Central Mass. Colleges Embrace Obama Plan To Curb Costs
As student loan debt in the United States approaches the $1-trillion mark and has become the largest form of unsecured debt in the nation, federal and state lawmakers are looking for ways to ease the burden on students and turning to performance-based funding for schools as a possible cure.
In August, President Obama unveiled a three-pronged plan to make higher education more affordable. It focuses on paying colleges and universities for their performance, using a rating system, promoting innovation and ensuring that “student debt remains affordable.”
Reaction within higher education seems to be that Obama's plan — particularly the ratings portion — has flaws, but is a step in the right direction. The president is asking the Department of Education to develop a college ratings system that would be in place and available to the public by the start of the 2015-16 school year. According to the White House, the system would compare schools with similar missions and rate them on measures such as the percentage of students receiving federal Pell grants, which are available to low-income students, affordability and outcomes, such as graduation and transfer rates, and how much graduates earn after they receive their degrees. By 2018, student aid would be based on those ratings, with high-performing schools receiving larger Pell grants and more affordable student loans.
“I think it's a step in the right direction. I think where he's going with higher education now is similar to what's being done in other industries, so that's making us more accountable for what it is that we do,” said Peter Miller, dean of admissions and financial aid at Anna Maria College in Paxton. He said schools that receive federal dollars should be held accountable for what happens to those who receive that money.
Dale Hamel, executive vice president of Framingham State University, thinks more transparency is good, but is concerned about how a ratings system might work. For example, he said, many FSU students attend for two years before they decide they want to pursue engineering degrees, which the school doesn't offer, and transfer.
“That's a success story,” he said. “(But) In (a rating) system, we would probably be put at a disadvantage for each of those students that wanted to go on and complete their degrees somewhere else.”
Average Student Debt Growing
While the state is not implementing a ratings system for four-year colleges, it's facing growing higher education costs, like many other states.
According to The Institute for College Access and Success' Project on Student Debt, Massachusetts went from 25th of 48 ranked states in terms of highest average amount of student debt carried by 2005-06 graduates, to 14th just five years later. In 2010-11, 65 percent of graduates had student loan debt, which averaged $27,181. Five years earlier, the average debt was 42 percent lower at $19,191.
To that end, the state Legislature came closer to meeting its goal of funding 50 percent of costs to run universities, upping funding by $15 million over 2013. That allowed state systems to freeze student fees for the year.
But a performance-based system has been implemented for the state's 15 community colleges. Effective July 1, it provided an extra $20 million above the $208 million the colleges received for fiscal year 2013.
Under the new plan, each school receives $4.5 million in operations funding. Then, half of the remaining $160 million in funding allocated for the community colleges is distributed based on credit hours completed. The other half is based on performance, including graduation rates, and emphasis is placed on graduation rates of students who receive Pell grants.
Quinsigamond Community College had the biggest jump in funding this year, 25.8 percent, to $16.3 million.
Steve Budd, interim vice president of enrollment and student services at QCC, believes the change in state funding method will be good for the school.
“I think really it just levels the playing field,” in terms of what schools get how much funding, he said. “I'm not afraid of performance criteria. I'm expecting to rise to that expectation.”
His concern about performance funding lies with the federal government's use of graduates' employment to help determine a school's ranking, because, he said, “that's more out of our control.”
But Budd said the focus on performance is pushing for curriculum reform and innovation. The idea is that it not only brings in new students, but helps them succeed at the school, which, in turn, helps boost the school's ranking.
Budd said that, for QCC, that means working with local businesses to understand their needs and building curriculum around them, including certificate programs, so that a displaced worker can quickly return into the workforce with new skills.
At Anna Maria, Miller said it's important that schools look at new models, such as offering online courses and three-year degree programs.
“We have to examine the way we do business,” he said.
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