Category Archives: College Tuition

Immigrants seeking in-state tuition want court to hear case

The Associated Press

ATLANTA — A group of young people brought to the U.S. illegally as children is asking Georgia’s highest court to overturn the dismissal of a lawsuit they filed seeking access to in-state tuition at the state’s colleges and universities.

The roughly three dozen young immigrants have been granted temporary permission to stay in the U.S. under an Obama administration policy introduced in 2012. Their lawsuit asks a judge to instruct the university system’s Board of Regents to allow them to qualify for in-state tuition.

The Georgia university system requires any student seeking in-state status for tuition purposes to provide verification of “lawful presence” in the U.S. The Regents have said students with temporary permission to stay under the 2012 program — known as Deferred Action for Childhood Arrivals or DACA — do not meet that requirement.

Lawyers for the state argue that the young people do not, in fact, have “lawful status” in this country. Moreover, the state’s lawyers argue, the Board of Regents is protected from the lawsuit under the principle of sovereign immunity, which shields the state and state agencies from being sued unless the General Assembly has explicitly waived that protection.

A Fulton County Superior Court judge in June 2014 agreed with the state that the Board of Regents is protected by sovereign immunity, and the state Court of Appeals upheld that ruling in March. Now the young immigrants want the state Supreme Court to rule that the board isn’t protected by sovereign immunity and to send the case back to the Superior Court for a ruling on the merits of the lawsuit.

Charles Kuck, the young immigrants’ lawyer, argues that since they are seeking a declaratory judgment — a ruling by the court that states legal rights — sovereign immunity does not apply. That protection only applies in cases where a party is seeking injunctive relief, which generally involves a court order to do something or stop doing something, Kuck argues.

A 2014 Georgia Supreme Court decision found that state agencies are protected from lawsuits involving damages or injunctive relief, but that opinion did not specifically address declaratory judgments.

If sovereign immunity were to apply to suits seeking a declaratory judgment, it would mean a state agency could make and interpret administrative rules in any way it wanted to and then stand behind sovereign immunity if challenged. That, Kuck added, would be illegal and unconstitutional.

Lawyers for the state argue that the 2014 Supreme Court ruling should not be interpreted as excluding cases in which declaratory relief is sought. The trial court and Court of Appeals were correct in finding that “the same constitutional analysis that protects the State from actions for damages and claims for injunctive relief applies with equal force in protecting the State from declaratory relief,” the state’s brief says.

The Supreme Court is set to hear oral arguments in the case Friday in a special session at the Gilmer County Courthouse in Ellijay.


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Georgia’s public universities raising tuition up to 9 percent

The cost of higher education at Georgia’s public universities will jump by up to 9 percent next academic year.

The University System of Georgia Board of Regents (USG) Tuesday approved a series of tuition hikes for the 2015-16 academic year. The increases will range from 2.5 percent at 20 of the system’s 30 institutions to 9 percent at The University of Georgiaand Georgia Tech, two of the four research universities.

USG noted Georgia Tech and UGA “require more investment to provide the academic programs, offerings and student services that are essential as leading and nationally ranked research universities.”

Tuition will rise by 5.5 percent at the system’s other two research institutions, Georgia State University and Georgia Regents University.

The tuition increases will maintain the balance in the costs of public higher education in Georgia at roughly 50 percent from the state government and 50 percent from tuition.

“To ensure we can continue to offer quality public education, we must continue to invest in our institutions,” system Chancellor Hank Huckaby said. “We have carefully assessed the tuition rates for our institutions to make sure we are balancing the increasing costs of providing public higher education while keeping tuition and fees as affordable as possible.”

Students attending Atlanta Metropolitan State College and Middle Georgia State University also were hit with tuition increases of 9 percent.

Several other universities will experience larger tuition hikes than the base 2.5 percent because of special circumstances.

Students at Kennesaw State University will pay 4.4 percent more in tuition to help cover the costs of KSU’s upcoming consolidation with Southern Polytechnic State University. Tuition at Georgia Gwinnett College will go up by 8.3 percent to bring it more in line with the system’s other four-year universities.

Dave Williams
Staff Writer-
Atlanta Business Chronicle

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White House Abandons Plan to End College Savings Accounts

Your 529 Plan Is Safe. Here’s Why the White House Changed Course.

