Offering free tuition to students whose household income falls below a certain threshold would appear to make higher education more affordable. However, they have little impact on lower income students, who often already qualify for substantial financial aid.
Free tuition policies do not necessarily expand aid for these students, According to an analysis by Phillip Levine for Brookings, the public policy think tank. Instead, the primary benefit of these policies is communicating financial aid packages more clearly and effectively.
From the Washington Post’s database, between 40% and 65% of public universities offer a free tuition policy, as do 18% to 33% of private institutions with large or very large endowments, respectively. Only 7% of private universities with small endowments do, since tuition is their primary source of revenue.
Policies also vary by individual school: income requirements, academic or residency requirements, and whether the policy covers tuition only or other necessary expenses differ at each institution.
At schools with free tuition policies, students receive a minimum aid award— the cost of tuition—but families must still complete financial aid forms to cover expenses like food, housing, books, and supplies. The policies may communicate expected aid effectively, but they do not spare families from the complex, time-consuming financial aid application process.
Levine’s analysis subtracted the net price of institutions from the cost of attendance. At the 25th percentile of household income, he found that students received at least as much aid from traditional grant packages as they would under a free tuition policy. Since many of these aid awards cover non-tuition expenses as well, the free tuition policy is not as effective for this category of students.
The sticker price of a college or university is often very different from what students actually pay, which can turn lower income students and families away from higher education. Because the financial aid system is complex and opaque, universities often struggle to communicate the final price.
Free tuition policies can improve overall understanding about the cost of college, but it is essential that institutions include information about additional non-tuition expenses to ensure fully transparent communication, the report concluded.
