The Changing Dynamics of Student Financing Policy: Implications for College Access and Equity. Donald E. Heller

Transcription

1 The Steinhardt Institute for Higher Education Policy New York University March 7, 2007 The Changing Dynamics of Student Financing Policy: Implications for College Access and Equity Donald E. Heller

2 It is the responsibility of the community, at the local, State, and National levels, to guarantee that financial barriers do not prevent any able and otherwise qualified young person from receiving the opportunity for higher education.... The democratic community cannot tolerate a society based upon education for the well-to-do alone. If college opportunities are restricted to those in the higher income brackets, the way is open to the creation and perpetuation of a class society which has no place in the American way of life. A., signing the Higher Education Act of 1965 B. Senator, upon the renaming of the Basic Educational Opportunity Grant Program in his honor, 1980 C. President s Commission on Higher Education, 1947 D., upon his founding of the U. of Virginia, , Donald E. Heller 2

3 It is the responsibility of the community, at the local, State, and National levels, to guarantee that financial barriers do not prevent any able and otherwise qualified young person from receiving the opportunity for higher education.... The democratic community cannot tolerate a society based upon education for the well-to-do alone. If college opportunities are restricted to those in the higher income brackets, the way is open to the creation and perpetuation of a class society which has no place in the American way of life. A. Lyndon Johnson, signing the Higher Education Act of 1965 B. Senator Claiborne Pell, upon the renaming of the Basic Educational Opportunity Grant Program in his honor, 1980 C. President Truman s Commission on Higher Education, 1947 D. Thomas Jefferson, upon his founding of the U. of Virginia, , Donald E. Heller 3

4 The educational pipeline th graders by family income in % 94% 99% 96% 93% 80% 72% 64% 77% 60% 40% 33% 20% 0% Planned to attend college HS diploma Any college enrollment by '94 4-year college enrollment by '94 < $25,000 > $75, , Donald E. Heller Author s calculations from NELS:88 and ACSFA, Empty Promises 4

5 The educational pipeline college-qualified students th graders by family income in % 80% 60% 40% 20% 78% 96% 83% 52% Gap between rich and poor 21% 62% 18 points 31 points 41 points 0% Any college enrollment by '94 4-year college enrollment by '94 Complete BA degree by '00 < $25,000 > $75, , Donald E. Heller ACSFA, Empty Promises 5

6 Academic barriers vs. financial barriers? Percentage of 1992 high school graduates attending any college by 1994 Lowest SES Quartile Highest Test Quartile Lowest Highest 36% 78% Smart poor kids 77% Not-so-smart rich kids 97% 2007, Donald E. Heller ACSFA, Empty Promises 6

7 Stratification of enrolled students Fall enrollment of full-time, first-year students, % 90% 80% 70% 24% 5% 28% 30% 32% 6% 38% 60% 50% 40% 21% 23% 14% 14% 9% 19% 17% 13% Comm. College Proprietary Private 4-year Public 4-year 30% 20% 50% 43% 37% 37% 40% 10% 0% Asian American White Hispanic Black Native American 2007, Donald E. Heller College Board 7

8 The importance of academic preparation Proportion of 1992 HS grads enrolling in 4-year college by family income and highest level of HS math 100% 90% 80% 70% 60% 50% 40% 30% 20% 73% 72% 59% 54% 30% 20% 40% 68% 81% 50% 90% 84% 10% 0% Low Moderate Middle High < Algebra II At least algebra II At least trig. 2007, Donald E. Heller ACSFA, Mortgaging Our Future 8

9 Funding for public higher education institutions Proportion of total current fund revenues, by source 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% State & local approp. Tuition & fees Federal govt. Other 2007, Donald E. Heller Author s calculations from IPEDS 9

10 The relationship between appropriations and tuition 14% 12% r =.35 10% Annual change 8% 6% 4% 2% 0% (2%) Higher ed appropriations Tuition - Public 4-year institutions 2007, Donald E. Heller Grapevine (Illinois State U.), College Board 10

11 Changes in tuition prices Increase since 1980, constant (2006) dollars 200% 175% 150% Private 4-year Public 4-year Comm. Colleges 125% 100% 75% 50% 25% 0% % 2007, Donald E. Heller College Board 11

