Regional interstate compacts as a way to cut college costs.

Don’t overlook higher education regional interstate compacts as a way to cut college costs.

Regional interstate compacts are reciprocity arrangements whereby state universities and colleges offer tuition discounts to out-of-state students, allowing them to “pay the same price as a resident or capture a significant discount“.  Here are four regional compacts along with the participating states.

Western Undergraduate Exchange – Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, North Dakota, Oregon, South Dakota, Utah, Washington, and Wyoming

Academic Common Market – Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia

Midwestern Higher Education Compact – Illinois, Indiana, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, and Wisconsin

New England Board of Higher Education –  Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont

Not all schools in each state participate, and most schools limit the number of students accepted.  Various restrictions are imposed.  In many cases, only programs not available in the student’s home state are included in the agreements.

Example of savings from an MHEC public college or university:

In-state tuition	$4,000
Out-of-state tuition	$8,000
MSEP Tuition (150% of In-state tuition)	$6,000
Your Savings	$2,000

These interstate compacts are worth exploring by students interested in attending college outside their resident states.

Preferential packaging – college financial aid as a recruiting tool

Preferential packaging of financial aid is commonly used by private colleges and universities.  Because schools are not transparent about this strategy, many families are ignorant of how it works.  Muhlenberg College is unusually open about explaining this practice.

Preferential packaging means, simply, that the students a college would most like to enroll will receive the most advantageous financial aid packages.

There are three basic types of financial aid (FA):  grants, loans, and work.

A preferential financial aid package includes a far greater percentage of grant aid than self-help (loans and work). Because they have discretion over how much grant aid they choose to award a student, a college can award a bigger grant to a student they would really like to enroll….

Willamette University also is exceptionally forthright about its preferential packaging.

For students with demonstrated financial need, the percentage of need that is met with “gift-aid” (scholarships and grants from all sources) will also reflect the students’ academic standing within our admitted applicant pool. In other words, the stronger the student, the greater the scholarship award is likely to be.

Let’s look at an example from a CollegeConfidential post.

In this case the college’s Cost of Attendance (COA) is $40,000, and two applicants have the same financial need but quite different academic credentials.

Student A ACT 33 GPA 4.0 EFC = $7k

Student B ACT 24 GPA 3.2 EFC = $7k

Student A is more attractive to the college because his stats would improve the school’s stats.  Perhaps Student A is also an Underrepresented Minority (URM), another desirable factor.  Both students will be offered $10,000 in FA, but Student A will receive a preferential package that does not include a loan.

Financial Aid Offered
Student A:  $8,000 grant; $2,000 work-study – Total = $10,000
Student B:  $3,000 grant; $5,000 loan; $2,000 work-study - Total = $10,000

Note that these awards are technically “need-based”, but in fact do take merit into consideration.  If it is the official policy of this college only to offer FA based on need and not on merit, another student with the highest of academic credentials but lacking any financial need (EFC = COA) would receive nothing.

What it means to applicants

• Students seeking to maximize financial aid should apply to schools where their statistics place them in the upper third of the applicant pool.
• Students with no financial need are shut out of many merit awards that include a need component.

Related:

• Psst – one of Duke’s so-called merit scholarships is actually need-based (Cost of College)
• Family income matters for ‘merit’ awards at the University of Rochester (Cost of College)

Students ‘baffled’ and ‘dumbfounded’ by 2013 college admissions decisions

The number of college applications continues to increase and admission rates continue to decrease, with 2013 decisions leaving some students ‘a bit “baffled” and “dumbfounded”’.

The New York Times recently reported 2013 acceptance rates for about 75 colleges.

Applicant pools are growing larger; the University of Southern California received more than 47,000 applications this year. That’s 10,000 more students than just two years ago, when this year’s applicants were sophomores.

Colleges are also becoming more selective. The Ivy League reported an admit rate that dipped to 5.79 percent at Harvard this year. Stanford accepted 5.69 percent of its more than 38,800 applicants. The University of Chicago accepted only 8.8 percent of its more than 30,300 applicants.

Why are so many good students denied admission?

There are various reasons for this: Colleges concerned about their rankings are appearing more selective (and appealing) than ever. Admission officers often select students who are likely to enroll. And, of course, the huge volume of applications dictates that there just isn’t enough room for every good student who applies.

Unexpected outcomes have reinforced the sometimes unpredictable nature of the “holistic”college application process.

There are other reasons for the outcomes, all of which make holistic college admissions a complex, unpredictable process. So if you are a student or a parent who is scratching your head as you review the chart, just know that you’re not alone. Our student bloggers are a bit “baffled” and “dumbfounded” about the admission decisions, too.

One particularly frustrated parent:

I’ll scream if I hear the word “holistic” at a college info session again….

Dan Edmonds argues that higher selectivity is a myth.

