"Free" Community College Tuition Proposal Could Cost Taxpayers Plenty

President Obama announced a new program that will be included in his State of the Union Address on January 20th. Today he unveiled a new “America’s College Promise” proposal that calls for two years of "free" education at community colleges. The federal government would fund 75 percent of the cost of tuition with participating states picking up the rest.

How much would this cost? The White House released a Fact Sheet about the proposal, and while the potential price tag was a fact that was not included, it did note, "If all states participate, an estimated 9 million students could benefit. A full-time community college student could save an average of $3,800 in tuition per year."

According to the latest statistics from the American Association for Community Colleges, 2,804,305 full-time students are currently enrolled in community colleges around the country. So I assume that the White House's 9 milion figure covers multiple years of implementation because there is no way that community colleges would be able to expand their incoming class sizes that rapidy.

Based on the information provided by the White House and current enrollment levels, If all states were to participate in the new program, the federal cost in the first year would be $7.992 billion (the number of current full-time students multiplied by 75 percent of $3,800). The cost to the states would be an additional $2.664 billion.

That’s the potential cost for the first year of implementation, but of course, the actual figure would depend the number of states that choose to participate. Over the long-term, costs would also depend on the ability of community colleges to expand their capacity to accommodate a likely rise in demand for “free” education. Is is also assumed that these costs would build on existing federal support of community colleges which total $9.1 billion.

The Fact Sheet also failed to note how this program would be financed. Previous White House proposals to establish a universal preschool program for four-year-olds, at a five-year cost of $17.3 billion and $66.0 billion over ten years, would have been “paid for” by increasing tobacco taxes.