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College Dropouts ‘Cost’ Students’ Dreams and Taxpayers Billions, Report Claims

Taxpayers across the country spent more than $9 billion during a five-year span of the last decade, supporting college freshmen who left their respective four-year college or university before starting their sophomore year, according to a new report by the American Institutes for Research (AIR), a highly-regarded Washington-based research organization.

The AIR report, “Finishing The First Lap: The Cost of First Year Student Attrition in America’s Four Year Colleges and Universities,” characterizes the dollars “lost” as “staggering” and asserts “we continue to spend far too much money on students who don’t even finish the first lap, let alone fail to cross the finish line.” The report is set for public release today.

“Transparency is the first step to accountability,” says Dr. Mark Schneider, an author of the report, interviewed about its findings. The report makes no recommendations for policy or legal action and has its limitations with respect to the completeness of its research, he says. Still, Schneider says he hopes the findings “add to the discussion” growing in education and policy circles about how to get a better return on taxpayers’ investments.

The AIR report reviews federal and state expenditures by state during the five-year period of 2003-08, the latest period for which comprehensive data are available, the research group says. Its analysis was based on data from the U.S. Department of Education’s Integrated Postsecondary Education Data System (IPEDS).

The report says states appropriated almost $6.2 billion to colleges and universities to help pay for the education of students who did not return for a second year. In addition, the report says, states gave more than $1.4 billion and the federal government more than $1.5 billion in grants to students who did not return for a second year.

The report stressed it was not about why students “fail” but the “high costs of failure.”

“We’ve (President Obama and the higher education community) undertaken a completion agenda without understanding what’s going on,” says Schneider, a vice president at American Institutes for Research and former commissioner of the federal National Center for Education Statistics.

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