What many parents and students don’t realize is that increasing numbers of applications isn’t necessarily a sign that it’s harder to get into a selective school; rather, it’s a sign of changes in behavior among high school seniors. More and more people who aren’t necessarily qualified are applying to top schools, inflating the application numbers while not seriously impacting admissions. In fact, it has arguably become easier to get into a selective school, though it may be harder to get into a particular selective school.

This helps explain why students feel pressured to apply to so many schools, with the average student applying to more than nine colleges this past fall.

Our high school guidance counselor keeps saying there is no need to panic.

… there are more than 2,000 four-year colleges and universities in this country, and many of them offer an excellent education and admit the majority of students who apply. But as interest increases at selective institutions, it may help disappointed applicants to know that thousands of smart, talented, qualified students had to be turned away.

How to get more high-achieving, poor students to attend selective colleges

Most high-achieving students from low-income families are not attending top colleges, and top colleges are not aggressively recruiting these students.

Only 34 percent of high-achieving high school seniors in the bottom fourth of income distribution attended any one of the country’s 238 most selective colleges, according to the analysis, conducted by Caroline M. Hoxby of Stanford and Christopher Avery of Harvard, two longtime education researchers. Among top students in the highest income quartile, that figure was 78 percent.

The findings underscore that elite public and private colleges, despite a stated desire to recruit an economically diverse group of students, have largely failed to do so.

Racial diversity is a higher priority than socioeconomic diversity in college recruiting efforts.

Colleges currently give little or no advantage in the admissions process to low-income students, compared with more affluent students of the same race, other research has found….

Among high-achieving, low-income students, 6 percent were black, 8 percent Latino, 15 percent Asian-American and 69 percent white, the study found.

The solution – inform students about their college options.

Sending basic information to low-income, high-achieving high school students increased their enrollment rate in top colleges.

Among a control group of low-income students with SAT scores good enough to attend top colleges — but who did not receive the information packets — only 30 percent gained admission to a college matching their academic qualifications. Among a similar group of students who did receive a packet, 54 percent gained admission, according to the researchers, Caroline M. Hoxby of Stanford and Sarah E. Turner of the University of Virginia.

College counseling on the cheap, with an emphasis on affordability

Ms. Hoxby and Ms. Turner designed the 40,000 information packets they mailed — as well as follow-up material — as a low-cost, customized version of the college counseling that upper-income students take for granted. The packets explained application deadlines and student qualifications at a range of colleges. Students also received coupons to waive application fees — which had a particularly big effect. “We wanted students to find schools for themselves,” Ms. Hoxby said.

The College Board may soon begin replicating this strategy as a way to match low-income students with colleges that match their academic profile.

A little more help may be needed
Based on some reader comments in the quoted articles and on my own limited experience working with low-income students, many of them also need a mentor to help handle the many details involved in the college application process.  This is something that affluent helicopter parents typically do for their own children.

Related:  Fewer poor students at top colleges (Cost of College)

 

NYC shows how top colleges could be 50% Asian if not for holistic admissions

New York City high school admissions data suggest that top colleges might be 50% Asian if not for holistic admission policies.

Admission numbers for New York City’s top test high schools were recently released, showing that 50% of students admitted were Asian American.  Admission to these schools is determined solely by test scores.

Top universities use a holistic admissions system, aiming for racially diverse student bodies.

HT Powerline

Related:  

• ‘Racial preferences mostly benefit fairly privileged students of color’ who help dispel stereotypes (Cost of College)

Quick Links – Pay to play in New York; academic standards rule at elite colleges; Massachusetts charter schools

◊◊◊  Pay to play outlawed in N.Y., for now (lohud.com)

Unlike most states, including nearby Connecticut, Massachusetts, and New Jersey, New York does not currently allow schools to charge students extra to participate in extracurricular programs.  But as the tax cap continues to put pressure on school spending, New York might join other states in requiring students to “pay to play”.

State Assemblywoman Amy Paulin, D-Scarsdale, expresses the concerns of many.

“I believe extracurricular activities provide children with extra opportunities and extra potential for learning. There’s enough disparity for poor families. They already have a disadvantage,” she said. “In my mind, pay-to-play means we all pay later on.”

The rules vary widely across the country, with some states/districts only requiring athletes to pay.  Even in New York, the spirit of the law seems to be violated in some cases.  For example, a student must pay $90 or sell program ads as a condition of participating in our local high school play.  Isn’t that a form of pay-to-play?

◊◊◊  In their first cut for admissions, academic standards rule for most elite colleges.

Before they’re holistic, colleges look at grades and test scores.

… The most common winnowing process (used by 76 percent of the colleges that answered Rubin) is some measure of academic merit. This may be based on grades, rigor of high school courses, test scores and so forth. While there is some difference in the relative weight given to various factors, there is a straightforward value on doing better than others in whatever formula the college uses.

