"Access and Affordability: The Path to a Bachelor's Degree"

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November 2006

PanelistsOn November 15, 2006, the topic of discussion for the Quality Advocates was“Access and Affordability: The Path to a Bachelor’s Degree.” The panelists included:Anna Griswold, Assistant Vice President for Undergraduate Education and Executive Director for Student Aid; Donald E. Heller, Associate Professor and Senior Research Associate, Center for the Study of Higher Education; and Michael J. Dooris, Director, Planning Research and Assessment, Office of Planning and Institutional Assessment. The panelists addressed how tuition costs affected the ability of students to enter college and complete degrees both at Penn State and nationally. The topic is important since Penn State is committed to providing an affordable education and has set a strategy in the University’s strategic plan to “Ensure the University’s commitment to access by aggressively striving to moderate tuition increases at all campuses”.

Dooris cited national level discussions, where the issue of affordability has received much attention, with some observers suggesting that students are being “priced out” of a college education, while others claim tuition costs do not deter students from college.(view slides)To examine this issue at Penn State, Dooris and Marianne Guidos, with the assistance of the Office of Student Aid, completed a study which looked at graduation rates by academic ability and ability to pay for a cohort of 11,930 fulltime baccalaureate degree-seeking students who entered in fall 1999.

This kind of information does not have a real action implication whether you are talking in terms of admissions policies, advising, fundraising, or the mix of need-based versus merit-based aid.

Michael Dooris

The study grouped the cohort into quintiles based on family income and quintiles based on first semester grades and then examined the six-year completion rates by academic and income quintiles. The study found that adisproportionate percentage of the cohort were higher income students and that high-income students were more likely to complete degrees within six years compared to low-income students, regardless of their academic ability. Generally, within each GPA quintile, students who fell into the highest income quintile were between fifteen and twenty percent more likely to complete a degree than those in the lowest income quintile.  An additional logistic regression analysis also found that grade point average and income were related to completion rates.  Dooris suggested the study was important to Penn State because it used objective data based on the outcomes of real students, and because the findings had implications for policy decisions, such as admissions criteria and fundraising.

Don HellerHeller provided some context for understanding how Penn State compares to other colleges and universities by looking at national trends in tuition and financial aid. (view slides) Overall tuition prices have increased over the past twenty years, while family incomes have remained almost flat for families with the lowest incomes and have risen only slightly for those with higher incomes.  Public four-year schools have most felt the impact of a poor economy: as the economy worsens states have historically provided less money to higher education. Although the amount of financial aid increased as tuition costs rose, the bulk of the increase in financial aid came from loans. Grants now represent less than 40 percent of total financial aid, while loans represent about 55 percent. The Pell program has been hit hard: the Pell grant, which has traditionally been a need-based form of aid aimed mainly at lower income families, represented over 80 percent of the average cost of tuition in 1980 but has fallen to only about 30 percent in 2005.  

Heller also cited the widening gap between low income and high income students as they move through the educational pipeline (high school, entrance to college, and completion of degrees).

“…there has been a large erosion of the purchasing power of the Pell grant, to the point today, where a Pell grant provides just about 32 percent to 33 percent of the average public four year cost of attendance. Now here in Pennsylvania, in most of the public institutions it provides a lot less…

Donald Heller

One study found that, when in the eighth grade, lower income students were about as likely as higher income students to plan to enroll in college, but were 14 percent less likely actually to complete high school diplomas, 29 percent less likely to enroll in any college, and 44 percent less likely to enroll in a four-year college. According to Heller, “… the gap between rich and poor increases as you go through that pipeline… Financial barriers help push students out of that pipeline.”


Heller pointed to some recent policy trends that colleges and universities are using to help meet the financial need of students.Institutional aid is growing, although there is an emphasis on merit rather than need-based aid. This is also occurring in the federal Pell grant program, with special merit based awards for selected students with 3.0 or higher grade point averages (although the majority of Pell grants still go to students in the lowest income quartiles). Heller also mentioned other developments. One of these the Carolina Covenant program at UNC- Chapel Hill, guarantees financial aid without loansfor low-income students. He also mentioned recent calls for class-based (as opposed to race- or ethnicity-based) affirmative action, and recommendations to simplify the financial aid system and to provide earlier notification of aid to students.

Anna GriswoldAccording to Griswold, factors such as the Higher Education Reconciliation Act, the Secretary of Education’s Commission on the Future of Higher Education Commission Report (commonly known as the Spellings Commission), changing demographics and internal Penn State studies and reports may all affect the future of financial aid at Penn State. (view slides) Financial aid is important to Penn State students, as 80 percent of undergraduate students received some form of financial aid in 2004-05. The bulk of financial aid (63 percent) is in the forms of loans, with 23 percent coming from grants and 13 percent from scholarships. Financial aid is distributed to students from all income levels, and in fact, the greatest growth since 2001-02 in the number of students receiving financial aid occurred in the highest income category. 

Income Distribution of Aid Recipients

(constant dollars)





$0 to $40,000





$40,001 to $85,000





$85,001 and higher





Between 1994-95 and 2004-05, the total amount of financial aid almost doubled from $226 million to $538 million. But as Griswold pointed out, the purchasing power of federal and state grants has not kept up with increases in tuition, and even in the past several years, theaverage unmet financial need of students is growing.  For instance, the average unmet need for low-income students was $2,067 in 2001-02 but grew to $6,133 in 2004-05. For middle-income students, average unmet need grew form $5,317 to $9,583.

Griswold suggested that students are taking on more private loans, and their parents are taking out other loans to meet this growing gap.  By the time students graduate, the average debt load is $22,240, and low-income students have higher debts than average.

The Quality Advocates Network meets several times each semester to share ideas and examples of improvement and change. To join the Quality Advocates Network mailing list or to learn more about the meetings scheduled, contact the staff at psupia@psu.edu.

The Quality Advocates Network is open to all Penn State faculty, staff, administrators, and students.