Federal Grant Programs

Yesterday, the New America Foundation's Education Policy Program released "Undermining Pell: How Colleges Compete for Wealthy Students and Leave the Low-Income Behind." Author Stephen Burd reveals a full-fledged "financial aid arms-race" between private colleges and universities, and a burgeoning one among publics as well. Schools adopt a "high-tuition, high-aid” model that allows them to attract wealthy and high-achieving students to boost their rankings with significant amounts of merit aid – money that could have instead been directed to need-based aid for low-income students. That means that the neediest students are left with an impossibly high tuition bill.

Burd uses data, many of which are available through our Federal Education Budget Project database, on Pell Grant enrollment and net price for the lowest-income students at thousands of individual colleges. The analysis shows that hundreds of public and private non-profit colleges expect the neediest students to pay an annual amount that is equal to or even more than their families' entire yearly earnings. As a result, these students are left with little choice but to take on heavy debt loads or to behave in ways that are demonstrated to reduce the likelihood of earning their degrees, such as working full-time while enrolled or dropping out until they can afford to return. Only a few dozen exclusive colleges meet the full financial need of the lowest-income students they enroll. Nearly two-thirds of the private institutions analyzed charge students from the lowest-income families, those making $30,000 or less annually, a net price of over $15,000 a year.

Many private colleges have small endowments, making it extremely difficult for them to provide adequate support to those students with the greatest need. According to the report, the poorest schools are often the ones that enroll the largest share of federal Pell Grant recipients, but they charge these students high net prices because of their own limited resources. At the same time, many of these institutions provide deep tuition discounts to wealthier students to attract those high-achieving students to the school.

This is not just a question of institutional wealth, though. Some of the country's most prosperous private colleges are, in fact, the stingiest with need-based aid. These institutions tend to use their institutional financial aid as a competitive tool to reel in the top – and the most affluent – students to help them climb the U.S. News & World Report rankings and maximize their revenue.

We created an interactive graphic that groups institutions into four categories based on whether they charge low-income students a high or low tuition and whether they enroll a high or low percentage of Pell recipients. We also used data from the Department of Education, FEBP, and The Chronicle of Higher Education to determine the number of endowment dollars available per student.

We can see from this graphic, for instance, that Washington & Lee University enrolls a very low proportion of Pell students (eight percent) and charges the lowest-income students over $14,000 a year in tuition after Pell Grants and financial aid. That’s an average tuition bill of over half of a family’s total income. What's worse is that Washington & Lee has a relatively large endowment of around $450,000 per student. 

While the problem is not as extreme among public universities, it is rapidly getting worse. As more states cut funding for their higher education systems, public colleges are increasingly adopting the enrollment management tactics of their private college counterparts - to the detriment of low-income and working-class students alike.

In many states, public institutions are following the same high-tuition, high-aid model – and in some cases, including in Pennsylvania and South Carolina, the neediest students are facing net prices more than double what they are charged in low-tuition states such as North Carolina. At Penn State University, for example, in-state students attending the university's flagship campus in University Park pay about $16,000 in tuition and fees annually, which is double the average tuition charged at all national public four-year colleges and universities examined in his paper. Despite the fact that Penn State spends nearly $14 million a year on institutional aid, its lowest-income in-state students pay an average net price of nearly $17,000, the fifth-highest of any public institution this report examines. In other words, Penn State's neediest students do not appear to be getting any discount relative to other students at all. At the same time, about 6 percent of the school's first-time freshmen received an average of $3,800 in so-called "merit aid" in 2010-11.

Schools like Penn State seem to be using their pricing autonomy to gain an advantage as they fiercely compete for the students they most desire: the "best and brightest" students - and the wealthiest. These actions fly in the face of national goals to increase access to higher education and help more students earn high-quality degrees.

