Many students who aren’t interested in attending a public university in their own state tend to look at state institutions elsewhere.
Choosing public universities outside your border can sometimes be a relative bargain. In other cases, the price you pay as a nonresident will be exorbitant and comparable to private universities that are stingy with financial aid and/or merit awards.
Not surprisingly, the state schools that typically charge outsiders the most are those that enjoy coveted brand names or are institutions that are located in desirable areas such as near ski slopes. Here are some examples:
- UCLA
- University of California, Berkeley
- University of Michigan
- College of William and Mary
- University of Virginia
- University of Colorado
- University of Vermont
The schools that I just mentioned, as well as some others, can charge crazy prices because there are plenty of rich parents here and overseas that will pay whatever price is necessary for their children to obtain bachelor’s degrees at a trophy school.
I wrote an in-depth blog post about this phenomenon last year:
What Nonresidents Need to Know About Attending State Universities
Today I am sharing with you a new report from the New America Foundation that looks closely at the race among public universities to attract affluent outsiders to their states.
I’d urge you to read the report if public universities beyond your border are on your child’s college lists. Here is the link:
In great detail, Stephen Burd, who is a tremendous higher-ed journalist, documents that state universities are increasingly using merit scholarships to attract affluent outsiders. And this practice is increasing.
In the chart below, you can see in dramatic fashion that the amount of money state universities are devoting to the poorest and richest students are now nearly the same.
Schools with Highest Percentage of Merit Awards
You will find lists in this report that share the percentage of students at state universities that receive merit scholarships. This is not just a phenomenon you’ll see at state flagships, but also at state regional schools.
In this list below, you’ll see the schools that provide the highest percentage of students with merit scholarships at flagships.
Flagships Providing Lowest Percentage of Merit Awards
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Why State Universities Love Rich Students
State universities are attracted to high-income students for a variety of reasons. Here are the main ones:
Rich students bring in more revenue.
You can charge outsiders considerably more money and this cash is welcome since state governments are failing to support their public universities as they did before the recession that started in late 2007.
They help with rankings.
Just like their private peers, state universities are obsessed with inching up in the ratings and attracting smart, affluent students can help with that effort. In their admission processes, state schools focus almost entirely on test scores, GPA and sometimes class rank. These are among the admission factors that U.S. News cares about.
They need to attract rich students to ward off poachers.
If state universities don’t lock down their own brightest students with merit awards, they could find these teenagers swooped up by competing public universities elsewhere. I wrote about this phenomenon in a recent CBS MoneyWatch post.
For example, in the report Burd noted how the University of Missouri in Columbia (my alma mater) felt it had to react after admission representatives from the Universities of Alabama, Arkansas, Kentucky, Mississippi and Minnesota began aggressively recruiting in the state.
After losing out on high-achieving students that would have normally enrolled at Mizzou, the school significantly boosted its merit aid to higher-income Missourians and nonresidents. It also began poaching Illinois residents who might have normally have attended the University of Illinois, Urbana-Champaign. Now 20% of students at Mizzou are Illinois residents. University of Iowa and Indiana University have also been aggressive in recruiting Illinois teenagers.
Who Suffers From This Policy
The chase for high-income students, the report notes, is bad news for other students. State universities that dispense a lot of merit scholarships tend to serve a smaller percentage of disadvantaged students.
At universities that are aggressive with merit aid, Pell Grant students (awarded to low and middle-income families) represent 32% of the student body. In contrast, at schools that award less merit aid, Pell Grant students represent 42% of the student bodies.
As the report notes, “In bringing in more and more wealthy nonresident students, these colleges are increasingly becoming bastions of privilege.”