President Obama is abandoning his controversial plan to tax the interest on 529 savings accounts, the White House announced Tuesday.

The 529 plans are savings accounts in which parents and families can invest after-tax dollars. If the money is used for specified college costs, they don’t have to pay federal tax on the interest accumulated in these accounts.

The president’s proposal, which faced bipartisan opposition, would have “effectively end[ed]” the plans, according to the New York Times.

“Given it has become such a distraction, we’re not going to ask Congress to pass the 529 provision so that they can instead focus on delivering a larger package of education tax relief that has bipartisan support, as well as the president’s broader package of tax relief for child care and working families,” a White House official told the New York Times.

Earlier on Tuesday, House Speaker John Boehner, R-Ohio, said that 529 plans “help middle-class families save for college,” and said that taxing these accounts should not be included in the president’s budget proposal.

Lindsey Burke, the Will Skillman fellow in education policy at The Heritage Foundation, said that the president’s plan would have hurt middle-class families.

“Taxing college savings accounts would have created disincentives for those who save for college in favor of the federal government directing college spending, lending and handouts—through proposals like ‘free’ community college and student loan ‘forgiveness,’” Burke told The Daily Signal.

“It became clear pretty quickly that the proposal to tax college savings accounts in no way benefited middle-income families,” Burke added. “Families who have diligently worked to save for their children’s college education would have been penalized under this proposal. It seems, at least for the moment, that the administration is dropping its quest for this bad policy.”

>>> Obama Proposes Eliminating Tax Cut Designed to Help Families Save for College

Corie Whalen Stephens, a spokeswoman for Generation Opportunity, said taxing the interest on 529 plans hurts middle-class students and their families.

“It’s encouraging to see our president respond to the needs of our generation by dropping his ill-conceived idea to tax 529 college savings plans. His misguided proposal, intended to fund his unaffordable government policies, would have fallen squarely on the backs of middle-class students and their families,” said Stephens.

She added that funding a broken system doesn’t help students.

“Finding new ways for the government to finance a failing higher education system isn’t a solution. In fact, these endless subsidies with no reforms attached to them are the problem. To fix this, our leaders must look to policies that foster innovation and competition to lower overall costs—not repackage failed big government policies,” said Stephens.

By Kate Scanlon
Kate Scanlon is a news reporter for The Daily Signal and graduate of The Heritage Foundation’s Young Leaders Program.

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Making Sense of the Uproar Over Obama’s 529 Proposal

President Barack Obama’s proposal to scale back tax breaks for college-savings accounts, the 529 plans, provoked an immediate uproar. There’s no doubt the proposal would make future contributions to  529s much less attractive. (It doesn’t affect money already in 529s.) But the loud opposition misses the rationale for changing the way the government encourages saving for college and underscores the reasons tax reform is so hard.

Who benefits from the 529 tax break?

The White House says about 70% of the benefits of 529 plans go to households with incomes above $200,000. That’s fewer than 4% of all tax returns, according to the latest IRS data. There are no income limits on 529 plans; anyone can use them, no matter how affluent.

In general, tax breaks that involve deductions (mortgage interest) or excluding income from taxes (401k retirement accounts) benefit upper-income taxpayers more than others because they are in the highest tax brackets. (A $1,000 deduction reduces the tax bill by $250 for a family in the 25% bracket and $396 for a family in the 39.6% bracket.) Replacing tax deductions with tax credits can give everyone the same dollar amount, regardless of tax bracket.

If we’re uneasy about widening income inequality and want to use the tax code to lean against that (which not everyone does), then swapping deductions for credits makes sense. That is the essence of the president’s proposal.  He’d curb the use of 529s, which disproportionately benefit upper-income families, to finance expansion of the American Opportunity Tax Credit, which is available only to families with pretax incomes up to $180,000.  Families that don’t make enough money to owe income taxes can get up to $1,000 in cash from the AOTC today; the president would increase that to $1,500, an obvious winner for lower-income families.  He’d also extend the benefit to part-time students and allow students to take it for up to five years (instead of the current four).

Now the tax credit isn’t a perfect substitute for the 529 tax break, but the president’s plan for 529s piece can’t be viewed in isolation. He means to move tax subsidies for college savings down the income ladder. “The plan overall would do MORE to help both middle-class and lower-income families afford college,” Bob Greenstein of the Center on Budget and Policy Priorities says in a recent defense of the president’s proposals.

