Can No Tuition Up Front Be a New Model For College?

Fed up with the state’s disinvestment in higher education, John Burbank, a Seattle based liberal policy analyst and executive director of the Economic Opportunity Institute, has come up with a plan to help students finish their degree without going into debt.

The high cost of college education led Burbank to a proposal for universities to charge nothing upfront as along as students agree to share a small part of their future income. Burbank shared his idea with Rep. Larry Seaquist, who liked the idea but had no way to put money into the plan.

Students at Portland University heard about the idea and used it as a basis for a semester project in fall 2012. They then presented the project to Oregon state lawmakers who were also fond of the idea.

In 2013, the Oregon Legislature unanimously passed legislation to study what it called the Pay Forward, Pay Back program. The passage in Oregon put the plan in the spotlight, prompting a handful of states to consider similar proposals and drawing interest from Oregon’s congressional delegation.

According to Annaliese Davis of The Olympian, Democratic Senator Jeff Merkely proposed that the federal government would provide 90% of the program’s funding and the state would provide 10 percent. The idea has now been brought back to Washington by Seaquist, who says that due to tuition hikes, and underfunding of state grants, the proposal should be a priority.

 House Bill 2720 would create the Pay it Forward program, which would allow students to skip tuition if they sign a contract agreeing to later pay a small percentage of their income for a set number of years.

The bill states that the Washington Student Achievement Council will select five public highs schools to participate in the program. These students would enroll in Pay it Forward and pay nothing upfront for higher education.

Two years after graduation, or discontinuing the university, students would begin repaying the state. The payments would reimburse tuition costs without charging interest. The payments would fluctuate with the student’s income, and students would pay state universities no more than 5%, regional colleges 3.5% and vocational schools 2%. Repayment could last up to 25 years depending on income level and education costs.

The program would rely on money set aside by legislation in a trust account. State budget analysts cannot estimate how much would be needed until they have an idea of how many students would enroll. The money collected from graduates would go back into the trust to keep the program going. A representative from Economic Opportunity Institute and Seaquist estimate the start up costs to be between $1-2 million.

Others are more concerned. Director of state relations at Washington University Chris Mulick says the priority should be funding the state’s need grant and College Bound programs.

Julie Garver, director of government relations at The Evergreen State College, said the state does not need another form of financial aid, but education about options that are already available to students.

Supporters of the Pay it Forward program say their plan will not replace the state’s current financial aid program, and legislature is considering adding more money to the state need grant program.

 “I do not want this program to replace all of our other need grants or other programs,” said Rep. Larry Haler. “It’s considered another tool in the box for those students who can’t afford (tuition) at this time, and it offers the promise of college and the ability to eventually pay it off and become very productive citizens.”

Rep. Gerry Pollet says the average student in Washington has more than $23,000 in loans and that the current model is not working.

House Bill 2720 is awaiting a hearing and Seaquist says if it does not pass, he will continue to work at lowering tuition cost and rethinking financial aid.

02 11, 2014
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