The American Association of Community Colleges (AACC) believes that the report of the Project on Student Debt, "Denied: Community College Students Lack Access to Affordable Loans," fails to capture the intensity of many community college administrators' belief that it is inappropriate for their students to borrow to finance college. For many institutions, that aversion takes the form of choosing, after due deliberation, not to participate in federal loan programs. Student interests are paramount in this decision.
Community colleges are structured to make borrowing an absolute last resort and largely unnecessary. The average community college tuition is just $2,361 (College Board, fall 2007). This low tuition, coupled with sustained support for the Pell Grant program—the maximum grant increases to $4,731 this July 1—and the widespread availability of other grant and work aid (sometimes provided by states) means that the great majority of community college students do not need to take on debt to meet their educational expenses. Furthermore, community college students work—27 percent of all full-time students hold down full-time jobs, and nearly 80 percent of all students work at least part-time.
While we commend recent changes to the Higher Education Act that facilitate federal student loan repayment for students with heavy debt burdens, the consequences of default on federal loans remain grave. Community colleges are especially reluctant to see borrowing by first-time students who need substantial developmental education to fully prepare them for college-level work. These students face major challenges to completing or persisting in their programs, and that is accompanied by a higher incidence of default.
AACC continues to support giving student financial aid administrators greater authority to limit borrowing by certain categories of students, e.g., first-term. Unfortunately, Congress has rejected proposals to provide this additional institutional flexibility. AACC also supports giving needy students greater funding through the Internal Revenue Code. Currently, it is essentially the case that the poorer the student, the less likely he or she is to secure assistance through the tax code. Changing this situation would further reduce the need for community college student borrowing and strike a blow for common sense and fairness.
Again, it is overwhelming concern for the serious consequences of debt and default for students, rather than unwarranted concern about institutional default rates, that primarily drives institutional decisions about whether to participate in student loan programs. Nevertheless, institutional review of their policies in this area could be timely, particularly given the extremely small likelihood that default rates might endanger eligibility for other student aid programs. To that extent, AACC commends the report of TICAS for providing a fresh look at this difficult issue.
The American Association of Community Colleges is the leading national organization representing the nation’s more than 1,100 community, junior and technical colleges. The colleges comprise the largest sector of higher education, enrolling more than 11 million students each year – almost half of all U.S. undergraduates.
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