Third in a series 

THIS ISSUE BRIEF is part of a series examining a variety of controversial local and national issues, focusing on specific policy proposals that are under active consideration. The premise of these essays, as outlined here and here, is that many important public policy issues are more complicated than the most fervent adherents to either side usually acknowledge, a dynamic that often hinders our ability to engage in thoughtful debate. 

For each proposal in the series, I will provide some basic background, with a high-level framing of the disagreement and the polarized “bumper sticker” arguments on both sides. I’ll then present what I believe to be the most reasonable evidence-based cases, pro and con. Each issue brief will conclude with reflections on possible avenues for finding common ground or higher ground and some basic data points, with links to useful resources, to help facilitate a rational and civil dialogue, ideally leading to agreement or at least understanding, if not in the halls of power, then maybe just around the dinner table. 

The Proposal: 

Eliminate tuition and fees for degree programs at community colleges for all in-state residents, regardless of financial need.

Background:

Community colleges are publicly funded higher education institutions, offering two-year associate’s degrees and a variety of non-degree certificates related to occupational programs. In general, community colleges are open enrollment, with few admission requirements, except for specialized programs. Many students attend community colleges, rather than four-year institutions, at least to begin their college experience, because of their relatively low cost, flexible schedules, and logistical convenience. 

Sticking Points and Bumper Sticker Arguments:

The debate on whether community college should be free revolves around differing perceptions of fairness in terms of who pays for and who benefits most from post-secondary degrees.

College is a Right!: The advocates for free community college often rely on an argument that higher education should be considered a “public good,” which ultimately benefits society as a whole and should therefore be paid for by taxpayers, not just students and their families, just like K-12 schools. Although this argument is sometimes extended across the entire spectrum of higher education, the priority is community college, which is open to all and can provide an essential leg-up, especially for many lower-income students of color.

Get a Job!: The advocates on the other side argue that since not everyone goes to college, people who choose to work full-time after high school should not be required to subsidize, through tax payments, those who choose instead to continue their studies. Equally important, if college is supposed to enable higher earnings over time, then the college students who benefit should have to put their own “skin in the game.”

AN EVIDENCE-BASED CASE IN FAVOR:

Educational attainment beyond high school is increasingly a prerequisite for career success and overall economic competitiveness. Lumina Foundation estimates that 60 percent of all jobs today require a “credential of value” beyond high school, including associate’s degrees and non-degree certifications, but only 54 percent of working adults hold such credentials. According to a report from Georgetown University’s Center on Education and the Workforce, over 70 percent of all jobs by 2031 will require some amount of education beyond high school, with 55 percent requiring at least an associate’s degree. 

These forecasts are part of a steady trend that is even more important for access to good-paying jobs with the potential for long-term career advancement. Moreover, given the concentration of knowledge-based industries in Massachusetts, filling the credential gap is more important in the Commonwealth than almost any other state.

Sometimes an associate’s degree is enough to sustain a successful career and other times it is the first step on a longer educational journey that leads to further credentials. Either way, community colleges provide an essential on-ramp into the skilled labor force and are an essential resource for employers who are desperate for qualified human capital.

Equally important, since community colleges serve a disproportionately low-income and diverse student population, they play a crucial role in mitigating educational disparities that underlie our persistent challenges with income inequality and racial and ethnic inequities. 

Despite the growing need for the educational opportunities community colleges provide, enrollment in these institutions has declined precipitously over the past decade, made worse with the onset of the COVID-19 pandemic. There are many reasons for this trend, including overall demographic shifts, but one consistent barrier to access and, importantly, completion is the cost of attendance – or sometimes the perceived cost of attendance.

As a result of recent increases in financial aid at both the state and federal levels, most low-income students can fully cover the cost of tuition and fees with need-based scholarships.  But many students aren’t fully aware of how much aid they’re eligible for, since the financial aid procedures can appear daunting, especially for first-generation college students. Free community college simplifies the message.

Most community college students who are above the income threshold for federal Pell grants don’t have much disposable income either, so even the relatively low level of tuition and fees can seem insurmountable. In all cases, the non-instructional costs of attending college can be a deal breaker, from transportation, to childcare, to forgone wages.

Several other states are already experimenting with no-cost community college and the initial results are promising. For example, when the Tennessee Promise program was implemented in 2015, first-time, full-time community college enrollment jumped by 45 percent and the three-year graduation rate for that first cohort of Promise students was significantly higher than the overall average.

Finally, given the relatively low cost of community colleges, their large percentage of low-income students, and the current availability of “last-dollar” need-based scholarships (i.e., MassGrant Plus), the incremental cost to the state to provide additional financial aid to make community college free for all students would be modest in the context of the state’s higher education budget. An analysis conducted by EY/Parthenon in 2022 for the Massachusetts Board of Higher Education estimated that fully covering tuition and fees at community colleges, regardless of a student’s financial need, would add $54 million to the state’s scholarship budget, an increase of about 30 percent over the FY23 appropriation but less than 3.4 percent of the total higher education spending by the Commonwealth.

