The state grants and scholarships that made it possible for the neediest students to obtain a degree have dried up, just as the families of those students contend with stagnant wages that make it difficult to cover costs.
“No state will be able to really meet their projected workforce needs unless they educate these low-income students. That realization just hasn’t hit yet,” said Joni Finney, director of the Institute for Research on Higher Education at the University of Pennsylvania and a co-author of the study.
Maryland lawmakers made a concerted effort before the downturn to boost the state’s investment in higher education, pumping money into need-based grants and passing a corporate income tax that was used to stabilize revenues at colleges and universities. State officials and university presidents worked together to freeze tuition at four-year institutions even as the recession took hold and other states started raising tuition to offset budget cuts. Yet as the downturn wore on, the state retreated from providing as much need-based financial aid as it once did, leaving students to pick up more of the costs.
While Maryland provided an average of $426 per student in need-based aid in 2007, by 2013 that amount had fallen to $345 per student, below the national average of $474, according to the study.
Though the study ranks Maryland sixth in college affordability, researchers say the state is losing ground. Families earning less than $30,000 would have to pay 60 percent of their annual income to cover the cost of attending a public four-year university in Maryland. Even community colleges in the state are becoming less affordable, as low-income families would have to hand over 40 percent of their wages to attend, according to the study.
“Maryland really held it together on college affordability for a long time,” Finney said. “Some of that is unraveling, and once it unravels, it’s very hard to put back together.”
The Maryland Higher Education Commission did not immediately respond to requests for comment Wednesday.
Across state lines in Virginia, the prospects for low-income and middle-income students affording the state’s public colleges and universities look grim, according to the study. Virginia ranks 26th in the nation for college affordability because of the state’s paltry investment in need-based financial aid. Students would have to work 44 hours a week to cover the cost of full-time enrollment at Virginia’s public research universities, or 20 hours a week to cover the cost of getting a degree at a public two-year institution.
Virginia provides $315 per student for need-based aid, far below the $474 national average, according to the study.
“Virginia has been making a significant investment in merit aid,” Finney said. “A lot of states like to do this, especially in the south, but what we’re doing is providing money for students who would go to college anyway.”
State policy decisions have contributed to a seismic shift in the way Virginia’s public colleges are funded in just the past 26 years. Tuition made up less than a third of total education revenue at the commonwealth’s schools in 1989; tuition accounted for 62 percent of the money schools needed to educate students last year, according to the State Higher Education Executive Officers Association (SHEEO).
Virginia’s higher education spending, like many other states, historically rises and falls in lockstep with the economy. The collapse of the financial markets in 2008 led to a steady decline in funding, but as the economy rebounded, higher education funding did not keep pace. Virginia now spends $1,870 less per college student than it did in the 2007-2008 academic year, according to the Center on Budget and Policy Priorities, a think tank.
But the state is in the midst of a turnaround. In the last legislative session, Gov. Terry McAuliffe (D) pushed the legislature to pour money back into need-based financial aid and the operating budgets of state colleges and universities. The $24 million in need-based financial aid was the largest increase in a generation, said Peter Blake, director of the State Council of Higher Education for Virginia.
“This alignment of state appropriations, financial aid and low tuition and fees will help students have broader access to higher education regardless of their ability to pay,” he said. “While we’d rather be No. 1, instead of 26, the kind of support the governor and general assembly provided in this last session play to a more optimistic future.”
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