06/16/2014 11:46 am ET Updated Jun 16, 2014

Oregon 'Pay It Forward' Tuition Plan Would Cost Up To $20 Million A Year To Implement


The first government examination of a radical new tuition model called "Pay It Forward" was presented to lawmakers in Oregon last week, explaining for the first time how much a state would pay to implement the new system.

Sending 4,000 students to college without a tuition bill would cost the state of Oregon $5 to $20 million a year for two decades, the Oregonian reports.

Representatives from the Oregon Higher Education Coordinating Commission laid out their examination of the costs of a pilot program to state lawmakers:

If Oregon were to allow 1,000 students a year to start college on a tuition-free path in fall 2016, 2017, 2018 and 2019, and then allow them to complete as much undergraduate work as they can on that same tuition-free deal, the state would have to pay $6.5 million in the first year, $20 million at the peak in 2020 and amounts between those figures over 20 years, officials said.

Under the Pay It Forward model, students attend public colleges without a tuition bill with the understanding they will send a small percentage of their income for a set number of years. Usually, depending on whose proposal you're looking at, it's around 3 to 5 percent for about 20 years. A graduate who has a low income during this period wouldn't pay much for their degree, while successful and wealthy degree holders will pay more, the same way income taxes work.

Since Oregon's legislature unanimously passed a bill calling for an official study of implementing Pay It Forward in summer 2013, a number of other states have considered similar legislation.

However, the Oregon legislature is already allocating roughly $700 million in each biennial budget toward community colleges and the state's university system. Adding $20 million would still keep appropriation levels below where they were in 1999, when enrollment was much smaller.