Growing Costs At Iowa’s Colleges, Universities Put Focus On Financial Aid

Cameron DeRoos is glad to have Iowa State University on his radar for college but already worries about how much it will cost, even though he is still has more than half of his senior year to complete at Johnston High School. It could cost DeRoos and other students at ISU, in Ames, as much as $21,920 a year for tuition and fees, books and supplies, room and board, and other college-related expenses their freshman year in 2020-21, and up to an estimated $23,068 their senior year in 2023-24. At least that is what new projections show at The Hechinger Report, a Columbia University-based nonprofit, independent educational news organization. “I’m really concerned about how expensive it is,” DeRoos, 17, said. “I mean, my parents, my grandparents will be helping me with it. But at the end of the day, it seems like they might be paying for half.” The projected sticker price for Iowans wanting to attend a private college or university in-state is, as expected, even higher – more than $60,000 by 2024-25 at nine private Iowa schools and 10 the following school year in 2025-26, The Hechinger Report projected after studying tuition and cost-of-living trends for higher education institutions nationwide via Free Application for Federal Student Aid (FAFSA) data. Grinnell College, the highly respected four-year liberal arts college in Grinnell, would lead the way in the 2025-26 school year at $90,069, the projections show. Students attending Drake University in Des Moines could pay just shy of $78,000 and Cornell College students $77,350, the projections show. Those costs would be 32 percent more at Grinnell and Cornell and 37 percent more than in the 2018-19 school year for which the most recent data exist. Students from Iowa attending Coe College in Cedar Rapids, Luther College in Decorah and Wartburg College in Waverly could end up paying more than $70,000 a year in 2025-26, the projections showed. The Hechinger Report projections only covered students from Iowa.

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An expectation exists for Grinnell students when they enroll there: that they’ll pay a lot in tuition or, if needing financial assistance, get help from the college, Jackson Schulte, co-editor in chief of Grinnell College’s Scarlet & Black newspaper, said. “They market that pretty heavily,” he said about the college’s financial aid offers. “I think that allays some concerns,” Schulte, whose family moved from Ankeny to Grinnell when he was in eighth grade, said. “But, I mean, people are still pretty attentive to tuition hikes, things like that.” (To be transparent: This story’s reporter is a professional adviser for the Scarlet & Black.) Depending on the year, 17 to 19 of every 20 full-time, first-time Grinnell students from Iowa receive federal, state, local or institutional aid to attend the college, data The Hechinger Report crunched show.

Despite the actual costs, most students at an Iowa college receive financial aid. That is why admissions offices, and students and their families, focus more on the net price to attend college instead of the full sticker price. Three of every four ISU full-time, first-time undergraduates from Iowa received financial aid in the 2016-17 school year, the most recent for which data exists. Four of every five did at Iowa City’s University of Iowa that year, as did roughly two of every three at the University of Northern Iowa, based in Cedar Falls. Every full-time, first-time undergraduate received some kind of financial aid at 19 of the 44 Iowa colleges and universities in the 2016-17 school year that The Hechinger Report studied. Actual costs each student pays vary. The Hechinger Report researchers and editors caution that the sticker price data are speculative because the projections would come true only if growth between now and the years ahead follow the average growth rate for 2007-08 through 2017-18. Tuition cuts or freezes and shifts in the cost of living would affect the projections. Many Iowa students attending a private college in the state are eligible for assistance from the state’s Iowa Tuition Grant program – currently up to $5,650 annually. The extra available money has an impact. A 2017 National Bureau of Economic Research study showed that college enrollment for students in families earning less than $70,000 a year increases almost 15 percent when those families get $10,000 more to spend. Moreover, the aid can keep borrowing for college down, a consistent concern in higher education.

