DMACC and ISU Weigh in on Free Community College Proposal

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DES MOINES, Iowa -- In his State of the Union address Tuesday night, President Obama detailed a plan to bring more people into the middle class by making two years of community college tuition free to students.

The president's plan would be funded by taxing "529 plans" which currently allow families to grow their college savings tax free.

The plan has drawn skepticism from the state treasurer and concern from families.

“Paying for it with the people who have saved with 529's is not the way to go about it. There can be some tightening up in certain areas, but 529’s have great success, especially in Iowa and I'll be out there working as hard as I can to make sure we keep it here in Iowa,” said state treasurer Michael Fitzgerald.

DMACC president Robert Denson on the other hand says the plan could help companies fill a need for skilled workers.

"It's hard to find the funding to support an educational plan when you might be working 1-2 jobs just to feed your family. This is an exceptionally good thing for business because will it allow companies to reach out to individuals who wouldn't come here otherwise and get them into training programs that lead to jobs,” Denson told Channel 13 News.

At DMACC, tuition costs about $4,100 each year.

Under President Obama's plan, that would be covered for students who maintain a 2.5 GPA and stay on track to complete their program.

At the university level, the hope is that more people attending community colleges would equal more people transferring to four year schools.

"As a higher education institution, anything the government can do to promote higher education and increase access is a good thing,” said Kelly Friesleben, the associate director of admissions for transfer relations and recruitment at Iowa State.

About 1,300 students transferred to Iowa State from community colleges in the fall of 2014.

That made up nearly 20% of the school's incoming students.

3 comments

  • John Smith

    The Treasurer is doing a disservice to the citizens of the state, as is WHO-TV News. In fact, 529 accounts worked throughout the 1990s, before legislation promoted and signed by President Bush made them even more generous by making capital gains on such accounts tax free. As near as I can tell, all President Obama seeks to do is close that loophole back up by taxing capital gains on 529 accounts as income, when the parents withdraw them. They are allowed to salt away $14,000 per year of after-tax dollars into such accounts, and invest them in bond funds or stock funds.

    What this whole proposal amounts to, it would appear, is to tax families that are in the six figure income category on the capital gains they derive from a 529 account, and only when they actually use them, not before.

    In other words, something very different to “Obama To Tax College Student’s Savings”, as reported on WHO-TV News.

  • Fed UP

    Another lamebrain, spinmaster idea from our potus. There is no “free”, money doesn’t grow out of thin air, it has to come from somewhere, and that somewhere is the taxpayers. Taxing the college accts of those already saving for college is yet another of gov.’s long arm getting into every corner of our lives. My kids worked and took out loans, they got no “free” and did just fine. Not everyone is meant for college, and therein lies the problem, many think they have to go.

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