As we detailed yesterday, a New America report released last week and focused on the financial aid practices of colleges and universities singled out many private institutions for apparently sacrificing low-income students. Namely, it called them out for shifting aid from need-based to merit-based institutional scholarships, with Pell Grants picking up much of the burden.
The problem also extends to public higher ed institutions, many of which are struggling with the same declining enrollment and revenue issues, but with the added problems of state budget cuts or spending freezes.
While the situation isn’t as bad with public universities as with their private peers, it is getting worse. Most private colleges and universities charge students with family incomes of $30,000 or less a net price — tuition and fees minus grants and scholarships — of more than $10,000. But about half of the public schools have at least 30% of their students coming from low-income families and charge them a net price of less than $10,000.
As it does with private higher ed institutions, the New America report singles out specific state schools, and states in general — some for criticism, some for praise:
Hawaii provides the lowest net cost — for in-state students, at least
Hawaii tops the list of states with public higher ed institutions that charge the least for their lowest-income, in-state students. For students with families with annual incomes of less than $30,000, Hawaii charged a net average price of $5,909 in the 2011-2012 school year. Joining Hawaii on the low-cost-for-low-income-in-state-students list: North Carolina, Washington, Louisiana, New York, and California.
Delaware's in-state low-income students pay the most
Delaware had the highest net average cost for low-income in-state students, at $14,168, followed by New Hampshire, Pennsylvania, South Dakota, Illinois, and 20 other states with net averages over $10,000 for low-income students.
U.Va. & College of William and Mary enroll the least Pell recipients
The University of Virginia and the College of William and Mary have the worst Pell Grant recipient rate on the list — only 12% of their enrollments.
All together, the report names 235 public schools, also including the Universities of Michigan and Wisconsin at Madison, to what could be called its "Naughty List" — schools that charge lowest-income in-state students an average net price of more than $10,000. Many of these schools are also taken to task for their focus on recruiting out-of-state students who pay much higher tuition, aiding the institutions' bottom lines and taking slots away from low-income and minority students, according to the report.
Rowan University in New Jersey tops the highest-net-price list, however, with an average net price of $20,577 for its lowest-income students.
Is Oregon State the Northeastern of public institutions?
Oregon State University is cited as an example of a public institution that committed hard to the strategy of attracting more students — particularly high-achieving students — at the expense of low-income students. In the 2012-13 school year, 19% of the university’s freshmen had no financial aid and received an average of $4,000 each in merit aid. Meanwhile, Pell Grant recipients make up 34% of the enrollment and pay a net average price of $13,506, which is the 70th highest for public schools.
80 colleges and universities fall somewhere in the middle
Eighty public institutions land on the equivalent of a "Somewhat Nice List," charging the lowest-income in-state students an average net price of less than $10,000. But the number of low-income students admitted to these schools is limited, with 30% or less of their enrollment made up of Pell Grant recipients.
New America suggests a two-prong carrot-and-stick approach to help address the issue of more financial aid being diverted to merit scholarships at the expense of low-income students.
First, the carrot: Offer Pell bonuses to public and private institutions that are struggling financially, and that have student bodies with 25% or more Pell Grant recipients and graduate more than half of their students. This funding would help keep net prices down for low-income students.
The stick? Require wealthier schools with low Pell enrollment and high net prices to match a share of the Pell funding that they receive.
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