AN EVIDENCE-BASED CASE OPPOSED:

As valuable as community colleges are to students and employers, their track record of performance is mixed at best. Six-year graduation rates are low at about 30 percent.  Even when taking into account students who start at a community college and then transfer to a four-year institution, the numbers are discouraging. A federal study of Massachusetts Pell grant recipients who first enrolled in a community college, showed that 28 percent transferred to a four-year college, but fewer than half ultimately earned a bachelor’s degree.

Making community colleges free may not have much impact on these results. Indeed, by further reducing or eliminating the cost-barrier, more students are likely to enroll on a part-time basis, without a firm commitment to completing a degree and often without adequate academic preparation, a trend that could drive these statistics down even further.

Importantly, making community college free to students doesn’t provide any direct financial benefit to the colleges themselves, since it just replaces tuition and fee revenue with additional government funding. Colleges only benefit to the extent enrollment increases, producing additional net revenue through better utilization or economies of scale.

Equally concerning, if the state and federal government are picking up virtually the entire operating budget for community colleges, without any contribution from students, there will be much less consumer accountability, since the (paying) customer would become the government, not the students themselves. 

This shift in paying power would not necessarily be a good thing for the colleges, either, since the government would have a more direct interest in how dollars are being spent on campus. Today, the Legislature and the Department of Higher Education pay little attention to college budgets or operations, but that would inevitably change if they were fully picking up the tab. It would also raise the specter of greater fiscal unpredictability, since state budgets tend to be cyclical and can often include eleventh hour cuts to individual line items as part of a larger budget negotiation. Without the ability to collect tuition and fees from students, state spending cuts could prove highly disruptive.

Another likely consequence of making community college free for degree-seeking students is that it could cause an enrollment shift away from public and private four-year colleges, which would not have such generous government-funded aid packages. For many students, especially from low-income communities, going to a more inexpensive college is often seen as the highest priority. Unfortunately, this can result in “undermatching,” whereby a student passes up an opportunity to go to a more selective college with a stronger track record of ensuring first generation or high-need students graduate on time.

At the same time, since most free community college initiatives only apply to degree-seeking students, these programs  may undermine student interest in unsubsidized, non-credit workforce development offerings, which in many cases may be a better fit and a more direct path to economic self-sufficiency and mobility.

POTENTIAL FOR COMMON GROUND OR HIGHER GROUND:

There is little argument that low-income students should receive financial aid, up to fully covering all tuition and fees at community colleges. The disagreement tends to arise when deciding where to draw the line on income eligibility and whether to add additional stipends to cover other costs.

This is ultimately a conversation about fairness, such that students who can afford it pay their fair share and workers who don’t go to college aren’t stuck subsidizing those who do. The other part of the argument has to do with return on investment, specifically, whether free community college will likely yield more well-prepared graduates, a stronger workforce, a more competitive economy, and eventually more tax revenue to offset the added subsidy.

There may be a variety of creative approaches at both the two- and four-year college levels that could increase financial aid, while addressing these concerns. For example, instead of additional grants or loans, students could sign income-share agreements, capping their debt burden as a manageable percentage of their future earnings, while providing an upside benefit to their colleges if their post-graduate earnings are high.

Another option might be to provide new fiscal resources and incentives to the institutions themselves to increase graduation rates through better and more proactive student support systems, including more generous, but flexible, financial aid funds to encourage persistence and on-time completion. Of course, simplification and better communication at the state level, would also go a long way in maximizing access to existing aid resources.

The bottom line is that states and their higher education systems could rigorously evaluate multiple strategies to see what works best and under what circumstances, not only to address equitable access and affordability, but also to improve outcomes.

Jim Peyser served most recently as Massachusetts secretary of education under Gov. Charlie Baker.

Data:

Massachusetts Public Community Colleges

  • Number of community colleges:  15
  • Community college enrollment (annual headcount for FY23): 90,620 (down from 137,731 in FY14)
  • Percent of part-time students: ~60 percent
  • Percent of students who are Black or Latino: ~40 percent
  • Average student age:  mid-20s
  • Weighted average full-time tuition and fees, before discounts or financial aid: ~$7,100
  • Percent of students eligible for need-based federal Pell grants: ~45 percent
  • Average annual Pell grant award: ~$4,900
  • Percent of degree-seeking students transferring to a four-year college: ~30 percent
  • Percent of degree-seeking students graduating within 6 years of enrolling: 39 percent (30 percent from original community college, 7 percent from a four-year college, 2 percent from a different community college)

Sources & Resources:

Massachusetts Department of Higher Education Data Center (https://www.mass.edu/datacenter/home/home.asp)

Integrated Postsecondary Education Data System (https://nces.ed.gov/ipeds/)

Education Data Initiative’s Pell Grant Statistics (https://educationdata.org/pell-grant-statistics)

Lumina Foundation Report on Educational Attainment Trends (https://www.luminafoundation.org/resource/stronger-nation-ten-findings-on-u-s-educational-attainment-trends/)