While a new bill signed Wednesday by President Clinton cut student-loan interest rates, a new study reported that the price of getting a college degree has doubled in the last ten years. CBS News Correspondent Nick Young reports.
A College Board study says that college tuition rose 4 percent this year alone - more than double the rate of inflation.
The increase means that tuition and fees rose $132 at public four year-institutions, reaching an average of $3,243, the study says.
For private, four-year colleges, average tuition and fees rose $723, up 5 percent to $14,508. Those costs averaged $1,633 at public two-year colleges, up 4 percent, or $66. A 4 percent increase also occurred at private two-year colleges, where average tuition and fees rose $254 to $7,333.
Because of an earlier round of double-digit growth, tuition at public four-year institutions in the last decade has risen 50 percent, adjusted for inflation. Family income during that time rose only 1.5 percent, also adjusted for inflation.
Financial aid has also grown, offsetting some of the increases, the College Board said. But students are borrowing more and getting fewer grants. Neediest students are suffering most.
"State aid to public colleges and universities has been declining and more of the revenue for institutions to keep them operating has shifted to tuition," says Lawrence Gladieux, an analyst with the College Board, which represents colleges, universities and educational associations.
However, a higher education bill slashing student-loan interest rates was signed Wednesday, coinciding with the gloomy report's release. President Clinton signed the new legislation, dropping rates to their lowest level in 17 years and saving borrowers an estimated $11 billion over five years.
"Today with this lowering of the interest rates...we can really say that every high school graduate in America, regardless of income, can afford to go to college," the president said.
The White House said a typical student borrower at a four-year college, graduating with $13,000 in debt, would save about $700 over a 10-year repayment period.
The measure also raises the maximum authorized amount for Pell Grants from the present $3,000 to $4,500 a year in 1999-2000, and in steps to $5,800 in 2003-2004. But Congress would have to provide the money.
In light of the latest study, College Board President Donald Stewart urged families to begin saving early for college, but also said most students at four-year colleges and universities pay less than $4,000 a year for tuition and fees.
"The truth is that the majority of Americans often overestimate the price of attending college and may be discouraged by those miscalculations," he said.
The College Board survey of 3,000 institutions also found room and board costs rose an average of:
- Four percent at public four-year institutions, up $172 to $4,530.
- Three percent at private our-year institutions, up $190 to $5,765.
- Five percent at two-year private institutions, up $224 to $4,666.
Another report released Wednesday says that placing less of an emphasis on SAT and ACT scores for college admission has brought more diversity to some campuses.
The study by the Cambridge-based National Center for Fair & Open Testing, or FairTest, focused on schools that don't force applicants to take entrance exams such as SATs or ACTs.
"A number of schools that admit at least part of their student body without regard to the students' test scores is now at about 280 out of a universe of approximately 1,600," Gladieux explained.
The schools reported seeing a larger proportion of minorities, more low-income students, and more children of parents who had never attended college.