1. Community Colleges: Meeting the Challenge of Increasing Attainment Rates Arthur M. Hauptman SHEEO Higher Education Policy Conference August 2010

2. The Community College Challenge President Obama has laid out a very challenging goal for American higher education – for the U.S. to once again have the highest overall attainment rates among the youngest group of workers (ages 25 to 34 year old)  We have not been the leader in this category since 1990 Increasing associate degree attainment rates must clearly be part of any effort to increase overall rates of attainment in the U.S. in the next decade and beyond. This is the community college challenge. But there are some particular aspects of the relationship between American universities and community colleges which will make increasing associate degree completion rates particularly difficult

3. The Community College Conundrum Associate’s degrees have been the fastest growing type of degree in the U.S. over the past forty years. But the sub-bachelor’s attainment rate in the U.S. has stayed relatively constant at 10 percent of adult workers for much of that time, as the following charts demonstrate This is the community college conundrum: rapid growth in associate’s degrees awarded does not translate into higher attainment rates because many associate’s degree recipients already have a bachelor’s or get one after they attend community college. As a result, they are reported as bachelor’s degree holders and do not appear in the sub-bachelor degree attainment rates. This is different from many other OECD countries where sub-bachelors degrees are typically terminal ones, most further education students do not go on for university education, and the overlap between higher education and further education is rather limited.

4. Average Annual Rates of Growth, in Five Year Intervals, 1970 to 2005

5. AVERAGE ANNUAL RATES OF GROWTH IN DEGREES, FTE ENROLLMENTS AND POPULATION, 1970 - 2005

6. Attainment Rates for the Youngest Group of Workers, 1970 to 2020 (projected)

7. Big Barrier – Achieving the President’s goal for attainment will be exceedingly hard to achieve The preceding chart also demonstrates how difficult it will be to reach President Obama’s objective of having the U.S. achieve an overall attainment rate of roughly 60 percent by 2020 We would have to quadruple the historical rate of increase in the overall attainment rate over the next decade  The U.S. overall attainment rate has increased on average at an annual rate of.5 percentage points for the past 40 years. It would have to increase by 2 percentage points per year for the next ten years to reach 60 percent by 2020. This is highly unlikely without major shifts in policy and/or large infusions of money in the next several years  Can’t wait until 2020 for policies to be in place

8. What policies would help community colleges achieve the objective of increasing overall attainment rates? To achieve the President’s goal, or even at least move more rapidly in that direction, will require large scale changes in federal and state policies and funding patterns  What would those policies be? Increasing associate degree attainment rates also requires not adopting certain policies that will detract from the effort  What policies should be avoided?

9. Three Policies to Avoid Large increases in Pell Grants  Recent increases have resulted in very little additional funds for community colleges themselves  Little evidence that Pell Grants will improve completion Base policies on increasing completion rates  Easiest way for institutions to improve their completion rates is to be more selective or lower standards  Focus instead on increasing numbers of graduates Maintain federal campus-based aid in current form  Grandfather provisions disproportionately favor four-year institutions that have been in the programs a long time  Application process emphasizes which students receive awards, not the results

10. State policies to help community colleges increase attainment rates Reallocate some state resources from four-year to two-year institutions Base all or at least a portion of funding formulas on the number of graduates rather than the number of students enrolled Dramatically change how remediation is financed so that students would not need to borrow for remedial courses because they would no longer be charged tuition for these courses  Contract for remediation services instead

11. Federal policies to help community colleges achieve higher attainment rates The student aid process could be simplified by allowing parents/students to apply for student aid through a check-off on their federal income tax forms  Students from families on welfare, Medicaid, food stamps and EITC would automatically qualify for full federal aid The amount community college students could borrow for living expenses could be limited  Borrowing for living expenses is major reason for high debt burdens among community college students The campus based aid programs could be transformed into an access and completion fund in which institutions would receive federal funds based on the number of Pell Grant recipients they enroll and graduate  Institutions would have considerable latitude to decide how to spend these funds including student grants, work-study, mentoring, support services, and early intervention partnerships

12. In sum, the President’s ambitious goals require careful thinking about what works Certain policies should be avoided  Eschew politics and rhetoric  Emphasize program effectiveness State policies and funding should be designed to allow community colleges to act more effectively in meeting performance goals  Reallocate resources and reward performance Federal student aid policies should be modified to allow those programs to act more effectively in meeting the President’s goals  Big increases in Pell Grants are not the answer  Simplify aid process and re-focus resources