Tax-exempt bonds, novel programs help students pay college tuition

A wealthy Ivy League college has pioneered one of the newest sources of money for low-interest student loans: raising money through the sale of tax-exempt bonds.

Congress has just decided against clamping down on the ''Dartmouth Plan,'' which some fear could further drain an already ebbing US Treasury.

Dartmouth College was the first private college to turn to the bond market as an alternative financing source. In June, the school sold enough tax-exempt bonds to raise $29 million, $13 million of that for low-cost student loans to some 800 Dartmouth students. The rest is for construction and renovation.

The plan, like other programs that rely on tax exemptions to attract investors, is criticized by some because a US government already heavily in debt would lose even more tax money if investors buy the tax-free bonds.

Several states have passed laws allowing both public and private colleges to issue tax-exempt bonds to raise student-aid funds, but Illinois is the only one so far to set up a state agency to handle selling the bonds.

''But (selling tax-exempt bonds) is a limited alternative,'' says Ted Bracken of the Consortium for Financing Higher Education. ''It won't become an option nationwide because the laws on it vary too much from state to state. It also requires that the school be strong financially and be able to put together a sophisticated financial package (to make the investor want to buy the bond). . . .''

While the Dartmouth Plan may be the financial aid answer for the more well-endowed colleges and universities, others must look elsewhere. Among the new ideas:

* Georgetown University in Washington, D.C., may offer a nonsecured, noninsured loan for parents to pay back over an eight-year stretch. Much like a commercial loan, it may be offered at commercial rates.

* Sen. Bob Dole's plan for a tax-sheltered educational savings plan, where contribution and interest earned on a college ''nest egg'' would be tax-free. But cost estimates have ranged up to $7.8 billion a year by 1985.

And in the background of this newest wave of ways to pay for college is the radical idea of Boston University president John Silber. His controversial Tuition Advance Fund (TAF) plan was first perused and rejected by Congress in the late 1970s, when money was easier to come by.

TAF works by giving students in advance the money needed for tuition and room and board, up to $7,000 a year. The students then repay the advance plus a 50 percent surcharge through payroll deductions after they graduate. Students wouldn't have to start paying back until they started earning $10,000 a year. Then the Internal Revenue Service would start collecting a small percentage of the amount lent, and the percentage would climb as income increased.

Dr. Silber admits it's a fundamental switch of responsibility ''from the backs of parents to the shoulders of the student.''

Independent colleges are especially leery of a plan like TAF that would make it less likely for a student to choose an expensive college. And John Mallan, vice-president of the American Association of State Colleges and Universities, points out that it puts an enormous burden of debt on young people when they're just starting out.

But the TAF plan has some advantages over the current student aid system:

* The loan is available to all, regardless of income.

* Repayment is virutally assured through payroll deduction.

* After 15 years, the burden of student aid is shifted from the government to the student.

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