New Jersey hasn’t been able to rein in the rising cost of higher education, but it at least wants colleges to better explain why they cost so much money.
Lt. Gov. Sheila Oliver on Tuesday signed a new law requiring public colleges to provide a financial aid “shopping sheet” to prospective students. The sheet must include clear information on costs, loan options and estimated debt levels so families can see how much a college will cost and compare financial aid packages.
The law also requires public colleges to explain the reason for every mandatory student fee, how the price was set and how the money is spent.
“Students will be able to better understand the true cost of college, so they can make wise choices and determine the appropriate amount to borrow,” said Oliver, who was standing in for Gov. Phil Murphy while he vacations overseas.
The law comes as the rising cost of college in New Jersey has far outpaced inflation and growth in median family income. The state has put forth few solutions for curbing the sticker price of a four-year college and instead focused on transparency and financial aid along with a free community college program for low-income families.
Among the key information the shopping sheets must include:
- The total cost for one year of attendance, including tuition, student fees, room and board, books and other expenses.
- The amount of grants and scholarships awarded to that student per year.
- The net amount the student will owe for one year of attendance.
- Median federal borrowing levels for the college and the monthly amounts paid over 10 years.
- The percent of students from the college who defaulted on their loans.
“No student should be left in the dark about what college costs or whether their financial aid is a grant or a loan,” said Zakiya Smith Ellis, the state’s secretary of higher education.
Oliver also signed a separate law Tuesday that creates stronger protections for students taking out loans and requires loan servicing companies to be licensed by the New Jersey Department of Banking and Insurance.
Under that law, the state will create a student loan ombudsman’s office, which will help borrowers with complaints or unanswered questions about student loans.
“As a generation struggles to make monthly payments and navigate their financial futures, it is our responsibility to ensure they are not being exploited,” said Sen. Sandra Cunningham, D-Hudson, one of the bill’s sponsors.