12 Changes in tuition prices and income Increase since 1980, constant (2006) dollars 200% 175% 150% 125% Private 4-year Public 4-year Comm. Colleges Richest 20% of families Poorest 40% of families 100% 75% 50% 25% 0% % 2007, Donald E. Heller College Board, Census Bureau 12

13 The growth and shift in financial aid $160 $140 $120 $100 Total aid Grant % Loan % Max Pell % of public 4-yr COA 90% 80% 70% Billions $80 60% $60 $40 $20 50% 40% $ % 2007, Donald E. Heller College Board 13

14 State spending on undergraduate grants Billions of dollars $5.0 30% $4.5 $4.0 $3.5 $3.0 Need $ Merit $ % merit Since 1993, need aid has grown 7.3% annually while merit aid has grown 19.7% annually 25% 20% $2.5 15% $2.0 $1.5 10% $1.0 $0.5 5% $0.0 0% , Donald E. Heller Author s calculations from NASSGAP 14

15 Policy trends in recent years Growth of institutional financial aid Emphasis on merit rather than need in the awarding of institutional and state financial aid New Pell Grants with a merit component this year Academic Competitiveness (freshman and sophomore, $750 & $1,300) requires a a rigorous secondary-school school program of study and 3.0 GPA in college SMART (junior and senior, $4,000) majors in STEM areas or certain languages, 3.0 GPA in college Pell spending last year declined by $1B (first time since 1999) Some promising trends , Donald E. Heller 15

16 Grants to undergraduate students Billions of dollars , $16.9B , $38.8B $2.2, 13% $7.0, 41% $5.5, 14% $13.7, 35% $5.7, 34% $14.1, 37% $2.0, 12% $5.5, 14% Federal State Institutional Other* Federal State Institutional Other* * Includes private scholarships and employer aid 2007, Donald E. Heller NCES, National Postsecondary Student Aid Study 16

17 Distribution of grant dollars by income quartile dependent students, all institutions Family income quartiles (2002) 1 st : < $33,346 2 nd : $33,346 - $60,175 3 rd : $60,176 - $92,433 4 th : > $92,433 Census benchmark Median income of all families with at least one child ages 6 to 17 in 2002: $54,249 Federal grants, $4.0B 2nd 17% 3rd 2% 4th 1% 1st 80% 2007, Donald E. Heller Students attending a single institution full time 17

18 State grant dollars by income quartile dependent students, all institutions Need grants, $2.3B Merit grants, $0.7B 4th 4% 3rd 12% 4th 28% 1st 23% 2nd 31% 1st 53% 3rd 28% 2nd 21% 2007, Donald E. Heller Students attending a single institution full time 18

19 Institutional grant dollars by income quartile dependent students, all institutions Need grants, $4.7B Merit grants, $5.5B 4th 21% 1st 27% 4th 31% 1st 20% 3rd 25% 2nd 27% 3rd 28% 2nd 21% 2007, Donald E. Heller Students attending a single institution full time 19

20 Grants to high-income income students Proportion of dependent students receiving grants, by income group ( ) <$54,249 (Census median) 26% 27% $54,249 - $108,497 13% 25% $108,497 - $164,104 (95th %) 7% $2.3 billion 22% >$164,104 6% 19% Institutional grants State grants 0% 5% 10% 15% 20% 25% 30% 2007, Donald E. Heller Heller, WISCAPE

21 300,000 Lost bachelor s s degrees Projected number of bachelor s degrees lost to 2004 HS grads due to financial barriers (conservative projection) 250, , , , , , , ,000 66,000 72,000 50,000 0 Low income Moderate income Total At least trig. At least algebra II 2007, Donald E. Heller ACSFA, Mortgaging Our Future 21

22 Some promising trends Carolina Covenant and similar programs Guarantee full ride without loans for qualified students But..... Class-based affirmative action Advocated by Bill Bowen and others Not a substitute for race-based affirmative action Simplifying the financial aid system and making earlier commitments of aid Indiana 21 st Century Scholars, Oklahoma OHLAP, Washington Learns Commission Spellings Commission, Chronicle op-ed Dept. of Education meeting last month 2007, Donald E. Heller 22

23 Questions and discussion , Donald E. Heller 23