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Affordable, but Not Free

Inside Higher Ed

June 7, 2017


Recent proposals to make higher education tuition- or debt-free have had huge price tags attached -- hundreds of millions of dollars, in the case of plans put forward by Hillary Clinton and Bernie Sanders during the 2016 presidential campaign. But a report released today lays out a very different approach to college affordability, with a much smaller -- and arguably more attainable -- sticker price.

According to a new report from the State Higher Education Executive Officers association, state and federal governments would have to put up a combined $34 billion a year, after a four-year build-up period, to make SHEEO’s definition of “affordable” college a reality for all postsecondary students, be they full- or part-time, traditional age or adult. This contrasts with many of the current state and district plans for free community college or public higher education, which limit participation to full-time students and/or recent high school graduates.

In this case, “affordable” is defined as graduates using no more than 10 percent of their discretionary income a year toward student loan repayments. Much of the $34 billion -- half of which would be paid for by states, half by the federal government -- would be aimed at need-based financial aid for students coming from low-income backgrounds who don’t have the chance to save money for college. The report suggests states fund the plan with increases to higher education appropriations over the course of four years, by an average of 5 percent each year.

“The SHEEO model takes a different approach [from savings-based or debt-free models]. Our proposal is that students should not have to pay more than 10 percent of their income toward loan repayment. So it’s forward looking,” said David Tandberg, principal policy analyst at SHEEO. “The benefits of college accrue after you graduate, therefore we should look at affordability in regards to income postgraduation.”

Definitions vary as to what affordable college means, as does funding for higher education in each state. SHEEO’s model defines college affordability from the perspective of the graduate being able to repay loans. “Students in the lowest income quintile, they do not come in with resources. Saving is often nearly impossible, or it is impossible, and we don’t want them to be overburdened with work while they’re there,” Tandberg said. “It may make more sense to consider that their incomes will rise once they graduate.”

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