One of the biggest concerns at colleges and universities is how best to improve retention.
Retention means something quite different depending upon the institution. At elite colleges, for example, retention rates below 85 percent in four years are a cause of concern. At two-year and four-year colleges that are overwhelmingly first generation, highly diverse, adult-learning focused, and tuition dependent, the numbers are often well below 40 percent over four years. At community colleges, two-year retention rates are even lower.
The point is that we cannot understand retention without grasping the history, mission, purpose, program offerings, and financing at an institution. The retention number is further complicated because of transfer opportunities, especially at lower division institutions. In addition, poor counseling, unfocused or changing student interests, course availability, federal and state loan policies, and student life circumstances can dramatically affect retention numbers.
Yet retention is a “blue chip” metric against which trustees, the media, consumers, and state and federal governments judge quality. It’s a startling statistic but not an especially shocking one.
The drama over retention is set against a backdrop of student loan default. Beginning in September, any college with a default rate of 30 percent or higher annually will be required by the federal government to develop a plan to educate and assist students in understanding, handling and completing the pay back of their student loans. If the plan doesn’t produce improvement within three years, affected institutions will lose their eligibility for federal loans and the Pell grant program.
Colleges and universities with persistently high default rates that do not show improvement may be subject to closure.
Let’s clear the air about the default crisis. In doing so, we’ll set aside the debates about for-profit default problems, institutions that serve “high risk” populations being unfairly targeted, and studies that “prove the theory” in support of the new federal policies.
There’s already enough government by anecdote influencing state and federal policy.
But, let’s ask a policy question. Does it make sense? Is it reasonable for the government to step in to try to improve default rates?
In fact, the federal government continually runs the risk of overstepping its boundary on regulations affecting higher education in profoundly negative ways. Federal support, especially at private institutions, brings the government into the funding of higher education as a minority partner. Direct subsidies to public institutions are in aggregate historically state-government-supported. Excluding research support, federal government policies have always been directed more toward support of students.
When the dust clears, however, it is reasonable for the federal government to use its funding and regulatory authority to improve default rates on loans and grants on which it is the principal funder. The federal actions on student loan defaults pass the test of what is reasonable and do not exceed the limits that often precipitate long, debilitating fights over federal intrusion.
There are caveats.
First, it will be important for federal officials to understand how American higher education works. “One size fits all” solutions never succeed in dealing with a decentralized system of colleges and universities, mixed as public and private. Further, solving the student loan default problem is not theory. It’s better to move beyond academic educational policy debates.
It’s time for educational think tanks and federal policy wonks to remember that acting as futurists does not mean that they should attempt to live only in a world that they wish existed. Let’s agree to deal with the messy reality that collectively produced the greatest higher education system in the world, warts and all.
Second, the new plans should link the student loan default plan directly to the college’s strategic plan, counseling strategies, academic programming, assessment protocol, and admission and retention practices. Each plan must be different because every institution has context and subtlety. Good default plans will professionalize “Mom and Pop” operations, build from the experiences of other institutions, and improve retention.
Third, the default plan should recast improvement to student loan defaults as a retention issue. Simply put, the default crisis will then translate more effectively into an opportunity for a college or university to improve its bottom line, adhere to its mission, and comply with federal partnership agreements on grants and loans.
The New York Times editorialists were wrong recently when they argued that “identifying and reaching out to students with academic problems, counseling all students with their right and obligations under various loan programs—these are important tools to prevent defaults. But what is likely to persuade colleges to deploy these tools in the first place is the threat of losing federal aid if they do not.”
Good programs to help students do not advance through threats no matter how big the bully. Let’s hope that well-intentioned college and federal leadership will move past the unfortunate language in the Times editorial to see the potential for a well-defined partnership to deal with the student loan default program.
And let’s agree that the federal government has a role to play in student loan defaults—carefully defined—that is positive, helpful, appropriate, limited, and, most important, that puts students first.
In the end, student loan defaults are about improving retention for college students. It’s time to get more serious about this issue. Informed and sensitively developed student loan default plans open one door to improved retention.
Dr. Brian C. Mitchell is president of Brian Mitchell Associates and a director of the Edvance Foundation. He is the retired president of Bucknell University and former president of Washington & Jefferson College.