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Affording Bates

Paying for Bates is possible – if you decide it is.

By Nathan Halverson

An employee of the University of Massachusetts system, Karen Pangallo always assumed her twin sons Dominick and Matteo would take advantage of her employee benefits and attend a UMass school tuition-free. This fall, her sons begin their third year at Bates.

When the time came, Karen, her husband, Sal, and their sons considered a wide range of schools — some public, some private. Rather than succumbing to the fear of financing a private-college education for two, they got informed. They studied literature on the subject and attended seminars, and one thing they heard really stuck with them: “Don’t let finances get in the way,” one adviser told them. The Pangallos took the advice, and what they learned surprised them.

“Our sons were able to go to Bates College for the same amount of money it would have cost in the end to go to UMass, once we figured in the cost of housing, board, and fees,” Karen Pangallo said. “After all the dust had settled from the flurry of college and financial aid applications, Bates offered the best education with the best financial aid offer.”

Years ago, affording college seemed so much more straightforward. Mary Mitchell, the first woman to attend Bates, was able to politely refuse a scholarship (delivered in the form of a scroll) from president Oren Cheney. “I can take care of myself,” she said, and headed down to the Lewiston mills to pay for college. Today, turning down a Bates financial-aid package would probably involve refusing an $19,000 scholarship grant, a package of loans totaling $2,500, and a campus job worth $1,500. Take care of yourself without that aid? Good luck, Mary.

Modern financial aid, as the Pangallos found, is about judging affordability and understanding trade-offs. It’s about being able to trust the long-term benefits of a major financial investment (college graduates in this country will earn about a million dollars more than high-school graduates during their lifetimes), while doing the short-term work needed to understand the financial-aid system.

For many families, the cost of a college education may be the largest single expense after the purchase of a house. When Lynn Welbourn ’71 attended Bates College, a favorite saying was that the cost of Bates each year roughly equaled the cost of a mid-sized Ford. This is no longer the case. As Welbourn puts it: “Since I attended Bates, it’s gone from the price of one mid-sized Ford to almost the price of two.”

Welbourn has been a college counselor at Ipswich (Mass.) High School for the past six years, writes a column on college advising for the Salem Evening News, and is an independent college counselor. As a Bates alumna and the parent of a high-schooler. Welbourn is closely connected to and concerned with financial-aid issues.

While poring over pages and pages of information on financial aid and advising hundreds of students on college admissions, Welbourn has kept a watchful eye on Bates and she is impressed with Bates’ commitment to need-based financial aid (as opposed to merit-based aid, which rewards student achievement). But, she’s not alone in wondering if many middle-class families can no longer afford a school like Bates. “Families who make in the $80,000 to $135,000 per-year range can certainly afford to send their kids to college,” she said. “But even when making this kind of money, the cost of a Bates education is a lot for them.” For Welbourn, the Pangallos’ experience rings true: With need-based aid, some students will find the cost of many state schools and Bates to be in the same ballpark. But, she warns, some families may have to look seriously at schools that offer them more money — perhaps merit awards — even if they want to go to a school like Bates. While Bates’ reputation will open doors for its graduates, Welbourn argues that “there are a number of really good public schools and universities out there that offer a lot and that would give a student credentials similar to Bates.”

William Hiss ’66 served as dean of admissions from 1978 to 1995 and is now the vice president of external and alumni affairs at Bates. When he graduated in 1966, the cost of tuition was $2,350. The comprehensive fee for the Class of 2005 is $34,100. From Hiss’ perspective, the so-called middle-class squeeze is partly a matter of choices being made by American families now, or five and 10, years ago. “If families want to take that $8,000 vacation every year or two, or always have a new car, they have to understand that these things will be figured into the equation” when it comes time to afford a Bates education. Hiss’ message to the families of future college applicants: Either make, or be prepared to make, adjustments in lifestyle to be able to afford college tuition in the future.

Jamie Merisotis ’86 is president of the Institute for Higher Education Policy in Washington, D.C. He knows that affording tuition at a private college is a legitimate concern for middle-income families, yet he, too, has noticed the great expectations of the American middle class. “I have some concern with some families’ sense of entitlement to grant money,” he says. (Middle-class squeeze and merit aid: Politically motivated? See sidebar.)

