One Year After Oregon Passage, Tuition-Free College Model “Pay It Forward” Being Considered in 25 States

July 1, 2014 | Economic Opportunity Institute

gradcapsToday marks the one-year anniversary of the unanimous passage of Economic Opportunity Institute’s Pay It Forward model in Oregon – an innovative, debt-free model for access to higher education. With the support of students, professors, lawmakers and community leaders, Pay It Forward legislation is now active in 25 states, with study bills passed in Maine, Louisiana and Illinois.

“Just one year ago, a small group of Portland State University students changed the national conversation on student debt and college affordability,” stated Sami Alloy, legislative and policy director for the Oregon Working Families Party and member of Oregon’s Pay It Forward Workgroup. “Every day we hear from students in Oregon and from across the country who are waiting for lawmakers to take action on college affordability and implement Pay It Forward.”

Students, families, teachers, community advocates and business leaders across the country are acting to put an end to the student debt crisis by abolishing the biggest driver of college debt:  upfront tuition.

Student debt topped $1.1 trillion in 2014, growing by 10 percent last year alone. Two-thirds of all students are borrowing to afford college, with 7 in 10 college seniors graduating with an average of $29,400 in student debt. Even federal student loans are becoming a bad deal for many graduates. For the first time in history, student loan delinquencies surpassed credit card defaults.

Higher education is critical to U.S. economic competitiveness. By 2018, two in three jobs will require some form of higher education. Yet, the Millennial generation is projected to be the first American generation less educated than their parents – an anomaly among developed countries. The game of loans that has sustained American higher education for over 30 years cannot continue if the United States wishes to be competitive in the global economy.

“Pay It Forward puts college on the table for every student and family – regardless of their ability to pay,” stated John Burbank, executive director of the Economic Opportunity Institute where Pay It Forward was originally developed. “Pricing-out low-income and middle-class families from college education is morally reprehensible and economically unsustainable. Unlike this current debt-for-education system, Pay It Forward will enable graduates to be full participants in society, ready to start a family, buy a house or build a business and not worry about how they will send their own kids to college one day.”

 

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Comments

  1. Kaylee Galloway says:

    When I attended Western Washington University, Pay it Forward was definitely a heavily discussed topic among students and administration. It is good to see that other states are exploring the idea and that some progress is being made. Where can I find information on what bills all the different states are considering? Do we see the states considering work groups, pilot programs, or full implementation? I am also very interested in hearing about different state legislators’ perspectives regarding initial funding. Will it come from public or private investment?

  2. Kelli Smith says:

    Hi Kaylee. Thanks for your questions. As you noted, sources of initial funding will vary by state. By and large, initial funding is expected to be public, but many states have left open the option for at least partial private funding. For public investment, states are considering options ranging from budgeting from the general fund to bonding or other dedicated revenue — for example, one proposal out of Pennsylvania would fund Pay It Forward with a fracking tax, though not every state has that option! Of course, every legislature has unique budget circumstances that will dictate how best to get Pay It Forward off the ground in their state.

    We periodically post national updates to our website, which are posted on our Higher Education page. Since the last update in April, Maine (SP 748), Illinois (HB 5323), and Louisiana (HCR 21) have all passed study legislation, and California’s bill (AB 1456) has passed through the Assembly and is moving through the Senate. Most of the bills introduced were study bills, but some were for the creation of pilots, for instance, bills in Michigan (HB 5315 and SB 784) and Washington (HB 2720).

    We’re launching a new Pay It Forward website later this month that will keep you up-to-date on all Pay It Forward activity and legislation, so keep an eye out for that!

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