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For years, community colleges have borne the brunt of state budget cuts nationwide, and they continue to receive the equivalent of poverty wages in federal and state funding. And yet community colleges are much more dependent on state funding than four-year institutions. In Texas, for example, community colleges receive roughly 70 percent of their funding from the state, whereas the University of Texas relies on the Lone Star State for only 14 percent of its funding.

At the same time, community colleges have become the preferred destination of many students who would have gone to four-year institutions if not for the recession. Increasingly, they’re also the institution of choice for adults seeking basic education, the unemployed and underemployed looking to expand their skill-sets and military personnel returning from tours of duty. These streams of students have left countless community colleges oversubscribed, with would-be students vastly outnumbering available seats in lecture halls across the country.

Exacerbating the situation, a number of community colleges have cut back on class offerings to cope with the economic crisis. Among the first to go are often those most expensive to maintain, such as nursing. “Economically, [a community college] can have three or four sections of any one of the general-ed classes for the price of one section of nursing,” says Dennis Jones, president of the National Center for Higher Education Management Systems.

Effects of the economic crisis

Oversubscribed classes and reduced offerings have led some community college students to drop out or switch to for-profit institutions, where tuition is often significantly higher and program quality is uneven. For-profit schools have come under federal scrutiny in recent months because of questionable marketing tactics and high student-loan default rates, but they remain a popular alternative to community colleges because they typically offer generous financial aid packages and personal attention.

Nonetheless, students are still better off financially at community colleges because they’re less likely to need loans to attend them, according to Deborah Cochrane of The Institute for College Access and Success (TICAS). In a September 2010 interview on NPR, Cochrane said, “Whereas only about 13 percent of students at community colleges are even taking out student loans, about 97 percent of students at for-profit two-year colleges are taking out federal student loans.”

Another effect of reduced course offerings at community colleges – especially in the healthcare field – is a future workforce unequipped to fill available jobs. The Bureau of Labor Statistics projects that the country will need nearly 600,000 more registered nurses and 460,000 more home health aides by 2018, but currently there are far too few programs to meet these anticipated needs.

In looking at America’s global competitiveness and future workforce needs, politicians and policymakers have called for more students to obtain postsecondary degrees or credentials. Earlier this year, President Barack Obama set a goal of having the U.S. regain its position as the most highly educated nation in the world, as measured by the percentage of 25- to 34-year-olds holding postsecondary credentials, by the year 2020. But for the U.S. to reach this goal, community colleges will have to step up and play a much larger role in the higher-education landscape, with significantly more non-traditional students (such as adult learners) enrolling and far greater percentages of students completing degrees.

To do so, community colleges will need substantial financial support from the federal and state governments. In July 2009, Obama proposed the American Graduation Initiative, calling for an unprecedented federal investment in community colleges – $12 billion over the next decade – by way of grants to innovative states and colleges and support for much-needed infrastructure, including research and facilities. But as part of the passage of healthcare reform in late March 2010, the initiative was gutted. Community colleges, for now, will have to settle for $2 billion from the Department of Labor instead.

‘Everyone loves a cheap date’

On average, tuition and fees are lower at public community colleges ($2,544) than at public four-year schools ($7,020). But as a recent editorial in the Los Angeles Times pointed out, California’s community colleges could actually be more affordable to students if they charged higher tuition. At just $26 per credit, California has by far the lowest community-college tuition anywhere in the country. (Nationally, community college tuition averages about $70-100 per credit for in-state students; New Hampshire, at $195 per credit, has the nation’s highest community college tuition.) A major downside of California’s cheap tuition is that the state received a lot less federal stimulus money than it could have if tuition had been slightly more expensive. The Los Angeles Times reported that California would have gotten more than twice the $5 million it received from Washington if statewide tuition were just $1 more per credit.

A knock-on effect of California’s low tuition – besides oversubscribed classes – is that lots of students can’t enroll in enough classes to maintain their full-time status, which means they also can’t get student health insurance. Additionally, the low tuition makes it hard for students in the Golden State to receive federal grants, which they’d receive if they were enrolled in for-profits or in community colleges elsewhere around the country. Progress toward certificates and degrees is stalled and the likelihood that students will drop out increases.

David Loganecker, president of the Western Interstate Commission for Higher Education, says that “Everyone loves a cheap date” – that is, states love the low cost of community colleges – but too often people forget that you get what you pay for. Or, in California’s case, you don’t get what you don’t pay for.

The challenges ahead

Public institutions, both two-year and four-year colleges, are usually cheaper than private institutions, but in recent years they’ve seen more rapid increases in tuition than their peers. After adjusting for inflation, the cost of tuition, room and board at public institutions rose by 30 percent between 1997-98 and 2007-08, compared to an increase of 23 percent at private institutions.

Private institutions – especially for-profits – also tend to offer students more comprehensive financial aid packages than public institutions, even if much of the aid comes in the form of loans that must be repaid. Longanecker points out that in many states there aren’t any institutional incentives to help students get financial aid. Historically, aid has been distributed to schools based on the number of students who enroll at the start of each term, not on whether they stay enrolled and eventually graduate. This has led in some places to a revolving door where the only thing that matters is a steady stream of incoming students; the ultimate success of enrolled students has received scant attention.

Also, there’s a wariness among some community college students to take out any loans, particularly if they’re first-generation college students, because they’re worried about being able to pay them back later. (Unlike other forms of debt, student loans are not wiped off the books if a person declares bankruptcy.) And community colleges themselves sometimes discourage students from taking out loans, partly out of concern that high default rates among students will make the schools ineligible for federal aid.

Robert Shireman, former Deputy Undersecretary of Education in the Obama administration as well as the founder and former president of TICAS, says that “in some cases, there seems to be such a strong aversion by the schools for students to take out loans that students end up using credit cards or private loans, or they end up working too much.”

Many community colleges make it difficult for students to get the help they need, Shireman says. A 2007 report by TICAS, “Green Lights, Red Tape,” illustrated poor decisions made by financial-aid administrators at California’s community colleges, such as requiring excessive documentation from applicants and staffing financial-aid offices with junior employees unable to answer questions.

At the same time, the report noted, some schools understand they need to do more to make aid available by providing financial-aid packets in multiple languages, early disbursement to help students buy textbooks, and special aid programs to help students with financial emergencies. Schools also need to keep financial aid offices open longer so that students who work full-time during the day can still get the advice and assistance they need. Such changes would help close the gap between the percentage of eligible students who actually apply for federal financial aid at community colleges (58 percent) and four-year institutions (77 percent).

At the federal level, the Obama administration has taken action to make higher education in the U.S. both more accessible and more affordable, most notably by increasing the size of Pell Grants and simplifying the Free Application for Federal Student Aid (FAFSA). But much work, at both the federal and state levels, remains to be done.

Matt Krupnick contributed reporting.

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