"Tuition discounting is a tactic private colleges have long used to control a primary revenue stream. But over the past decade, an increasingly precarious financial picture-driven in part by stagnating state funding and tuition caps-has pushed public institutions to adopt tuition-discounting policies, too. According to an issue brief fromthe Strada Education Foundation, the share of first-time, full-time undergraduates receiving institutional grant aid at public four-year institutions increased from 49 percent to 62 percent between 2014-15 and 2021-22. The average discount rates increased from 24 percent to 31 percent over the same period."
"Tuition discounts allow institutions to maintain financial stability and recruit academically strong or underrepresented students who may be enticed by a big discount presented as a scholarship. However, increases in merit-based aid can "favor wealthier or out-of-state students at the expense of low-income, in-state residents," according to Strada's brief. "These practices also leave students, families, and citizens confused and without a transparent understanding of the cost of higher education," the report said, noting that low-income and first-generation colleg"
Public four-year institutions have substantially increased the share of first-time, full-time undergraduates receiving institutional grant aid and the average discount rates over recent years. The share of such students receiving aid rose from 49 percent to 62 percent between 2014-15 and 2021-22, while average discount rates grew from 24 percent to 31 percent. Stagnating state funding and tuition caps have contributed to a precarious financial picture that pushed public institutions toward discounting. Tuition discounts can help maintain financial stability and recruit students, but merit-based increases can advantage wealthier or out-of-state students and obscure true costs for low-income and first-generation students.
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