The survey included responses from ”63 of the 75 most competitive colleges, mostly private, with just a few public flagships”.

◊◊◊  Massachusetts has seen a 20% increase in charter enrollment over the last four years.

Legislation to eliminate a cap on the number of charter schools has been proposed by Democrat state senators.

BOSTON—Massachusetts lawmakers are considering eliminating a cap on the number of charter schools that can operate in the lowest-performing school districts, including here in the capital city.

While other states also have weighed lifting caps, charter advocates point to left-leaning Massachusetts as a somewhat unlikely model for the movement. “This demonstrates that charter schools are a viable reform,” said Nina Rees, president of the National Alliance for Public Charter Schools, a nonprofit aimed at advancing the movement. “If it can happen in Massachusetts, it can happen anywhere.”…

The 107,000-member Massachusetts Teachers Association is likely to oppose the bill, said union president Paul Toner. Under state law, schools’ funding is linked to the number of attending students, so charter schools divert much-needed funds from traditional schools, he said….

Because other states look to Massachusetts—where students overall routinely rank at the top of national and international tests—for lessons on academic achievement and innovation, the Bay State’s policies on charter schools are being followed closely, former Florida education commissioner Gerard Robinson told charter advocates gathered in Boston recently.

Nationally, charter schools are educating more than 2.3 million students in the 2012-13 school year, 275,000 more than last year, the largest single-year jump since the movement began 20 years ago, according to the National Alliance for Charter Schools.

More than 31,000 Massachusetts students attend charter schools, an increase of 20% in the past four years. …

Unlike many other states, advocates say, Massachusetts’ governance system designates state education officials as sole authorizers of independently run charter schools, overruling local mayors and unions.

Kiplinger’s best values in public colleges

Kiplinger’s recently released its list of best values in public colleges.  Here are the top ten for in-state (IS) and for out-of-state(OOS) students.

California students seeking a bargain are still paying relatively hefty costs approaching $30,000 per year, assuming they can get in to the more selective state schools.

New York stands out in offering a good value for OOS students.  Geneseo seems to attracs very few OOS students, perhaps due to its isolated rural setting.  On the other hand, Binghamton’s higher percentage of OOS students has been the target of complaints that state residents are being crowded out.  Unlike California and Virginia, New York has no formal rules on limiting OOS students.

Percentage OOS Students – School
 02% – SUNY Geneseo
18% – Univ. North Carolina Chapel Hill
12% – Binghamton University (SUNY)
27% – University of Virginia
06% – College of New Jersey
32% – College of William and Mary
07% – Univ. of California, Los Angeles
11% – Univ. of California, Berkeley
08% – Stony Brook University (SUNY)
23% – Univ. of Maryland, College Park

Kiplinger’s uses measures of “academic quality and affordability” to compile these lists.  The entire list of 100 colleges can be found here.

More colleges are becoming ‘need aware’

Do your chances of college admission decrease if you need financial aid?  The answer is a qualified “maybe”.  According to Paul Sullivan writing in the New York Times, more private colleges are becoming “need aware”.

Still, the vote by the board of trustees at Grinnell, a liberal arts college in Iowa, reflects a broader trend in financial aid. The college counselors I spoke to this week said the majority of colleges had already downgraded their policies to “need aware” — meaning that the colleges accept most of their students without looking at their need for aid but will consider financial need for some percentage of the applicants. Others are already considering a parent’s ability to pay in many of their admissions decisions.

This issue matters the most for marginal students, who should understand that their ability to pay could factor into how attractive they are to a school.

As colleges continue to deal with losses in their endowments from 2008, they have less money to offer as financial aid….

So while more colleges are considering the financial need of their applicants, highly qualified students, no matter their finances, will still be admitted. And wealthier families, an education consultant told Paul, should realize that their children are competing against students of similar wealth.

Applicants can signal their ability to pay full tuition to a college, which may give them an edge in gaining admission.

… Admissions officials can usually figure out fairly quickly who needs aid and who doesn’t.

“It will be obvious because they didn’t file a financial aid form,” Belinda Stern, an education consultant on Mercer Island, Wash., said. “Some people are a little more brazen and want to make it clear to the college that they are willing to pay the full ride and come right out and say it.”

All this is irrelevant for most applicants since they have no choice because they simply need the financial aid, as this comment explains.

… Who ignores financial aid? Only the very wealthy. Only if you have saved over $200K per child. Only if your income is consistently over $250,000 or so.

The rest of us don’t have the option of “ignoring” financial aid. We fill out the FAFSA and the profile in the hopes that the financial aid gods will smile on us and offer our children some money for their education. We don’t wonder if the “full-pay” kids have a better chance of admission–we know they do!

