The College Board's 1995 report for The California Higher Education Policy Center concluded, "Overall, going to college in California is much less affordable today than it was at the beginning of the 1990s." Two years later our assessment is not greatly changed. Yes, student fees for attending California's public institutions leveled off in the two additional years captured in this study. But the share of family income required to pay these fees remains far higher than it was in 1990-91. And while available aid has increased, most of the growth in aid has come in the form of loans, not grant support, and an increasing proportion of the borrowing is unsubsidized.
To make college affordable again, the 1995 report identified four policy challenges, which are as pertinent now as they were then.
Stabilizing tuition increases over time will require a range of policy responses that expand revenue from other sources, cut institutional operating expenses, and promote more cost-effective delivery of higher education. Other reports of The California Higher Education Policy Center have sought to spark debate on such policy choices.
Policy makers should aim to limit student fee increases in relation to annual growth of family income in California, thus gearing the price of higher education to a broad measure of economic well-being and family ability to pay. (In Higher Education in California: A State of Emergency?, David Breneman suggests relating tuition to the median income of students in each public segment.)
Meanwhile, federal aid in the 1990s continues to be long on promises and short on everything but loans. The federal government can no longer be counted on to carry as much of the burden of assuring access as it did in the past. Recent increases in the Pell Grant have only begun to restore its purchasing power. At the same time, borrowing is expanding, federal aid in general is becoming less targeted on the neediest, and the Clinton Administration's proposed tuition tax credits and deductions would help only those in the upper-income quartiles.
Without a stronger state commitment to need-based assistance (grant aid in particular), California will continue down the path of becoming a high-tuition/high-debt state, and the state's growing number of poor people will increasingly lack equal educational opportunity.
Whether the dollars come from "recycled" student fee revenue, new allocations from the state general fund, or savings from other areas of segment budgets, the investment in student aid must be increased-and geared by policy to the rate of increase in student fees.
The 1960 Master Plan called for state financial aid to promote student choice in attending private institutions. Today, state aid goes far beyond the original Cal Grant program. It includes myriad segment-specific and generally available programs, ranging from fee waivers for low-income community college students to graduate fellowships for the most talented researchers. The challenge for policy makers is to establish a strategic vision and set of priorities for state investment in financial aid. In tight fiscal times the state may not be able to sustain all of the objectives and funding categories that have accumulated over time.
As for the Cal Grant program, is the current pattern of awards the best use of state funds in the 1990s? Originally, 90 percent of Cal Grant funds went to students in the independent sector, but this sector's share has been on the decline for 30 years. UC students now receive more funds from Cal Grants than independent college students receive, while the share awarded to CSU students is under 20 percent and declining (community college students receive under 10 percent and proprietary sector students under 5 percent). The Cal Grant program has drifted from its original purpose without clear redefinition.
A related policy question is whether to channel the bulk of state student aid through the public segments or to place it in generally available programs that allow students to take the aid to the institutions of their choice. The three sectors in California (public, private nonprofit, and private for-profit institutions) are diverse, and no one program will work best for all students. At the same time, allowing students to "vote with their feet," carrying their aid to the institution of their choice, might be more equitable and efficient. Establishing the right mix of portable and segment-specific programs will require policy makers and university leaders to develop a cogent set of priorities for the use of student aid.
Awareness and Predictability of Aid. As prices go up, sticker shock can discourage needy students who may not know about financial aid or may be deterred by the application process. Information and outreach are important to increase awareness of available aid. Aid programs should be publicized and accessible to those who need help the most. Such efforts are especially important where high school guidance and counseling resources are inadequate. Continuity of aid levels from year to year is also important, so students can count on the support they need to complete their degrees.
Standards of Need. Federal criteria for determining student need are used to determine recipients of both federal and non-federal aid across the country. While the federal commitment to funding student aid may have eroded, the federal methodology of need analysis has been widely adopted. The 1992 reauthorization of the Higher Education Act substantially altered federal need standards, stretching eligibility to larger numbers of the middle class but with no assurance of commensurate federal funding. The result has been to create an "unfunded mandate," a legitimation of increased need without federal help for states and institutions to satisfy the greater demand. Under the revised standards, it is likely that available funds are being extended further up the income scale, at the expense of more disadvantaged students. State policy makers should study award patterns to find out what shifts are occurring-and whether the interests of needy students are being well served.
Nontraditional Students. Student aid programs have been designed primarily for dependent students of traditional college age. The system as it has evolved is not generally well suited to meet the needs and circumstances of older adults returning to higher education for a second chance, retraining, or mid-career change-students who typically attend part-time while holding down job and family responsibilities. In the 1990s and beyond, policy makers need to fashion more appropriate mechanisms for helping nontraditional students meet the costs of higher education.
Simplification. The aid process must be made as simple and straightforward as possible for students, while at the same time targeting aid to the neediest. There are too many programs, too many forms, too many procedures-to the point that the system itself can become a barrier to educational access.
The delivery of student aid is an enormously complex system, driven substantially by federal rules and regulations. But as a state policy issue, aid is moving from the periphery to the center of higher education finance. It has become increasingly important for state and higher education leaders to focus on this area in order to sharpen priorities and fashion more effective aid policies.
To do so, policy makers in California will need to know more about how the system works, the characteristics of aid recipients, and the effects of current aid programs. And they will need reliable, comparable data on aid patterns in each sector of postsecondary education.
This study certainly does not provide all the answers. Ideally we would like to know much more than we do, about who actually receives the available aid, how the patterns of eligibility are shifting, who is borrowing and why, and how enrollments may have been affected. But this report is a start.
[ DOWNLOAD | CONTENTS | PREVIOUS | NEXT ]