Report: Community College May Not Lower Price of Degree

Students in between classes at Austin Community College.
Students in between classes at Austin Community College.

Knocking out the first two years of a four-year degree at a community college is a popular way for students to try to keep the price of higher education manageable. But a new report has found that students who opt for that route tend to borrow as often and as much as their counterparts who start off at a four-year university.

The report, “A Brief Look at Transfer Students and Financial Aid,” was put together by TG, a nonprofit corporation established by the Legislature in 1979 to provide Texas students and families with information and services to help with the financing of higher education. (For example, they recently rolled out this nifty new debt-to-income calculator.)

Using national data, Carla Fletcher, a senior research analyst at TG and the report’s author, found that for students who borrowed money to finance their education, the median amount of student loan debt accumulated was approximately $20,000, whether they had transferred in or started at the university. At private institutions, transfer students finished with roughly $27,000 in debt, compared with $25,000 for students who were there on Day One.

“People have this idea that they are somehow going to save money because they go to community college,” Fletcher said. “But it looks like people end up borrowing about the same.”

She noted that many students who begin work on their bachelor's degree in community college see their savings erased at the university level, where — particularly at private institutions — they tend to receive less grant aid than students who followed a more traditional route and subsequently have to borrow more money.

 

Jeff Webster, TG’s assistant vice president for research and analytical services, noted that the burden might be mitigated somewhat in Texas, where private institutions tend to be more affordable. But for Texas universities, he still said he expects the report to be “a bit of a wake-up call.”

“As we talk about all the issues related to transfer, one thing that hasn’t quite been worked out is the level of debt incurred by students,” he said.

Fletcher also noted that, nationally, only about one-third of community college students who plan on transferring manage to do so within three years. In the report, she concludes that going the community college route “may end up creating a significant barrier for some students, but without the benefit of lower debt for those who transfer successfully.”

Options for easing the transfer process are likely to be discussed in the Legislature this spring.

House Higher Education Chairman Dan Branch, R-Dallas, has filed House Bill 30 in an effort to bolster transfer compacts between community colleges and universities.

“This bill is meant to say, ‘Hey, we don’t need to have a lack of clarity in that process,’” Branch said at a November TribLive event at Texas A&M University. “We need to have it as simple as possible.”

He said he wants to ensure that students seeking to transfer “don’t have a lot of confusion and a lot of gamesmanship where they thought they were going to get credit but now they only get credit for an elective.”

Another bill, HB 82, filed by state Rep. Ruth Jones McClendon, D-San Antonio, would create a common course numbering system for all higher education institutions in the state and could also ease the transferring process.

According to the TG report, changes to university policies regarding financial aid may also help to ease the burden on transfer students.

Steve Johnson, spokesman for the Texas Association of Community Colleges, said the report “points to the disconnect we have in financial aid policy at the state and institutional level for transfer students.”

“Community colleges are the less expensive option for the state and student,” he said. “So the goal should be to continue to emphasize this route and create effective financial aid policies at the universities for transfer students so they are not forced to take out more in student loans.”

 

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