Assemblyman Jim Beall is trying to get pre-paid tuition rolling in California, joining nearly 20 other states who have some sort of program to lock in tuition costs years before a child actually attends college.
Beall has packaged this as tuition relief, and with costs increasing nearly 400% in 20 years, it’s a pretty good way to package it. It also is nicely timed with Governor Schwarzenegger raising statewide tuition levels in his new budget.
Each year of UC tuition would be broken up into 100 pieces, or “units,” which would be priced based on existing tuition plus an additional amount for fund administration and stability.
In Washington, each unit currently costs $70 — $11 more than if it were based solely on tuition.
Parents or grandparents would be the likeliest adults to register a child — of any age — for the California program by buying one unit. Subsequent contributions of any amount could be made by anyone.
Participants would be required to hold their units for at least two years, after which they could be used if the student were accepted into a public or private college in California or outside the state.
Students attending a campus charging less than UC could use any surplus funds for other college-related expenses, while students attending the nation’s highest-priced campuses must bankroll any difference.
Donors would not receive a tax write-off, but money invested could appreciate, and gains would not be subject to state or federal income taxes if used for college attendance.
Tuition invested for one sibling could be transferred to another, but units could not be bartered or sold as property.
Families opting to close their child’s account prematurely would be subject to tax and program penalties — unless the student had died, become disabled or earned a scholarship.
I’ve had a bit of experience with this in Virginia, where my parents prepaid my brother’s tuition. Sure, he promptly attended a private school and then went out of state, making it kindof a moot point, but it was pretty clear talking with my parents over the years that it was a huge load off of their minds to have it taken care of to such a degree.
Granted, there are important details to sort through- whether you have to be a resident, whether there’s a time limit to redeem it, and so forth. There’s the question of how the state will invest the money brought in, both from moral and financial perspectives.
But ultimately, I’d imagine, the biggest concern is undermining either the education system or the state’s budget at some point down the line. There was a guest spot on NPR the other day in defense of college costs, essentially saying that you get more for your money than if you sent your kid to stay at an Embassy Suites for 9 months, which I suppose is technically accurate if not much else. Beall insists that, if instituted properly, this is self-sustaining financially, and it certainly seems like it could be. But fit it into the larger picture. If the government offers (but doesn’t force upon anyone) programs for education through a BA and health insurance, and if a living wage can be hammered through, and if we can take a stand against Super WalMarts and myriad other things we’re after, all of a sudden we’ve got a generation that’s pretty well taken care of by the time they’re 22 and hitting the world. And that ain’t so bad.
p.s. I have a silly little blog of my own now, and it’s cross-posted.