Here’s the million-dollar question: Why do colleges like Bates cost so much? “On some level we think of Bates as being the same as it always was, but of course it isn’t the same,” Hiss explains. “The things Bates has to pay for” — such as the best teachers — “don’t go up at the same rate as inflation. Computers are an entirely new cost that didn’t exist 25 years ago. Our commitment to lowering the faculty-to-student-ratio to under 10-to-1 means we have to hire more faculty, and if we want to keep up with the current technology, and provide new majors and activities for students, we have to spend money.”

The inherent inefficiency of U.S. colleges and universities was the subject of a recent essay in the New York Times by Kenneth Shaw and Dan Black of Syracuse University. The essay linked the steady increase in college costs to so-called Baumol’s disease, an institutional affliction named for William J. Baumol, a New York University economist. Baumol theorizes that unlike manufacturing widgets, where productivity often reduces costs, educating students is a labor-intensive process, where costs will always go up. Hiring and retaining excellent faculty (not to mention purchasing the latest technology and offering great academic and extracurricular programs) is never offset by increased productivity. Bates, where a guiding ethos will always be close student-faculty interaction, can only educate about 1,650 “customers” every year.

Financially speaking, the only safety valve available to colleges and universities to offset rising costs (and provide more financial aid) is income from endowment or other gifts. “Alumni generosity is the reason students are able get a Bates education in the Bates environment, and also plan their own curricula or travel and go see the world if they want to,” said Wylie Mitchell, dean of admissions. “We’re committed to maintaining access for students whose families can’t necessarily afford the full tuition at Bates. We’re able to do that because of the endowment, which translates to alumni generosity.”

Jennifer Giblin ’01 graduated with honors in English plus about $25,000 in debt. Giblin, from Braintree, Mass., has an older sister who attended Keene State College in New Hampshire. Her younger sister will attend Western New England College.

Giblin applied to Bates early decision, so she was committed to Bates regardless of her aid package. “I felt like I was going in with blind faith, hoping I’d be able to afford to go,” she said. “But we ended up getting a really good package, and we got more that first year because I had an older sister in college.” Like almost all aid recipients at Bates, Giblin has helped work off part of her aid, through campus employment.

Giblin will attend a three-month publishing seminar at Denver University in Colorado this summer before seeking to join the country’s workforce. She admits she’s at a scary crossroads for a college student: She’s graduating, off to a new place, facing a fair amount of student loan debt. Some of her friends have already landed jobs. Giblin, who loved her time at Bates, is optimistic, if a little apprehensive, about what’s next.

Hiss knows what’s next. Statistically speaking, those who earn college degrees in this country increase their earnings at a rate 15 to 25 percent ahead of inflation, and the lifetime income of any individual increases by between $400,000 and $500,000 for each level of school that person completes. “Graduating from college is the principal predictor in economic success,” Hiss said. Tom Mortenson, writing in Postsecondary Education Opportunity, summarized his years of research about the non-quantifiable benefits of higher education: “A more fully engaged and lived life.”

Melissa Penney ’03’s family has been attending Bates for most of the last 100 years. Her parents, Bruce Penney ’76 and Jan Malatesta Penney ’77 met when the two traveled to Spain for a Short Term. Melissa Penney’s grandparents also went to Bates — all four of them.

Bruce, an Internet engineer consultant, and Jan Penney have five children. They assume all five will go to college, though they won’t all go to Bates; Katherine Penney, Melissa’s sister, is enrolled at Bowdoin. So far, Bruce Penney has the confidence of someone familiar with the system, and someone who planned for his children’s education.

“Well, you never save enough, but we did have a plan,” he said. The Penneys averaged the price of school, put money away each year for each child, increasing that amount as necessary to compensate for a rising tuition. See sidebar on savings.

They expected to get some financial aid, and expect to pay off $15,000 or more in loans for each child. “These days, it’s not too difficult to drop your info into spreadsheet programs and estimate what you need,” Bruce said. Perhaps he remains unfazed because, like his daughter, he had four siblings and all five went to college. “Somehow my parents did it,” says Bruce Penney.

“I think, what’s key, is that you find a school that feels right for your child,” he added. Melissa attended an orientation for prospective students and came away feeling sure she wanted to attend Bates. “The overall cost in that case wasn’t really a consideration,” Bruce Penney said. “We figured the finances would come through.”

