New Jersey Gov. Phil Murphy announced a proposal on Thursday, April 5, 2018, to devote $50 million of the state’s 2019 budget toward providing tuition assistance at state community colleges for students with family incomes below $45,000.
Murphy described this $50 million funding request as the first step in a multiyear effort to offer free community college to some students in the Garden State. Murphy campaigned on making community college free for all in-state residents — a proposal he believes would carry a $200 million annual price tag — but it’s unclear if he’ll receive the necessary support even for the $50 million initiative.
Helping New Jersey residents afford college
Murphy outlined the details of his plan as part of a discussion held at Mercer Community College.
He indicated that $45 million of the $50 million would be used to provide grants to students from families with household incomes below $45,000. The remaining $5 million would be provided to the 19 community colleges serving New Jersey students and is intended to help colleges prepare for an influx of new enrollments driven by the new grants.
Grant funding under Murphy’s proposal would be available to students of all ages, and both full-time and part-time students would be eligible.
While responding to questions about his proposals to eventually make community college free for all students, Murphy defended covering tuition costs even for students whose families could afford to pay.
“Who died and went to heaven and said public education is free from K to 12, but not before K or after 12?” Murphy said, according to press reports. “There are also kids in that system one could argue don’t necessarily need free education, but they get it. I’m a big believer that education ought to be a right, not a privilege.”
New Jersey’s community colleges are currently serving approximately 150,000 students, a fifth of whom are already going to school tuition free because of other grant programs. The new grants Murphy intends to provide with the $45 million in funding would be considered “last-dollar” grants. That means students would first need to exhaust other sources of grant funding, including Pell Grants.
Murphy estimated the new funding could help approximately 15,000 students enroll at no cost. However, because the budget doesn’t go into effect until July, students would need to wait until January 2019 when the second semester starts to enroll tuition-free. And that’s only if Murphy can get his requested funding, which is far from certain.
Republicans oppose Murphy’s plan. “No government-funded program is free,” said Republican State Sen. Tom Kean Jr. “Taxpayers always pay the price and, frankly, people in New Jersey pay far too much already.”
Some Democrats, including Senate President Steve Sweeney, have also expressed concerns about raising taxes to fund programs such as free community college. So, it’s unclear whether Murphy’s proposals will advance. Democrats must choose whether to offer community college for free as part of the budget that must be sent to the governor for his signature by June 30.
The growing list of states aiming to make community college free
New Jersey isn’t the first state to propose tuition-free community college. In fact, The Century Foundation reported a total of 16 states have at least one statewide “free college program” that allows at least some students to attend college without paying tuition costs.
Many of these were recent initiatives. Rhode Island began offering tuition- and fee-free community college beginning in the fall of 2017 to full-time students who maintain a 2.5 GPA. Tennessee will offer tuition-free community college to all students beginning in 2018. Starting in the fall of 2017, New York became the first state in the U.S. to offer free tuition at both two- and four-year schools for students with family incomes under $125,000.
However, eligibility for and access to these programs vary greatly from state to state. As The Century Foundation reported, many programs “include extensive eligibility requirements intended to either ration the benefit in order to bring down costs or direct the benefit to certain populations of students (or both).”
Free community college could provide much-needed relief
These programs could provide much-needed relief at a time when student debt is rising. Average student debt for the Class of 2016 was up 6% compared to the prior year, reaching $37,172. Further, an estimated 44.2 million Americans owe student loan debt. Debt balances have risen for both federal student loans and private student loans, with private loan debt hitting $7.8 billion in the 2014-2015 year, up from $5.2 billion in the 2010-2011 year.
Students who wish to attend four-year institutions could benefit if New Jersey, or other states, make community college free for everyone. Students could begin their education at a community college to significantly reduce total college expenditures.
Need a student loan?Here are our top student loan lenders of 2018!
|1 Important Disclosures for CollegeAve.
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or Nationwide Bank, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
Information advertised valid as of 11/1/2018. Variable interest rates may increase after consummation.
