Would a residency requirement undermine Murphy’s free college plan?

Last week, New Jersey gubernatorial candidate Phil Murphy came out with a proposal for free college. Here at Blue Jersey, we had a response to Murphy’s plan: Brian Everett argued that Murphy’s plan needs to be tweaked to include a residency requirement. But is that really a good idea? Too often, the negative effects of restrictions on policies are born by the most at-risk populations. A residency program carries that same risk.

Photo: Mary Altaffer, AP

Universal proposals, like free college for all, are at the center of Bernie Sanders-styled progressivism. That form of economic populism leverages the popularity of universal programs to increase support for at-risk communities. It has an impressive history; programs such as Social Security as example of its success. The logic is at the heart of the current battle over Medicare-for-All and Single Payer approaches to health care. These types of programs are also difficult to enact at the state level. But it’s possible to make state-run higher education institutions free — putting it at the center of the local progressive agenda.

But these programs also run the risk of adding restrictions that are of little consequence to a wider base of constituents, but disproportionately affect the most at-risk users of the program. Take the example of “asset tests” for SNAP Benefits (formerly known as food stamps):

In Pennsylvania, then-Governor Corbett’s enacted such an “asset test” on the SNAP. The test was designed to keep those with significant wealth but little income from abusing SNAP by passing the income test and receiving benefits. But that’s not what happened:

As Alfred Lubrano at the Philadelphia Inquirer wrote at the time:

During the first year of the test, nearly 4,000 households lost or were denied benefits because they had too many financial resources, state figures showed.

In that same time, though, many more people – some 111,000 households – were denied benefits simply because they failed to provide proper documentation for the asset test.

Advocates for the poor said that by weeding out a relatively small number of people with too many assets, the state made getting food stamps so complicated that deserving low-income people became inundated by paperwork and lost their chance to hold on to precious benefits.

Rather than exclude households that were taking advantage of the system, the asset test put an additional burden on the most at-risk families. Thankfully, that test is no longer in effect in Pennsylvania, but the lesson stands. Restrictions on programs need to be analyzed and understood by the burden they put on those most at-risk. The worry with the residency requirement connected to free college is the same; does it undermine the most vulnerable students’ futures?

Dr Sara Goldrick-Ras, perhaps the country’s preeminent scholar on the risks and challenges of vulnerable students in higher education, sharply criticized the New York residency requirement for exactly this reason. The whole thing is worth a read, but here is an excerpt:

New York doesn’t need to do this in order to reap a strong return on its investment. About 80% of New Yorkers will stay in the state anyway and New York is going to gain plenty of new residents by offering college for free. Yes — brain gain is the way to deal with brain drain —attract more people, and create a generation of grateful New Yorkers who will stay in state in order to give this opportunity to their kids. Trying to trap and punish the 20% or so who work or even more outside New York because they have to costs more than its worth. That 20% will be among the most vulnerable people — most likely they will be the sort who were the first in their families to attend college (and didn’t understand this requirement), or people who face more difficulty finding jobs in New York because of narrower social networks, job opportunities, or even labor market discrimination.

She lays out 5 unexpected consequences of the residency requirement: 1) incentivizing unemployment for those who can’t find jobs but can’t move because it would trigger crippling debt 2) reduce income for those students who lack the freedom to move 3) discouraging service such as the military, Peace Corps or Americorps 4) discouraging talent development 5) cutting against family ties – people who have to leave New York to take care of an ailing family member will trigger debt. She argues that the marginal state benefits, bureaucracy needed to enforce such a requirement, and negative impact on students make such a requirement bad policy.

The lesson here is to tread carefully. There’s a wider political discussion to be had about whether such a restriction is good politics. But requiring those in Murphy’s free college plan to remain in the state runs serious risks of undermining the very students who most-need access to higher education.

Comment (1)

  1. Brian K Everett

    Very good points to consider. We would not want policy to work against our best intentions.

    However, in terms of NJ and Murphy’s plan, I don’t think that I subscribed to all of Dr. Goldrick-Ras’ criticisms, some for policy issues and others due to my own opinion.

    1) Incentivizing unemployment. I really don’t subscribe to this one based upon the current alternative to no government intervention in student debt. Even if an individual did indeed need to move and then owe the state money, their repayment obligations to the state come with no interest over a ten-year time frame. Compare that to FAFSA loans at 6%-8%, sub and un-sub, or private loans all the way up to 12%. <–!!!! Also, I believe Oregon actually pays for state college tuition in a way that garnishes wages, thus still lessening the immediate burden of educational debt that most experience from the private market/federal program.

    Consequence 2. Perhaps, yes. But, related to my standpoint above to consequence 1, how is this state sponsored initiative worse than the current free market and federal ways of financing a college degree? Short term wage loss may be way outweighed by long term savings with zero interest, even if they do move.

    Consequence 3. There can totally be an earmark for service. That should not be disincentivized. Plus, I'd be interested in how the GI bills would take care of any educational debt?

    Consequence 4. The State itself is currently unable to retain talent due to it going to other states for college, so I'd be interested in exactly how this is measured. Isn't the entire point of Murphy's plan to give the state more talent? Why not make sure the talent the state paid for benefits the state?

    Consequence 5. This sort of relates to my explanation of my thoughts towards consequence 1. Sure, this life situation now causes one to assume debt, but without the policy in the first place, the individual may be in way worse shape with free market interest rates AND and family crisis.

    With several other New Jersey-specific policies, such as legitimized residency despite no citizenship status, I still think that a residency stipulation for county college education is totally acceptable, especially if the intention, per Murphy's announcement, is to better train and educate for New Jersey's tomorrow. Otherwise, the public tax payer of New Jersey paid for California's newest resident's education… That's the cycle that needs to stop.

    Reply

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