1 William Zumeta Daniel J. Evans School of Public Affairs & College of Education University of Washington Presented at the Steinhardt Institute for Higher Education Policy New York University March 12, 2008 * Based on a study by Zumeta and Deborah Frankle, Strengthening California’s Community Colleges and Affordable Access to Them, published by the National Center for Public Policy and Higher Education, Report #07- 1, March Financial support from the William and Flora Hewlett Foundation is gratefully acknowledged. The Power of Policy Ideas: Are California’s Community Colleges Really Affordable? If Not What Can a Strapped State Do?*

2 Tuition/Fees in 50 States

3 Expenditures per FTES – Selected WICHE States

4 Many of California Community Colleges’ students are lower income than in other states.

5 Hours Worked by CCC Students, by Student Category A key consequence of too little financial aid is that students work too many hours, hindering their academic progress.

6 CCC affordability is NOT mainly about fees. Almost 29% of CCC credit enrollment receives BOG Fee Waivers… …and over half of all full-time CCC students receive BOG Fee Waivers. 28.7% 51.6% Sources: CSAC Nine-Month Student Expense Budgets, Chancellor’s Office, August 2006 BFAP Report

7 Non-fee costs of attendance are rising fast for CCC students. Sources: Bureau of Labor Statistics, California Department of Finance, CSAC Nine-Month Student Expense Budgets

8 Financial Aid Administrative Dollars per Undergraduate Student, Source: Chancellor’s Office, August 2006 BFAP Report California underinvests in financial aid capacity in the community colleges. This capacity is key to fully accessing federal aid and Cal Grants.

9 Student Costs and Rates of Aid Application and Receipt (NPSAS:04)

10 Unmet Need After Financial Aid (NPSAS:04)

11 Receipt of Pell and State Grants (NPSAS:04)

12 There are signs of improvement since the state's infusion of BFAP-SFAA funds for capacity building and aid outreach.

13 Pell Grant and BOG Fee Waivers and their share of credit enrollment are increasing. Source: Chancellor's Office Data Mart, accessed 8/14/06. Credit headcount comes from a special CO tabulation.

14 Recommendation: Expand Board Financial Assistance Program Outreach and Capacity-Building Research and disseminate best practices Increase incentives for FAFSA completion Tie increased resources to performance improvements CCC student population is needier but receives fewer financial aid resources than other segments Signs of improvement in aid application and receipt rates since major infusion of state BFAP funds in CCC students work too much, reducing persistence, completion, and transfer Why? How?

15 Recommendation: Enhance Cal Grant Programs Increase value of Cal Grant B Access Grants and link the value to inflation or target a percentage of the originally legislated value. Provide more Competitive Grants to serve a target percentage of eligible applicants (e.g., 25% compared to current 18%). Increases to Cal Grant B Access Grants have not kept pace with inflation, much less costs of attendance 82% of eligible CCC applicants remained unserved by Competitive Grants in Why? How? Changes to Cal Grant programs effective in have helped more CCC students.

16 Trend in Cal Grant B Access Grant Compared to Inflation Indexed to = 100 Notes: CCPI for is a Department of Finance estimate. Sources: California Department of Finance, California Postsecondary Education Commission Had the Cal Grant B Access Grant’s value kept pace with inflation, it would be worth $5,190 for Instead, the maximum Access Award is $1,551.

17 Recommendation: Establish Rational Fee Policy (1 of 2) CCC affordability is not mainly about fees! Low-income students needn’t pay fees due to BOG Fee Waivers Impending fee rollbacks will cost the California treasury $80 million and the neediest students $20 million in aid (LAO estimates) Low fees contribute to low rates of aid application The system needs more revenues to improve financial aid capacity and student persistence, completion, and transfer rates Why?

18 Recommendation: Establish Rational Fee Policy (2 of 2) Create consistency and predictability for CCCs and students by tying annual fee increases to an affordability indicator such as state per capita personal income (average annual growth was 4.36% over ) This implies annual fee increases ranging from $0.87 to $1.23 per credit between and Use additional fee revenues to invest in student services designed to improve financial aid capacity and student persistence, completion, and transfer To reduce disincentives for fee increases, the state should match revenue from increases to fund a Community College Grants Program targeted at particular student needs How?