Dive Brief:

• Incoming students from families earning $80,000 a year or less will be able to attend the University of Southern California (USC) tuition-free starting this fall, the institution announced Thursday. 
• The university also will no longer consider home equity when determining students' financial need. 
• USC joins a growing list of institutions that are expanding free tuition to low- and middle-income students.

Dive Insight:

USC plans to increase undergraduate aid by more than $30 million annually. Currently, the university doles out $375 million each year in grants in scholarships to undergraduates, according to a press release.

The expansion of aid to low- and middle-income students is an increasingly popular strategy colleges are using to recruit and retain students put off by high sticker prices. But such policies may not add much financial strain for institutions that already offer generous financial aid packages to students in low- and middle-income brackets, experts note.

"(What) some of these programs really do is they basically make clear what the colleges were more or less already doing," Robert Kelchen, a higher education professor at Seton Hall University, told Education Dive last year. 

USC's new financial aid plan is similar to a program its current president, Carol Folt, rolled out while she was chancellor of the University of North Carolina at Chapel Hill. The Blue Sky Scholars program, announced in the fall of 2018, gives tuition assistance and other aid to students from families earning $75,000 or less a year. 

UNC-Chapel Hill's program aims to "send a signal to middle-income North Carolinians that their university is on their side," Stephen Farmer, the university's vice provost for enrollment and undergraduate admissions, told Education Dive last year. 

For some colleges, these efforts appear to be attracting more students. Rice University, in Texas, and Colby College, in Maine, saw an uptick in applications after debuting financial aid policies for low- and middle-income students.

USC follows Stanford University in dropping home equity from its financial aid calculations. The move acknowledges that home values have risen drastically, especially in some regions of California. 

The boost in need-based aid at the university also comes at a time when merit-aid is under fire. 

Over the past two decades, public universities leaned more on merit aid to recruit out-of-state students, according to a recent analysis from New America. In 2016-17, public universities met two-thirds of student aid recipients' financial need, falling six percentage points from 2000-01. 

USC's move comes as it contends with fallout from the Varsity Blues admissions scandal. Last year, it added stricter oversight to its admissions processes for student-athletes after it was linked to the nationwide scheme.