New York Announces Free Tuition College Plan
By Joe Messinger, CFP®
April 14, 2017
So, do you wish you lived in New York? If you aren’t a resident of NY, you might consider it now that the state of New York has become the first to offer free tuition to in-state students attending public college in their home state with their free tuition college plan. What are the particulars? How are they making this happen?
Governor Andrew Cuomo signed the program into law. The plan is called the Excelsior Scholarship. It was created with the goal of helping middle class families. For families receiving financial aid like Pell Grants (for families earning less than $50,000), Excelsior would be added on top of that other aid. For those like middle class families who aren’t receiving need-based financial aid, Excelsior would provide it to them.
The eligible colleges in New York are part of the State Univeristy of New York (SUNY) and the City University of New York (CUNY) systems of schools. Students must attend school full time with 30 credit hours per year and graduate within two to four years depending on the degree they are enrolled in. Students need to maintain a certain GPA (although what that may be has not been determined yet.)
After graduation, students must continue to live in New York for the same number of years that they received Excelsior. If they move, they will have to repay the money. Families need to be especially careful to understand what the residency requirement means. Students need to realize they will be taking on student loan debt if they plan on leaving the state too soon.
Because of the full-time requirement, some worry that this program really does not help that group of families who earn too much to qualify for financial aid but not enough to send their kids to college full time. At community colleges, the majority of the students are attending part time. This scholarship would not help them.
Also consider, New York isn’t providing free college…just free tuition. Families are still responsible for room and board costs. A four-year SUNY college currently costs around $83,000 for tuition, fees, room and board. This scholarship would provide about $26,000 leaving a family on the hook for the remaining $57,000.
The income level qualifications for the scholarship will roll out in three stages. In fall 2017, students with families making up to $100,000 annually will qualify. This figure will increase to $110,000 in 2018 and max out at $125,000 in 2019.
Are you wondering who is really paying for this? Of course, you are. The New York taxpayers will be footing the bill with the hope that the requirements on graduates’ after college plans help build the tax base.
Detractors argue colleges are not held accountable to maintain their college costs. They also argue “free” encourages people to rush to sign up without a full understanding of what they are signing up for.
Although this new free tuition has lots of “ifs” and “buts,” the intention is a good one…how to make a college education reachable and affordable to more students. It is perhaps a step in the right direction. As with anything in this college funding world though, students and families need to fully understand their choices and the future implications of those choices. We’ll have to keep an eye on other states as this idea spreads and changes.
July 7, 2017