This post is co-authored with David Tandberg, vice president of policy research and strategic initiatives at the State Higher Education Executive Officers Association (SHEEO); and Robert Kelchen, assistant professor of higher education in the department of education leadership, management, and policy at Seton Hall University.
For the new majority of postsecondary students — individuals who are over 18 years of age, have children of their own and are juggling a full household budget — financial aid may be the only means by which they can afford not only tuition, but also necessities like housing, food and child care. Trouble is: Who should decide how much aid students can get to meet expenses outside of tuition?
Currently, it is the responsibility of postsecondary institutions. To help, the U.S. Department of Education provides some vague guidelines. But relying on a budget created by the institution can create financial uncertainty for students, many of whom have budgeted on their own prior to beginning or returning to postsecondary education. Because current policy pays institutions before it pays students, tuition must be met before any leftover money is made available for students to pay for things like housing, food, transportation and textbooks. Among public colleges and universities, these additional costs are likely larger than the total tuition.
So does this approach allow students to access sufficient resources to realistically support their postsecondary experiences? In some cases, evidence suggests that budgets may be crafted strategically to produce a desirable total cost-of-attendance figure, rather than to provide for acceptable living situations for off-campus students. On the other end of the spectrum, research on over-aiding students is nonexistent and mired in anecdote rather than research.
If students are not allowed to set their own budgets, and if questions remain about institutional practices, to whom should this responsibility fall? States may be able to play a role, given their existing responsibilities in coordinating postsecondary education across institutional boundaries. In at least one state, Colorado, the department of higher education provides indirect cost estimates to institutions with the goal that students attending geographically proximate institutions would have comparable and reasonable living budgets. Most states, however, do not provide this type of guidance.
States have always had an opportunity to lead when it comes to ensuring that postsecondary students have access to the financial resources to support their success. For example, state higher education agencies often administer state financial aid programs, which are key to providing opportunity to over 4.5 million students each year. However, to protect state aid and ensure that students have the resources they need to be successful, increasing intentionality around cost-of-living policy is a necessary next step.
For more details on how cost-of-attendance budgets are crafted, and to view data for your state, see this Medium post from SHEEO.