Limited budgets impact two-year university support

Today’s students face a variety of challenges in obtaining a degree or diploma basic needs uncertainty, mental health problems, financial instability and a lack of academic preparation.

To meet these needs, more institutions are investing in comprehensive supports that address threats to student retention and completion and meet student needs holistically.

Recent survey data of the Federal Reserve Bank of Richmond notes that community colleges in the Fifth District (the Carolinas; Maryland; Virginia; Washington, DC; and part of West Virginia) have had to make strategic decisions about resource allocation and rely on diverse funding sources work together to provide these services.

What is the need: In conversations with community college leaders, researchers found that barriers to academic success were primarily non-academic.

An April working paper of the Community College Research Center at Columbia University’s Teachers College has identified mental illness as the greatest predictor of persistence among students enrolled at public two-year colleges. EdSights noted a similar trend Fall 2023 data shows that students at two-year institutions are more likely to report financial problems and stress.

CCRC found that most student success interventions for community college students address financial and academic needs.

Provide assistance: Wraparound support, as defined in the report, includes academic advising, mental health counseling, child care assistance, financial literacy programs and career services.

Many community colleges operate with limited budgets and rely heavily on local, state and federal funds, which do not cover general aid, according to the report. Grants can be competitive and some policy restrictions can also limit how funds can be allocated. Some decision makers are also unclear about the importance of these services, which may result in a preference for funding direct education costs over support services.

The Richmond Fed investigation found that many colleges had established their own foundations to provide financial aid and raise money to students. Five financing flows emerged as trends among respondents:

1. State and Federal Grants. Public funding through targeted grants such as the Strengthening Institutions Program, the Student Support Services Program, and the Postsecondary Student Success Grant can improve services at two-year institutions.
2. Private donations and foundations. Alumni and local foundations can help fund mental health grants and interventions. Community involvement in fundraising can also promote a sense of ownership and investment in the university beyond the dollars allocated.
3. Partnerships. Nonprofits, local businesses and social services partner with community colleges to support students. One area where students often need support is transportation, and a partnership with public transportation authorities can provide free or low-cost options.
4. Income. To fund student support, colleges will often charge specific fees, similar to a student activities fee or technology fee.
5. Operational financing. Another common strategy is to spend a portion of operating budgets on staffing, programming, or other initiatives to provide support services. State funding formulas can make this a challenge, however, because community colleges often have more staff than full-time enrollment, which costs a lot of money.

How does your college or university fund student success initiatives? Tell us more here.