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NC Promise Expands

NC Promise Expands

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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 has 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.

NC Promise low tuition affected enrollment

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? 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.

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 focuses 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.

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 expenses are:

University Expenses
Elizabeth City State University $9,859 On campus
$1,350 Off campus with family
UNC Pembroke $12,420 On campus
$2,764   Off campus with family
Western Carolina University $14,030 On campus
$ 2,933 Off campus with family
Fayetteville State University $11,827 On campus
$ 2,387 Off campus with family

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.

Wally Boston Dr. Wallace E. Boston was appointed President and Chief Executive Officer of American Public University System (APUS) and its parent company, American Public Education, Inc. (APEI) in July 2004. He joined APUS as its Executive Vice President and Chief Financial Officer in 2002. In September 2019, Dr. Boston retired as CEO of APEI and retired as APUS President in August 2020. Dr. Boston guided APUS through its successful initial accreditation with the Higher Learning Commission of the North Central Association in 2006 and ten-year reaccreditation in 2011. In November 2007, he led APEI to an initial public offering on the NASDAQ Exchange. For four years from 2009 through 2012, APEI was ranked in Forbes' Top 10 list of America's Best Small Public Companies. During his tenure as president, APUS grew to over 85,000 students, 200 degree and certificate programs, and approximately 100,000 alumni. While serving as APEI CEO and APUS President, Dr. Boston was a board member of APEI, APUS, Hondros College of Nursing, and Fidelis, Inc. Dr. Boston continues to serve as a member of the Board of Advisors of the National Institute for Learning Outcomes Assessment (NILOA) and as a member and chair of the board of New Horizons Worldwide. He has authored and co-authored papers on the topic of online post-secondary student retention, and is a frequent speaker on the impact of technology on higher education. Dr. Boston is a past Treasurer of the Board of Trustees of the McDonogh School, a private K-12 school in Baltimore. In his career prior to APEI and APUS, Dr. Boston served as either CFO, COO, or CEO of Meridian Healthcare, Manor Healthcare, Neighborcare Pharmacies, and Sun Healthcare Group. Dr. Boston is a Certified Public Accountant, Certified Management Accountant, and Chartered Global Management Accountant. He earned an A.B. degree in History from Duke University, an MBA in Marketing and Accounting from Tulane University’s Freeman School of Business Administration, and a Doctorate in Higher Education Management from the University of Pennsylvania’s Graduate School of Education. In 2008, the Board of Trustees of APUS awarded him a Doctorate in Business Administration, honoris causa, and, in April 2017, also bestowed him with the title President Emeritus. In August 2020, the Board of Trustees of APUS appointed him Trustee Emeritus. In November 2020, the Board of Trustees announced that the APUS School of Business would be renamed the Dr. Wallace E Boston School of Business in recognition of Dr. Boston's service to the university. Dr. Boston lives with his family in Austin, Texas.

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