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It’s getting harder for low-income students to afford college, though Minnesota shows hopeful trends

After years of more state investment in need-based aid, moderate tuition increases, and higher family income, the analysis shows schools here have become more affordable.
Photo by Nicole Honeywill on Unsplash
After years of more state investment in need-based aid, moderate tuition increases, and higher family income, the analysis shows schools here have become more affordable.

College may be increasingly necessary, but it’s increasingly unaffordable at a growing number of public schools in the United States. An analysis of more than 1,000 institutions found the average Pell-grant recipient can’t cover the cost of obtaining a higher degree from most U.S. schools even after pooling money from every available source.

The report, by the National College Access Network (NCAN), shows the issue of college affordability goes beyond instances of extreme student debt or isolated admissions scandals. Evidence shows higher education mostly excludes low-income Americans, who can’t access the same schools as their wealthy peers because of the cost. It’s true of prestigious state schools like the ones local kids grow up imagining they’ll attend and it’s also true of community colleges, which are broadly assumed to be a cheap option.


“We are signaling to students ever more clearly that college is an engine of social mobility,” Bill DeBaun, NCAN director of data and evaluation and co-author of the report, told MinnPost. “At the same time, this research is showing us that the options are actually getting fewer. And it’s getting harder to afford college.”

Minnesota is in better shape than other states, according to the report. After years of more state investment in need-based aid, moderate tuition increases, and higher family income, the analysis shows schools here have become more affordable. It’s one of about a dozen states trending in a hopeful direction. But the price tag is still too high for low-income students at most of Minnesota’s two- and four-year schools.

An objective look at affordability is needed, said Meredith Fergus, financial aid research director at the Minnesota Office of Higher Education, which is working on an analysis of its own. State policymakers, especially, should have a clear view of how cost interferes with Minnesotans’ ability to pursue higher education despite their effort to “make the math work.”

‘Sounding alarm bells’

NCAN had heard for a long time that students struggled to find affordable options, DeBaun said. The point of coming up with an affordability measurement – a generous one that “errs on the side of affordability” – is to show state and federal decisionmakers what’s going on in ways that anecdotes fall short of describing.


“We’re sounding alarm bells,” DeBaun said. “If you look at a model and try to be conservative with it and the results you’re getting are still eye-popping … still have quite dire circumstances for students, I think that strengthens the message you can build.”

To measure affordability, NCAN had to simplify a complex set of circumstances. Its calculations are based on the costs and resources for average Pell-grant recipients at each school. Those awards depend on financial need, so the analysis doesn’t consider a scenario where a family doesn’t qualify for the federal program but still can’t afford the cost of school. Of those Pell grantees, it only looks at the average traditional student (someone who would live on campus and doesn’t have a family to care for) who qualifies for in-state tuition at public colleges or universities.

It assumes the student’s family would chip in all of what the federal financial aid formula estimates it could, based on family income. The federal estimate tends to be high, Fergus said. Minnesota has its own definition that she thinks is fairer.

Then NCAN assumes students receive Federal Work-Study, though the program isn’t large enough to accommodate everyone who is eligible. It stands in for any part-time work during the academic year. Separately, NCAN adds wages from a summer job, calculating that a student would be capable of putting all of their earnings, 40 hours a week at minimum wage, toward their next year of school.


That, in particular, is a very generous assumption. It means living expenses aren’t a factor in the interim months (the study estimates 12 weeks) between spring and fall semesters.

Putting it all together, the analysis compares the total cost of attendance at 605 community colleges and 528 four-year universities, plus $300 for emergency expenses, to the sum of average state, federal and institutional grant awards at each institution, the average federal loan disbursement, estimated expected family contribution by average Pell grant, and estimated student wages. NCAN calls the difference the “affordability gap.”

Despite all the ways the model assumes the best-case scenario, the average affordability gap was $2,118 at four-year schools and $453 at community colleges in the 2016-17 academic year.

Nationally, the portion of schools deemed affordable by this measure declined between 2012-13 and 2016-17 – the five-year period NCAN reviewed. The gap between how much the average low-income student could afford to pay and how much school costs widened over the same period.

The results have broad policy implications. Students bear more of the cost burden as the share of revenue from state and federal appropriations declines, and this study makes a case for why that’s unfair. DeBaun said the next step in NCAN’s research is to identify the specific roadblocks that cause problems at state and institutional levels.

How affordable are Minnesota schools?

Minnesotans fare better than the national average in some ways. The affordability gap is smaller. On average, the gap for community college-goers is $67. It’s $1,644 for four-year university students.

Most important, affordability is trending in the opposite direction of most other states. It’s one of just eight states where the portion of four-year schools considered affordable grew over five years and the affordability gap shrank. It’s one of nine states where that’s true of community colleges.

Still, of the 41 schools NCAN reviewed, only 39 percent were affordable. That includes nearly half – 47 percent – of 31 community colleges, which matches the national rate, but just two of 11 four-year schools (18 percent).

Affordability gap by Minnesota institution, 2017
Source: NCAN

NCAN says the University of Minnesota Twin Cities has an affordability gap of $4,456. A university administrator wasn’t available to comment, but the Office of Undergraduate Education took issue with how much the report says Pell grant recipients received in federal, state, and institutional grants. The university says it was $17,797 for the “typical student” in 2016-17, though NCAN reports it averaged $8,760.

Fergus was pleased with the five-year trend revealed in the report because it shows the payoff of some work at the state level. Minnesota spent 65 percent more on state grants in 2016-17 than in 2012-13, she said. Federal aid increased at the same time. Tuition hikes slowed down over that time, too. And family incomes and the minimum wage rose, which would affect estimated contributions from families and summer jobs, though that doesn’t mean families could actually afford to put more toward college.

“Prior to 2009, they would have seen the opposite,” she said. Then, state need-based aid was flat and tuition increased faster. “It’s really kind of cool to see the outcome.”

Her office is working on a way to measure affordability with more detail to demonstrate to policymakers the areas that need work.

The Minnesota version would include private schools, as well as public ones, and would take geography into account. It’s one thing to say 39 percent of Minnesota schools are affordable, but those options aren’t distributed equally across the state. It would emphasize what Fergus called “a reasonableness factor.”

“Higher education is affordable when [students] can afford at least half of their education options,” she said. She means their local options. “You need loans to be reasonable. And you need that expected family contribution to be reasonable.”

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