Download PDF Version

Page Viewer

College Affordability…

Many students are not able to keep pace with rising tuition, because family earnings have lost ground over the past decade.
Tuition at two-year and four-year institutions has outpaced median family income in the majority of states—and in all states where community colleges are most critical to access to college opportunity and to the baccalaureate degree.
Student financial aid did not keep pace with tuition costs, exacerbating the college affordability problem.
Forty-four percent of low-income students (those with a family income of less than $25,000 per year) attend community colleges as their first college after high school.
The most underserved populations are among the least able to afford steeply rising tuition, least likely to enroll in college, and least likely to complete degree and certificate programs if they do enroll.

Affordability and Transfer:

Critical to Increasing Baccalaureate Degree Completion

LOW RATES of college completion have long been a major deficiency in the performance of American higher education. Over the last decade, the extent and importance of the problem was documented by the National Center for Public Policy and Higher Education in the Measuring Up national and state report cards on higher education, and by international comparisons of educational performance.

This Policy Alert addresses baccalaureate degree completion and the vital role of community colleges as the entry point for many students seeking bachelor’s degrees. It focuses particularly on states with rapidly growing young populations, where ethnic groups and low-income students with low rates of college participation and completion are most concentrated. The report notes that community colleges are more crucial than ever, but that state financial aid and transfer policies that enable students to move from two-year colleges to baccalaureate-granting institutions are not keeping pace with current needs.

The White House, national foundations, and states have recently launched important initiatives to increase the number of Americans who complete college programs leading to associate and baccalaureate degrees and postsecondary certificates. These initiatives seek improvements in state policy and budgeting, including better tracking of college completion rates, and financial incentives for colleges to employ educational practices that will improve the success of students in completing degrees and certificate programs. However, these policies may fall short of expectations if they fail to improve the affordability of two- and four-year colleges and the transfer pathway from community colleges to four-year colleges and universities. These issues—which significantly influence student completion rates—matter a great deal to student success, but policymakers have often found them difficult to address.

States, in particular, must confront the challenges of college affordability. Their most underserved populations are among the least able to afford the continuous escalation of tuition, the least likely to enroll in college, and the least likely to complete degree and certificate programs if they do enroll. The students from these groups who do enroll usually choose the most affordable postsecondary education option—community colleges. Once enrolled, the strategies many of these students use to pay for college include reducing course loads in order to work more hours; “stopping out” of college to earn money to return; or working excessive hours while maintaining a full-time course load—all responses that significantly reduce the likelihood of completing a baccalaureate degree or any college program.1

Equally important, in many states the effectiveness of the transfer path from community colleges to four-year baccalaureate-granting colleges and universities is particularly critical to improving college completion rates and raising the proportion of residents who earn baccalaureate degrees.

Because so many students who seek a bachelor’s degree begin at community colleges, initiatives to improve baccalaureate completion should incorporate policies and practices that explicitly address college affordability and transfer. Even the most thoughtful and well-intentioned policies will be very limited in their effectiveness if they fail to address these critical issues that reflect the real life circumstances and constraints confronting students seeking, often struggling, to earn bachelor’s degrees.

The nation and the states rely increasingly upon lower-division education in the community colleges and effective transfer pathways to improve baccalaureate completion rates and raise higher education attainment.

Community colleges account for approximately 40 percent of all enrollments in American higher education. The proportion of students enrolled in community colleges varies from one state to another. Table 1 shows the proportion of enrollment accounted for by community colleges in selected states and in the nation. States like California, Arizona, Texas, and Illinois account for a large part of all students enrolled in higher education. These states also have among the highest levels of participation in the community colleges.

