At least two New Jersey colleges have decided to fully expunge student debt incurred during the pandemic to make way for students to re-register in the fall. Hudson County Community College and Bergen County Community College each wiped out approximately $5 million in student debt last week incurred from the spring 2020, fall 2020, and spring 2021 semesters, without prejudice. The sweeping measures affected approximately 2,000 and 4,800 students, respectively.
HCCC and BCCC are part of a small but growing number of colleges and universities nationwide opting to use the Higher Education Relief Fund of the Coronavirus Response and Relief Supplemental Appropriations Act, also known as the CARES Act, to give students a financial clean slate after a fiscally challenging 16 months. The HEERF encourages institutions to consider using the funds to discharge student debts, according to guidance from the U.S. Department of Education.
Representatives of both colleges said the move was intended to remove barriers that would prevent students from completing their education, which could then have negative economic impacts on those students downstream.
“The number one goal we have is to try to avoid students dropping out. Because of the nature of our student body, the likelihood [is high] that if they stop now, they’ll never come back to us or to any higher degree,” explained HCCC President Chris Reber.
Community colleges on average serve more historically disadvantaged communities than four-year institutions. At HCCC, 87% of students are non-white and one-third speak English as a second language. Eight in 10 HCCC students apply for federal financial aid, and more than half of them work full time while going to school full time. BCCC’s students are 66% non-white.
BCCC Executive Director of Public Relations and Community and Cultural Affairs Larry Hlavenka Jr. said his institution is “always trying to find ways to increase affordability to make it more affordable to get students here and put them on the path to success,” and said that when presented with the federal aid, it didn’t take long for university officials to land on wiping out student debt.
“These are students with all kinds of balances. I talked to a student the other day who had $267 of unpaid debt. The amount is not necessarily important. It’s that this creates the situation with these students where they can’t come up with $100, $200, and that prevents them from registering and enrolling and continuing on the path of higher education,” Hlavenka said. “This allows them to come back and get them back on that path.”
According to Heather McKay, director of the Rutgers Education and Employment Research Center, debt is a “huge factor” in college non-completion. “Many students who do not complete have a small amount of debt, less than $10,000, but it [limits] their completion as a lot of folks are at the same time trying to pay their bills, working, parenting,” McKay said.
Individuals who don’t earn a college degree have poorer financial prospects than those who do. For the cohort of students who attended college in the mid-2000s, an associate’s degree yields a causal earnings premium of about 30% over a high school diploma, according to a study published by American University Professor Dave Marcotte through the Institute for the Study of Labor in 2016.
McKay said those who don’t complete a degree program are more likely end up in poverty, and that they also lack access to the social capital that college could expose them to that would then help them get and keep a job and move up the ladder.
Once HCCC students caught wind of their debt being expunged, letters of gratitude poured into the inbox of Lisa Dougherty, vice president of student affairs and enrollment.
“I just wanted to say thank you so much,” one student wrote. “I am deeply moved by this generosity, I’ve never had anyone do anything like this for me before. I believe you will be blessed abundantly exceedingly for this generosity you have bestowed upon me, I also believe this school (my home) will continue to shine way beyond its years with the continuation of helping and building great minds.”
“THANK YOU GUYS SO SO SOOOOO MUCH!!!!! I pay my entire college tuition out of pocket so I have to work 50+ hour weeks just to be able to afford it,” read another letter. “Throughout the entire semester I have to watch what I spend so that I can make sure I saved enough to pay my school bill. I do not receive any financial aid from the school nor my family. This was a complete lifesaver and I appreciate it more than you can imagine.”
In disbelief, one student wrote, “Huh is this true? Or is this a hoax? If this is true thank you so so much.”
And simply, another wrote in, “Thank goodness.”
Of the nearly 5,000 HCCC students whose debt was eliminated, 1,200 of them have already registered for fall classes.
“When you think about $1,000 bill for a student that can’t put food on the table, and they now owe college $1,000? Alleviating that burden, it was life changing,” Dougherty said.
Elsewhere, Connecticut State Colleges and Universities announced July 20 that it would eliminate $17 million of debt incurred by community college students over the pandemic, affecting more than 18,000 students statewide.
Days before, South Carolina State University, a historically Black institution, cleared balances for more than 2,500 students when it eliminated $9.8 million in debt. President Alexander Conyers said at the time, “No student should have to sit home because they can’t afford to pay their past due debt after having experienced the financial devastation caused by a global pandemic.” Livingstone College in North Carolina also moved to eliminate student debt to the tune of $2.8 million.
Other colleges and universities have distributed direct relief to students in a form other than debt expungement, including Stockton University in South Jersey, which distributed $7 million to 4,054 students, or half of all undergraduate students, based upon their Expected Family Contribution range from the student’s 2021/22 Free Application for Federal Student Aid.
McKay called the relief “a wonderful opportunity for folks to be able to start over after this very challenging year” and “really smart precedence” for the institutions to set.