Blair Horner: Colleges Open, Will Governor Cuomo Help?

Aug 27, 2018

It’s that time again; colleges are opening across New York and for many of the students, the campus experience will have a profound impact on their lives; their career choices, their world view, the connections that they make.  The public benefits too: more highly trained residents have a positive impact on the economic health of the state, the nation and the world.  Studies in New York have shown that every dollar invested in higher education results in multiple dollars more in tax revenues generated by students both while attending college as well as after they graduate.

College graduates positively impact our democracy – a more highly educated person is often in a better position to appreciate the nuances of public policy.

For those reasons, society has viewed investing in higher education as a worthwhile public good the state and nation are better off with more highly educated workers and voters.  Of course, a college degree is not the only path to economic or civic success to be sure, but it helps.

Despite the obvious benefits from public investments, New York (like much of the rest of the nation) has been shifting the costs of attending college from the state to the student and his or her family.  The result has been dramatic: over the past decade or so the amount of debt resulting from attending college has skyrocketed.  Today, 70 percent of college students graduate with significant loans.

Over 44 million Americans collectively hold nearly $1.5 trillion in student debt. That means that roughly one in four American adults are paying off student loans.

When they graduate, the average student loan borrower has over $37,000 in student loan debts, a $20,000 increase from 13 years ago. With that money, borrowers could put a down payment on a home, purchase a new car or bootstrap their own business.

Much handwringing has occurred over this trend, but not much action.  Here is New York, Governor Cuomo has successfully advanced a proposal to make it easier for some to pay off their debts.  The “Get on Your Feet Loan Forgiveness Program” provides up to 24 months of federal student loan debt relief to recent New York college graduates who are participating in a federal income-driven repayment plan whose payments are generally capped at 10 percent of their discretionary income.

The governor also got legislative approval for his much ballyhooed Excelsior Scholarship program which allows some middle income students to attend public colleges and universities in New York tuition-free.

While both of these programs’ goals are laudable, both are by design very limited in their impact.  Most students are ineligible.

All State University of New York students, have seen tuition hikes nearly every year during the two terms of the Cuomo Administration.  Since 2011, state law has allowed for tuition hikes at the State University of New York for up to $300 per year.  And thanks to that law, tuition has gone up, totaling a whopping 30% increase in the cost of attending public college. 

The law allowing public tuition hikes has been linked to another provision, one that requires the state to “maintain” its support for SUNY (and the City University as well). The governor linked tuition hikes with a promise that the state would not cut its support for higher education and thus use the tuition hikes to merely fill in budget gaps.  Instead, higher education advocates hoped, additional tuition dollars would be used to enhance the institutions.

As is too often the case, the fine print spelled out a different scenario.  The state’s “maintenance of effort” did not include inflation and other cost increases.  As a result, state support for higher education has been stagnant while costs have increased; meaning that student dollars are being used to close budget shortfalls after all.

Governor Cuomo will have an opportunity to close those shortfalls.  Both houses of the Legislature unanimously approved legislation that requires the state to cover the inflationary costs of SUNY, thus ensuring that the tuition hike dollars are used solely for SUNY improvements.  It is expected that the legislation will land on the governor’s desk soon.

During the time that public college tuition has increased over 30 percent, the state’s overall budget increased by over 30 percent.  Clearly, the state has had the money to cover the increases in college inflationary costs, just not the political will to do so.  Now is the time for New York to reverse its policy of increasing costs to attend colleges, boosting state support is an important first step.

Blair Horner is executive director of the New York Public Interest Research Group.

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