Enrollment in community colleges is closely related to several background characteristics of students. Students who enroll in community colleges are more likely to be low-income, the first in their families to go to college, and members of underrepresented racial or ethnic groups. The most recent national data on college enrollment and income show that 44 percent of low-income students (those with family incomes of less than $25,000 per year) attend community colleges as their first college after high school. In contrast, only 15 percent of high-income students go to community colleges initially. Similarly, 38 percent of students whose parents did not graduate from college choose community colleges as their first institution, compared with 20 percent of students whose parents graduated from college.2

In addition, several studies have confirmed that students who enroll in community colleges are less likely to complete their educational objectives. Students who intend to complete a bachelor’s degree but enroll in a community college as their first institution are about 15 percent less likely to complete their degree, even after background characteristics are taken into account. Given that these institutions are the destination of choice for many students who seek a bachelor’s degree, more must be done to ensure that these students have every opportunity to succeed.3

Most of the states where the increases in high school graduates will be the greatest rely upon community colleges as the entry point for large proportions of students.4

As Table 2 shows, several states—including Arizona, California, and Texas—will experience rapid growth in high school graduates in the next decade, and therefore depend even more heavily on community colleges to serve these students. These states will continue to rely on community colleges as the point of entry for these students, many of whom will be first-generation students from traditionally underserved groups. Failure to improve current rates of transfer and bachelor’s degree completion in these states will mean that many of these students will not reach their educational goals, and the states and the nation will risk a shortage of baccalaureate degree holders.

Racial and ethnic groups with a history of poor college completion are concentrated in community colleges and dependent upon effective transfer to earn bachelor’s degrees.5

Students from underrepresented racial or ethnic groups are more likely to enroll in community colleges as their first postsecondary institution. Nationally, 50 percent of Hispanic students start at a community college, along with 31 percent of African American students. In comparison, 28 percent of white students begin at community colleges. This picture is even clearer when viewed in terms of race and income. For example, among low-income students from underrepresented racial and ethnic groups, half begin at community colleges—more than double the rate of their peers from high-income families. There is almost no difference in the proportion of these students who want to go on to complete college compared to their peers.6

Table 3 shows the proportion of black, Hispanic, American Indian, and Asian students who enroll in community colleges in states with large minority populations. In Arizona, more than two-thirds of Hispanic students are enrolled in community colleges. In California, more than 70 percent of African American students are enrolled in community colleges. Similarly, in Illinois, 65 percent of Hispanic students are enrolled in community colleges. Raising the rates of educational attainment of students from these racial and ethnic groups is central to the larger objective of maintaining a well-educated population and workforce. Because these students begin higher education at a community college, ensuring an affordable and efficient path for those who aspire to a baccalaureate degree or higher must be a key goal for state higher education policy.

Unfortunately, many students are not able to keep pace with rising tuition, because family earnings have lost ground over the past decade. Median family income, adjusted for inflation, declined in the United States over the last decade. At the same time, tuition at two- and four-year colleges increased at a rate faster than inflation or family income, and student financial assistance did not keep pace with college costs, exacerbating the college affordability and college completion problems.

Student financial aid at the federal, state, and institutional level has increased in the past decade. However, the investments in student financial aid have not kept pace with college prices in all sectors of higher education. In the face of escalating costs, one strategy for many students is to attend a community college for the first few years of college enrollment.

However, even at community colleges, Figure 1 shows that from 1999–2009 tuition increases outpaced median family income in states where community colleges are most critical to college opportunity and to achieving a baccalaureate degree. In most states, median family income has remained constant or declined.7 According to the College Board, tuition at public two-year institutions has increased much more rapidly than the general rate of inflation for the past two decades.8

In addition, 68 percent of community college students report that they chose their college because of the cost, compared with 58 percent of attendees at public four-year institutions and only 30 percent of students at private four-year institutions.9 Concerns about college affordability have most likely been driving many students to community colleges. If current trends continue, more students will be priced out of higher education altogether. Even if students do manage to pay the cost of tuition at community colleges, their ability to pay the cost of completing a bachelor’s degree at a four-year college or university is in doubt.

