State budget cuts to higher education along with rapidly rising college tuitions have greatly reduced the opportunity for many Americans to earn a degree. Over the past 10 years, the average cost of tuition and fees at state-sponsored four-year colleges has increased 37% while inflation has risen 19%. Over the past 30 years, tuition costs have increased 213%. The average cost for a resident student attending a four-year public university today is about $17,000 a year – and over twice this amount for a private school. The average debt for those with a student loan is now $33,000. Colleges and universities receive much of their revenue from federal student grants and loans. Year after year, it is common for these institutions to enact tuition increases that dwarf the inflation rate. Critics blame universities for skyrocketing tuitions by not controlling costs and wasting money on unnecessary expenses, sports teams, glamorous research programs and excessive administrator compensation.
A Federal Reserve Bank report blames the rapid rise in college tuition on the increase in federal student loans and grants which has made more dollars available to schools. The Fed states that many of these institutions take this opportunity to unnecessarily increase the cost of college. The Fed discovered that for every dollar awarded in student grants and loans, tuition goes up about sixty cents.
Proposed Legislation: To prohibit federal student aid to institutions of higher education where tuition increases exceed the rate of inflation.
Prospective Sponsor: Rep. Juan Vargas (CA)
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