The NY State Excelsior Scholarship Has Launched: Key Program Details, Anticipated Impact & Ideas to Compete Against Tuition-Free Options

June 12, 2017 Kathy Bryan

Last week, the application for the Excelsior Scholarship in New York State became available for students enrolling in college this fall. The new scholarship program allows for free higher education at NY public schools for those who qualify. For competing private schools, it’s time to take action and ensure you have a plan in place to compete in the changing marketplace.

What is the Excelsior Scholarship?

Beginning in the fall of 2017, and phased in over a period of three years, the Excelsior Scholarship supplements current aid programs available to NY residents. By covering the delta between cost of college tuition (currently $6470 per year for four-year SUNY and CUNY programs) and other available financial aid, the Excelsior Scholarship is intended to make college tuition free for those who qualify.

The Excelsior Scholarship is estimated to cost $163 million, paid for by the state of NY.

Who qualifies for the Excelsior Scholarship?

To qualify for the Excelsior Scholarship, a student must be a NY state resident (continuously for 12 months prior to enrollment) and from a family with a household adjusted gross income that falls at or below the cap for the program.

  • 2017 income cap: $100,000
  • 2018 income cap: $110,000
  • 2019 income cap: $125,000

There is no age limit for the Excelsior Scholarship. It’s estimated that more than 940,000 individuals are eligible. However, some criticize the program as having limited value because many lower-income students already receive enough from their federal grants and state aid to have their CUNY and SUNY tuition completely covered.

Who can use the Excelsior Scholarship?

The Excelsior Scholarship will be available to students enrolled in two- and four-year programs at public colleges throughout NY state. This includes the long roster of CUNY and SUNY schools. Students must maintain good academic standing, take at least 12 credits per term and 30 credits per calendar year, and be on track to graduate on time.

Note: Based on current enrollment trends, most (90%) NY state community college students and the majority (60%) of NY students enrolled at four-year schools attend college part time.

What does the Excelsior Scholarship cover?

The Excelsior Scholarship covers the gap between college tuition and other aid received, with a maximum benefit of $5,500 per year. The scholarship is provided for two years for associate programs, four years for bachelor’s programs and five years for programs intended to take the extra year to complete.

The Excelsior Scholarship does not cover fees and other college expenses, including room and board. In addition, it is not available to students pursuing a second associate or bachelor’s degree. And the Excelsior Scholarship is not awarded to students enrolled in graduate programs.

What are the post-graduation requirements for the Excelsior Scholarship?

Students who utilize the Excelsior Scholarship must live and work in NY state after graduation for a length of time equal to the amount of time for which they received the scholarship. If this requirement is not fulfilled, the award is converted to a loan ― with interest. Those who transfer to another school to complete a bachelor’s degree, enroll in graduate school in another state or join the military can defer this requirement for a set period of time.

According to Governor Andrew Cuomo, the live and work requirement is in place because, “The state with the most educated workforce is the state that is going to succeed long term, from an economic development point of view.” It is estimated that 84% of SUNY and CUNY graduates stay in NY after graduation. However, some believe the live/work clause of the Excelsior Scholarship may limit the number of students willing to accept the award because it restricts post-graduation mobility and employment options.

What is the anticipated impact of the Excelsior Scholarship on higher education institutions?

The Excelsior Scholarship is estimated to boost enrollment at NY public institutions by 9-22%, lowering enrollment at NY private nonprofit schools by 7-15% as a result. It is believed that the private school retraction is most likely to occur at tuition-dependent colleges that primarily recruit from within the state of NY and already provide deep tuition discounts. In the words of Gary Olson, president of Daemen College near Buffalo, NY, “Once this [the Excelsior Scholarship] is out there and implemented, possibly some of the more precarious institutions will go under.”

Conversely, selective schools and those with high enrollment from individuals out of state are likely to be less impacted.

From a statewide economic outlook, trends related to population, employment and wages are anticipated to have a positive impact. In addition, college enrollment and completion rates are expected to climb.

What other free college programs exist in the U.S.?

Promise Programs are place-based scholarship programs that provide for free college tuition, based on a variety of qualification and availability provisions. The first, the Kalamazoo Promise, was launched in Kalamazoo, Michigan in 2005. There are now more than 50 local programs and two state programs, in Tennessee and Oregon.

In addition, a number of schools across the nation offer free tuition programs, including:

What can colleges and universities do to maintain enrollment in the face of tuition-free competition?

Competition for college students is intense, and it is wise to assume that tuition-free options will have appeal to many. Higher education recruitment, enrollment and marketing professionals should put strategies in place to help ensure their ability to maintain enrollment volumes at their schools.

If your school is not strongly differentiated, this should be of concern. The most selective schools have a long list of attributes that set them apart from their competition, with reasons ranging from strong sports programs to campus culture to leading academic programs, niche majors and strong employment outcomes. Identifying (or developing) a unique selling proposition and promoting it should be part of your plan.

Recruiting from outside of the free tuition area (NY state, in the instance of the Excelsior Scholarship) will also be important. As is attracting more students from upper-middle- and upper-class families (those who are less likely to qualify for free tuition).

Also consider new pricing strategies. With average discount rates topping 48% nationwide, a deep cut in tuition may not be as compelling to incoming students as it was in the past. When you’re competing with free, you need something better than half off.

Do you want help planning out your enrollment strategies for next year and beyond?

Reach out to the experts at DMS. We work with colleges and universities across the nation to identify and implement programs intended to scale enrollment volume while minimizing recruitment costs. 

 

Sources:

 

About the Author

Kathy Bryan

Kathy Bryan is the Senior Vice President of Corporate Marketing and Communications at Digital Media Solutions (DMS), an industry leader in providing end-to-end customer acquisition solutions that help clients grow their businesses and realize their marketing goals. In this role, Kathy is responsible for all aspects of marketing and communications for DMS and its subsidiary brands. Since its inception, DMS has evolved into a full-service performance marketing company that services firms within highly complex and competitive industries including mortgage, education, insurance, consumer brands, automotive, jobs and careers. DMS has achieved incredible year-over-year growth, which has earned recognition on the Inc. 5000 list in 2014, 2015, 2016 and 2017.

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