October 20, 2020
Andrew Farnitano, Hildreth Institute, 925-917-1354, firstname.lastname@example.org
BOSTON – As Massachusetts public colleges and universities currently face hundreds of millions of dollars in budget cuts due to the COVID-19 pandemic and resulting state budget gap, two new reports from Massachusetts research institutions warn against cuts to public higher education institutions and present a new model for equitable affordability programs. The reports warn that students of color and low-income students are being left behind by inadequate financial aid policies and state budget cuts. They offer a roadmap to ensure that public college is truly affordable for those who need it most.
A report from the Massachusetts Budget and Policy Center (MassBudget) outlines the deep state budget cuts to public higher education that have occurred in the past two recessions, and which are being repeated now. The report notes that funding for public higher education in Massachusetts has never been restored to its Fiscal Year (FY) 2001 level of $1.4 billion (inflation-adjusted). As a result, the task of funding our public colleges and universities has increasingly fallen on students and their families.
“Now more than ever, the public higher education sector in Massachusetts needs adequate funding. Past recession-based budget cuts, along with new COVID-related costs, are harming already bruised budgets for these public institutions. These past cuts have translated to higher tuition and fees and created an affordability crisis most deeply felt by students of color,” said Anastasia Martinez, a Policy Analyst and State Policy Fellow at MassBudget and author of the report. “Lack of adequate state funding to our public universities and colleges means money is spread thin between ensuring accessible and affordable tuition for students, adequate resources for safe campuses, and preventing cuts to staff and programs. Not only does accessible and affordable public higher education benefit the Commonwealth overall, it also provides a clear pathway to economic equity for Black and Latinx students. Investing in public higher education is an antiracist policy choice.”
A report from the Hildreth Institute takes a closer look at ‘free tuition’ programs to investigate whether they are the most desirable path to increasing college affordability. The report examines 22 state-wide, free-tuition programs established in the last decade, and finds that most fail to address the real financial and non-financial barriers that prevent many students from accessing and obtaining a higher education credential. Although tuition and fees are the most often discussed college costs, they represent only 24 percent of the cost of attending a community college and 40 percent of the total cost of attendance at a public 4-year university. The report also shows that the limited focus on covering tuition and fees, after accounting for students’ existing financial aid, does not provide any new grant dollars for lower-income students, whose tuition and fees are already covered by existing financial aid. The report proposes an alternative, equitable method for allocating financial aid that remedies the regressive features of existing tuition-free programs and recommends a framework to increase the inclusivity of college affordability initiatives in Massachusetts and across the country.
“Most existing tuition-free programs are at community colleges, and they do not provide new grant dollars to students coming from the lowest-income households. These students, however, still face significant financial gaps in covering the full cost of college. These programs do little to decrease opportunity gaps and lower the economic barrier which prevents low-income students and people from historically underrepresented populations from attending college,” said Bahar Akman Imboden, PhD., Managing Director of the Hildreth Institute and author of the report. “For millions considering a higher education credential, the concern is not only how to pay for tuition and fees but also how to afford other necessities like textbooks, a computer, software and internet access, housing, food, and transportation. Our proposed grant design seeks to increase access to students who would most benefit from a higher education credential but who are often priced out of it.”
Other key points from the MassBudget report include:
- Well-funded public universities and colleges — especially community colleges — provide a critical pipeline for training and re-training students for jobs essential to the state’s economic recovery. Graduates of public institutions are more likely to live and work in Massachusetts after graduation, meaning they are more likely to contribute to our communities and economy in the long run.
- Between FY 2001 and FY 2019, average tuition and fees for public campuses per student increased by about $6,100 while state funding per student decreased by $2,790 (adjusted for inflation).
- Massachusetts has cut state scholarship funding by 29 percent since FY 2001 (adjusted for inflation). Without sufficient scholarship money, many students turn to loans. This is especially true for Black and Latinx students who are most likely to take out loans and borrow greater amounts. The average debt of public higher education graduates in FY 2018 was around $32,000 in Massachusetts — an increase of 54 percent since FY 2001.
- During the Dot-Com recession of FY 2001-2004, the state government cut public higher education funding by $392.9 million adjusted for inflation. During the Great Recession of FY 2009-2012, state funding for public higher education was cut by $131.7 million. Those cuts during the Great Recession occurred despite the fact that the state relied on more than $430 million from the federal American Recovery and Reinvestment Act (ARRA) to fund public higher education and avoid deeper cuts.
“The state’s next steps are crucial for the Commonwealth’s economic recovery and for work towards systemic change to ensure equity. Economic recovery from this current recession will require a well-educated workforce,” said Marie-Frances Rivera, President of MassBudget. “Choosing to cut state funding for public higher education could, once again, have long-lasting impacts on opportunities for students of color and on the prospects for a thriving Commonwealth.”
Other key points from the Hildreth Institute report include:
- Tuition and fees only represent 24 percent of the total cost of attendance at public 2-year schools and 40 percent at public 4-year institutions.
- The lower the income of a student, the less likely they are to benefit from existing tuition-free programs, known as ‘last-dollar’ scholarships, which cover only the portion of tuition and fees that are not covered by existing financial aid. Many low-income students do not benefit from these free-tuition programs because their tuition and fees are already covered by existing need-based aid (especially at community colleges where tuition and fees are low), even though they struggle to afford the full cost of college attendance. Meanwhile, a student with means is more likely to receive aid from tuition-free programs equal to the full cost of tuition and fees, even though they can more easily afford the full cost of college attendance.
- The report proposes a ‘last-dollar’ scholarship on the full cost of attendance, which is equivalent to meeting the student’s unmet need, which will effectively reduce, if not eliminate, the need to borrow for college. This award amount is determined by subtracting all the existing non-loan financial resources from the full cost of attendance (including work-study or salary from work of no more than the recommended 10 to 15 hours a week).
- If the cost of such a program is initially prohibitive, a partial version of this program could provide a flat or progressive grant that covers a portion of students’ unmet need considering the full cost of attendance. This allocation method will still target financial aid to those who need it the most, while effectively reducing their need to borrow.
For the full MassBudget report on public higher education funding during recessions, click here. For the full Hildreth Institute report on creating equity in college affordability programs, click here. A brief version of the Hildreth Institute report is also available here.