PRIVATE COLLEGE STICKER PRICES JUST CONFUSE PEOPLE
Stephen C. MacDonald – We are in a time where families are questioning expenses and making cautious decisions about spending choices – those choices include evaluating college costs.
This past winter, education trade publications and newspapers in the Boston area published a story about college tuition sticker prices. In summary, the stories said that more than a dozen colleges and universities in the greater Boston area had tuition sticker prices of more than $50,000 per year.
What would you think if you saw a story with a headline “50-Thousand Dollars?” You would naturally assume that it costs fifty grand to send your son or daughter to one of those schools. But you would be wrong. Most students pay much less because most students get institutional grants, scholarships, and other forms of financial aid.
But you can’t blame people for thinking that way. Higher education has a baffling pricing structure. Many people (and some journalists) never get past the sticker price. The other strange part about paying for college, at some schools, is that you may be accepted in December but not find out what you are expected to pay until March.
In the early 1990s at Lebanon Valley College we had a president, the late John Synodinos, who tried to fix this. Parents, he believed, should know at the time of their child’s acceptance how much it was going to cost them.
“You wouldn’t buy a winter overcoat this way, “John said. “You wouldn’t buy a coat in December and wait until March to find out how much it is going to cost you. You shouldn’t have to buy a college education that way, either.”
So John and his senior staff came up with a solution that rewards good work and is elegant in its simplicity. We still use it today. Students in the top 10 percent of their high school class earn a half-tuition scholarship. Our tuition, our “sticker price” this year is $30,910. So students in the top tenth of their high school class get a scholarship worth half of that: $15,455.
Those in the top 20 percent of their high school class earn a scholarship that is worth one-third of tuition. That amounts to a grant of $10,303. And students in the top third of their high school class get 25 percent off tuition, or an automatic grant worth $7,728. This is before any additional financial aid is awarded and also deducted from tuition. In fact, 95% of our full-time undergraduates receive an LVC scholarship.
Implemented in 1992, this plan presented students and their families with a clear measure of what they would have to pay to attend this college. They didn’t have to wait weeks or months for the financial aid office to figure it out to the last penny. At the same time it rewarded students for the work they did in high school. Response was favorable, immediate, and nearly overwhelming. The Washington Post devoted an editorial to the plan called “Incentives to Get an A.” Some years later, “ABC World News Tonight” did a segment on it.
Most important, our enrollment has more than doubled since 1992. And one reason is that we gave people an easy way to see beyond the false limitations of the sticker price. Today, our financial aid program remains distinctive in higher education.
Though they don’t do it the same way as Lebanon Valley College does, all private colleges and universities today devote significant resources to student financial aid. Those students and families who pay who pay full price are relatively few. How many parents and students, however, know this? How many see the tuition sticker price and conclude that private college is not for them? Whatever the number, it is too high.
I urge parents and students to look beyond the sticker price and consider the advantages of attending a private college or university. Private colleges and universities offer the best four-year graduation rates among Pennsylvania post-secondary institutions, and their generous financial aid packages make them surprisingly affordable.
Stephen C. MacDonald is president of Lebanon Valley College in Annville, PA.
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