Massachusetts recently joined the ranks of states and other localities that have made community colleges tuition-free. David Deming, the Isabelle and Scott Black Professor of Political Economy and HKS faculty co-director of the Project on Workforce, is an economist whose research focuses on higher education and the future of the labor market. We asked him about the growing national movement to eliminate community college tuition and how this effort may be reshaping the country’s workforce development policies.
Q: The idea of free community college really gained traction over the last decade, with nearly 30 states now offering a variety of different tuition-free community college plans. As a scholar who has examined the critical role community colleges play in workforce development, what impact have these plans had?
The idea of free community college is not new. In fact, community colleges in many states were free until the 1960s. Even some four-year schools like the CUNY system in New York City and the University of California system were free until about 50 years ago. Ronald Reagan was elected governor of California in 1966 on a platform of charging tuition to UC students in the name of fiscal responsibility.
The basic problem is that colleges have been victims of their own success. A generation ago, 20% of people went to college. Now it’s more than 60%, and the population has expanded substantially as well. The promise of free college is just a lot more expensive than it used to be.
The modern free community college movement really started in 2014 when Republican Governor Bill Haslam of Tennessee signed the Tennessee Promise Scholarship Act of 2014, which provided free tuition and mentoring for recent high school graduates to attend any community college or college of applied technology in the state. A bunch of other states followed Tennessee’s lead, and today about half of all states have some form of tuition-free college program.
Most programs are still too recent to look at longer-run impacts like degree completion and earnings. One exception is a study of an early version of the Tennessee program in Knox county, which found that free community college increases associates degree completion by more than 20%. However, it found no significant impacts on BA completion or on short-run earnings, although the participants were still relatively young to look at labor market impacts.
The bottom line is that these programs clearly increase community college enrollment. Whether they have broader positive economic impacts is still uncertain.
Q: Is tuition the biggest hurdle for students trying to access community colleges across the country? What other hurdles exist?
The main reason so many states have enacted free community college plans is that they don’t cost very much taxpayer money. Why? Tuition is already very low, and more importantly, most states (including Massachusetts) have enacted so-called “last dollar” plans that only kick in after students apply for and receive federal financial aid. To put some numbers to it—average community college tuition in Massachusetts is about $4,500. The maximum Federal Pell Grant is $7,395. Since most community college students are low- or middle-income, and many are young and financially independent, they would already have gone for free even without the new Massachusetts plan.
In my view this makes the Massachusetts plan more valuable, because the advertising value of “free community college” will get many people in the door who would have gone for free anyway. Now they know before they apply for aid, rather than having to fill out a long form and wait for a month or more. These folks are busy and have complicated lives. The administrative burden of applying for aid looms just as large as the financial cost, but knowing that it will be free at the end of the day could make more people take the plunge.
“The primary risk of free community college is that we will focus too much on price, and not enough on quality. … The risk is that the fiscal burden of free tuition will cause legislators to cut appropriations over time.”
David Deming
Q: Is there a concern that these tuition-free programs might inadvertently undermine enrollment numbers and the subsequent viability of some four-year colleges?
Potentially. The evidence I’ve seen suggests that it does divert some students away from four-year colleges, but that the net impact is positive. This is partly because of the advertising value I mentioned above, but also because some community college students who enroll on the promise of free tuition will end up transferring to a four-year school down the line.
The big losers are private institutions, who will lose students to the promise of free tuition in the public sector. In my view this is a good thing, not because private institutions are per se bad (I teach at one!), but because the competitors to community colleges are typically large online for-profit schools that charge high tuition and deliver poor value for money.
Q: Massachusetts was relatively slow in making community college free. In fact, Tennessee has been a national trendsetter in this movement, with policymakers flocking to the state to see how community colleges there attract and retain students. How was this significant expansion of education spending in a relatively conservative state such as Tennessee possible?
Like many other states, the Tennessee Promise program was funded primarily by proceeds from the state lottery. In Massachusetts, the legislative deal that established free community college also allowed the Massachusetts state lottery to move online, which they expect will increase sales and revenue. Some people think lotteries are exploitative, but lawmakers typically think the tradeoff is worth it.
Q: Back in Massachusetts, what steps should policymakers and community college administrators take to ensure the rollout of this tuition-free initiative is a success?
The primary risk of free community college is that we will focus too much on price, and not enough on quality. Community college tuition may be about $4,500 per year in Massachusetts, but the true resource cost of the education is more than double that amount. In other words, the cost of paying the salaries of community college instructors, student support, building maintenance, and everything else is much higher than what can be funded by tuition. The gap is made up by state legislative appropriations—essentially, the taxpayers fund a transfer of tax revenue each year directly to community colleges. Students were paying $4,500 per year to get a $10,000 per year education.
The risk is that the fiscal burden of free tuition will cause legislators to cut appropriations over time. Concretely, this would mean larger classes, less student support, and a lower quality education all around. A $10,000 per year education would become a $5,000 per year education, even if the price is still “free.”
We know from many studies that spending increases graduation rates, and the best programs in dynamic fields like nursing and technology are often more expensive to maintain. So, the main risk is that free community college will become lower quality and stop being a good deal for students, who, after all, are still foregoing a lot of income to attend.
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Banner image: a professor delivers a lecture to students at Bunker Hill Community College in Boston. Photo by Josh Reynolds/AP Photos. Faculty portrait by Martha Stewart.