by Robert J. Massa

Ten college and university presidents met with Vice President Biden at the White House earlier this month to announce their voluntary endorsement of a uniform financial aid award letter that would provide students with clearer, more transparent and accurate information about how much they will have to pay – now, and in the future — for their college education.
The initiative is an effort to discourage students from financially over-extending themselves, and beginning in the 2013-14 school year students applying to any of these institutions will be given a one-page cost or “shopping sheet” prepared by the Consumer Financial Protection Bureau. The sheet will include the full price of a year at college, including an estimate for books and personal expenses. This is nothing revolutionary as far as I’m concerned, as I’ve always worked for colleges that disclosed this information. But what will be of value is the part that breaks out grants from loans and work-study income, and shows students the long-term implications of borrowing by estimating monthly payments after graduation.
This initiative has received a lot of press recently. While its intentions toward financial transparency are good, it’s still, as Neil Armstrong once said, only “one small step.”  But it is a step in the right direction.
One can argue that even standardized forms can be confusing, especially those created by government agencies (I know; hard to believe, but true).  What’s not included on the standardized form is how much the college has determined a family should pay toward annual costs after analyzing their financial aid application (FAFSA or PROFILE). Therefore, the first item on the form might read:
“Based on the information provided on your application for financial aid, your family contribution for the coming year is $X. This leaves a remaining need of $X, based on the cost of attendance listed below. This letter will outline your options in meeting the remaining need.”
Here’s what else needs to be changed:
1. The form calculates how much a family will pay for one year by subtracting the total grant and scholarship amount from the full cost (including books and personal expense estimates) of attending the institution. This is not quite accurate as loans reduce the amount owed out-of pocket for that year.  A better descriptor might be “Price after Grants and Scholarships.”
2. The form lists loans and work-study options. To lessen confusion, it would be more accurate to include ONLY subsidized loans that would be part of a need-based financial aid package. Unsubsidized student loans and parent loans should be listed as “optional.”
3. The “How much you owe after graduation” section should first provide an estimate of the monthly payments a student would make if the full amount of a subsidized student loan is borrowed in each of the four years. Rather than lumping together all loans, federal unsubsidized and private loans should be listed separately as they are discretionary and not used to meet need (unless gaps are built into the financial package). Estimates should be made for those payments, separate from the need-based loans, acknowledging that it is often a family choice to borrow to fund all or part of the expected family contribution.
Finally, although the above suggestions would give families a clearer understanding of their total financial obligation, they are simply tweaks of a disclosure statement that is fundamentally a good one.   If we really want to address the issue of student debt, however, we need to start with addressing the always-increasing price tag of a four-year degree. This will require a “giant leap” that can occur only when colleges take control of their own rising costs.  Some costs, such as heath care and energy, are out of the colleges’ control.  But others, such as pinpointing programs and services to discontinue before adding new ones, must be tackled.  Campus politics often work against this, but consumer pocketbooks will force the issue.
For many, it will be a “giant leap” of faith into a brave new world.
Robert Massa is vice president for communications at Lafayette College in Easton, PA.  The views expressed in this article are those of the author and not necessarily those of the College.


by Robert J. Massa

Five years before I would join the Lafayette College staff, my son Dan chose Lafayette over a larger university.  It changed his life.

As a high school student, my son was arguably bright but more interested in “hanging out” than studying.  At a college of 2400 students where professors work only with undergraduates, he was transformed, first by his advisor, and then by two research professors in their laboratories.  These great professor-mentors took my son and developed a curiosity in him to solve problems, to work with others in cross-disciplinary teams and to write his observations in a publishable format.  He not only landed a job immediately after graduation, but he embarked on a career and a way of living that was worth every penny I paid, and then some!  Add to that his experience in choral and a capella music, his experience on the men’s volleyball club team, and his work for the admissions office and it is easy to see why the value of a Lafayette education is real to me.

But don’t take my word for it.  PayScale, the Seattle-based compensation data company, placed my son’s small college fifth in the nation among liberal arts colleges for starting salaries.  Using PayScale data, Bloomberg Business Week placed it17th among 1,248 colleges and universities nationally, and 2nd among liberal arts colleges, in net 30-year return on investment.  This is a powerful endorsement for a small college that offers a personalized, “hand-tooled” education that crosses disciplinary boundaries.  It pays handsome dividends, not only in the salaries graduates earn, but in the quality of life they enjoy.

Most of my career was devoted to college admissions and financial aid.  Although I understood price concerns, it always frustrated me when parents and prospective students tried to “bargain” for a better financial deal:  “X College gave me this much; what are you going to do?”  I began to wonder, particularly in the later years, if anyone really cares about value.

Price, of course, is only one component of value, but other factors include program strength, faculty commitment, alumni accomplishments, mentoring, facilities, campus life opportunities and peers. Education is an investment in one’s future – long term gains outpace short term “losses,” i.e. a higher annual price tag for college.  This may be lost on a generation of students and parents understandably concerned about the up-front financial outlay.  What does this suggest for the future?

Small colleges must collaborate with other colleges, universities and the private sector to increase value and control costs. We must explore the possibilities of using technology in collaboration with others to deliver some content in cost-effective ways without compromising our mission and purpose.  But at the end of the day, parents will be willing to pay, according to their ability, only for what they perceive will be added value over a less expensive alternative for their children’s future.

My job is to convey value through stories about people and their successes while at college and after graduation. We must always be concerned, however, about cost and the impact it has on the price we must charge and on our ability to provide access to excellence.  There are challenging times ahead. Colleges that position themselves well will meet those challenges with considerable success.

Robert J. Massa is vice president for communications at Lafayette College inEaston, PA.