Community colleges comprise nearly a quarter of the more than 360 higher education institutions that are committing to a national effort to be more transparent and clear about their student financial aid offers.
The College Cost Transparency (CCT) Initiative — a task force composed of leaders from 10 higher education associations, including Walter Bumphus, president and CEO of the American Association of Community Colleges — announced Tuesday that the participating higher education institutions (nearly 90 two-year colleges among them) are voluntarily agreeing to follow a set of “principles and standards” around student financial aid offers to make it easier for families and students to understand the often-confusing packages, which can make it difficult to assess the true cost of an institution and to compare the offer with those from other colleges and universities.
The new principals and standards provide some common ground on terminology and clear requirements to include in financial aid offers, said Peter McPherson, chair of the CCT task force and president emeritus of the Association of Public and Land-grant Universities (APLU).
Commitments from colleges and universities to the effort are continuing, and CCT will review and approve those commitments on a rolling basis and update the list of partner institutions accordingly, the organization said.
The initiative, funded by a grant from Strada Education Foundation, will now be managed by the National Association of Student Financial Aid Administrators.
What the principles and standards encompass
According to CCT, the principles and standards provide that financial aid offers to undergraduate students:
- Are transparent, ensuring that costs are understandable for students and families, and include the most accurate estimate possible of a student’s costs.
- Describe and explain all types of aid offered using standardized, plain language.
- Prominently display critical components, such as an estimate of the student’s total cost of attendance, including costs that institutions will pay and costs paid to others; types and sources of financial aid being offered, separated into grants and scholarships, student loans, and student employment or work; an estimated net price; and more.
- Follow U.S. Education Department (ED) guidance with regard to referencing Parent PLUS Loans.
- Provide information about employment requirements and information on job placement, if student employment is offered.
- Explain the terms and conditions and information on how much student loan debt may cost over time, if federal student loans are included.
Nods from the feds
The announcement received kudos from key lawmakers and federal officials, including U.S. Education Secretary Miguel Cardona and Rep. Virginia Foxx (R-North Carolina), chair of the House Education and the Workforce Committee.
“The College Cost Transparency Initiative is a big step in the right direction towards making sure that students and families have the best information during the college application process,” Foxx said in the release.
This spring, Foxx and Rep. Lisa McClain (R-Michigan) reintroduced H.R. 1311, the College Cost Transparency and Student Protection Act, which aims to ensure that aid offers are clear and comparable for students and families by establishing standardized terms and definitions for key information on costs, grant aid and other financing options. It also would require student aid offers to be sequenced so students are first presented the direct costs they must pay to enroll, and then an itemized list of indirect costs they have the option to finance and what resources they have available to do so.
In addition, the bill would require ED to update its College Scorecard to include information on costs, earnings and loan payments so that students can see the total cost of attendance and out-of-pocket costs that students typically pay, as well as direct and indirect costs.