Paying for Higher Education

As concerns have grown about access to and affordability of California’s higher education system, understanding costs has become more critical than ever. How are institutions—and students—faring?

This question is the focus of three reports released by PPIC and a panel discussion held last week in Sacramento. Hans Johnson, a Bren fellow at PPIC, first summarized the research. One report shows that federal financial aid has shielded low-income students from rising tuition at the University of California and California State University. A second report evaluates both revenues and spending—including faculty salaries and benefits— and concludes that UC and CSU have not become less efficient in the past several years. A third report suggests that as California begins to reinvest in public higher education, it could tie funding more closely to results—for example, the number of degrees awarded—to meet state goals. In his presentation, Johnson noted that the state’s current goals—the Master Plan for Higher Education—are more than 50 years old and overdue for an update.

Panelists took up the issue of goals—how to set them, what to measure, and how to share the costs—in a discussion moderated by Patrick Murphy, PPIC research director. Participants were Henry Brady, dean of UC Berkeley’s Goldman School of Public Policy; Nancy Shulock, former executive director of CSU Sacramento’s Institute for Higher Education Leadership and Policy; and Amy Supinger, California policy consultant for the Lumina Foundation.

Video: Making College Possible

At a time when California’s economy needs more college graduates, a new PPIC report examines the role of grants and scholarships in making higher education both accessible and helping students graduate. Hans Johnson, the report’s author and PPIC Bren Fellow, talked about his findings at a briefing last week in Sacramento.

He found that although total financial assistance available through federal grants, Cal Grants, institutional aid, and private scholarships has increased, it has not kept pace with the actual cost of attending California State University and community colleges. These are the California colleges that enroll most low-income students in California—a state in which nearly 60 percent of K–12 students qualify for free and reduced price lunch programs.

“If we want the economic ladder to success to work in California, we need more students to go to and complete college,” he said. “And given our student population, a lot of those students will be from very low-income families.”

He recommended strategies to make college more affordable and accessible. They include directing any additional aid to low-income students and helping more students complete financial aid forms.

Boosting Transfers From Community College to CSU

To increase the number of college graduates in California, state policymakers are working to make it easier for community college students to transfer to four-year institutions, particularly the California State University (CSU) system. Legislation in 2010 required state community colleges to create a special degree that would ease the transition to CSU campuses.

Researchers Colleen Moore and Nancy Shulock provided a progress report on the implementation of this new degree at a PPIC briefing on Friday. These two researchers are from the Institute for Higher Education Leadership and Policy at CSU Sacramento and are the authors of a new report for PPIC, From Community College to University: Expectations for California’s New Transfer Degrees.

They found that the new degrees have improved pathways for community college students. But many community colleges still offer transfer degrees in only a few majors, and some CSU campuses accommodate the degree in only some of their degree programs. In other words, the program still has a long way to go before it is fully implemented.

Ready for College?

California needs more college graduates than it is currently producing. Part of the problem has been a lack of college readiness among the state’s high school graduates. Fortunately, recent trends in college preparation provide some good news. By several measures, a large and growing share of the state’s high school graduates are ready for college-level work. Indeed, many of them have successfully completed college-level courses even while still enrolled in high school.

New data on Advanced Placement (AP) exams are especially encouraging. AP courses are college-level courses in more than 30 subjects offered in high schools throughout the country. AP exams determine whether a student has attained college-level proficiency in the course, and AP exam passage rates are a meaningful measure of college preparation. Many colleges accept AP exams for college credit, and research shows that AP students outperform other students in college. Indeed, students who earn AP credits graduate at higher rates overall and often perform better in subsequent courses in the same field.

California’s high school graduates outperform their peers in the rest of the country on AP exams. In 2013, more than one in four California high school graduates (26.9%) passed at least one AP exam sometime during high school, compared to one in five in the nation as a whole. Among the 50 states and the District of Columbia, California high school graduates ranked sixth highest. Moreover, the share of graduates successfully completing an AP exam is going up fast in California—higher than in the rest of the nation. Between 2003 and 2013, the share of high school graduates passing at least one AP exam increased 9.6 percentage points in California, compared to 7.9 percentage points for the entire nation. California has a higher share of graduates taking AP exams than does the nation as a whole (45.6% versus 35.0%), with passage rates among AP exam takers slightly higher in California (59.0% versus 57.4%).

Other measures of college readiness also show progress. More students are taking the college preparatory courses (known as the “a–g” courses) required for admission to the University of California (UC) and the California State University (CSU). The latest data from the California Department of Education show that 38.3 percent of public high school graduates in California took the a–g courses in 2011–12, up from 34.6 percent in 2001–02 and from 32.3 percent in 1993–94. Gains in college prep work have been especially impressive among the state’s Latino high school graduates, who now make up almost half of all high school graduates. Among Latino graduates, the share taking a–g courses increased from 21.8 percent in 2001–02 to 28.0 percent in 2011–12. Increases in college readiness would be even better news if our state was responding with policies to meet the growing demand for college. But it’s not. Only the top eighth of high school graduates are eligible for UC and only the top third are eligible for CSU—according to eligibility thresholds that were set more than 50 years ago. Given the increasing shares of high school students who are well prepared for college, some reconsideration of those thresholds is long overdue.

If California is to meet the demand for educated workers, it needs to produce more college graduates. Making room for these highly capable students—by increasing the share of high school graduates eligible for the University of California and the California State University systems—would improve the well-being of our state and the lives of these young Californians.

Chart sources: PPIC calculations based on College Board data.