Stanford University is leading the way by announcing it won’t charge tuition fees for students whose families earn less than $100,000 a year. The money will be paid from the funds collected via its endowment.
Stanford University will make the official announcement today and the news will no doubt make many students happy. University President John Hennessy will make the announcement today on campus.
Stanford will no longer charge tuition to students who come from families who earn less than $100,000 a year. It will also waive room and board fees for students whose families earn less than $60,000 a year.
The university will pay for this through its endowment which has grown by 22 per cent to $17.1 billion. Lawmakers had previously complained that universities like Stanford University are not doing enough for students, despite getting huge funds from industries and outside parties.
Sen. Chuck Grassley of Iowa, the ranking Republican on the Senate Finance Committee, said: "They're supposed to offer public benefit in return for the privilege of tax exemption…If endowments increase by double digits from one year to the next, it raises the idea that maybe these schools aren't using enough of their endowments to help students afford college."
Whether it was a decision made on its own or one made in response to calls from lawmakers, tuition will not be free for many students.
University Provost John Etchemendy told the San Francisco Chronicle:"Thanks to our increasingly generous financial aid program ... attending Stanford will cost less than most private and many public universities."
The University said it will increase its annual endowment payment to 5.5 per cent to defray the costs. The plan will begin in the 2008-09 academic year.
Thanks to this plan, students don’t have to worry about loans to get into this university. Instead of working while going to school to pay for the debts, they can now focus more on school work.
Hennessy said about the plan: "We are committed to ensuring that Stanford asks parents and students to contribute only what they can afford…No high school senior should rule out applying to Stanford because of cost."
Stanford is one of the premium institutions in the United States, and its tuition fees had increased much faster than the country's inflation rate. At the same time, however, their tax-exempt endowments have increased by more than 10 per cent annually. So, they can afford to pay for their students.
In the past 10 years, tuition alone at Stanford increased from $21,3000 to $34,800 - roughly $7,200 more than if it had held to the rate of inflation during the decade.
Stanford's endowment is the third largest of any university in the country, behind only Harvard and Yale.
With this endowment, the university was able to provide financial aid for a majority of its students (75 per cent). This new plan is expected to reduce the tuition charges collected by 16 per cent overall.
Stanford University boasts famous alumni like Sergei Brin and Larry Page, Google co-founders; Jerry Yang, Yahoo CEO; Tiger Woods, golf champion, and many more. Some alumni (like Jerry Yang) have donated millions of dollars to Stanford.
I personally think this is great news and I hope other universities do the same. In Denmark, the government pays the students to attend college and education is free for all students until college.