My 3 children chose their colleges based on who offered them the best aid package, period. And they are doing fine.

Related:  Will checking ‘no financial aid needed’ help your admissions chances? (Cost of College)

Carnegie Mellon University – an example of transparency in financial aid policies

Carnegie Mellon University is unusually transparent in sharing information on how financial aid is awarded.  First, it is clear that awards always incorporate a financial need component.

Carnegie Mellon provides qualified students with need-based institutional grants and scholarships to help fund the expenses of college. Grants and scholarships are considered to be ‘gift aid,’ meaning that neither amount has to be paid back.

Additional details

Grants
… Grants are awarded to students who demonstrate financial need….

Scholarships
Carnegie Mellon offers the Carnegie Scholarship which is a joint need- and merit-based scholarship….

Basic principles

Carnegie Mellon’s financial assistance program is designed to meet our dual goal of helping prospective students who have demonstrated financial need afford the cost of education and rewarding those students who have outstanding talents and abilities. Need-based financial assistance is used to enroll high-quality students. Highest quality students will receive the most favorable financial assistance packages.

CMU is open about their policy of reviewing offers from competing schools and their use of statistical modeling.

We have been open about our willingness to review financial aid awards to compete with certain private institutions for students admitted under the regular decision plan. Unlike most institutions, the university states these principles openly to those offered first-year admission under the regular decision plan. While early decision students are not eligible to participate in this aid review process, we will meet their full demonstrated need as calculated by the university.

We use statistical modeling as an aid in the distribution of limited financial aid dollars. It is a strategic tool that helps us pursue our goal of increasing the quality of the student body while using our resources as effectively as possible. This modeling takes into account a student’s intended college major, academic and artistic talents, non-academic talents and abilities, as well as financial need. This approach to awarding financial aid is unique to Carnegie Mellon and has not been developed with the aid of any outside consultants.

Here are some of frequently asked questions about financial aid.

• How are students considered for the Carnegie Scholarship?
• Is there a way to get an idea of what it will cost to attend Carnegie Mellon?
• Carnegie Mellon is expensive – how will I know if it’s going to be affordable for my family?
• Can I request an estimate of my financial aid eligibility before applying to Carnegie Mellon?
• If I apply for financial aid, will it hurt my chance of getting accepted?
• Is financial assistance available for international students?
• What effect will receiving an outside scholarship have my financial aid package

The answer to the last question makes it clear that students are allowed to “stack” outside scholarships on top of financial aid awarded by CMU.

Related:  Maximizing college revenue through financial aid allocation (Cost of College)

Maximizing college revenue through financial aid allocation

How are college financial aid decisions made?  Some insight can be gleaned from a paper presented at the 2007 Frontiers in Education (FIE) Conference - Deriving Financial Aid Optimization Models from Admissions Data.

… Financial aid is used to achieve a number of enrollment objectives, including diversifying the student population, attracting strong students, and maximizing tuition revenue. While financial aid generally positively affects applicant enrollment decisions, the effect on the probability of enrollment varies across applicants….

Schools obtain as much information as possible from each applicant as this helps them predict how a particular student will react to a given level of financial aid offered.  Schools gather data such as grades, test scores, financial resources, intended major, caliber of high school, extracurriculars, etc.

The expected tuition revenue from any given applicant who has been offered a particular amount of financial aid can be obtained by multiplying the probability of enrollment by the revenue obtained at that financial aid level. As the financial aid increases, the probability of enrollment increases but the tuition revenue decreases. So for each applicant there will be a financial aid offer that maximizes the expected revenue from that student. Our objective is to offer each student the amount of financial aid that maximizes tuition revenue, subject to capacity constraints. Developing such an optimization model requires first developing a predictive model that can determine for any given student the probability of enrollment for each level of financial aid offered.

The graph might look like this for a particular student, with a typically nonlinear relationship between probability of enrollment and financial aid.

Multiplying this curve by the linear relationship between percentage revenue and percentage financial aid generates the expected revenue at each level of financial aid.

For this particular applicant, the maximum expected revenue occurs when 50% financial aid is offered.

They’ve got your number, so to speak.

The goal is to get the most tuition revenue from the existing pool of applicants.  Here’s how Mark Kantrowitz described the sophisticated enrollment management techniques colleges use to attract desirable students and maximize revenue.

“A lot of it is done by computer programs to calculate how much aid they need to offer to each student so they can get the maximum number of desirable students without going over their financial aid budget,” says Mark Kantrowitz, the publisher of FinAid.org and FastWeb.com.

Many regional and religious colleges, he says, also try to “optimize their revenue” by offering partial scholarships to the students who can pay the rest of the tuition — even “B” students with an SAT verbal and math score of 1200 or less. Caution: You’ll have to maintain a grade-point average of about 2.7 to 3.0 to renew most scholarships after your first year.