State Policies for Improving Affordability, Transfer, and Baccalaureate Degree Completion

The primary goal of state policies for transfer should be to ensure that community colleges are a viable route to the bachelor’s degree, and that students who begin at community colleges can complete their educational goals with no greater difficulty than students who start at four-year colleges. The guiding principle of the strategies outlined below is to maximize students’ opportunities to succeed.


States should assure that tuition and student financial aid policies do not discourage full-time attendance at two- and four-year colleges; state policies should encourage and enable expeditious completion of college programs by full- and part-time students. Tuition increases that outpace family income, particularly at community colleges and regional state colleges and universities, discourage enrollment, transfer, full-time enrollment, and degree completion. These problems are compounded by a weak economy and high unemployment. Need-based financial aid, targeted to low-income students, plays a critical role. Financial aid should be available for students who transfer, to enable them to attend full-time; aid should also be available for those students who enroll part-time due to the need to work and support their families. However, student financial aid by itself will not effectively address the affordability issue if tuition increases consistently exceed the growth of family income.

Transfer and Completion

In addition to affordability, states must assure, as the Southern Regional Education Board has advocated, “a reliable, robust college transfer system,” with a clear and efficient route through the community colleges to the bachelor’s degree.10 In the absence of comprehensive, integrated statewide transfer policies, many students will find that credits they have accumulated at a community college will not count toward their bachelor’s degree at a four-year institution. Overall completion rates among students who lose significant credits in the transfer process are low, and it is not difficult to see why. Students are often required to enroll again in courses they have already taken, incurring significant costs in terms of tuition and time. In the absence of effective statewide policies, the burden of negotiating transfer, often between large, complex institutions, falls primarily on students seeking to transfer. Additionally, the costs of inefficiencies in the transfer process (e.g., credits not transferable; excessive credits taken after transfer because community college credits are not applied to degree requirements) are borne by students and states. One test of the effectiveness of transfer policies is whether students who transfer from community colleges complete bachelor’s degrees with the same number of credit hours as “native students” who receive their lower-division instruction from a four-year college or university.

• States should require a statewide standardized lower-division transfer core curriculum and transfer associate’s degrees with courses accepted by all public two- and four-year institutions (and private institutions that choose or can be induced to participate) for general education and prerequisite courses for majors.

• States should consider guaranteeing admission with junior status for students who have met the designated lower- division transfer requirements and earned the associate’s degrees.

• Common course numbering system across two- and four-year institutions for the designated transfer curriculum should also be in place. Common course numbering ensures that all institutions recognize credits from courses that cover the same material.

• Articulation agreements between individual two- and four-year institutions or groups of institutions can be helpful, but they should be developed in the context of statewide transfer policy. Several states have established such policies, ensuring successful transfer of credits and high completion rates among community college students.

• States should require the components of this framework be put in place through statewide agreements. Faculty from four-year institutions and community colleges should develop the transfer curriculum collaboratively to assure that the transfer courses are equivalent across all institutions.

State Transfer Policies

State transfer policies are in place and evolving in several states. For example, Florida, New Jersey, Rhode Island, and Washington offer transfer associate’s degrees. Ohio and Texas have standard general education curricula for transfer. Florida and Texas use common numbering of lower-division courses for all public colleges and universities. Arizona is establishing six transfer pathways leading to associate’s degrees that provide a way for students to maximize transfer credits as they move from an Arizona public community college to an Arizona public university.

To increase completion in Massachusetts, state lawmakers are advancing a new “Mass Transfer” bill, which would establish a more efficient and seamless student transfer system for all public higher education students. Based on the recommendations of a statewide advisory group submitted to the Massachusetts Board of Higher Education in June 2008, the bill calls for developing more streamlined and automated transfer systems among the state’s community colleges and universities.

Recent legislation enacted by California will create a transfer degree and guarantee junior status to those transferring between the community college system and the state college system.11 Students in Florida who transfer from community colleges graduate with the same number of credits as “native” students. In Arizona, there are discipline-specific task forces where faculty from two- and four-year colleges and universities agree on common core courses and discuss curricular changes.

