Federal Funding Left Out Some of the Most Vulnerable

Two weeks ago, the U.S. Department of Education released figures on how much each college will receive from the $12 billion set aside for higher education in the coronavirus stimulus package passed by Congress last month.

It's hard to say definitively who the winners and losers are, as the funds were parsed out by a specific formula. But that formula proved to disadvantage some of the institutions that may need the most help right now.

"I think it was pretty clear from Congress that the intent was to really focus on the need of students at institutions from the fact that they so heavily weighed the formula toward full-time Pell Grant recipients," said Megan McClean Coval, vice president at the National Association of Student Financial Aid Administrators.

One of the key phrases in that sentence? "Full-time Pell Grant recipients."

"The way it reads to me, the formula was designed to help schools with the most full-time enrollment, and that inherently disadvantages a large part of the student population," said Clare McCann, deputy director for federal policy at New America. "I think we do see a lot of those institutions that you might not expect rise to the top, when we’re typically talking about community colleges as the workforce driver."

For example, Ivy Tech Community College of Indiana has nearly 62,000 students and received about $33 million. Georgia State University has an undergraduate enrollment of 25,000 and received $45 million.

Sixty-five percent of community college students are enrolled part-time, according to data from the National Student Clearinghouse Research Center. Part-time students are also more likely to be nonwhite, low-income and first-generation students than their full-time counterparts, according to a report from Achieving the Dream, a nonprofit organization dedicated to community college student success. They're also more likely to be working full-time and taking care of family members.

Looking at the statistics, part-time students are more likely to need the support provided by the formula, but they weren't counted. ​

It would have made more sense to use two formulas for the funding: one for aid to institutions for operational losses, and one for emergency aid to go directly to students, McCann said.

"If you're thinking of aid for students, the need is probably larger for part-time students who may have lost jobs," she said. "The formula for student aid could discount neither online nor part-time status." ​

It was difficult for higher education leaders to devise a formula in a short period of time and anticipate all of the consequences, according to Karen Stout, president and CEO of Achieving the Dream.

Still, the consequences are clear now.

"It’s hard for community colleges to be less valued when you look at the vulnerable students that we’re serving, and those are the same vulnerable students that are out in the workforce right now," she said.

The funding disparity will have ripple effects on students of color, many of whom attend community colleges, and low-income students.

Stout would like to see a new version of the Trade Adjustment Assistance Community College Career Training grants to stifle those inequities and help the workforce in the future, and more flexibility with financial aid with professional judgment allowances.

"The move to remote learning has amplified what we already know about community college students. They’re vulnerable, and they’re even more vulnerable now," she said. "We don’t want this to reinforce those inequities."

Four-year regional public institutions also likely got the short end of the stick because they tend to enroll more part-time students than public flagship universities do. In a recession, there's usually hope that college enrollments -- particularly in low-cost institutions, like regional four-years and community colleges -- will bounce back as people try to up their skills.

But that's a big question mark this time around, McCann said.

"My gut instinct is that regional publics are particularly vulnerable because they are both underfunded and somewhat more dependent on that enrollment question," she said. "But community colleges are very severely underfunded as well, and if the circumstances don’t shake out in their favor, it could be very hard."

A lack of data was another problem for Congress, McCann said. Lawmakers had to build something around metrics that don't exist, like how many people were enrolled this year exclusively in online education.

"Had we only passed the College Transparency Act, we would’ve had that data," she said. "This gets back to why passing a reauthorization of the Higher Education Act is so important. Congress is making decisions on things that we don’t actually even know."

Ben Miller, vice president of postsecondary education for the Center on American Progress, doesn't think anyone necessarily won with this stimulus formula.

"Everything’s really, really terrible for everybody," he said.

Community colleges definitely lost a bit more because of the use of full-time-equivalent enrollment instead of overall head-count numbers. Largely online schools, like the University of Phoenix, lost big because of the exclusion of online-only students. The inclusion of graduate students benefited wealthier institutions.

But the worst offense, Miller said, is how the funding is delivered.

"There was a fundamental error on the front end of not running any money through the states," he said. If money had been run through the states for public colleges, those institutions would've benefited much more than they have. ​

If Miller were to write the formula, he would have guaranteed allotments through the states, limited funding for for-profit institutions to emergency student aid and used head-count enrollment numbers, he said.

For some, the way funding shook out wasn't a shock.

"We are continually asked to do the most with the least," said Jason Kosnoski, associate professor of political science at the University of Michigan at Flint. "It’s a travesty, but I guess it’s not a surprising travesty."

Kosnoski is also part of the One University campaign, asking the university to provide more equitable funding to its Dearborn and Flint campuses. The flagship Ann Arbor campus received more than $24.2 million in funding from the stimulus, while Flint received $4.6 million.

Ann Arbor's campus has about five times as many students as Flint's campus does. But nearly all of the students at Flint are in-state students, while half at Ann Arbor are from out of state.

The regional campuses, and other colleges like them, also teach more working-class, first-generation and nonwhite students, Kosnoski said.

"Our universities teach students who are going to stay in the state. We teach students who are going to do the type of work that is considered necessary," like nursing and law enforcement, he said.

The full ramifications of the pandemic on higher education are yet to be seen, McClean Coval said.

"I think investing more in students and institutions in the fourth package will be much needed from Congress," she said.

A coalition of higher education groups is calling for at least $47 billion in future stimulus packages. But even that might not be enough, depending on how many states cut their budgets and by how much, Miller said.

"Each successive recession appears to be worse and worse for higher education," he said. "​Community colleges and regional four-years already do a disproportionate job serving our lowest-income learners and learners of colors. I would anticipate that further cuts will continue to have disparate equity impacts."

If the sector doesn't get the funding it needs to ride out this storm, the future could hold higher tuition, more adjunct labor and the "hollowing out of the academic enterprise," Miller said.

"What Congress did a few weeks ago wasn’t even enough for what the crisis was in March, and things are only to get worse from here," he said. "We need much greater dollars distributed in a way that emphasizes the need to protect our public colleges."