Free Community College: Proceed With Caution

In the fall of 2014 Tennessee Governor Bill Haslam launched a higher education completion agenda dubbed the Drive to 55. The initiative set the goal of having 55 percent of all Tennesseans 25 years of age or older possess a postsecondary credential by the year 2025. One key component of the Drive to 55 is called the Tennessee Promise. This is a last-dollar scholarship for students to earn an associate degree or pre-degree certificate from a community college, college of applied technology, or a four-year university. The scholarship is capped at the level of tuition and required fees at the community college which is currently about $4,000 per year. Before the Tennessee Promise kicks in, however, the following student aid must be applied to the student’s account: the Federal Pell Grant, the state’s need-based aid grant, and the state’s merit scholarship. The remaining amount, if any, is then paid for by the Tennessee Promise.

The start of Tennessee Promise did not come without sacrifices. Freshman and sophomore merit scholarships for university students dropped from $4,000 to $3,500 per year in order for the community college scholarship to go up from $2,000 to $3,000 per year. This approach cut aid for students choosing to attend a university and may unnecessarily shift the enrollment toward the community colleges. University students could get their reduced aid back during the final years of eligibility if they can attain the 3.0 GPA renewal requirement. However a majority of university students will lose the scholarship completely because they do not meet the renewal requirements by their third year.

The Promise was implemented without a good understanding of where low-income, first-generation students go to college. It was started with the assumption that community colleges serve as the only gateway to postsecondary education for this population. In reality many public and private non-profit universities also play a key role. In Tennessee, the average percentage of students receiving Pell Grants at Tennessee’s community colleges is 47 percent. It is 50 percent among the Tennessee Board of Regents universities and 42 percent among the non-profit private universities. There are fifteen private universities with a higher percentage of Pell recipients than the average proportion at Tennessee’s community colleges.

The Tennessee Promise may lure many highly qualified students to begin their college careers at a community college when they would actually be better served by enrolling in a university. The risk of this enrollment trend is called “under-matching.” The six-year completion rates for Tennessee’s community colleges hovers around 30 percent as compared to over 60 percent at the non-profit private universities. That’s right, within six years students are twice as likely to graduate with a four-year degree from a private university than with a two-year degree from a community college. If you look solely at full-time students the rates change to nearly 60 percent for community colleges and 90 percent private universities.

The more transitions, such as transferring from one college to another, a student faces in their academic career the less likely they are to graduate. Research by the Federal Advisory Committee on Student Financial Aid found that highly qualified, low-income students who begin at a community college with the intention of getting a four-year degree are unlikely to do so even after ten years. This finding could have devastating implications on the four-year degree attainment rate in Tennessee for decades to come and is counter to the desired outcomes of policy makers.

In addition, the Tennessee Promise seems to target the wrong demographic. The Promise is not a need-based student aid program. Consequently, many high-income students who can easily afford the $4,000 per year cost for a community college will be eligible for the funds. Since the program is a last-dollar scholarship, very few students will actually receive any cash. The Pell Grant already covers all the direct costs for low-income students and the state’s merit scholarship program provides $3,000 in aid for those students who qualify. So basically those students who are not poor enough to get Pell and not academically prepared enough to qualify for merit scholarship will benefit the most from the program.

Whereas the goal of the Tennessee Promise is to increase the number of credentials in Tennessee its focus is on training, not education credentials. This is a short-sighted economic and community development strategy. More often than not, training workers with certificates and two-year degrees has limited impact and focuses on high-paying jobs rather than high-paying careers. Not long after the completion of a pre-degree certificate or an applied associate degree, workers will need to have their training updated. In contrast, a four-year degree teaches the student process skills such as lifelong learning, inquiry, critical thinking, collaborative problem solving, and effective communication skills. University degrees result in entrepreneurial innovation which serves to sustain and grow an economy over time. These graduates also help to create vibrant cultures where economies can flourish.

Is there a good side? Absolutely. There has been no other time in recent Tennessee history that the talk about going to college has been so prevalent. The Promise has migrated the college-going discussion from the counselor’s office to the kitchen table. No doubt the program will increase enrollments at Tennessee’s community colleges. Too, it will boost the quality of the workforce pool for manufacturing and other entry level positions. Yet it takes both the colleges and universities to attain the goals of the Drive to 55.

Other states considering a similar policy shift need to proceed with caution. Implementing such a program comes with risks. It may take a decade or more before Tennessee fully realizes the costs and benefits of such a policy shift. Policy makers should be deliberative and inclusive in the design and implementation. Bottom-line? Do no harm, and make sure all higher education partners are empowered to attain the higher education goals of the state.