Over the past several decades, a powerful enrollment management industry has emerged to show colleges how they can use their institutional aid strategically in the pursuit of high-achieving and affluent students. And worse yet, there is compelling evidence to suggest that many schools are engaged in an elaborate shell game: using Pell Grants, the primary source of federal aid for low-income students, to supplant institutional aid they would have provided to financially needy students otherwise, and then shifting these funds to help recruit wealthier students. This is one reason that, even after historic increases in Pell Grant funding, the college-going gap between low-income students and their wealthier counterparts remains as wide as ever.

Although the deadline for all students to achieve proficiency in math and reading has been lifted in most states by No Child Left Behind (NCLB) waivers, 2014 test anxiety is high as ever. That’s because the 2014-15 school year is the first time 45 states and Washington, D.C. will be fully implementing the Common Core State Standards – including new tests that will be used as part of high-stakes accountability systems for schools and, in many cases, teachers and students. But when the time comes, will states stay the course? Practical concerns along with escalating political arguments already threaten the emerging system of common standards and assessments.

As I wrote previously, Alabama became the first state to exit the Common Core test consortia, opting instead to administer ACT-based assessments. By 2014, Alabama will likely not be alone in its choice. ACT is a well-established player that has spent decades building an organization with a reputation for providing valid, reliable assessments. Conversely, the state consortia are upstarts, attempting to build next-generation assessments and a precarious, multi-state structure to support and sustain the effort simultaneously. Naturally, states are left with many unanswered questions. How much will the new tests costs, and what are the technical requirements? Will the tests accurately reflect a student’s readiness? And will the assessments even be completed on time? In his smart take on the issue, Bellwether Education Partner’s Andy Smarick writes, the ACT “is the ‘Plan B’ that many states – concerned about the reliability and cost of the consortia-developed tests – have been looking for. It enables a state to remain committed to tough standards and rigorous assessments without putting all of their eggs in the basket of a fragile multi-state entity.”

But this kind of pragmatic concern isn’t the only threat to the common standards. While the Common Core is a state-led initiative (I repeat, the Common Core is a state-led initiative), the effort has been supported by private and corporate philanthropy and by the federal government. Specifically, the requirement to adopt the common standards to compete for Race to the Top funding is at the heart of increasingly polarized and politicized arguments against the Common Core. In their words, “Obamacore” amounts to a “nationalized curriculum” and “leftist indoctrination” that has been “forced on state governments” and “imposed on the children of this nation.”

Reasonable individuals easily dismiss most of these arguments. But reasonable arguments are often overshadowed, especially when national politicians and parties start getting involved. Just last week, the Republican National Committee adopted an anti-Common Core resolution, echoing these same divisive arguments.  And President Obama frequently touts that his administration “convinced almost every state to develop smarter curricula and higher standards, all for about 1 percent of what we spend on education each year” – adding credibility to their claims.

The problem may be about to get worse. As noted in our Key Questions on the Obama Administration’s 2014 Education Budget Request, federal funding for the assessment consortia is set to expire before the tests are fully launched. To provide continued support, President Obama’s latest budget includes a $9 million competitive grant initiative that could finance some of their ongoing work. The other $380 million of the “Assessing Achievement” program would provide states with formula grants for their current assessment programs, although leftover funds could go toward Common Core implementation.

However, a significant change would occur in fiscal year 2015: Assessing Achievement formula funding would be available “only to States that have adopted college- and career-ready standards that are common to a significant number of States” (emphasis added). While Race to the Top included a similar requirement, that program was a competition, where states could opt-out. NCLB waivers also require states to adopt college- and career-ready standards, but they do not have to be common ones. The Assessing Achievement program would mark the first time federal formula funding – typically available to all states – required adoption of common standards. If enacted, this requirement will undoubtedly add fuel to the “Obamacore” fire. On the heels of the president’s budget request, Sen. Chuck Grassley (R-Ia) is calling for the federal government to eliminate all Department of Education funding that supports or prioritizes the Common Core – and he doesn’t even mention the Assessing Achievement program.

