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College Tuition Costs Jump

Educators blame declining state support

By Mark Huffman
ConsumerAffairs.com

October 20, 2009

Tuition costs at the average four year public college rose 6.5 percent, to just over $7,000, according to a report by the College Board. The board attributed the hike in tuition costs to declines in state support and endowment declines.

The financial difficulties facing households across the nation are putting increased pressure on financial aid budgets, the report said. Although grant aid also rose significantly in 2008-09, the latest year for which data are available, student borrowing continues to increase, as does the gap between available resources and the overall cost of attending college.

Trends in College Pricing 2009 and Trends in Student Aid 2009 provide insight into how colleges and universities and their students are grappling with recent economic pressures.

"It is vital that we assure access to a high-quality college education for all students," said College Board President Gaston Caperton. "While a college education is critical to long-term financial security, it feels out of reach to many students and families in today's economy."

Colleges want more aid

Caperton said states and institutions must increase their efforts to reduce costs and to prevent tuition from rising as rapidly as it has in the past.

"We must provide generous financial aid for those who most need the funds and help students and families to understand the wide array of options available to them in our diverse educational system," he said.

The average published price of tuition and fees for in-state students at four-year public colleges in the U.S. is $7,020 in 2009-10, $429 higher than a year ago. After adjusting for inflation, the average net price paid for tuition and fees by public four-year college students overall is lower in 2009-10 than it was five years ago -- but higher than it was last year.

Like published prices for tuition and fees, expenses for food, housing, books and supplies, and other living costs continue to rise more rapidly than the rate of inflation, and only at public two-year colleges does grant aid for the average student stretch beyond tuition and fees.

Community colleges a better value

In the private not-for-profit sector, tuition and fees average $24,040 at baccalaureate colleges, $23,700 at master’s universities, and $32,349 at doctorate-granting universities. About 19 percent of full-time private college students are enrolled in institutions with published prices below $18,000, and 20 percent attend institutions with prices $36,000 or higher.

Grant aid increasing 3.4 percent per year

About two-thirds of full-time undergraduates receive grants. In 2008-09, they received an average of $5,041 in grant aid per full-time equivalent student, supplemented by $4,585 in federal loans. Forty-one percent of all grant aid to postsecondary students was provided by colleges and universities, 32 percent by the federal government, 11 percent by states, and 16 percent by employers and other private sources. Over the decade from 1998-99 through 2008-09, grant aid per undergraduate student increased at an average of 3.4 percent per year after adjusting for inflation.

In 2007-08, public four-year institutions distributed about two-thirds of their institutional grant aid without regard to financial circumstances. Students from families with incomes below $32,500 received an average of $700 in non-need-based and $830 in need-based institutional grant aid, compared to $940 and $300, respectively, for those from families with incomes between $60,000 and $100,000. Students at private not-for-profit four-year institutions receive significantly more institutional grant aid than do those at public colleges and universities, and the patterns of that aid differ considerably at institutions with different prices.

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