The Pangallos are a middle-income family from Salem, Mass. Karen graduated from Salem State College in 1976, got her master’s degree from Simmons College in 1980, and is now a librarian at North Shore Community College. Sal graduated from UMass-Amherst in 1973, got his master’s from Boston State College in 1981, and has been teaching in the Marblehead public schools for 28 years.

Like many Bates students, their children, Dominick and Matteo, will have a fair amount in loans to pay back (the average loan burden per student at graduation is $15,500). Unlike the Penneys, the Pangallos are working from a more modest college savings. Says Karen: “As public school educators, we were limited as to how much we could put towards college fund savings,” she said. But, by working hard as a family, they’ve been able to make Bates a reality for their sons. “We don’t live extravagantly. We drive older cars, cut corners, look for sales, shovel our own snow, eat from our garden, and Matt and Nick worked 2 and 3 jobs during the summers.”

The challenge for Bates, said Jamie Merisotis, is to continue to provide opportunities for and attract students from Maine to Macedonia, while steadily improving the competitive quality of the College. “Bates is committed to increasing the financial aid budget ahead of tuition, and not all similar schools can say that,” Merisotis says.

“When I was at Bates 15 years ago, there was no Mays Center, no Olin Arts Center, no Pettengill Hall. There wasn’t even a Bates phone system. If you wanted a phone in your room, you called the phone company and had one put in, or used the pay phone in the hall. Bates is playing in the exclusive pond with the big fish, and 20 years ago it was still trying to get into that pond.”

They Made Bates Happen

From Wisconsin, she is in theater and the Bates Democrats. Her parents are divorced, but both contribute financially. She has a younger brother in college.

  • Family Income: $80,000
  • Bates cost1 $35,000
  • Family contribution2 $10,000
  • Student’s demonstrated need $25,000

Financial aid package

  • Grant $19,500 (including grant from the Blake Family Scholarship Fund)
  • Loan $3,800
  • Campus employment $1,700

Total financial need met $25,000

1 Includes comprehensive fee, books, travel, supplies.

2 Includes student’s contribution from summer work or other source. Bates measures the ability to contribute by analyzing family income and asset strength, family size, siblings already in college, and unusual or emergency expenses.

They Made Bates Happen

He is a four-year letterwinner in soccer from Connecticut. A political science major, he works as a liaison between the College and Lewiston neighbors. His mother is a public school teacher, and his father works for the Connecticut Student Loan Foundation. He has a younger sister in college.

  • Family income: $130,000
  • Bates cost $35,000
  • Family contribution $21,000
  • Student’s demonstrated need $14,000

Financial aid package

  • Grant $8,000 (including grant from the Dorothy Sweeney Emery ’34 Scholarship Fund)
  • Loan $4,300
  • Campus employment $1,700

Total financial need met $14,000

They Made Bates Happen

From Massachusetts, he is active in Bates track. He is treasurer of his dorm and is involved in creating a dance troupe at Bates. His parents are divorced, but both contribute financially. His father is a policeman, mother a secretary.

  • Family income: $52,000
  • Bates cost $35,000
  • Family contribution $6,000
  • Student’s demonstrated need $29,000

Financial aid package

  • Grant $24, 800
  • Loan $2,500
  • Campus employment $1,700
  • Total financial need met $29,000

Financial Aid at Bates

  • $34,100 — Bates comprehensive fee in 2001-02
  • 676 — students receiving grant aid, of a campus enrollment of 1,650
  • $17,640 — average grant award
  • $1,000 to $30,000 — grant range
  • $15,500 — average loan debt at graduation
  • $86,730 — average adjusted gross family income of U.S. Bates grant recipients
  • $0 to $130,000 — family income range (of those receiving grant aid)
  • $12.3 million — scholarship aid budget (of which only 5.5 percent comes from state or federal sources)
  • $3 million — portion of aid budget from endowed funds

They Made Bates Happen

A Maine student, she is active in Modern Dance, Women of Color, and the International Club. She is an anthropology major and has studied in Martinique. Her mother is a single parent who substitute teaches and waitresses in the Bridgton area.

  • Family income: $16,000
  • Bates cost $35,000
  • Family contribution $3,000
  • Student’s demonstrated need $32,000

Financial aid package

  • Grant $26,500 (including grants from the L.L. Bean Scholarship Fund and William C. Kilbourne ’29 and Anna Saunders Kilbourne ’36 Scholarship Fund)
  • Loan $3,800
  • Campus Employment $1,700
  • Total financial need met $32,000

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