Education experts and university officials are cautiously considering the implications for other institutions after Harvard and Yale universities introduced new plans to reduce costs for low- and middle-income students.
Because the Ivy League rivals are unusual in both elite status and the size of the endowments from which they draw funding,other universities and the public should not assume the schools' plans would be practical across the board,said David Ward,president of the American Council on Education,the coordinating group for higher education institutions.
Harvard and Yale lead the university endowment list with $34.9 billion and $22.5 billion,respectively,for the fiscal year ending June 30.
“I think the tragedy here is that,while I want to applaud Harvard and Yale for what they've done,there is a myopia as to why that matters to the rest of higher education,” Ward said.
On Monday,Yale detailed its plan to cut costs for students by as much as 50 percent and to increase annual spending for undergraduate financial aid by more than $24 million,to about $80 million. Families with incomes under $60,000 would pay nothing toward a child's education,and those with incomes of less than $120,000 would contribute between 1 percent and 10 percent of their income annually. Students still will be expected to pay $2,500 annually,a cut from about $4,000.
In December,Harvard administrators – who in 2006 set a $60,000 bar for zero family contributions – touted a similar “sweeping overhaul” of financial aid policies targeting middle-class students. The school will increase its undergraduate financial aid from about $100 million this year to an estimated $120 million for the 2008-09 school year,said John Longbrake,Harvard senior director of communications.
Stanford,which ranks third on the endowment list with $14.1 billion,created two programs for low- and mid-income students in the past two years and set its income line for zero parental contributions at $45,000,said Shawn Abbott,director of admission. He said it is premature to speculate on the school's reaction to the new plans.
Those plans were music to the ears of Sen. Charles E. Grassley,R-Iowa,who has pressured universities with endowments above $1 billion – more than 60 university systems – to help offset increasing tuition costs.
“Yale's action shows that,despite some squawking,the sky won't fall when universities increase the amount of money they spend from their endowments,and when they do,it can mean big help for families struggling to pay college costs,” Grassley said in a statement Monday.
Not all responses have been so positive. Lynne Munson,an adjunct research fellow with the Center for College Affordability and Productivity,said the schools are still hoarding funds and increasing their payouts by only “a token amount of money” compared to their endowment sizes.
“I think when you are sitting on that amount of funds,the donors have that much for financial aid – they're basically telling you to throw open your doors,” she said.
The education council's Ward said the initiatives certainly are “big in a rhetorical sense,” but he's concerned that other public and private schools' previous efforts to aid low- and middle-class students have been overshadowed by the hulking prestige of Harvard and Yale and their enormous endowments.
That's exactly the point Princeton University spokeswoman Cass Cliatt has fought to make in response to questions about whether her school will roll out a similar program,given its fifth-place spot on the endowment list.
Princeton has not set a defining line for zero family contributions,but in 2001 the school initiated a no-loan financial aid policy. Students who qualify for aid will receive grants to cover what they would otherwise take out in loans. Princeton also increased spending from its endowment and reduced its work-study requirement.
“We did it so early that,now that our peers are catching up,many people have forgotten that,” she said.
Public institutions also have created programs to increase access for lower-income students. The University of North Carolina at Chapel Hill rolled out its “Carolina Covenant” plan four years ago to help students graduate debt-free through a mix of grants,scholarships and work-study.
But most public and private schools don't have the funding to employ such large financial aid boosts,said John Walda,president of the National Association of College and University Business Officers. Public university systems with large endowments,such as the University of Texas and the University of California,have much larger undergraduate populations among which to divide their financial aid. And most private institutions don't have the massive endowments to fund similar programs,he said.
Occidental College in Los Angeles,which has an endowment about 1 percent the size of Harvard's but about the same $35,000 undergraduate tuition,would have a much more difficult time making the same kind of sweeping change,said Brett Schraeder,Occidental's director of enrollment management.
“We're trying to find that balance between what we can feasibly do and what's in the interest of families who are trying to figure out a way to pay for college,” Schraeder said.
Georgetown University in Washington,a private school with about 1,600 undergraduate students,ranks 76th on the 2006 endowment survey published by the college business officers group. Georgetown's endowment totaled $834.5 million,or about $525,000 per undergraduate; Harvard and Yale have more than twice that amount per undergraduate.
Only a handful of schools have the endowment-per-student ratio to make extensive reforms,Georgetown spokeswoman Julie Green Bataille said. “And right now,unfortunately,that's not our reality,” she added.
Occidental's Schraeder said he thinks all U.S. universities would follow in Harvard and Yale's footsteps if they had the resources to do so because all are concerned about over-burdening students financially.
“I think every college is following closely,” he said. “Whether they'll be able to do anything like Harvard or Yale is another question.”