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Do Debt-Free College Programs Really Work?

While research shows they can boost enrollment, there is not enough evidence to determine effects on two- and four-year completion rates.

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The cost of college is shaping up to be a key policy debate as Democratic presidential contenders continue to roll out proposals on college affordability.

But while campaigning on a national program to address student debt is a relatively new political strategy, many of the proposals put forward by White House hopefuls are not.

Seventeen states have already passed an array of tuition and debt policies — referred to as promise programs — to create more opportunities for underrepresented students, according to a recent report released by the National Conference of State Legislators (NCSL).

The obvious next question for voters to consider: Have these programs worked?

It’s not clear. Study author Bennett Boggs says his research shows several initiatives boosted enrollment, but he cautions there is not enough evidence available to determine whether those programs also boosted two- and four-year completion rates.

The existing state programs, as well as the proposals from presidential candidates, range in structure: Some are “debt-free” programs that cover tuition and other associated costs, while others are “last dollar” programs that only pay for the remaining tuition balance after other grants have been applied. Without more information on completion rates, it’s difficult to say what the impact of a national promise program would be — and to judge which proposals would be worth the return on investment.

To gain a better understanding of which initiatives are working, Boggs said we need to track who graduates from associate’s and bachelor’s programs.

If we don’t address the other barriers to completion besides cost — and there’s significant research to show there are large barriers for veterans, students of color, first-generation students and others — cutting tuition might not help as much as we think it will.
Chase Sackett Arnold Ventures policy and advocacy manager

Another wrinkle is that tackling tuition alone probably will not solve all the problems with the current system, according to Chase Sackett, Arnold Ventures policy and advocacy manager.

“If we don’t address the other barriers to completion besides cost — and there’s significant research to show there are large barriers for veterans, students of color, first-generation students and others — cutting tuition might not help as much as we think it will,” Sackett said.

In the report, Boggs noted that most existing promise programs are last-dollar initiatives intended to help low- or middle-income students attend community college. Many have added basic requirements for minimum grade point averages or credit accumulation to create incentives they hope will lead students to better academic records and greater success after school.

Though they may be well-intentioned, those requirements can actually become an issue if they aren’t communicated well to students. And “limiting students to two-year institutions denies many students the opportunity to obtain bachelor’s degrees that are associated with substantially better employment opportunities and greater financial earnings than associate degrees,” Boggs said.

<15%
Proportion of low-income students who get a four-year degree
60%
Proportion of wealthy students who get a four-year degree

That could potentially worsen stratification in the higher education system. Research by Third Way, a left-leaning think tank that studies higher education, shows the biggest opportunity gaps appear in completion of four-year programs. Less than 15 percent of low-income students get a four-year degree, while about 60 percent of wealthy students do.

Degrees from four-year programs cost more however, leaving policymakers with a balancing act when it comes to access and outcomes, said Kelly McManus, who leads Arnold Ventures’ higher education advocacy work. Coupling tuition programs with evidence-based initiatives to help students navigate college could help boost enrollment and completion, but such initiatives also require funding.

“The upside of debt-free programs is we limit the risk that a student will leave with debt but no degree. But that could come at the expense of investing in programs that have been shown to help students graduate and secure higher paying jobs,” McManus said.

As the idea gains traction nationally — despite the lack of evidence on outcomes — Boggs proposes several principles to direct resources toward students who would benefit the most from financial support. They include covering fees, tuition, and living expenses to ensure low-income students can enroll; including four-year institutions; limiting eligibility requirements; and tracking data about graduation, employment, and more.

The goal, he said, is to avoid “a scenario where more students are enrolling in college through promise programs but degree attainment and employment success rates don’t budge.”