If we’re going to use the tax code to encourage saving for college, then there’s a good case for targeting tax breaks at lower- and (truly) middle-class families. Government help will make more of difference for them – and certainly will reduce the amount of debt they take to go to college — instead of helping affluent families who are going to send their kids to college no matter what the government does.

Do we really prize simplicity in the tax code?

Everyone wants a simpler tax code. Almost everyone says there are too many deductions, credits, exemptions and loopholes. (What’s the difference between a deduction or credit and a loophole? If you get the benefit, it’s a deduction or credit. If someone else gets it, it’s a loophole. )

The president’s proposal is a small step towards simplicity. It would, the White House says, “consolidate education incentives into one vehicle.”  That means doing away with some tax breaks – the Coverdell college-savings accounts, the little-used deduction for interest on new student loans, the Lifetime Learning Credit – and sweetening others.  It turns out that a lot of people prefer complexity to simplicity if simplicity means doing away with a tax break they get.

Do tax breaks really encourage savings?

Much of the U.S. tax code is based on the logical economic argument that tax breaks get Americans to save. The argument: If you increase the after-tax return on savings (by giving people a tax break for putting some of their wages into a 401k or by making the capital gains, interest and dividends on a 529 tax free), people will save more than they otherwise would.

But do they? That’s long been debated by economists. Recent research from Harvard’s Raj Chetty and colleagues suggests tax breaks for retirement savings  reward people who would have saved the money anyhow and don’t increase the total amount of saving.

Better to skip the tax breaks, they say, and rely on “nudges,” such as automatically enrolling workers in retirement-savings programs. Most people are what the researchers call “passive savers.” They don’t respond much to tax incentives. Of course, that’s one risk the president is running here. One advantage of 529 plans is that they are widely marketed by states and mutual funds and that may help nudge people to save for college. Curtail the benefit and there’ll be less of that marketing.

By David Wessel
Director, The Hutchins Center on Fiscal and Monetary Policy
Senior Fellow, Economic Studies
The Brookings Institution

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3 Ways to Lower Crazy High College Costs

Stuart M. Butler | Brookings

After centuries of little change, the basic “sage on a stage” business model of higher education is beginning to undergo a radical transformation. Buffeted by high tuition costs and loan debt, students and their parents are seeking better value for money. Meanwhile technological change spearheaded by online education and such innovations as “massive open online courses” (MOOCs) is shaking up the economics of educational information and teaching. And new business models, introducing such approaches as competency based degrees and blends of online and campus-based learning, are reducing costs and offering more customized degrees.

Thanks to these developments, the cost of acquiring the skills needed to be successful in the future economy is likely to fall sharply. That will be good for the economy. It will also open up opportunities for skill-based economic advancement for the many Americans who today cannot afford college without incurring crushing debt.

For this transformation to achieve its full potential, however, three things are needed.

First, would-be students must be able to obtain clear information about costs and quality, so that they can locate the best value for money. As Wellesley College economics professor Phillip Levine explains in his new Brookings study, that is no easy task. Much like the health industry, higher education is woefully inadequate at providing accurate and usable information on the actual costs a student is likely to incur, given a student’s economic circumstances and other factors. So it is difficult to engage in comparison shopping. Levine notes that “net price calculators” developed by the federal government are difficult to use and often inaccurate for particular students – but fortunately some colleges like Wellesley recognize the market value of good information and are developing more effective tools.

Second, we need comparison information that recognizes “quality” means different things to different people. Students place different values on different features of a college, from the availability of certain courses and professors, to the employability associated with certain majors, to the “college experience.” The weighting of such factors has a strong subjective element. That’s why national and international “scorecards” will always vary widely and be disputed, and why the federal government cannot develop a supposedly objective checklist of quality criteria. So it is important is for students to have access to scorecards that reflect their own criteria for value in education. Fortunately customized information is becoming increasingly available from private sources. It’s not just US News & World Report anymore. Parents and high-schoolers concerned about the earning potential of particular degrees can consult the Forbes and Kiplinger ratings, for instance, while those seeking a broad education can now consult the What Will They Learn rankings of the American Council of Trustees and Alumni

The third essential step is to open up the cozy world of higher education to more competition from institutions with new business models. That is certainly happening, but competition is held back by the outdated accreditation system, which protects the traditional providers because federal aid is limited to use in institutions with traditional accreditation. Fortunately the accreditation oligarchy is under pressure. Degrees based on competency rather than “seat time” are gaining traction, while low-cost degrees are reducing the need for loans. Meanwhile there are a range of proposals to amend traditional accreditation, from legislation to permit states to develop their own accreditation systems that would retain eligibility for student loans to steps to open up the accreditation system to new kinds of institutions.

