The timing of this announcement came in the middle of the annual conference of the National Association of Student Financial Aid Administrators (NASFAA) in Chicago. Reactions varied. Most started with a general appreciation of the need for greater transparency and consistency in aid awards so families can make accurate comparisons of net price after gift aid (grants and scholarships) to see what their financial bottom line is at each institution. However, the conversation quickly turned to technical suggestions and requests on how the new Shopping Sheet could be improved.
In some cases the reaction was outright resentment that the federal government would presume to know better than any institution, how best to present financial aid awards. These reactions focused attention on the lines being drawn around the country -- on campaign trails and college campuses -- about the evaporating ability of today's American family to successfully achieve part one of the American dream, a world-class education.
There is a struggle going on, one between the historically college-concentric approaches to financial aid information for prospective and entering students, versus one that is consumer-centric. One might argue that the struggle is even larger than that -- that the battle lines are being drawn between a higher education system that historically has largely set the rules of engagement and the "public," both consumers and politicians, who are waking up to the implications of a system in which these other parties have had limited ability to do much more than consume what the system produces at the price it sets.
Usage of the Shopping Sheet is voluntary for colleges so far, and like many of the folks at the NASFAA Conference we believe it needs refinement, but should it go further? Should it be required by USDOE? Should states apply pressure by making it a requirement if a college wants to participate in a state grant program?
The Shopping Sheet is not the federal government's first foray into the financial aid transparency arena. The Higher Education Act of 2008 established a mandate that every college or university serving first-time, full-time students have a net price calculator on its website by Oct. 29, 2011.
As we have addressed in a white paper just released (www.college-costs.com) the federal mandate was flawed to begin with and has led to a wide range of inconsistent solutions. While the intent was not flawed, the solution presented fell short. The Shopping Sheet once again acknowledges the problem and offers a standardized solution. I would argue that it takes us a step closer to achieving the intent of the net price calculator mandate. Now we just need to connect the two and iron out the kinks.
Here in Indiana, we have been trying to address financial aid transparency long before USDOE started providing regulatory guidance on the subject. In response to a request from the Indiana Commission for Higher Education's (ICHE), we built the Indiana College Costs Estimator (ICCE) website (www.indianacollegecosts.org) so that families around the country can get consistent, tentative financial aid awards estimates from Indiana's colleges long before March or April of a student's senior year in high school. ICHE licensed the ICCE so it can be a free resource for families. On the site a user can, among other things, input their financial and other information and get side-by-side comparisons of tentative aid awards.
Thanks to ICHE's license, the Ivy Tech Community College system and eight other university campuses are using it as their free Net Price Calculator solution. We have had great cooperation from Indiana's colleges since the launch of the site last year with over 80 percent providing their institutional packaging tables. Obviously there is some work to be done as we try to bring the remaining institutions on board.
I'm hopeful that the new momentum created by things like the Shopping Sheet, the next price calculator mandate and the Indiana College Costs Estimator website will serve as further encouragement to all colleges and universities across the country to embrace this new era of consumer empowerment. We believe that in the end, what is best for the consumer ultimately is best for the colleges, especially if they are genuinely interested in improving the fit between their students and their institutions, which will in turn, help improve their retention and graduation rates. We'll see, but clearly the momentum seems to be moving in the consumer's direction ... finally.
National Center for College Costs
15 W. Franklin St.