Blog: Higher Ed Beat

Who Benefits from New York’s Free College Plan?

Gov. Andrew Cuomo’s plan to make tuition free year at New York’s public colleges and universities for students from families earning less than $125,000 is being touted as a shot across the progressive bow. As the new Congress and White House tout a conservative agenda, the governor is offering a playbook that states could use to capitalize on the liberal currents that crisscrossed the Democratic presidential primaries. At a press event unveiling the plan, Sen. Bernie Sanders called Cuomo’s proposal “a revolutionary idea for higher education.”

Not so fast, said Matt Chingos, a scholar on higher education at the Urban Institute, in an interview. “The Sanders and Clinton plans – they included middle-income people, some upper-income people, but that’s a way to get broad-based political support for a program that’s also going to have significant benefits for low-income people,” he said. “Whereas the Cuomo plan gives zero benefits to low-income people; it’s completely a handout to the middle class.”

Here’s why: The plans proposed by Clinton and Sanders were “first-dollar” programs, meaning that students would receive free tuition on top of what they’d receive in federal grants. Cuomo’s plan is a “last-dollar” proposal – the free-tuition benefits kick in only after all other federal and state grants are applied to a student’s tuition bill. Because lower-income students tend to receive federal Pell grants that max out at nearly $6,000, federal aid covers virtually the entire tuition for a school like SUNY Albany, where tuition is $6,470.

For students who aren’t eligible for federal grants like Pell, which tend to go to those with family incomes of $40,000 or less, the Cuomo plan could provide generous relief. And at the state’s system of public universities, the SUNYs, more than three out of five students don’t receive Pell grants, suggesting that the largest audience for Cuomo’s plan is the students who are more likely to be able to afford tuition in the first place.

Nor is tuition the only expense of attending college, even when excluding room and board. At the State University of New York at Buffalo, various fees add up to $3,000, in addition to the $6,770 tuition bill, and Cuomo’s plan doesn’t cover fees. “It’s sort of a political sleight of hand to say we’re going to cover tuition and forget that tuition doesn’t include fees,” said Chingos. A recent report found that student fees nationally inflated the tuition bill by 27 percent on average. In Massachusetts, student fees are five times higher than tuition at its public colleges.

The New York governor’s initiative, which is by no means a sure thing in the state’s Legislature, also mandates that students enroll in college full-time in order to receive the free-tuition assistance. That can upset plans for low-income students who attend college part-time while juggling work and family obligations. According to 2011 data, 40 percent of the nation’s students attended college part-time, and they graduate at rates that are below average. A press release on Cuomo’s proposal argues encouraging students to study full-time will boost their odds of completing college.

Cuomo’s plan may serve another purpose: encouraging more higher-income students to stay in New York and attend its state schools. A New York Times analysis last summer calculated that the Empire State loses more than 10,000 students a year to colleges in other states, while bringing in fewer than 4,000 out-of-state students. Could dropping the tuition tab for flight-risk students whose families can afford steeper tuitions in other states keep more of them in a New York state of mind?

Maybe, said Chingos. The incentives for a state to entice students to stay are varied, but there’s the potential for long-term economic benefit to the region as talented learners receive educations locally and accept jobs in the area, helping to spur economic growth.

New York’s public colleges, including the CUNY system in New York City, could also gain prestige points. As wealthier students persuaded by free tuition attend a SUNY in lieu of a private or out-of-state college, they could drive up the selectivity of New York’s public universities because students from upper-income backgrounds – the ones who gain the most from Cuomo’s plan – tend to be more academically prepared than lower-income students. “If they keep the institutions the same size, well then, they may change who goes to CUNY and SUNY but they won’t change the number of people who go” to college, Chingos said.