Dive Brief:
- A “last dollar” financial aid program at a Rutgers University campus has boosted enrollment of lower-income students as well as reduced their reliance on loans and the need to work excessive hours to make ends meet, according to a study by the Federal Reserve Bank of Philadelphia.
- The study of the two-year-old Bridging the Gap program at the Rutgers-Camden campus, which gives low- income students a tuition discount based on family earnings after they have received other need-based federal and state aid, also found that there were indications of improved academic performance and retention, but those gains were difficult to assess. One author said participants reported being less distracted and stressed by financial issues.
- More than 8,700 students applied to the Rutgers-Camden in 2016, the report found, up substantially from 7,000 the previous two year. “Based on interviews conducted in fall 2016 with Bridging the Gap beneficiaries, we know that the program played a role in the decision of some college-bound, lower-income students to enroll at Rutgers–Camden,” the report states.
Dive Insight:
Last-dollar funding has advocates and detractors. A comparison by the Association of Community College Trustees says that it does not help to pay extra costs besides tuition and room and board associated with college attendance unlike first-dollar support.
Researchers have found low-income students may need extra assistance in three areas: clarifying financial information, easing the financial burden and filling in financial aid gaps. One problem identified by some experts is that students don’t know what their final cost will be, although the MyinTuition program, a cost calculator supported by more than 30 institutions, is promoted as a way for students to get a more accurate picture.
Colleges often offer special financial support for first-generation students. For instance, the University of Alabama, which urges applicants to indicate first-generation status to be eligible for special assistance and lists three scholarships on a website page dedicated to those students.
Free college programs are now offered in 16 states and 200 communities, according to College Promise, the national program that advocates for and supports free college initiatives. It claims the programs have paid off with higher enrollment and retention. Free college programs differ on how they formulate the assistance, including whether they pay last- or first-dollar amounts and what requirements they have concerning GPA, residency before and after college and whether the student has full- or part-time status. At Marion Technical College near Columbus, qualifying students can get a second year free.
Some programs for low-income students have proven successful but too expensive for colleges.The National Center for Education Statistics reported that for the 2014–15 academic year, the average spent on undergraduate tuition, fees and room and board was about $16,00 at public institutions, $42,000 at private nonprofit institutions and $23,000 at private for-profit institutions.