Hope College, a Christian college located in Holland, Michigan, is establishing the innovative Hope Forward program, enabling free tuition for college, which will allow students to graduate debt-free. The first pilot cohort of students is enrolling in the school in Fall 2021. The institution is trying to create this business model to free itself from being tied to tuition, build a true learning community, and inculcate the values of giving and generosity in students.
A Different Leadership Skillset
Matt Scogin, who served on Hope’s board prior to becoming its president in 2019, brings deep finance experience to higher education. He graduated from Hope College in 2002 with a degree in economics and political science. After studying at Harvard’s Kennedy School of Government, he spent the first part of his career working in both the federal and state government, including the White House, the U.S. Treasury, and the Massachusetts Governor’s Office. He then worked on Wall Street.
In developing a different financial model, Scogin used two assumptions – first, that higher education has never been more important, and second, it’s also never been more cost-prohibitive. This conundrum has been the focus of his work.
Scogin believes that if higher education changes its business model from its current emphasis on tuition, a lot of challenges would be solved. The high student loan debt is impacting not only an individual’s future but also the economy of the nation and the world. There’s a lot written about the importance of access to higher education, and by moving away from a tuition model, Hope College hopes to increase access to higher education, regardless of the students’ ability to pay.
Hope College is creating a pay-it-forward model based on generosity and gratitude, both of which are Christian values. College leaders believe this approach will help the institution fulfill its mission of helping students have a life of impact after they graduate.
Hope leaders believe that the high debt burden is skewing what students do after college. While graduates may want to work for a non-profit, they more often opt for a job that will help them pay off their student debt. Once these individuals start down a career path, it’s hard to make a change. This leads to the mid-life crisis because individuals are not following their heart. This new tuition model frees them up to create the type of impact they want to in their lives.
Millennials and Gen Z students are more driven by values than were previous generations – a life’s purpose of making money for money’s sake doesn’t appeal to them. They see how broken the world is, having been born around 9/11, and seen their family experience the financial crisis. Now that they are in college, the world is in a pandemic and dealing with racial injustices. These students’ lives have been spent in a world in turmoil – and it impacts their values and behaviors.
Hope College believes that with God, all things are possible – and all issues are solvable. The college wants to inspire students to realize that with hope, they can solve these seemingly insurmountable problems. Leaders believe that Hope Forward will help graduates do this by relieving them of student loan debt.
Hope Forward Explained
Hope Forward will allow students to come to Hope College with their tuition fully funded up front through the college’s endowment. Students then make a commitment to be philanthropic and making an annual donation to Hope every year for the rest of their lives. No amount or percentage of income is specified, because the college wants this donation to feel like a gift instead of a bill. This model also builds Hope’s model around the Biblical principles of giving and generosity.
The effort is built on three pillars:
The first is accessibility, which provides access to a great education as well as access to a life of impact after graduation.
The second pillar is gratitude and generosity, which is aligned with the Bible’s call to give money away. Hope is giving away an education, and graduates would then give back to the college. In addition, this model hopes to inspire graduates to be generous citizens of the world.
The third pillar is community, which involves moving away from a transactional relationship with students. Instead, Hope College wants to create a community model where students are students and not customers, and faculty are considered faculty and not employees. Scogin believes that higher education should not think of itself as a business; instead, it should think of itself as a learning community. By taking this approach, Hope College is creating a lifelong partnership with students, one that has the College and students engaged for the rest of their lives.
The business adage is that the customer is always right – and many colleges and universities share this sentiment. However, this can be toxic for a healthy learning environment and can lead to a sense of entitlement among students. One reason may be that because as tuition has gone up, students have come to see themselves more as the “customer” and less as the “student.” This results in their asking for better options – such as amenities, residence halls, and dining halls – and get what they want. This approach not only feeds into the sense of entitlement but also makes education more expensive.
Operationalizing Hope Forward
Hope College leaders are modeling Hope Foward on the way that churches are funded. Interestingly, the college – which is 160 years old – didn’t charge tuition for the first 54 years of its existence. Instead, tuition was subsidized by the church. The Hope Forward is a new idea, but also is going back to Hope College’s roots.
To make the Hope Forward model work, Hope College is focused on raising an endowment of over $1 billion. Additionally, the college is organizing its fundraising around affinity fundraising. Leaders will ask donors to endow specific areas of the college’s budget, which will allow graduates to give to things that they love. This campaign has just started but already has raised $31 million.
The fundraising begins with a donor conversation with the president and the college’s development officer, but then as these conversations unfold, the deans and department heads are drawn in. Faculty also participate and are excited about this effort.
The college has approximately 3,000 students, and its annual tuition is $36,000. With room and board, the annual cost is $46,000. The current plan is for the endowment to grow so that the interest covers student tuition. Hope Forward students will still pay room and board because leaders feel it is important for them to continue to have some financial skin in the game. However, there is need-based assistance available for students who qualify. This makes education much more accessible.
A pilot cohort of 22 students enrolled for the Fall 2021 term. One donor has funded this cohort and will fund a second cohort that will start in 2022. The college is taking small intentional steps so that leaders can assess, learn, and continue to rework the program as it moves forward. Thus far, the initial pilot is meeting the expectations going in.
Faculty and staff are excited about the Hope Promise since it was first shared two years ago. The idea has both energized the campus and offered a rallying point as the community has had the opportunity to shape the idea and conversation. Also, because the fundraising effort is based on an affinity model, every department has bought into this plan.
Free Tuition Sustainability
By using an endowment, Hope Forward becomes sustainable but also provides some built-in constraints. This will give leaders an interesting incentive to keep costs stable and the size of the institution small.
Currently, the college is full and has a waiting list. When an institution is tuition-dependent, there’s a tendency to want to admit more students to bring in more tuition dollars. In comparison, under the Hope Forward model, students wouldn’t bring more tuition dollars but would bring more expenses. There would be incentives to maintain the college’s size. Hope College is small enough to be known but large enough to have academic scope and scale in the departments.
Three Recommendations for Higher Education Leaders and Boards
- Ask fundamental questions. By identifying and addressing the fundamental question of the standard tuition model, Hope College’s leaders believe they will be able to also change many other areas, such as access and diversity.
- Diagnose what problem the institution is trying to solve and really focus on that one area, instead of a wide-ranging strategic plan.
- Be willing to talk about the situation a lot, learn as it moves forward, and adjust along the way.
Resources
Dr. Drumm McNaughton is a Higher Education Consultant that helps colleges and universities transform and innovate for holistic sustainable growth.
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