01/13/2015 04:55 pm ET Updated Mar 15, 2015

Obama's Free Community College Plan Rewards Frugality

President Obama's plan to make the first two years of community college free would finally reward rather than punish students who are frugal about college costs. The majority of our nation's students, almost 60 percent, begin their postsecondary education in a community college, which is the most inexpensive college option, with an average annual tuition of $3,260. These students are choosing to reduce their college-going costs by foregoing the universities, for-profit and other private college options that carry much larger price tags and often result in significant student loan debt or higher rates of public subsidy for poor students utilizing Pell Grants. These prudent students should be rewarded for their thriftiness.

So, how and why are they currently being penalized?

My recent research project interviewed over 700 community college students in eight states and examined the social media posts of nearly 40,000 more. In a chapter in the book, Reinventing Financial Aid, we describe how our current system of channeling financial aid through students to pay for such a low cost option actually penalizes many of these students and the community colleges they attend.

One way they are penalized by the current process is that they are overburdened with the procedures necessary to receive very small amounts of aid. The financial aid application process is complex, and filling out the FAFSA form each year creates particular impediments for students who don't fit the traditional mold of a teen or young twenty-something financially dependent on their parents. Many community college students are young but live in households where they help support their parents and siblings, or they live entirely separate from their parents. To qualify for aid, such students must request an "override," proving they are worthy of help by providing evidence and explaining the details of their non-normative family circumstances. Students in non-traditional situations are also more likely to be subject to federal "audits" of their FAFSA to uncover discrepancies in reported income. And since so many poor and non-traditional students are concentrated in community colleges, financial aid staff there are overburdened with processing both override requests and audits. These institutions are often those under the gun - having to be accountable for errors in FAFSA payments revealed through audits -- yet under-resourced, with a ratios of one financial aid advisor for every 5,000.

Another way community college students are penalized by the current process is through aid disbursement delays. It is not uncommon for community colleges to have a majority of their students qualify for Pell Grants. Since community college tuition is often lower than the amount of Pell Grant received, students can apply the remaining Pell money to their costs for books and technology, living expenses and transportation. Rather than having this money on hand before they begin their classes, most students have to wait a whole month or longer to receive a "refund" that should be in their hands before the semester begins. Why the delay? Community colleges are being held responsible to repay the Feds the Pell money given to students they call "Pell runners," who take the money but don't attend classes. Delaying the reimbursements allows colleges to confirm attendance before disbursing the remaining grants and loans. What is the consequence for those cost-conscious, needy students who are trying to access college in the most affordable way possible? Instead of being ready and prepared, many of our poorest college students are trying to manage the first month or so of their semester without their books or supplies, struggling to pay their rent or transportation expenses or forced to use vouchers in the college bookstore rather than purchasing their books and supplies in the open market, where prices are significantly lower. The serious students are being punished for the sins of a tiny fraction, less than 3 percent of all Pell recipients.

We should encourage our representatives to support Obama's plan. Eliminating the opportunity for Pell runners by eliminating tuition could alone save about $1 billion. Furthermore, according to a Lumina Foundation report by leading experts on the topic of college affordability, a more universal program of two free years could be more simple, efficient and less bureaucratic than our current complex mix of targeted, patchwork aid and it could also be achieved with no increase above current expenditures!

With an average age of 28, community college students are a diverse group, and most are not "kids." They are primarily financially independent older adults, many working or raising children or both, as detailed in my chapter in the book, Remaking College. Some critics claim President Obama's plan will help more middle income students. Is that so bad? Anyone attending community colleges -- not just the very poor or the very young -- deserves a break for placing less of a financial burden on themselves and other taxpayers by choosing such low-tuition institutions. We should stop fighting over crumbs, and simply push for reforms like this that foster universal rather than targeted access while taking measures to prevent lower-income students from being displaced by higher income-ones. In my judgment, the proposed changes would reduce the existing complexity, procedural hassles and delays in financial aid that are already jeopardizing poorer and non-traditional students and pushing them away. In fact, such obstacles likely contributed to the growth of the for-profit college sector, where admissions/recruitment staff hand-hold students through the financial aid process for the prize they seek -- applying OUR tax dollars to pay tuitions as high as three or four times community college tuition. According to a 2012 U.S. Senate report, nearly a quarter of all Pell Grant money is currently subsidizing the college-going of the 15 percent of students, mainly poor ones, attending for-profits.

Since two years of free community college, if done smartly, is a feasible reform that can be accomplished without raising overall student expenditures, I say make our public option community colleges free, make them more hassle free and put our tax dollars to work more efficiently for the public good.