Graduate debt-free? University of California leaders think it’s possible | News

The University of California promises to offer its California college students a debt-free college experience by 2030 as part of a review of how the system views college accessibility.

To get there, the system of 230,000 students seeking undergraduate degrees depends on a combination of state and federal support, income from recent tuition increases, and students working part-time to cover the full cost of education. Students from wealthier households would also depend on parental support.

The system’s governing body, the Board of Regents, took another step toward that debt-free goal on Thursday by voting to prioritize part-time work over borrowing as part of UC’s official financial aid policy. The change is subtle, but it is one more example that UC points out that its students should be able to get a high school diploma without having to borrow in the coming years.

“The preferred outcome of our financial aid strategy is for students to be able to pay for their education through available part-time job opportunities and minimize student loan lending,” said Michael Brown, rector of the entire UC system. at the UC Regents meeting Wednesday. .

Although more than half of undergraduate students in UC state do not pay tuition due to financial aid, the free college movement has expanded its reach to include non-academic expenses that are still vital to student education, such as housing, transport. and food.

All those expenses add up. Just over half of resident students graduate from UC with student loans, accumulating an average of $ 18,800 in debt. It is a figure that is well below the national average, but which remains a financial millstone around the neck of borrowers. A CalMatters analysis found that low-income students receiving federal aid also take out loans, for amounts that typically range from $ 11,000 to $ 16,000.

Earlier this year, UC said it would provide additional grants to 6,000 low-income students this fall so students could avoid loans.

The debt-free target for 2030 depends largely on compliance with California lawmakers and the federal government.

State legislature and Gov. Gavin Newsom are expected to pledge $ 632 million this year as part of an initial payment of a debt-free grant that experts say will cost $ 2.6 billion. Once fully funded, the grant is supposed to provide students with enough money to cover the full cost of attendance after considering parental support, part-time work, and grant assistance.

Low-income students whose families cannot afford to help with college will have to contribute about $ 8,000 a year to their education, which they can earn by working 15 hours a week during the school year. Where they find these jobs is an open question, but lawmakers and the governor last year launched a $ 500 million fund to create part-time job opportunities for low-income students attending state public colleges and universities.

Students from higher-income households may also avoid taking out loans, but this means that their families will provide money for their education based on a federal formula. Higher-income students are also expected to work.

There is no timetable to fully fund the debt-free grant. However, the Senate wants to commit more money in advance and fully fund the program for 2025-26 as part of the June 15 budget agreement.

The new debt-free grant, which lawmakers call the Middle Class 2.0 Scholarship, is key to UC’s debt-free goals.

That debt-free target for 2030 “depends on the middle-class scholarship reform the legislature approved last year and its full funding,” said Seija Virtanen, UC’s associate director of state budget relations, during an Assembly budget subcommittee. on education. hearing this week.

For its part, UC will divert 45% of its income from its recent enrollment increases to student financial aid, compared to 33%. Politics came to life last year. It is also in the UC pact with the governor, a de facto agreement in which Newsom promises a 5% annual increase in UC education funding in exchange for key promises about student accessibility and success. Those funding increases still need legislative approval.

In an analysis conducted by UC officials last August and shared with CalMatters this week, the system plans to raise an additional $ 333 million by 2029-30 for its college student aid program through tuition increases. The current level of aid is $ 785 million, Ryan King, a UC spokesman, wrote in an email.

UC grant aid is already the second largest source of financial support for college students in the system. The federal government provided $ 420 million in student scholarships last year. California programs, the main one being the Cal Grant that covers tuition, spilled nearly $ 1 billion in student aid last year.

That state participation will grow once the middle class scholarship is officially funded. But there is another wildcard that can guide more aid to students.

Last year, Governor Newsom vetoed a bill to add more than 100,000 students, including several thousand UC students, to the Cal Grant program, though it has expanded the eligibility of grants in other ways. An almost identical bill is now going through the legislature, but some lawmakers supporting the bill were baffled because Newsom’s May budget proposal did not promise funding for the bill, which is expected to cost more than $ 300 million a year. .

A leading lawmaker who helps shape higher education spending policy called that omission “significant irony.” Sacramento Democrat Kevin McCarty, chairman of the education budget subcommittee, told a hearing this week that although the governor’s office has made a debt-free deal with UC, the governor’s budget does not “fund that thing you need to get a debt-free university “.

About 109,000 of the 150,000 students who would benefit from the Cal Grant expansion are students from community colleges. (Around 500,000 students from all institutions already receive the Cal Grant.) Unlike UC and Cal State students, those attending community colleges are not eligible for the planned expansion of the middle-class scholarship, although they would get it if they moved to a California audience. university.

That’s why Eloy Ortiz Oakley, who is both UC regent and chancellor of the California Community Colleges, sees the passage of the Cal Grant Expansion Bill as the top priority of the community college system. The project would give those students at least $ 1,648 a year while in community college and give them free tuition if they move to a UC or Cal State.

“Students who have been last in line for so long need to get to the front line here very soon,” Oakley said in an interview.

But more money for financial aid is only half the conversation, he added. UC also needs to figure out how to reduce its costs. This may mean offering more online courses and avoiding filling certain jobs, among other solutions.

“Are we hiring in places that continue to grow the bureaucracy of our colleges and universities? Or are we growing in places that directly cater to the needs of students?” he asked. is a non-profit, non-partisan media company that explains California politics and politics. Read more CalMatters state news here.

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