Scholarship design: Which institutions should be included?

In general, students will benefit from having a range of choices when it comes to types of institutions and covered programs (for example, two-year and four-year degrees, short-term credentials, and apprenticeships). But Promise stakeholders must also seek to direct students toward institutions and programs with strong records of student success and completion.

Cost considerations often drive the decision about which institutions should be included; a better approach is to connect this decision to stakeholder goals.

Most statewide Promise programs limit usage to the two-year public sector, often for cost reasons and because politically there are benefits to a relatively quick return on investment in the form of more educated workers. (There are a few exceptions, including New Mexico, New York, and Washington, which include four-year public options.) If focusing on this sector, state policymakers and higher-ed leaders should ensure there are strong transfer pathways for students wanting to matriculate to a four-year institution and that credits earned in a two-year setting will transfer to a four-year institution.

Community colleges launching Promise programs with their own funds will almost certainly restrict usage to their own institutions. Here, an analysis of institutional capacity and local workforce needs can help stakeholders focus on where additional resources may be needed and tighten the connection with the local economy.

Stakeholders designing community-based programs have more options. If generating degrees and credentials for local residents is the top priority, limiting usage to local institutions might make sense. If stakeholders are hoping to use a Promise program to attract or retain residents (for example, to increase local public school district enrollment or attach residents to a community for the long term), a generous program that includes both two- and four-year options is a better design choice.

Limiting institutional choice can also have unintended consequences. The two-year public sector is considerably less expensive than the four-year sector (either public or private),¹ and most Promise programs do not in fact include four-year options. However, programs focused solely on two-year institutions run the risk of inducing some students to switch from four-year to two-year institutions, where completion rates are lower. (College quality affects completion rates for equivalent students, thus “undermatching”—attending an institution that is less selective than the one to which you could gain admission—is best avoided.²) Limiting postsecondary options will reduce costs but make it likely that fewer students will participate. Field of study requirements (such as restricting scholarship use to certain majors) have the side effect of creating administrative complexity that can undermine program success. The more “asterisks” that apply to rules about scholarship usage, the harder it is to send a clear message to prospective students. As a result, the students that stakeholders are trying to reach may not be aware of which specific programs qualify or may be confused about what happens if they switch majors later. Students are less likely to participate when this type of uncertainty prevails.

If resources are constrained, beginning with a more affordable Promise (such as one limited to community colleges) can help build college awareness without overextending stakeholders’ financial capacity. If a Promise program focuses exclusively on two-year institutions, ensuring robust FAFSA completion efforts and information availability around other scholarships can help students attend more selective institutions. (Some Promise programs, including the Detroit Promise, have negotiated directly with four-year institutions that offer scholarships out of their own resources to support some students.) If additional resources become available, adding four-year institutions to the range of choices should be considered. Beginning with more expansive postsecondary choices that prove financially unsustainable and then narrowing options can erode confidence in a Promise program.

Guidelines around where students can use their scholarship interact with the two other key design decisions—student eligibility and the form of the scholarship—to determine the nature of the incentive provided by a Promise program.