2 Important Disclosures for Discover.
3 Important Disclosures for Ascent.
Before taking out private student loans, you should explore and compare all financial aid alternatives, including grants, scholarships, and federal student loans and consider your future monthly payments and income. Applying with a cosigner may improve your chance of getting approved and could help you qualify for a lower interest rate. Ascent Student Loans may be funded by Richland State Bank (RSB) or Turnstile Capital Management, LLC (TCM), which are not affiliated entities. Certain restrictions and limitations may apply. Ascent Student Loan products are subject to credit qualification, completion of a loan application, verification of application information and certification of loan amount by a participating school. All loan products may not be available in certain jurisdictions. Other terms and conditions apply. Ascent is a federally registered trademark of TCM and may be used by RSB under limited license. Richland State Bank is a federally registered service mark of Richland State Bank.
* Application times vary depending on the applicants ability to supply the necessary information for submission.
* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
4 = Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.
5 Important Disclosures for PNC.
PNC Bank is one of the nation’s largest education loan providers. For over 40 years, PNC has been committed to helping students and their families make possible the adventure of college.
6 Important Disclosures for SunTrust.
Before applying for a private student loan, SunTrust recommends comparing all financial aid alternatives including grants, scholarships, and both federal and private student loans. To view and compare the available features of SunTrust private student loans, visit https://www.suntrust.com/loans/student-loans/private.
Certain restrictions and limitations may apply. SunTrust Bank reserves the right to change or discontinue this loan program without notice. Availability of all loan programs is subject to approval under the SunTrust credit policy and other criteria and may not be available in certain jurisdictions.
SunTrust Bank, Member FDIC. ©2018 SunTrust Banks, Inc. SUNTRUST, the SunTrust logo and Custom Choice Loan are trademarks of SunTrust Banks, Inc. All rights reserved.
7 Important Disclosures for LendKey.
Additional terms and conditions apply. For more details see LendKey
8 Important Disclosures for CommonBond.
A government loan is made according to rules set by the U.S. Department of Education. Government loans have fixed interest rates, meaning that the interest rate on a government loan will never go up or down.
Government loans also permit borrowers in financial trouble to use certain options, such as income-based repayment, which may help some borrowers. Depending on the type of loan that you have, the government may discharge your loan if you die or become permanently disabled.
Depending on what type of government loan that you have, you may be eligible for loan forgiveness in exchange for performing certain types of public service. If you are an active-duty service member and you obtained your government loan before you were called to active duty, you are entitled to interest rate and repayment benefits for your loan.
A private student loan is not a government loan and is not regulated by the Department of Education. A private student loan is instead regulated like other consumer loans under both state and federal law and by the terms of the promissory note with your lender.
If your private student loan has a fixed interest rate, then that rate will never go up or down. If your private student loan has a variable interest rate, then that rate will vary depending on an index rate disclosed in your application. If the interest rate on the new private student loan is less than the interest rate on your government loans, your payments will be less if you refinance.
If you don’t pay a private student loan as agreed, the lender can refer your loan to a collection agency or sue you for the unpaid amount.
Remember also that like government loans, most private loans cannot be discharged if you file bankruptcy unless you can demonstrate that repayment of the loan would cause you an undue hardship. In most bankruptcy courts, proving undue hardship is very difficult for most borrowers.
9 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|3.94% – 12.78%1||Undergraduate, Graduate, and Parents|
|3.97% – 12.97%3||Undergraduate and Graduate|
|4.34% – 12.99%2||Undergraduate and Graduate|
|4.12% – 10.98%*,4||Undergraduate and Graduate|
|5.03% – 11.23%5||Undergraduate and Graduate|
|4.12% – 13.13%6||Undergraduate and Graduate|
|4.92% – 10.01%7||Undergraduate and Graduate|
|3.72% – 9.68%8||Undergraduate, Graduate, and Parents|
|4.26% – 12.13%9||Undergraduate, Graduate, and Parents|