Innovation combined with information drives change. Administrators of the hallowed halls and ivy-clad towers of the world’s universities are now learning that lesson.

  • Stuart M. Butler

    Senior Fellow, Economic Studies

    Prior to joining Brookings as a senior fellow, Stuart Butler spent 35 years at The Heritage Foundation, as Director of the Center for Policy Innovation and earlier as Vice-President for Domestic and Economic Policy Studies. He is also an Adjunct Professor at Georgetown’s McCourt School of Public Policy and a visiting fellow at the Convergence Center for Policy Resolution. He is a member of the editorial board of Health Affairs, serves on the panel of health advisers for the Congressional Budget Office and is a member of the Board on Health Care Services of the Institute of Medicine. He also serves on advisory councils for the National Coalition for Cancer Survivorship, the Kaiser Institute for Health Policy and the March of Dimes.

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Dual enrollment vs. AP classes: Are Georgia high school students learning about both options?

Rick Diguette is a local writer and college professor.  Today, he takes up a topic of personal interest to me as a parent of two high school sophomores, dual enrollment.

Should more high school students be able to take classes like this one at Georgia State? (GSU Photo)

My twins have to decide in the next few weeks whether to apply  for their high school’s new International Baccalaureate diploma program, which locks them into six two-year courses over 11th and 12th grades. Their other option is to select a mix of IB and AP courses, which could possibly allow space for dual enrollment at a local college.

But I found out from the high school it falls on parents to pursue and enable dual enrollment. Parents whose children dual enrolled at Georgia State, Georgia Perimeter or Tech confirmed to me they spent a lot of time and energy making it happen.

Diguette says it should be easier for Georgia high school students to take courses at local college.  But he says schools often promote AP classes to their students instead.

By Rick Diguette

It is no secret that the cost of a college education is greater today than ever before.  And the cost just keeps rising.  That is also why the debt college seniors incur by the time they graduate has continued to rise―by an estimated 6% every year since 2008. When they finally have that diploma in hand, better than 70% of America’s college graduates have racked up almost $30,000 in student loans.

Those are the cold, hard facts that most Georgia parents must reckon with sooner or later.  Even parents of a child who can take advantage of HOPE know that Georgia’s lottery-funded scholarship program isn’t nearly as lucrative as it once was, especially if their child doesn’t qualify for a Zell Miller Scholarship. 

Since there is no reason to believe that college costs will begin to fall any time soon, parents and students must be resourceful as they plan ahead.  However, one low-cost option that they sometimes overlook is Dual Enrollment.

High school juniors and seniors participating in Dual Enrollment can earn college credits while satisfying their remaining high school graduation requirements at the same time.  Although this 2-for-1 deal has been around a long time, the savings it can generate have never looked more attractive.

Dual Enrollment students taking two college courses each semester during their junior and senior years can graduate from high school with 24 college credits. That is almost the equivalent of freshman year. And most of the costs associated with earning those fully transferable college credits will be paid for by the Georgia Student Finance Commission.

Another Dual Enrollment option available exclusively to public high school juniors and seniors is Move On When Ready. Students participating in the program must take all of their courses at a local college, but they can still take part in team sports and other non-curricular activities at their high school.  The costs associated with courses taken as a Move On When Ready student are fully funded by the Georgia Department of Education.

If all of this sounds too good to be true, rest assured it isn’t.  But there is a hitch.   

According to the Georgia Department of Education, beginning in the 8th grade all Georgia students should receive information about Dual Enrollment by April 1 of each school year.  If your school’s principal supports Dual Enrollment, you and your child will hear about the program. 

But not all principals are sold on Dual Enrollment, and the same can be said for some teachers and guidance counselors.  What they promote instead is Advanced Placement.

The Educational Testing Service has done a great job marketing Advanced Placement as a means of adding rigor to the high school curriculum.  Teachers and guidance counselors advise parents and students that college admissions screeners look favorably on high school transcripts with a high percentage of Advanced Placement courses.