What can we make of these threats to the Common Core? To date, most of its political detractors have been contained outside of the mainstream and have had little success gaining traction or passing legislation to reverse Common Core adoption. Will the RNC resolution, Grassley’s letter, or potential changes in federal funding have a greater impact?

On the other hand, the pragmatic concerns about how the new standards and assessments will be implemented are just that – pragmatic. Few could fault Alabama’s decision to choose the ACT over PARCC and SmarterBalanced. All three of the developing testing systems could prove to be a great improvement over current assessments, measuring competencies better aligned to postsecondary work and providing more useful information to students, their teachers, parents, and policymakers.

The important difference between the practical and political critiques is that states deciding to use the ACT system are not necessarily backing away from their commitment to the Common Core altogether. Yes, the assessment consortia should do as much as possible to allay the concerns of wavering states. And yes, policymakers and stakeholders should closely monitor all of the emerging for-profit and non-profit ventures to ensure their assessments, curricula, textbooks, and other resources accurately reflect the new standards. But in the end, any damage done to the Common Core from these pragmatic objections to the consortia is far less severe than what would happen in the unlikely, but not out of the question, case that “Obamacore” goes mainstream. Common Core supporters would do well to distinguish between the two. 

In President Obama’s State of the Union address Tuesday, he called on Congress to expand high-quality early learning opportunities to low- and moderate-income children. Today, with the release of a White House document and a speech at a Decatur, Ga. pre-K center, Obama sketched more of the plan’s details.

Every parent of college-aged kids fears the eye-popping complexity of applying for financial aid, but that complexity can actually end the college dream – and the American dream - for some students. In this In the Tank Podcast, New America Managing Editor Fuzz Hogan talks to Education Policy Program Director Kevin Carey and Schwartz Fellow Jason DeParle about some of those stuck students, and discusses how better policy can help fix the crisis.

EXECUTIVE SUMMARY

The federal financial aid system is no longer up to today’s demands. Built in a different era, its haphazard evolution over the decades has made it inefficient, poorly targeted, and overly complicated. With the need for higher education never greater and college growing increasingly unaffordable, students deserve a streamlined aid system that is more understandable, effective, and fair.

In a post for the Huffington Post's Education blog, I wrote about the Early Education Initiative's event on January 14 that highlighted three promising strategies for turning around low-performing schools: FirstSchool, AppleTree's Every Child Ready and Cincinnati's

Each January, Early Ed Watch predicts where we will see the most action, innovation and consternation in the year ahead. Here are the hot spots we see for 2013. Notable is the absence of the reauthorization of the Elementary and Secondary School Act, otherwise known as No Child Left Behind. Prognosticators don’t give the bill much chance of making progress this year, given stalemates between the two houses of Congress.

The Child Care Development Block Grant, on the other hand, could see some action on Capitol Hill.  Debates on how to evaluate teachers will likely continue to dominate, as they did in 2011 and 2012. And at least one topic has popped up consistently since 2010 when we started this exercise: Head Start reform via the new "re-competition” process.

On a day that many educators and office workers are madly finishing tasks or already traveling to prepare for the holidays, the U.S. Department of Health and Human Services released results from a long-awaited study on whether children's gains from Head Start still show up four years after students have exited the program. 

The Education Watch podcast this week covers a lot of ground that pertains to early education. We talk about a forthcoming Head Start brief, news from the U.S. Department of Education on Race to the Top (including five new winners of Early Learning Challenge grants) and new commentary in Ed Week on half-day kindergarten and the mismatch with the Common Core. 

Release the kraken data! The U.S. Department of Education has finally revealed some of the results from its research on the effectiveness of the School Improvement Grant (SIG) program, or rather, the one-time, $3 billion infusion to the SIG program included in the 2009 American Recovery and Reinvestment Act (ARRA). The controversial program, which was re-tooled by the Obama administration, has supported intensive turnaround efforts – up to $2 million per school – in over 1,300 of the nation’s chronically low-performing schools.

