Cost and Financing

Many states have introduced performance measures into their higher education funding formulas to create institutional incentives to improve productivity. To date, however, only Tennessee has completely rewritten its college funding system to place outcomes at the center of the formula.  In doing so, the state has crafted a program that allows state funding and state policy to be closely aligned across the diversity of publically funded post-secondary institutions in the state.

As students head to college campuses around the nation, many have taken out loans to pay for their education. The Consumer Financial Protection Bureau estimates that the student loan debt load nationwide reached more than $1 trillion earlier this year.

We’re all aware the cost of a college education has skyrocketed in recent years. So a preliminary report just released by the National Center for Education Statistics (NCES) on college tuition and enrollment data might be somewhat anticlimactic. Yet the report, Postsecondary Education and the Price of Attendance 2011-12, Degrees and Other Awards Conferred: 2010-11, and 12-Month Enrollment: 2010-11, does provide data on precisely how steep the tuition escalation has been. It concludes, perhaps to the surprise of no one, that the economic downturn has had the greatest impact on public colleges.

Last-minute Congressional action seems poised to stop interest rates on subsidized federal Stafford loans from doubling from 3.4 percent to 6.8 percent on July 1. The legislation, passed along with a the extension of the highway bill that faced the same deadline, pays for the $6 billion cost of the plan by shortening the eligibility time for the subsidy (to six years for programs intended to be...

To some extent, access to postsecondary education and the ability to pay have always been inseparably linked.  We often call education the great equalizer, yet individuals from more affluent families have always been better able to afford tuition to attend more elite private colleges or to earn a degree from a public university without relying on financial aid and student loans as those from middle-class and low-income households.

Now, one community college in California is about to attach some new financial strings to the cost of higher education. One expert says it might be a first. Santa Monica College, with 34,000 students, will implement a new two-tier approach to pricing its classes. Beginning this summer, Santa Monica College will begin increasing tuition for about 200 courses it offers. Students needing to enroll in these classes will have to pay $180 per credit hour, compared to just $36 per credit hour for most classes offered at the college. 

A proposal in the Florida House of Representatives would slash state financing by nearly $250 million next year and would enable the state’s universities to increase tuition by as much as 15 percent. A second measure in the Florida Senate would cut postsecondary spending more than $500 million. It would allow smaller institutions to raise tuition by 3%. Larger state universities would not be permitted to raise tuition under the Senate plan.

On Monday, President Barack Obama officially unveiled his budget for 2013.  As he spoke from Northern Virginia Community College, Obama highlighted the more than $65 billion in education funding focused on resources dedicated to transforming K-12 and postsecondary education to ensure students have the skills and knowledge to succeed in the future.

Educators and policymakers realize that all of America’s students need a high-quality education to prepare them for college and careers. 2012 promises to be another busy year in  transformational strategies in education. In order to ensure a world-class education, leaders will likely address these top five issues facing states and territories (“the states”) this year.

According to White House data recently requested by The Council of State Governments, over $66 billion worth of funds1 from the American Recovery and Reinvestment Act remain unspent.  While nearly 85 percent of stimulus dollars have been paid out and almost all of the remaining funds have been obligated for projects, the 15 percent left to be spent adds up to a hefty sum.  And as states continue to feel the fiscal and economic effects of the Great Recession, $66 billion could go a long way in helping states get on the road to recovery.

Sticker shock, that idiomatic phrase that through the decades has been associated with automobile and home purchases, medical expenses and energy prices is increasingly identified with something else – the cost of postsecondary education. A newly released report by The College Board concludes average in-state tuition and fees at four-year public colleges jumped 8.3 percent this fall. Viewed another way, the average in-state student will spend more than $600 on tuition and fees this year than in 2010-11.

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