This is the fifth story in an occasional series assessing and exploring where the leading candidates stand on the most important issues facing New Jersey. Follow this link to read all the articles in this series.
While not a principal focus, New Jersey’s high-cost public colleges — the fourth most expensive in the nation — and higher than average loan burden on students have been on the radar of both major party gubernatorial candidates.
Republican Kim Guadagno, the current lieutenant governor, and Democrat Phil Murphy, a former Wall Street executive and ambassador to Germany, agree on such issues as the importance of emphasizing STEM education and vocational training. But they have fundamental disagreements on others, including how to bring down or slow the growth in college costs and ease student borrowing.
The state’s higher education system has been treated like a stepchild for decades. According to a recent report from New Jersey Policy Perspective, a progressive think tank, New Jersey cut the amount it provides to state colleges by an inflation-adjusted 21 percent between the start of the Great Recession in 2008 and 2016 alone, while enrollment increased by 15 percent. Student debt has also risen, in many cases doubling or more, during that time. Last year, Rowan University students who graduated after living on campus for six years left with more than $40,100 in loans.
Guadagno’s freeze and cap
To attack both problems, Guadagno supports freezing tuition and capping fees at public colleges and universities. She said that over the past two decades, average yearly tuition and fees have risen by 136 percent at public four-year institutions in New Jersey and 73 percent at two-year schools.
“By freezing tuition and capping fees at public colleges and universities, families will be able to plan and save for the cost of a college education,” she said.
But Guadagno did not give more specifics about how the freeze would work, and how it would be funded.
The Assembly passed along party lines a Democratic bill that would have frozen public college tuition for a student’s four years at whatever the cost was when the student entered as a freshman. The bill went no further amid warnings from college officials that such a freeze would lead to significantly higher tuition costs for each new incoming freshman class to make up for the capped tuition for existing students unless the state were to increase its support to the schools.
Murphy has pledged to increase state aid to the colleges as a way to keep tuition increases down and keep student loan debt manageable. His website states he plans to use “state investments” as a funding source but does not provide any additional specifics and his campaign did not respond to a request for particulars.
Murphy’s free ride
The Democrat has also proposed making a two-year community college degree free for all students, a plan Guadagno is especially critical of.
“A free college education falls in the category of who’s going to pay for it,” Guadagno said during their last debate last week, addressing a student at William Paterson University who asked whether the candidates would support a free public college education model similar to the one New York state recently adopted. “I would love to provide you with a free college education and if you have the means to pay for it do I still want to provide you with a free college education because that’s what my opponent is saying. My opponent says that whether you can afford it or not, you get a free college education … Everyone in New Jersey is going to pay for it.”
The Murphy campaign estimates the cost at $200 million, although NJPP put that at $250 million. Murphy has said he expects to be able to pay for that within two years from increased revenues from economic growth. And he defends the plan from those, including the progressive NJPP, that say it would be better to use funds to help more lower-income students pay for college, rather than provide two free years of schooling to even wealthy students who would be able to pay for themselves.
“It’s an argument other states have grappled with,” Murphy said following that last debate with Guadagno. “We’re convinced in this state it’s a game changer for everybody and it’s $200 million at most out of a $35 billion budget. The big reason is the feds pay a big chunk of this already … It would immediately ignite that middle-skill level of the workforce that we’re missing right now.”
Not unique to NJ
This program would not be unique to New Jersey, as several other states give high school graduates free access to community college. New York state has gone further, providing a four-year degree from a New York City or state college for free to children in families with income as high as $125,000, provided the student live and work in New York for the same length of time in which they were enrolled.
Murphy has a similar, but more modest plan. His website includes a proposal to have New Jersey forgive the loan debt for college graduates working in STEM (science, technology, engineering, and math) fields in New Jersey and to give incentives for private-sector employers to provide student loan relief as an employee benefit, without giving further details on how such forgiveness would work.
He seemed to take that a step further, though, in last week’s debate. Answering the student’s question, he did not mention only STEM graduates when he said, “How about something like stay in New Jersey for college, stay here five years after to work and then we’ll forgive years six, seven, eight, nine, ten x-thousands of dollars off your outstanding loans?”
Guadagno’s proposals related to STEM do not appear to be as potentially costly as Murphy’s, though they could be controversial in other ways.
For instance, she has proposed requiring high school students to take computer-coding courses. She said this should allow more students, and particularly girls, to pursue a career in technology.
“I believe we should do more to connect higher education with the needs of the business community to lower the cost of education, close the skills gap, and to teach students marketable skills that will boost the innovation economy in New Jersey,” Guadagno said.
Murphy has a similar idea, though his “Computer Science for All” initiative would give all public school students access to coding skills without making it a mandate. He also supports expanding and modernizing vocational schools.
Guadagno also supports expanding career and technical education programs and offering more college credit programs in high school as a way to ensure students are learning 21st century skills that will make them marketable to employers. And she would promote the use of more “stackable credentials,” which would allow students to earn skill certificates that would count towards two- or four-year degrees.
Another proposal aimed at ensuring students are leaving school with the skills New Jersey businesses need would be to expand the state’s Talent Networks. There are currently seven networks made up of the colleges, universities, and business groups working together to improve the training students are receiving so it matches up with workforce sectors — advanced manufacturing, financial services, healthcare, life sciences, hospitality/tourism, technology, and transportation/logistics.
More on-the-job training
Both candidates support increasing apprenticeships and on-the-job training for students transitioning into the workforce.
Guadagno’s idea for helping students pay for college and reduce their loan debt is to have New Jersey give an income tax deduction for those who save for school through New Jersey’s 529 college savings plan called NJBEST. Through NJBEST, families put money into an account for a minor and its investment earnings are exempt from taxation. Guadagno said most states provide a tax deduction for 529 contributions and New Jersey should do the same. It’s unknown how much that might cost the state in incomes taxes that would not have to be paid.
Murphy plans to attack college costs and debt more directly, saying he would have the public bank he wants to create write lower-cost student loans.
“Higher education has become out of the reach of too many young people and their families. It’s maddening,” Murphy said, citing a billboard on the New Jersey Turnpike advertising the University of Maine as offering out-of-state tuition that is cheaper than in-state tuition at New Jersey’s public colleges. “We’ve defunded. We’ve ravaged higher education in this state … We love the idea of a public bank that we all as citizens own and one of the lines of business is reasonable student loans.”
The New Jersey Higher Education Student Assistance Authority, which write student loans, has been under fire for what some state senators called “predatory lending” and “loan sharking.” Last summer, as lawmakers held hearings on HESAA’s practices, including its policy not to tell the loved ones of a student who died that they could seek to have the student’s debt forgiven, Murphy called for overhauling the authority’s operations to better help reduce students’ financial burdens.
Guadagno called Murphy’s public bank plan “wacky,” adding, “I can’t imagine a worse idea than giving all of the receipts to some bureaucrat in Trenton to hand out to other people, so the idea of a bank handing out loans to students is beyond words fantasyland.”