Resources for Policymakers

Meghan Wilson Brenneman, Patrick M. Callan, Peter T. Ewell, Joni E. Finney, Dennis P. Jones, and Stacey Zis, Good Policy, Good Practice II (San Jose: National Center for Public Policy and Higher Education, 2010),

Excelencia in Education, Ensuring America’s Future: Benchmarking Latino College Completion to Meet National Goals, 2010 to 2020 (Washington, D.C.: 2010),

John Immerwahr and Jean Johnson, Squeeze Play 2010: Continued Public Anxiety on Cost, Harsher Judgments on How Colleges Are Run (Public Agenda, and National Center for Public Policy and Higher Education, February 2010),

Colleen Moore, Nancy Shulock, and Cristy Jensen, Crafting a Student-Centered Transfer Process in California: Lessons From Other States (Sacramento: Institute for Higher Educational Leadership & Policy, August 2009),

Martha J. Kanter, “American Higher Education: ‚First In the World,’” Change, (May-June 2011), pp. 7-18,

National Center for Public Policy and Higher Education, Measuring Up 2008 (San Jose: 2008),

National Conference of State Legislatures and the College Board, The College Completion Agenda: State Policy Guide (2010),

National Governors Association (NGA), Complete to Compete,

Southern Regional Education Board, No Time to Waste: Policy Recommendations for Increasing College Completion (SREB: September 2010),

Western Interstate Commission for Higher Education and Hezel Associates, Promising Practices in Statewide Articulation and Transfer Systems (Boulder: 2010),


1 Laura Horn and Rachael Berger, College Persistence on the Rise? Changes in 5-Year Degree Completion and Postsecondary Persistence Rates Between 1994 and 2000 (Washington, D.C.: National Center for Education Statistics, 2004),

2 Based on an analysis of Education Longitudinal Study, ELS: 2002-06 public release data. Source data available at: Full analysis available upon request.

3 Bridget Terry Long and Michal Kurlaender, “Do Community Colleges Provide a Viable Pathway to a Baccalaureate Degree?” Educational Evaluation and Policy Analysis 31, 1 (March 2009), pp. 30–53.

4 NCES, IPEDS, 2007-08 Enrollment File, all public, private non-profit, and private for-profit 2-year and 4-year institutions.

5 NCES, IPEDS, 2007-08 Enrollment File, all public, private non-profit, and private for-profit 2-year and 4-year institutions.

6 ELS: 2002-06 data.

7 Census Bureau, Median Income for Four-Person Families.

8 Sandy Baum and Jennifer Ma, Trends in College Pricing 2010 (New York, NY: College Board, 2010).

9 ELS: 2002-06 data.

10 Southern Regional Education Board, No Time to Waste: Policy Recommendations for Increasing College Completion (SREB: September 2010), p. 17.


The National Center for Public Policy and Higher Education

The National Center for Public Policy and Higher Education promotes public policies that enhance Americans’ opportunities to pursue and achieve high-quality education and training beyond high school. As an independent, nonprofit, nonpartisan organization, the National Center prepares action-oriented analyses of pressing policy issues facing the states and the nation regarding opportunity and achievement in higher education—including two- and four-year, public and private, for-profit and nonprofit institutions. The National Center communicates performance results and key findings to the public, to civic, business, and higher education leaders, and to state and federal leaders who are in positions to improve higher education policy.

Established in 1998, the National Center is not affiliated with any institution of higher education, with any political party, or with any government agency.

This Policy Alert is supported by grants from the Bill & Melinda Gates Foundation and Lumina Foundation for Education. The statements and views in this report, however, do not necessarily reflect those of the funders, and are solely the responsibility of the National Center for Public Policy and Higher Education.

152 North Third Street, Suite 705, San Jose, California 95112
Telephone: 408-271-2699 - FAX: 408-271-2697

HOME | about us | center news | reports & papers | national crosstalk | search | links | contact

site managed by NETView Communications