Mapping Community College Finance Systems to Develop Equitable and Effective Finance Policy
The stakes for community colleges have never been higher. Growing talent gaps and high student debt levels position them as the most affordable and accessible entry point to high-value credentials and degrees. And they are the main connection between states’ education and workforce systems. In short, community colleges are central to building an economy that works for all Americans.
Yet most community colleges are not meeting their potential. Despite years of reforms, outcome gaps persist, leaving too many low-income and historically minoritized students behind. Community college enrollment has been dropping for years, a trend exacerbated by the COVID-19 pandemic. Enrollment of Black students has especially plummeted, erasing two decades of progress.
While many reasons exist for these trends, one root cause stands out: community college funding is largely inadequate, inequitable, and has not kept pace with the needs of students or institutions. Given the direct effect of resources on student success, it is hardly surprising that community colleges struggle to meet the economy’s workforce needs and support students through to completion.
Equally important is the fact that community college finance systems are not working: they all too often contribute to inequities rather than address them. Community college finance systems include major recurring revenue sources and the policies that control their amount, distribution and use. These systems are shaped by complex, often contradictory, policies that accumulate over time, and they vary widely from state to state.
For community colleges to reach their full potential as drivers of prosperity and equity, states must create strong, stable, coherent finance systems that enable and incentivize colleges to better meet pressing state interests and student needs. As a first step, policymakers need clear, comprehensive and state-specific pictures of how current finance systems operate — crucial information that was missing from the literature until now.
By mapping and comparing three very different state systems, we reveal the diversity and complexity of how community colleges are financed and provide an analytical framework to support informed and effective reforms.
To read the executive summary, click here.
To read the full report, click here.
To download the press release, click here.
