When in Boston recently for a conference, I met a fellow educational consultant from China. Hearing I was from Kentucky, he asked, “Tuition is very reasonable at Kentucky, yes?”
I paused before answering. Through the eyes of his clients, tuition at the University of Kentucky seems a comparative bargain, yet the first priorities of a public institution should be affordability and excellence for its state’s residents. By that measure, our public institutions become a little less reasonable each year. Recently announced tuition increases mean more indebtedness for needy students than ever before. Reductions in staff and stagnation of faculty salaries erode overall quality.
UK has worked to aid more students and has increased the average award, a challenge in the face of dwindling state support. In Fall 2006, 80 percent of undergraduates received financial aid, with state funds providing 41 percent. By Fall 2011, 91 percent of undergraduates received aid, with only 27 percent of it from state funds.
Student debt norms
According to the Project on Student Debt (www.projectonstudentdebt.org), college graduates nationwide carried an average of $25,250 in student loan debt in 2010.
Kentucky statistics from the Project on Student Debt show how we compare: the state’s graduates of public and private nonprofit four-year institutions carried an average debt of $19,375, which ranks Kentucky 43rd among all states. In addition, the proportion of Kentucky graduates with debt was 58 percent, with a state rank of 25th.
Thirty-six percent of UK’s 2010 graduates carried student loan debt, averaging $19,812. Of Transylvania University’s 2010 graduates, 64 percent carried student loan debt, averaging $22,432. Both totals compare favorably to the national average.
Many families are surprised to find that the difference in total private and public college loan debt is so small. Brad Goan, vice president for enrollment at Transylvania, shared the following data on this fall’s entering class with Business Lexington:
• Percentage of first-year students expected to pay full cost: 2%
• Percentage of first-year students expected to pay 50 percent or less of full cost: 78% (includes loans), 58% (with loans excluded)
• Average cost for first-year students: $12,506 (with loans), $14,851 (with loans excluded)
• Total direct costs for 2012-13 (for the 2% paying full cost): $38,615
Goan marvels at families’ misperception of private vs. public college net cost.
“I know we lose a number of families every year because of sticker shock and a lack of understanding of how the process works,” he said.
Recalibrating college choices
Affluent professionals may view these loan norms as reasonable. Yet students from backgrounds where assets are limited or nonexistent, as Faith Sandler, executive director of The Scholarship Foundation of St. Louis, and Lisa Orden Zarin, CEO and founder of College Bound, wrote in a May 1 article in the St. Louis Post-Dispatch, “are faced with the possibility of dreams denied.” And, “in time, an undereducated community will see the economic effects in business closings and relocations, job loss, health care for the uninsured, incarceration and other costly social services that weaken the economy.”
“The really scary thing that we see happening,” Sandler said, “is that the parent takes out the PLUS loan for the first semester, and then the student cannot return for the second semester because there’s a back balance owed on the loan that the parent simply cannot pay.” So the student may take time off, intending to re-enroll when finances are more stable.
Students who take a stop/start approach to studies due to financial exigency, however, learn that it hampers degree completion. As a result, Sandler now says to families, “As you sit here right now, if you cannot pay this sum that you’re thinking of taking on for four years, don’t sign up for even one year.” She urges them to enroll at a more affordable college so as not to be on the hook for a lifetime of student loan repayments.
Professor Kelli Carmean, chair of Eastern Kentucky University’s Department of Anthropology, Sociology and Social Work, sees a silver lining benefiting her institution. Reflecting on the improved quality of students in her classrooms, she said, “It’s possible that these students are choosing EKU because it’s more affordable than other options, whereas years ago they may have made a different enrollment choice.”
Commencement of the future
Doonesbury’s Garry Trudeau imagined a Walden University commencement exercise in which the dean announced, “All students owing more than $100,000 are invited to meet with debt counselors in the field house following today’s ceremony ...”
That Walden commencement may become reality if college costs are not brought to heel. Expect a small graduating class if so, as many students will simply conclude that they can’t afford college at all.
When the cost of college prevents enrollment, the entire community pays a price. In the words of my mother, “Prospective students should choose schools that match their pocketbooks.” In the words of Sandler and Zarin, “our policymakers and community leaders should return to an understanding that educational attainment is not a private commodity but a public interest.”
Jane S. Shropshire guides students and families through the college search process. Contact her at Jshrop@att.net.