CBO Reports to Senate on Financing College Education
January 29, 2004
The Congressional Budget Office (CBO) issued a report in January to the Senate Budget Committee entitled “Private and Public Contributions to Financing College Education.” The report estimates how much students and families paid in college costs in the 1999-2000 academic year after accounting for all types of federal assistance through the Title IV programs, tax credits, and tax-advantaged vehicles for educational savings.
The report focuses on how students and families pay for college and the allocation of college costs among the various payers, including those outside the family such as governments and institutions. To achieve this purpose, the CBO developed a comprehensive measure of net price, or sticker price, minus financial aid. Significant attention is given to differentiating student from parent contributions, and variances based on family income and type of institution attended.
Statistics derived from the study indicate that the cost of a year of college (including living expenses) in academic year 1999-2000 was $19,998. Families bore about 50 percent of the expense; the federal government defrayed 9 percent; and others, primarily state governments, covered 43 percent. The allocations varied by family income, but CBO found that for every income group and every college type, the student's share was less than 30 percent of total costs. These shares are determined after the general subsidy—the colleges' instructional expenditures per pupil minus tuition and fees—was deducted from the total cost.
To access the full report, see the CBO Web site.
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