Thursday, December 16, 2010

Income Redistribution in California State Universities

Gary Fouse

If you follow the news in California, you probably know that the University of California and California State University are both raising tuitions in reaction to the budget crisis. (We're basically bankrupt.) Yet, at the same time, CSU has announced that one-third of the money from tuition hikes will go toward financial aid for low-income students.

Sounds like income re-distribution to me.
(Orange County Register/Brian Joseph)

Not so, says a CSU spokeshole.

"The education of each resident student attending a public institution of higher learning in the state of California, whether receiving any form of financial aid or not, is in fact subsidized in some way. At the CSU, a student who pays the full fee rate is receiving a subsidy on about two-thirds of the cost of their education ($7,305 in 2010-11), with that funding coming from the state.

The primary purpose of the State University Grant (SUG) program is to promote access and ensure affordability for those students with the least ability to pay for a postsecondary [sic] education. However, the notion that “students are expected to subsidize the education of their fellow classmates” is a common misperception. There is no transfer of dollars from student A who does not receive financial aid to student B who does.

In regards to the distribution of financial aid, the CSU first determines whether a student meets general eligibility requirements. One of the programs is the state Cal Grant that covers the State University Fee (what is charged as tuition) for most CSU recipients and comes from state general funding. If a student is eligible for financial aid, but not a Cal Grant or other grant/scholarship designated for payment of fees or a waiver of fees, they can receive a State University Grant (SUG). This student’s state university fee would be covered by the SUG award for a net cost of zero dollars to that student.

Financial aid and federal tax credits may also be available for many students who do not receive a Cal Grant or SUG, including those with family incomes of up to $180,000.

Ultimately, the resources available to the CSU from either fees or state funds pay for the broad range of educational expenses and student services on campus, including providing an increased number of course sections."

Blah blah blah, woof woof woof, quack quack quack. Sounds like a three card monty to me.

Excuse me, but let's break that down into simple numbers even a UC Santa Cruz Community Studies major could understand. One third of student tuition fees go to financial aid for students with lower incomes.

That's income redistribution.

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