READ ALSO: DISCOUNTED TUITIONS SEEN AS MISSING THEIR MARK — LOW-INCOME, UNDERREPRESENTED STUDENTS 

FACTORS VARY

Variables make long-term predicting difficult. “It’s really, really difficult to make these kinds of predictions, even based on historical data, because there are so many moving parts to the process,” Robert Broshous, associate vice president and dean of admission at the University of Dubuque, said. Those moving parts include: the costs to operate the university, which can fluctuate from year to year; available resources; and what competing colleges and universities charge and provide in aid. Higher education administrators try to look ahead as far as possible to find balance between competitive college offerings and making those offerings affordable, Broshous said. “Students want to know,” he said. “They want to know what it’s going to cost. Many students are deciding early because they’ve narrowed their search down. They’ve been doing it for a couple of years. We might be on their short list and they might be able to decide if the cost is right – if the net cost is right, I should say.” Predicting what students pay after financial aid is more difficult than projecting sticker price because of variables that go into individual student’s situations, The Hechinger Report researchers said. Projections show the total cost of attending the University of Dubuque, one of three higher education institutions grouped together on a bluff overlooking Dubuque, increasing 42% from 2018-19 to 2025-26. The total sticker costs were about $45,890 in 2018-19 but are on track to be $65,111 in 2025-26, The Hechinger report showed. Broshous said the projection could be high because the university had two recent years of extraordinary tuition increases in its 10-year trend that aren’t anticipated again at this time. Also, the university’s listed costs were about $2,000 lower in each school year than The Hechinger Report showed but the university’s figures don’t include the costs for buying books, supplies and incidentals. “We don’t have any control over what those numbers will be,” he said. “Our ambition is to keep costs at a rate that families can afford, to attend and still enjoy the excellent value in the education here at the University of Dubuque,” he said. Broshous said he focuses on new students but the university also works to keep them there, offering aid for all four years of college instead of just the first year. Broshous said all student aid at the university comes from its endowment fund, worth almost $166.3 million in 2017, the university’s 990 IRS tax filings show. By comparison, Grinnell College’s endowment fund that supports financial aid has been around $1.8 billion, IRS records show. Projections for Iowa’s three regents-run state universities show the cost, before aid, of attending in the 2025-26 school year the University of Iowa at $28,749, increasing 19% from 2018-19. Costs would increase 13% at Iowa State University to $24,034, and 11% at the University of Northern Iowa to $23,269.

LOOKING AHEAD FROM HIGH SCHOOL

DeRoos, the Johnston junior, said he would like to be an accountant after college. The lowest 10% of total accountant salaries in 2018 was less than $43,650, the Bureau of Labor Statistics reported. DeRoos said he was figuring on a starting salary in the mid $36,000 range. “That’s less than my education,” he said. “And that bothers me because, at the end of the day I really don’t know what’s going to happen.” DeRoos was part of a roundtable discussion IowaWatch held with a dozen and a half Johnston students about their pending costs to attend college. Payton Blahut, a junior in the group, said she would like to attend Temple University in Philadelphia but needs scholarships to go with money she is saving from working two jobs. “I’m terrified,” Blahut, 16, said. “I would love to go out of state and get out of Iowa for my school, but I’m a one-parent household.”  Students are told to save for college but a high school student’s window of opportunity for saving money is short, sophomore Shay Polson said. Getting a job is hard at her age, Polson said, so she cannot start saving much now. She said a student needs a job other than household chores for which parents give them money to save for college. Polson, 15, said she would like to attend Graceland University, where her sister has attended, and play soccer. But where she attends will depend upon whether or not she can get a scholarship. Leven Petersen was one of only two students in the roundtable discussion saying they think they have adequate funds saved for college. “My grandparents used to own stock and so every day since I’ve been born they’ve put money into this bank account that I have,” Petersen, 17, a junior who would like to attend Iowa State University, said. “And that’s going straight into college funds.” The bottom line, senior Collin Minear said, is: “Your college choice might depend on how much money you have or how much in loans you want to take out.” Minear, 17, a senior, said he plans on attending Des Moines Area Community College because it will be an easier transition from high school and to college and will cost less than a four-year college.

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This IowaWatch story was written in collaboration with The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. The Hechinger Report provided IowaWatch with data and national stories. IowaWatch reporter Lyle Muller did interviews and writing for this Iowa-based story.  

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This story also was published by the Des Moines Register, Oskaloosa Herald and Iowa City Press-Citizen under IowaWatch’s mission of sharing stories with media partners. The Hechinger Report calculated future sticker prices for four-year institutions by using data on compound annual growth rates in total cost of attendance from 2008 to 2018, obtained from the National Center for Education Statistics, and projecting those numbers to the academic year beginning in fall 2025. 

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