Obama doubles down on free community college in 2017 budget proposal

Both Republican and Democratic lawmakers support reforms to make college more affordable

President Obama's FY 2017 budget proposal, which includes a plan to make community college free for many students, has earned praise from leaders in higher education but faces resistance from Republican lawmakers.

Estimated nine million students could benefit

Under Obama's plan, the federal government would cover 75% of the cost of tuition for two years, approximately $3,800 per student on average. The remaining 25% would be covered by states that choose to participate. The plan is projected to cost $61 billion over a decade.

To be eligible, community college students would have to maintain a 2.5 GPA, make progress toward a credential, and attend classes at least half-time. For schools to be eligible, they must award credits which can be applied to a four-year degree or provide credentials that lead to work in high-demand fields. Under the plan, low-income students enrolling at historically black colleges also would be eligible for financial aid.

Overall, the White House says as many as nine million students could benefit from the proposal.

Officials say the plan was partially inspired by Tennessee Promise, a program that makes the state's community college free for recent high school graduates. That program is a "last dollar" scholarship, which covers any costs remaining after other sources of aid have been applied. Obama's plan would work a little differently, providing funding up-front.

Hesitance in higher ed, pushback in Congress

While leaders in higher education have largely applauded the administration's proposed budget, they are not optimistic that they will see any real benefits and are pushing Congress not to let higher education initiatives take a backseat to other issues.

Peter McPherson, president of the Association of Public and Land-Grant Universities, says, "Election-year politics should not foreclose progress in the year ahead," arguing that ambitious proposals "should not be immediately dismissed simply because there will be a new occupant at 1600 Pennsylvania a year from now."

Republican lawmakers have criticized the budget proposal, with congressional party leaders refusing to let Obama's budget director formally present the plan to critical Senate and House committees this week, breaking with a long-held tradition.

Seeking bipartisan cooperation to make college affordable

U.S. Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) are among the lawmakers working to gain bipartisan support for the reauthorization of the Higher Education Act. They both advocate for making college more affordable and simplifying the process of applying for financial aid.

"[T]o discourage over-borrowing," Murray proposes "tak[ing] the federal handcuffs off colleges and universities that now prohibit them from advising students fully about the cost of college and the cost of their loans." She also supports "giving colleges and institutions that participate in the student loan program the ability to put limits on the amount of loans a student can take out."

Murray notes, "There is bipartisan support for requiring institutions who participate in the federal student loan program to have some accountability for students who default on their loans."

Supporting community college and business partnerships

Obama's budget proposal also calls for a $2.5 billion tax credit over five years for businesses that work with local community colleges and hire graduates.

The Community College Partnership Tax Credit would reward businesses that donate funds for instruction, equipment, or internships in fields such as information technology, energy, and health care. Companies that hire students from those programs could earn a one-time $5,000 tax credit per student hired.

The credits would be distributed to states based on population size, then passed to selected businesses and community colleges that create qualifying connections.

An estimated 500,000 graduates would benefit from the programs over the five years, according to James Kvaal, White House deputy director of domestic policy.

While the budget requires an unlikely congressional approval, this specific idea may take root and receive bipartisan support, observers say.

"The idea of ... bringing together community colleges and the local employer base is a very powerful one and really doesn't break along party lines," says Ted Mitchell, the Department of Education undersecretary (Tumulty, USA Today, 2/9; Reuters/NBC News, 2/6; Lederman, Insider Higher Ed, 2/10; Douglas-Gabriel, "Grade Point," Washington Post, 2/9).

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