A state-federal partnership to cover college costs

A Senate bill introduced last week aims to create a state-federal partnership that provides a dollar-for-dollar federal match to state higher education appropriations in exchange for a commitment to help students pay for the full cost of attendance without having to take on debt.

Sen. Brian Schatz (D-Hawaii), who introduced the Debt-Free College Act last Thursday with support from 32 other Democrats, said the bill would restore a path to affordable college by providing states incentives through matching grants to increase investments in public higher education and provide students with debt-free college.

In addition to covering tuition and fees, the bill would provide Pell Grant students at two-year and four-year public colleges with financial aid for books, transportation, housing and other costs, which are often a financial barrier for many students, especially at community colleges.

“After the recession, states cut their investment in public education while college costs continued to rise,” Schatz said in a press release. “We’re at a point now where the full cost of college is more than twice as much as tuition, which is why solutions to the student debt crisis need to focus on the full cost to students and their families. My bill brings states back to the table and leverages federal dollars to reinvest in public education and help the people who need it most.”

States’ role

States that participate in the partnership would commit to maintaining funding for public two- and four-year colleges and providing need-based grants to cover students’ cost of attendance that their families cannot afford, with the goal of advancing debt-free college for all in-state students within five years of joining the partnership, according to the public policy organization Demos. The partnership also would allow participating states to allocate a portion of their federal grant (up to 10 percent) toward building capacity and improving educational quality, such as increasing class offerings, investing in student support services, and repairing campus infrastructure, all of which would benefit long-underfunded community colleges, in particular.

Beyond tuition and fees, the total cost of attendance — room and board, books and supplies and other expenses — has prompted 44 million Americans to take on debt to cover their financial need, according to Schatz. College debt has increased 170 percent since 2006 and now exceeds $1.4 trillion, which is second only to mortgage debt and surpasses even credit card debt.

The bill also would open Pell Grant eligibility to Dreamer students and repeal suspension of eligibility under the Higher Education Act for drug-related offenses. It has been referred to the Senate Committee on Health, Education, Labor and Pensions.

An economic boost

Democrats who support the bill noted the importance of education’s role in developing the skilled workforce U.S. companies need to stay economically competitive.

“College costs and student loan debt are holding back an entire generation and creating a drag on economic growth for our country,” Sen. Tammy Baldwin (D-Wisconsin) said in a statement. “We must embrace solutions like the Debt-Free College Act to help America’s students and ensure that higher education is a path to prosperity, not a path into suffocating debt.”

Earlier this month, Baldwin reintroduced the America’s College Promise Act, which would create a new federal-state partnership to provide two years of tuition-free access to community or technical college programs that lead to a degree or industry-recognized credential.

Commentary: An opportunity for low-income students to earn a debt-free degree

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