Education leaders are praising President Obama's proposal to tie federal aid to a college's value, but worry that creating a single rating system to measure that might be the wrong approach and might discourage students from going into low-paying careers after they graduate.
"It does make sense to link budget allocations to performance and results and not just to enrollment," said Richard M. Freeland, Massachusetts commissioner of higher education. "But I'm not sure one formula for all types of institutions in all regions of the country will make sense."
Under the president's proposal, the federal government would create a rating system by 2015 to guide students to colleges offering the best value based on average tuition, graduation rates, student debt burden, percentage of low- and middle-income students who receive loans, and graduates' earnings.
But Richard Doherty, president of the Association of Independent Colleges and Universities in Massachusetts, said using graduates' earnings as a criteria "builds in a perverse incentive" for students not to go into what are often low-paying professions, such as teaching and social work. And in order to improve graduation rates, colleges might be more selective about the students they admit.
Obama's proposal nevertheless could put pressure on colleges to hold down tuition and graduate more students because federal aid would depend on the value a school provides.
Over the past 30 years, average tuition and fees at four-year public colleges and universities have increased 257 percent in inflation-adjusted dollars, according to the College Board. Wages, meanwhile, have risen only 16 percent.
But Congress would have to authorize any shift in financial aid, and Republicans could try to block the president's proposal.
"Anytime you hear another edict from the Obama administration, you have to think twice," said Tim Buckley, a spokesman for the Massachusetts GOP. "Considering the disastrous implementation of Obamacare, members of Congress would be wise to doubt this program's usefulness. Trying to treat large public universities and small private colleges the same way is another one-size-fits-all solution that is sure to fail."
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