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Tuesday, October 8, 2013

Study finds multiple factors for high levels of college debt in NH

CONCORD – A new study concludes New Hampshire students graduate from college with the most debt in America for a variety of reasons ranging from high tuition costs and low levels of state aid to the relative wealth of families and their college choices.

Brian Gottlob of PolEcon Research said his 63-page report concludes there is no single cause or cure – more taxpayer support or deep cuts in spending by college administrators – that would quickly reverse this trend that has only gotten stronger over the past decade. ...

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CONCORD – A new study concludes New Hampshire students graduate from college with the most debt in America for a variety of reasons ranging from high tuition costs and low levels of state aid to the relative wealth of families and their college choices.

Brian Gottlob of PolEcon Research said his 63-page report concludes there is no single cause or cure – more taxpayer support or deep cuts in spending by college administrators – that would quickly reverse this trend that has only gotten stronger over the past decade.

“We’re not going to be able to attack this simply by saying the state should spend more money or that the public and private colleges merely have to cut back on expenses,” Gottlob said at a news conference Monday. “Why is student debt so high in New Hampshire and what can we do about it?”

The study was done for Granite State Management & Resources on behalf of the New Hampshire Higher Education Assistance Foundation.

“This report raises a critical concern, and it really should lead to a call for action,” said Rene Drouin, president and CEO of Granite State Management & Resources.

Drouin’s group is sponsoring a roundtable discussion Nov. 5, inviting college presidents, legislators, higher education advocates and the public to discuss “creative and practical solutions” to deal with the issue.

Gottlob said it’s too simple to conclude that student debts here exceed all others because colleges spend too much money or because New Hampshire’s level of state support for higher education is by far the lowest in the nation.

“There are a variety of reasons; they are all
complex, and they are all interconnected,” Gottlob said.

One that has gotten far less attention than those two factors is a middle-class squeeze more prevalent here than elsewhere, Gottlob said.

New Hampshire ranks in the top 10 in per capita income so many families qualify for little, if any, scholarship aid for their children but only a small number of them are wealthy enough not to need any help.

“It is foolish to think of New Hampshire’s broad middle class as anything other than an asset to the state, but in the case of college costs and considering the college enrollment patterns of New Hampshire high school graduates, New Hampshire’s broad middle class may contribute to the high level of debts of its residents,” the report stated.

It notes tuition and fees at public and private schools in New Hampshire are the seventh highest in the nation and spending by public college administrators here was above the national average over the past decade.

“At one time, public colleges in New Hampshire were a relatively low cost option for New Hampshire families and their children to obtain a four-year college degree, but over the past two decades, that has eroded,” the study said. “Thus, one traditional approach taken by families looking to minimize the cost of higher education as well as the need to borrow to pay for it, by attending an in-state public college, is unavailable to New Hampshire students.”

Further, New Hampshire has the lowest number of graduates who choose to attend college in their home state though state public colleges are accepting more and more in-state students.

Meanwhile, most students who wind up leaving pick a public or private school in New England, New Jersey, New York or the Mid-Atlantic states that have the highest costs of colleges in the country.

“Clearly student choice and the demographics of our families contribute to this phenomenon,” Gottlob said.

While the report does not specifically advocate an approach, it points out that increasing state college aid and reducing spending on the campuses together would have a synergistic or stronger impact on student debt than doing either in isolation.

For example, Gottlob noted increasing state aid $1,000 per student while cutting spending on campuses by $800 per student could cut tuition nearly 8 percent.

By itself, you would need to double that state aid increase – $2,000 per student – to achieve the same break in tuition.

And the report encouraged policymakers to consider tying any future increase in state aid to changing spending practices on college campuses.

“Explicitly linking levels of state support for public colleges to expenditures levels and uses may be one way to provide state policymakers with the assurances that state support will have the effects desired by lawmakers,” the report said.

Gottlob pointed out the challenge college administrators face is if they cut spending on campuses too deeply, they risk dropping in status, according to national ranking of the best colleges such as the one by US News and World Report.

Kevin Landrigan can reached at 321-7040 or klandrigan@nashua
telegraph.com. Also, follow Landrigan on Twitter (@Klandrigan).