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FEDERAL STUDENT AID AND COMMUNITY COLLEGE STUDENTS Sandy Baum George Washington University Graduate School of Education and The Urban Institute North Carolina.

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Presentation on theme: "FEDERAL STUDENT AID AND COMMUNITY COLLEGE STUDENTS Sandy Baum George Washington University Graduate School of Education and The Urban Institute North Carolina."— Presentation transcript:

1 FEDERAL STUDENT AID AND COMMUNITY COLLEGE STUDENTS Sandy Baum George Washington University Graduate School of Education and The Urban Institute North Carolina Association of Community College Presidents July 2014

2 What’s good for community college students and what’s good public policy? Public policy (equity and efficiency) o Diminishing financial barriers for students with very limited resources o Using public funds to change behaviors and outcomes in socially desirable ways. Community colleges: o Disadvantaged students making cost effective choices o Students on the margin of enrollment o Need to improve success rates

3 Trends in College Pricing 2013For detailed data, see: trends.collegeboard.org. NET PRICES, ROLE OF LIVING COSTS Published In-State Tuition & Fees, Net Tuition &Fees, and Room& Board in 2013 Dollars, Full-Time Undergraduate Students at Public Institutions, to SOURCE: The College Board, Trends in College Pricing 2013, Figure : U.S. $3,264; NC: $2,242

4 Trends in College Pricing 2013For detailed data, see: trends.collegeboard.org. Distribution of Pell Grant Funds and Federal Subsidized & Unsubsidized Loan Funds by Sector, to SOURCE: The College Board, Trends in Student Aid 2013, Figure 8B. CC: 24% of full-time, 39% of all UGs

5 Sources of Undergraduate Grant Aid by Sector,

6 Pell Grants Simplification --IRS data --Look-up table Supporting completion --Availability of year-round aid --Funding per credit hour / “Flex Pell” Providing guidance

7 Student Loans Is there a crisis? About 42% of all students (53% of full-time students) borrow each year. About 18% of community college students (24% of full- time students) borrow each year. 39% of community college completers in had borrowed (62% all sectors, 87% for-profit).

8 Total Amount Borrowed by 2009 by Students Beginning Postsecondary Education in , by Degree Attainment Did Not Borrow $1 to $10,000 $10,001 to $20,000 $20,001 to $30,000 $30,001 to $50,000 $50,001 or more TOTAL 43%25%16%8%5%2% Bachelor's Degree (31%) 36%12%22%14%10%5% Associate Degree (9%) 42%24%18%9%7%1% Certificate (9%) 39%45%12%2%1%0% No Degree, Still Enrolled (15%) 39%27%18%9%5%2% No Degree, Left Without Return (35%) 52%30%11%4%2%0% Source: Beginning Postsecondary Students Longitudinal Study 2009, Data Lab

9 Total Education Debt of Associate Degree Completers $0 $1- $4,999 $5,000- $9,999 $10,000- $14,999 $15,000- $19,999 $20,000- $24,999$25,000 + Public Two-Year AA, AS, general education or transfer 63%9% 7%4%3%5% AAS, occupational or technical program 53%8%14%8%7%3%8% For-Profit AA, AS, general education or transfer 12%3%10%9%11%15%40% AAS, occupational or technical program 12%5%9%10% 15%40% Source: National Postsecondary Student Aid Study, Data Lab

10 Trends in College Pricing 2013For detailed data, see: trends.collegeboard.org. Distribution of Total Enrollments, , Borrowers Entering Repayment in FY 2011, and FY 2011 Two-Year Cohort Default Rate, by Sector SOURCE: The College Board, Trends in Student Aid 2013, Figure 12C.

11 Two-Year Cohort Default Rates by Sector Three-Year Cohort (2009) Default Rate 18%8%7%23% 13%

12 Loans Income-based repayment as the default option Part-time students Distribution of subsidies In-school subsidy Restricting eligibility

13 Public Policy Free community college? o Recent high school graduates (two-thirds of first-year students age 21 or older) o Limited to tuition in excess of federal and state grants o Potential enrollment impact Simplification Targeting of subsidies (in-school subsidy) Progress / completion incentives


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