The sliver of data released this week includes 2009-10 and 2010-11 test data from about 730 of the 831 highest priority SIG schools, those categorized into Tier I or Tier II.[1] Here are the highlights (H/T to RiShawn Biddle and PoliticsK-12):

• Two-thirds of schools showed gains in math, and two-thirds in reading in the first year of the SIG program (2010-11)
• 25 percent of schools saw double-digit gains in math, and 15 percent in reading
• 40 percent of schools saw single-digit gains in math, and 49 percent in reading
• 28 percent of schools saw a single-digit decrease in math, and 29 percent in reading
• 6 percent of schools saw a double-digit decrease in math, and 8 percent in reading
• 26 percent of schools had posted math improvements the year prior to entering SIG, but declined once they received SIG funding; this happened for 28 percent of schools in reading
• 28 percent of schools had posted math declines the year prior to entering SIG, but improved once they received SIG funding; this happened for 25 percent of schools in reading
• A larger proportion of elementary schools posted gains in the first year of the SIG program, compared to middle and high schools, and they were less likely to see declines
• Rural schools appear to fair as well as schools in suburban and urban areas

But can we say that “there’s dramatic change happening in these schools” as Secretary Duncan claimed? Not so fast. Clearly, the Department didn’t read Matt DiCarlo’s excellent run-down of when you can – and cannot – make policy claims based on test data.

First, the Department doesn’t clarify whether any of these increases or decreases in test scores are statistically significant. Given inherent measurement error in any assessment and the fact that it is unclear if the Department is using proficiency rates (less accurate) or actual test scores (more accurate) to calculate these gains and losses, statistical significance cannot be assumed.

Second, the Department doesn’t clarify whether they are using cross-sectional or longitudinal data. In other words, were the gains or declines based on individual student growth (i.e. a student taking the 3rd grade test in math improved when taking the 4th grade math test) or were they based on comparing this year’s crop of 3rd graders in math to last year’s 3rd graders? My money is on the latter, which limits how we can interpret the data as the results aren’t fully comparable from the pre-SIG year to year one of the turnaround program.

Third, the Department doesn’t explain whether or how the researchers took into account other non-school factors that could affect student achievement. Without at least addressing these issues, it is impossible to know whether changes in student performance were even attributable to changes in school leadership or culture (i.e. the SIG program) rather than conditions in the economy or students’ home lives. And the Department doesn’t explain how they controlled for other policies at the school-level that could influence test scores. As chronically low-performing schools, the SIG interventions are unlikely to be the only improvement strategy or program at work in these schools.

These are huge caveats to the SIG data, but that’s not to say that ED’s findings aren’t important. They are. But more details are sorely needed to really make an accurate assessment of the program.

To begin with, the Department of the Education must disaggregate the data into the four turnaround models. More significantly, changes in student proficiency rates on standardized tests are only one possible outcome of the SIG program – and perhaps not the most important outcome to track. The Department plans to release student and teacher attendance data, enrollment in advanced courses, and other “leading indicators” for the SIG schools next year, but what about data relating to school leadership, school culture, and parent involvement?

While more difficult to quantify, these areas are also essential components of school turnarounds. Secretary Duncan alluded to it in releasing these early results: “What’s clear already is that almost without exception, schools moving in the right direction have two things in common; a dynamic principal with a clear vision for establishing a culture of high expectations, and talented teachers who share that vision, with a relentless commitment to improving instruction.” However, the data attached to Duncan’s statement failed to mention the effect sof leadership or teaching in SIG schools.

Predictably, analysts – notably Bellwether’s Andy Smarick – have already interpreted the early results as a failure of the entire SIG effort. But without more convincing and complete data, it really is too early to make definitive judgments about the program. This nuanced, wait-and-see approach may not be as satisfying, but in an effort as important as improving our nation’s worst schools, it is the right approach to take.