2017-04-21 / View From Here


Governor Cuomo's Tuition Plan

Our legislators in Albany rarely make national news (except perhaps as the subject of legal proceedings), but they did in recent days when they passed legislation urged by Governor Andrew Cuomo providing for free tuition for many New Yorkers attending the State University of New York or City University of New York.

To be sure, student tuition and subsequent loan debt is a serious problem for many families and graduates. While Governor Cuomo perhaps overstated the case when he compared student debt to “starting a race with an anchor tied to your leg”, heavy college indebtedness can have a big impact. In the last election, Bernie Sanders gained some traction with a free tuition proposal. There is at least something to the argument that college has become the 21st century version of high school, often a minimum educational standard. And, of course, student debt is frequently not dischargeable in bankruptcy, so it can be very hard to disgorge.

A case in point was a 23 year old, Christian Lopez, who I wrote about in 2011. Mr. Lopez was sitting in the stands at Yankee Stadium and happened to retrieve the home run ball that Derek Jeter put in the seats for his 3000th hit. The young man received a number of gifts from the Yankees for returning the ball to the Yankee shortstop rather than selling it to the highest bidder and also apparently got some financial remuneration for his sportsmanship from Miller High Life, Steiner Sports and Modell’s. However, it also turned out that Mr. Lopez, who was a cellphone salesman, had just graduated from college with $100,000 in student debt and definitely needed the financial help. I remarked in the piece that you shouldn’t have to catch an historic baseball to avoid long term debt of this magnitude.

Nevertheless, there are significant questions and objections to Mr. Cuomo’s program. (I note that Republican politicians in New York State can’t be too critical since the GOP-controlled state senate adopted the plan.) Indeed, opposition, or at least deep skepticism, was expressed by such disparate voices as E.J. Mc Mahon of the conservative Empire Center, columnist David Brooks of The New York Times and indeed the editorial board of the Times.

As the critics point out, the rules of the program raise numerous issues. Scholarships are only available for study at public colleges, thus placing the 150 private institutions in the state at a competitive disadvantage. Only students studying full time (averaging 30 credits per year, with some hardship exceptions) may gain aid under the program, thus excluding many individuals unable or unwilling to follow the traditional educational study model. Students must remain in New York State for the same number of years that they received scholarships, even if there are compelling economic opportunities elsewhere. The scholarships also do not cover such essentials as room, board and books.

The economic requirements of the program seem flawed. The program does not help families with taxable incomes under $50,000, who are already covered by the Tuition Assistance Plan. While a $100,000 income limit (based on adjusted gross income; $125,000 starting in $2019) may seem reasonable upstate, exceeding this level of income in high-cost places like Nassau County does not equate with great wealth and going over the limit by even a dollar appears to wipe out the scholarship. Significantly, student income is included in the family total, an odd disincentive in some cases against students holding part time jobs.

Most fundamentally, there is something deeply problematic about “free” tuition. Entitlements like this tend to be difficult to end and send the wrong message to recipients -- that there is something for nothing. It may also push up demand for SUNY and CUNY college and require cutbacks in the quality of education.

So, Governor Cuomo and our state legislators are definitely addressing a real problem with the free tuition program, but the law that emerged has far too many drawbacks.

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