NC Promise Expands

In a blog article that I titled The Signs Are All Around Us, I included a few thoughts about the NC Promise program. That write-up is republished below as a refresher about the program and a few of my questions. An update is published below my original article.

The Chronicle of Higher Education featured an article this week written by Sarah Brown about the state of North Carolina’s radical college affordability program called NC Promise.

NC Promise lowers tuition to $500 per semester for in-state students and $2,500 for out-of-state students at three universities in the University of North Carolina System. It may be the only state-sponsored promise program that isolates the first dollar program to three universities in the state and includes a lower tuition for out-of-state students.

Elizabeth City State University (ECSU), UNC Pembroke, and Western Carolina are the three universities where any student enrolling receives this benefit regardless of financial need. When the program was proposed by North Carolina’s Republican politicians in 2016, political backlash caused two HBCU’s (Fayetteville State University and Winston-Salem State University) to ask to be removed from the program.

Enrollments are up since the program’s implementation at all three universities. ECSU’s enrollments are up more than 50 percent. The program’s success has convinced politicians to allow Fayetteville State to join the program this fall.

Enrollment during the pandemic plateaued at all three universities. While overall enrollments are up, it’s mostly transfer students who have driven those increases. The graphic below shows the overall enrollment for each institution since the program’s implementation.

All three institutions selected for NC Promise are in economically depressed areas of the state of North Carolina. The success of the program has meant increased cost in the state higher ed budget, but legislators thus far accept those increases as recognizing the program’s success.

Recognizing that tuition alone may not make a difference in attendance, this year ECSU received $125 million for capital funding from the state’s covid funds. The Senate’s leader did not rule out a potential enrollment cap in a few years if the program is too successful.

The UNC System is studying the success of the program. Among the research questions that they’re researching are (1) did the low tuition increase the number of Pell students attending each institution and (2) is the lower tuition increasing the number of out-of-state students attending?

If the decision were up to me, I would also conduct research on where the transfer students are coming from. Are they from state two-year colleges or private four-year colleges with higher tuition?  Because of the limited distribution to these three institutions, only 12 percent of the UNC System students are benefitting from the low tuition under NC Promise.

Fayetteville State University Added to Program

On March 15, Higher Ed Dive reporter Liz Farmer wrote an article titled North Carolina expands its $500 tuition program. Will it keep paying for it?. The article focused on the addition of Fayetteville State University to the NC Promise program. Fayetteville State, an HBCU, initially opposed its inclusion stating that it was a way to reduce funding to historically black universities.

In a reversal, the current chancellor of Fayetteville State is quoted as stating, “If there was ever an example of a school that could benefit from the NC Promise program and diversity of students it could serve, it’s Fayetteville State University.” He highlighted the fact that more than half of FSU’s students are low-income or first generation and half are older than 24.

Ms. Farmer poses a couple of interesting questions. First, will the program prove its worth? While the evidence shows that enrollments increased at all participating institutions, no one knows if persistence has improved because the program has not been around long enough. Second, she notes that food and housing can cost as much as tuition or even more in the case of low tuition institutions. Students that find it difficult to pay for room and board may find it difficult to remain in college.

Are Room & Board Costs a Deal Breaker?

In order to provide more perspective on the second point, I went to College Navigator and looked up the most recent estimated room and board expenses for students at each of the four colleges participating in the program. For the 2021-2022 year, the room and board expenses were:

I decided to look at these expenses just two years later for the 2023-2024 academic year. Again, I used College Navigator as my source. The increases in room and board expenses varied by institution. Elizabeth City’s increases were modest with no increase for living off campus with family (perhaps they missed the inflation in basic costs of living memo). UNC Pembroke and Fayetteville State increased their on-campus costs the most at $1,674 and $2,091 respectively. For Pell-eligible families, those expenses are likely funded by student loans.

There is another category, Off campus, but it’s easier to note that it closely approximates the estimated expenses in the On campus category. Only living at home provides a lower estimated cost because it assumes that the room and board cost is assumed by the household.

It doesn’t require a PhD to see that room and board costs are substantially higher than the $500 per year tuition. These costs are also higher than the current level of Pell grants which means a student living on campus would have to borrow to cover some of their college attendance costs. I find it difficult to believe that this program will increase the percentage of low-income students attending college as a residential student.

I applaud the North Carolina legislature for creating the NC Promise program. I applaud the universities that are participating in the program. At the same time, I think any college program that requires students to pay money in the thousands of dollars (even if it is for room and board) will fail to attract our lowest income families who have no excess funds available. As I said in my earlier writeup, it will be interesting to follow the data and see if the percentage of students who are Pell grant recipients increases. It will also be interesting to see if student persistence (Ms. Farmer’s question) increases as well.