Net Price Calculators in Michigan Key to College Decisions in a Crisis
Lansing, MI – Before the COVID-19 pandemic, Michigan had significantly underinvested in both operational support for colleges and universities and in-state grant aid for students. In 2019, the state was spending 20 percent less on colleges and universities than the decade before; higher education absorbed the second largest cut of any budget area when the Great Recession hit in 2008; and tuition increased: Michigan’s average public four-year college tuition is now about $2,900 higher than the national average.
High tuition makes headlines and may dissuade students from pursuing college. However, a college’s “sticker price” can be misleading because it does not reflect any grant or scholarship aid that reduces the price students actually pay, and the difference between sticker price and net cost can be both significant and counter-intuitive.
A decade ago, the federal government attempted to address confusion around sticker and net price by requiring all colleges to maintain on their websites a net price calculator (NPC) that displays a personalized estimate of net cost based on the family resources input by a prospective student. While a critical resource, national research has shown that NPCs can be hard to find, hard to use, and hard to compare across colleges. In Michigan, our analysis of NPCs at colleges across the state found that trends mirror the national story: these tools are not consistently easy to find, use, or compare. A new report from the Institute for College Access & Success (TICAS), Giving Students the Upper Hand: Improving Net Price Calculators to Aid Michigan’s Students and Families in Making College Decisions, explores accessibility and details findings, including that one in eight NPCs in Michigan are hard to find on institution’s websites, one-fifth require overly detailed family financial information to complete, and some schools use data that is as much as a decade old to compute the results. The report provides recommendations for the federal government, states, and colleges to improve these crucial tools.
“Research shows that low-income students are especially sensitive to variations in price, and easy access to transparent estimates of college costs is key to supporting their decision to apply to college and helping them find the right financial fit,” says Catherine Brown, TICAS’ senior advisor for Michigan. “While policymakers will need to make significant new investments to address widespread college affordability challenges across Michigan, the economic fallout from COVID-19 means it is more important than ever that all students have clear information to navigate hard decisions about where to apply, where to enroll, and how to pay for it.”
COVID-19 will undoubtedly exacerbate the higher education affordability challenges that existed in Michigan before the pandemic and put at risk the progress the state has made in growing its college-going and success rate. While information will not close true affordability gaps, the power of NPCs is that they help prospective and current students identify colleges that are in closer reach than the sticker price and their personal finances may initially indicate. Federal and state policymakers and institutions can take actionable steps to make these tools easier to find, easier to complete, and easier to compare to ensure that a decade after they were created, NPCs can live up to their full promise to clarify the actual cost of pursuing higher education.
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The Institute for College Access & Success is a trusted source of research, design, and advocacy for student-centered public policies that promote affordability, accountability, and equity in higher education. For more information see www.ticas.org or follow us on Twitter and Facebook.
