Tennessee’s free community college program “pays for itself,” working paper finds. When then-Gov. Bill Haslam signed the Tennessee Promise into law in 2014, he touted the program as one that would “make a real difference for generations of Tennesseans” at zero net cost to the state. The program — the first in the U.S. to offer tuition-free community college statewide — covers any remaining tuition and fees for full-time students after their financial aid is applied.
Evaluating the impact
A recent working paper, published in May by the National Bureau of Economic Research, found that the last-dollar program “pays for itself.” Celeste Carruthers, a labor economist at the University of Tennessee, Knoxville and one of the study’s co-authors, said the program pays for itself when factoring in the higher salaries that degree holders earn on average compared to their peers who hold just a high school diploma.
The paper found the program boosted college enrollment by 5.4 percentage points among 19 year olds from before 2009 to 2015, researchers found. Associate degree attainment grew by 2.9 percentage points among 21 year olds over the same period. The program additionally led to 8% to 9% more transfers from two- to four-year colleges, a slight increase in bachelor’s degrees, and incomes that were 6% to 8% higher for program participants in their early 20s, the study found.
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“Evaluating the Tennessee Promise on its own terms and its own intended outcomes of increasing college-going and increasing college completion, our analysis suggests that it was successful on those terms,” Carruthers said.
Paige Schoonover, economics professor at Saint Mary’s College of California and a study co-author, said one of the biggest takeaways from the research is that the Tennessee Promise did not steer students from four-year degrees. That’s significant, said Laura Perna, a professor of education at the University of Pennsylvania and an expert on college promise programs.
“One concern with these programs is that they encourage some students who would have attended a four-year institution — and completed a bachelor’s degree — to instead attend a community college, institutions where, on average, rates of transferring to a four-year institution are low,” Perna said.
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Instead of incentivizing students to stay in community colleges, the Tennessee Promise appears to have changed how they earned a four-year degree, Schoonover said. Along with increases in associate degree attainment, “we actually saw a small increase in bachelor’s degrees as well,” Schoonover said.
Perna said she would like to know more about what else in Tennessee might be helping students in the Tennessee Promise successfully transfer to a four-year institution.
Program design and results
Carruthers said “it’s hard to unpack” precisely which elements of the Tennessee Promise that makes it successful because it combines scholarship aid with mentors who help students handle the logistics of simply getting to college. “You see that eligible students are both more likely to go to college and more likely to complete a two-year degree and not less likely to go on and complete a four-year degree.”
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After the Tennessee Promise began in Knox County as a pilot in 2009, the statewide version launched with the high school graduating class of 2015. It was part of Haslam’s “Drive to 55” campaign to raise the percentage of Tennesseans with a postsecondary degree or credential to 55%.
Since most students are eligible for need-based Pell Grants, state merit aid or both, the cost per participating student is less than $1,000 per year, according to the study. The authors wrote that the program was notable “not only for its scale, but also for its simplicity.” In order to qualify, Tennessee high school students submit a short application the fall of their senior year, complete the Free Application for Federal Student Aid and enroll in college immediately after high school. They also must maintain at least a 2.0 GPA in college and meet mentoring and community service requirements.
