By Owen Daugherty, NASFAA Staff Reporter
As Congress works to pass legislation that would make community college tuition free for all, some are taking issue with the funding mechanisms being used and the total price tag of such a plan, instead presenting other ideas to make community college more affordable and accessible.
In a recently published paper outlining a “better alternative” to free community college, Preston Cooper, a research fellow at the Foundation for Research on Equal Opportunity (FREOPP), argues the federal government should funnel money to community colleges that ensure students have positive outcomes.
Cooper points to the fact that — due the availability of federal, state, and institutional aid — tuition at community college is relatively inexpensive, with only about 1 in 5 students borrowing to attend and therefore “a blanket federal subsidy with little regard for quality differences between institutions and programs” makes little sense and is not the best allocation of resources.
“The scheme might improve access to community college — but if so many students fail to graduate or realize economic gains from their education, what is broader access really worth?” the paper asserts.
Currently, congressional Democrats are advancing a plan that would make community college tuition free through a federal-state partnership. Under the partnership, the federal government would foot the entire bill for the first year, with participating states being required to contribute 5% of the cost for each year until 2027-28, the last year of the program in the legislation, at which point the federal government will cover 80% of the grant and states will cover the remaining 20%.
The federal share of state grants would be determined on a per-student basis, based on full-time equivalent enrollment, equal to the nationwide median community college resident tuition and fees, not weighted for enrollment, for each eligible student enrolled in community college in that state, and would be increased annually based on the lesser of the estimated Consumer Price Index (CPI) increase or 3%.
The Democrats’ proposal advanced out of the House Committee on Education and Labor earlier this month and now moves on to the House Budget Committee for the next step in the reconciliation process.
Cooper suggests instead of a one-size-fits-all approach to tuition-free community college, in which certain states could opt-out entirely, the federal government should instead award community colleges funds directly depending on their students’ success after graduation.
For example, he recommends giving community colleges $6,600 for every one of their graduates who earns more than $45,000 three years after finishing school.
“The system would create a powerful financial incentive for community colleges to scale up those programs that show strong financial returns — and perhaps close ones which aren’t worth students’ time,” Cooper posits.
The $6,600 figure comes from an analysis from the Urban Institute that found the Democrats’ plan would give states roughly that much per student every two years to make community college free. The $45,000 threshold is used because it is about $10,000 above the median earnings of a young adult with only a high school degree, hence Cooper asserting that community colleges which help graduates achieve at least $45,000 in earnings are “almost certainly creating real economic value for their graduates” and therefore should be rewarded with federal funds.
The paper adds that community colleges, and in turn federal dollars, should be focused on programs that yield median earnings above $45,000, noting that most of those existing community college programs are in the health care sector.
“Modest tuition fees in exchange for an economic payoff is a much better deal than zero tuition for a program with no financial value,” Cooper concludes. “Broader access to community college means little unless the economic value of the education is assured.”
Publication Date: 9/23/2021