In this confusing and challenging time, students need more transparency from colleges, not less. They’re trying to make high stakes decisions about their future amidst the uncertainty of how long this will last, how much college will cost, how much they’ll be able to earn, and if they’re a dependent, their parents’ ability to support them if they’ve lost a job, lost their savings, or become sick.
They’re having to determine what college will look like in the fall, and what contingencies exist if their college isn’t able to open dorms or provide in-class instruction, or worse, if a school closes because of financial troubles.
A recent court decision held that Mount Ida, a college that closed in Massachusetts, was not liable to students for damages. Specifically, the ruling said that students were not owed a "fiduciary" obligation to the students to keep them informed of the school's troubled finances.
We recently conducted a flash survey of 100 college-bound families and 75% of respondents indicated that the coronavirus is changing their college process and decision-making. Notably, 33% of those respondents said they are considering a gap year, another educational path, or other delay in attending. According to the AGA, a nonprofit that accredits gap year programs, 90% of students who take a structured gap year return to school within a year, and are more likely to graduate on time and with a higher grade-point average.
One parent respondent said, “We are at a standstill, trying to make a plan for how to approach where we will apply and why.” Another posed this question, “Will my colleges under consideration survive?”
Last fall we conducted research to develop a model for college financial health with the goal of making this research open source and welcoming contributions to improve on our initial work. However, some colleges chose to chill our speech, by writing a cease and desist letter to our planned publisher, Inside Higher Ed, who covered the story in detail.
In an accompanying opinion, my co-founder Sabrina Manville and I posited, “Students are obligated to pay a college even if they don’t graduate. So why shouldn’t a college be obligated to stay in business until a student graduates? If so, it would require colleges to maintain a certain amount of cash to teach-out the current class.”
Colleges are facing extreme financial challenges, and colleges not only want to prevent this new information from coming to light, but they are lobbying to prevent students from accessing currently available data on their financial health. When surveyed recently by Inside Higher Ed about where they need the most support from state and federal governments to navigate the COVID-19 crisis, a full quarter of responding college presidents said they need the ability to tap endowment funds without negatively affecting their financial responsibility score. Why are we protecting failing institutions and not the very students who will be the ones that pay the price — literally — for their college closures?
We’re currently working on updating our research to respond to some of the previous concerns raised by colleges and others. First, we’re incorporating the most current available data. We’ll be looking at the sources of revenue, such as international students, which are likely to be impacted by COVID-19. Second, we’re changing the output from years of solvency to a “stop light” output still under consideration (e.g. Green - many years of solvency, Yellow - should be fine in the short term, Red - exercise caution). Third, we’re evaluating incorporating a college’s prior experience with online learning - something top of mind for many students and families should this crisis continue into the fall. “I don’t see why I should be paying full price for online classes if you don’t get the same kind of learning,” a student told the Mercury News. More student voices on Reddit here.
College goers would be wise to do their homework and really consider their choices. If you are interested in collaborating on our research, we’d love to hear from you so consumers can get the information they need to ensure they’re better off after college.