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Rising college costs prompt student loan reform

States struggle to contain fees at public universities while the federal government rolls out affordability measures to help counter the rising costs of higher education.

By Staff writer / September 18, 2009

Rich Clabaugh/Staff

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As 19 million college students descend on campuses this fall, many families are asking: Can we afford this?

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People are often willing to stretch already-tight budgets to reach their college goals. But when costs get out of reach, a national goal is at stake, too: By 2020, President Obama has said, the United States should lead the world in the rate of college degrees earned. Both he and members of Congress are at work to boost financial support for college students.

Many factors determine whether college is "affordable" – everything from students' income, to state and federal policies, to a school's price. Here's a look at some of the current issues and long-term trends that play into the affordability equation.

What's happening with state financial aid and tuition at public schools?

Last year, average tuition and fees at public four-year institutions came to $6,590, but the net price (what's paid after receiving various grants) was $2,850. Students also paid $7,750 for room and board, the College Board reports.

Prices, and the degree to which they're going up this year, vary considerably from state to state. Because of revenue declines, at least 32 states have made cuts to higher-education funding recently, and more may follow. California students can expect to see cost increases of up to 20 percent, while those in Washington State, Florida, and New York will see a spike of about 15 percent, says Terry Hartle, a senior vice president at the American Council on Education in Washington.

A number of states, including Indiana, Ohio, and Illinois, have had to cut back on need-based student grants. But pockets of good news exist: Missouri's schools will not raise tuition this year. The state held funding steady by tapping into federal stimulus dollars. Maryland has a tuition freeze in place for the fall, but recent state budget shortfalls have cast doubt on whether that can continue in the spring.

What's happening with tuition and aid at private schools?

Last year, average tuition and fees at private four-year institutions came to $25,140; the net price was $14,930. Students also paid $8,900 for room and board.