A Senate hearing on efforts by states to make college more affordable highlighted several initiatives that Sen. Tom Harkin (D-Iowa), chair of the Health, Education, Labor and Pensions Committee, said he hopes can be replicated more broadly.

These initiatives are likely to receive more attention next year, when Congress begins to work on reauthorizing the federal Higher Education Act.

At Thursday's hearing, Harkin expressed urgency in addressing the soaring cost of higher education. When it comes to increasing affordability, “states still have a primary role to play,” he said.

Harkin cited several areas where states can take the lead, such as setting performance goals, redesigning financial aid to target those most in need, establishing statewide articulation policies and  promoting accelerated learning opportunities to get students through school faster.

Shifting the burden

One state that has taken the lead in reducing students’ cost burdens is Oregon, which has adopted a need-based financial aid program, known as the Shared Responsibility Model, said Camille Preus, commissioner of the Oregon Department of Community Colleges and Workforce Development. The model establishes a four-step approach to affordability, with the assumption that “the student, as the primary beneficiary of the education, bears the first and most significant responsibility for paying for college,” Preus testified, with the other partners—family, federal government and state government—closing students’ “affordability gap.”

The defined student contribution is $5,700 a year for a community college and $8,700 for a four-year college or university. To cover that cost, a student could use whatever option works best, such as working, student loans, savings, private scholarships or work-study programs.

The family share is determined by a financial-need formula based on incomes and assets, family structure and attendance patterns. Families with the most resources are expected to cover the remaining costs, middle-income families pay some of the costs, while those with very low incomes contribute a small amount or nothing.

The same needs-based formula determines how much the federal government contributes, in the form of Pell grants or loans. The state offers Oregon Opportunity Grants when there is a remaining need not covered by the other partners.

Underlying this program is state legislation aimed at encouraging more access to higher education, Preus told the committee. The “40/40/20 goal” calls for 40 percent of adults to earn at least a bachelor’s degree, 40 percent to earn an associate degree or postsecondary credential, and 20 percent to earn a high school diploma.

Performance-based systems

Muriel Howard, president of the American Association of State Colleges and Universities, outlined four strategies states can undertake to make college more affordable:

• Increase their investment in financial need-based aid to students.
• Give public colleges more flexibility on institutional matters, such as setting tuition policies and allowing group-purchasing consortia.
• Set college and career-readiness standards, which would reduce the time-to-degree.
• Establish mission-driven, flexible and equitable performance-based funding systems which would give colleges incentives to cut costs and improve completion rates.
  
David Longanecker, president of the Western Interstate Commission for Higher Education, outlined several promising state policies aimed at making college more affordable. One example, is a performance-funding process adopted by the Washington State Board for Community and Technical Colleges that rewards institutions based on students’ success in achieving various persistence benchmarks.

“While this may not seem like an affordability policy, it is because students who persist at higher rates reach their educational goals quicker and thus more affordably,” Longanecker said.

Another example is the Oklahoma Promise Scholarships program, which covers tuition at any state institution for students from lower-income families who take a rigorous curriculum, get decent grades and stay out of trouble in high school.

The Complete College Tennessee Act (CCTA), passed in 2010, includes several elements aimed at making colleges more outcome-oriented and more efficient, said Tennessee Board of Regents Chancellor John Morgan. The goal is to reduce the time it takes to complete a degree and focus resources on strategies that lead to greater success.

CCTA called for a new formula to allocate state funding to public higher education institutions, Morgan noted. For community colleges, the formula is based on such outcomes as an increased number of degrees and certificates awarded and job placements.