And yet in one of its very own reports, ETS acknowledges that “although most students attend a high school at which the AP program is available, few students actually take an AP exam even after taking an AP course, and only a fraction of those who do take a test score high enough to qualify for college credit or placement in the colleges and universities that offer such opportunities.” 

Participating in Dual Enrollment benefits high school students in many ways.  Perhaps most important, it prepares them for the college environment which is quite different from what they’ve grown accustomed to in high school.  And it also allows them to save their parents some money. 

Best of all, those 24 college credits earned by my hypothetical Dual Enrollment students are 24 college credits they won’t have to pay for with student loans.    

By Maureen Downey
AJC – Get Schooled 

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College is Not a Ludicrous Waste of Money

A couple of weeks ago former Secretary of Labor Robert Reich published an article under the unfortunate and misleading headline “College Is a Ludicrous Waste of Money.” Readers who did not finish the article might have assumed Reich was arguing that a college degree is vastly overpriced, offering graduates little in the way of an economic return.

As a well-informed observer of U.S. labor markets, Reich knows this frequent complaint about American colleges is flatly untrue. The economic reward from attending and completing college has probably never been higher. The fact that many parents, students, recent graduates, and, yes, economic reporters believe differently reflects confusion rather than a sober appreciation of the facts.

Two different trends have combined to persuade many people that college is just not worth it anymore. One highly publicized trend is the sustained increase in the sticker price of college, especially four-year public colleges. These colleges saw average tuition double between 1988 and 2013, even after adjusting for the general rise in consumer prices. In other words, public college tuitions climbed much faster than the prices of other goods and services. Of course, many students do not pay the full sticker price charged by the college they attend. Low-income students and students with strong qualifications often obtain financial aid, which reduces their net cost of attendance, and many elite colleges are now free for families with incomes under a certain amount. Even so, many middle-class and affluent students face higher charges than they would have paid two or three decades ago.

A second trend visible to many recent grads and their parents is the shrunken paychecks available to students after they’ve graduated from college. Many students finishing college cannot even find a job that requires a diploma let alone the skills they learned in their field of specialization.

With steadily higher tuition and stagnant or even declining wages for new college graduates, how can it be that the economic return to college may be near an all-time high? The simple explanation is that the prospects for twenty-somethings who do not complete college are much worse than those of the ones who do. What is more, the economic prospects of the young adults who do not complete college have worsened over time, and much faster than the prospects facing new college grads.

A student’s economic reward from completing college depends on more than just her cost of attending and the expected income she will earn after graduation. It also depends on what she would earn if she did not enter or finish college. One reason the nation’s colleges have not seen a drop in in enrollment despite the supposedly gloomy prospects of new graduates is that for most 18- to 22-year-olds it still makes sense to pay the price and get the degree.

In one crucial way, the worsening economic outlook facing non-college-bound youngsters has made college cheaper for the students who attend. The (often discounted) sticker price of attending college is only one of its two major costs. The other is the earned income a student gives up because she is sitting in a classroom or studying rather than holding down a job. Because the wages of high school graduates and college dropouts have shrunk, the “opportunity cost” of attending college has also dropped.

Many new college graduates are understandably disappointed by the job market they have entered. A large fraction of them are forced to take jobs for which they may feel over-qualified. It is worth remembering, however, that holding a job for which one is over-qualified can be far preferable to the outlook facing a job applicant whose education ended in high school. In many situations where business owners can hire either a college or high school grad, they will hire the college graduate, even if the position only requires the skills picked up in a high school classroom. This gives college graduates a leg up in getting jobs when there are many non-college applicants for the same jobs.

The unemployment rate of high school graduates has been more than twice that of college graduates over the past two decades. At the same time, the employment rate of high school grads has been 16½ percentage rates lower. Last year, the employment rate of high school graduates past age 25 was 54 percent while that of college graduates was a bit less than 73 percent.

There are many good reasons to be disappointed with the current state of the job market. Americans with just a high school diploma have a lot more reasons for discontent than those who have graduated from college, however. The big current payoff from a college degree is not due to the soaring prospects of the average college grad. It is due instead to the worsening prospects facing youngsters who fail to enroll in or complete college.

By: Gary Burtless
The Brookings Institution

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