Publication Date: 1/21/2015

Laura K | 1/22/2015 4:11:22 PM

The problem isn't that people are not going to community college (or any college for that matter). The problem is that people are graduating with degrees they cannot use. I am not sure that sending more people to college for degrees they cannot use is the solution that we need. If schools taught basic economics, the current crop of young people would not be cheering for this pandering nonsense. Laura from http://sterlingstore.co.uk/

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