There is ample evidence that low- and moderate-income students with the talent to earn admission thrive at top institutions when their financial needs are met, and graduate at higher rates than they do at less competitive schools. Yet, most top-performing colleges and universities consider students’ ability to pay in admissions decisions, at times accepting less talented full-pay students in order to meet revenue targets. For those lower-income applicants who are admitted, many institutions struggle to meet their full financial need.

With finite budgets and multiple priorities, institutions limit the funds they allocate to need-based aid and other programs that support low- and moderate-income students. Yet even with those constraints, there are top-performing colleges and universities that have enhanced their commitment to serving these students and have found the financial means to do so.

The American Talent Initiative (ATI) is a Bloomberg Philanthropies-supported collaborative of colleges and universities with a goal of attracting, enrolling, and graduating an additional 50,000 talented lower-income students at the US institutions with the highest graduation rates by 2025. Each quarter, Ithaka S+R and the Aspen Institute’s College Excellence Program, the two organizations supporting ATI, will produce a “strategy paper” identifying solutions to problems of practice that will help our members and the broader higher education community advance the goal of expanded access and success.

In the first strategy paper for ATI, released today, Jessie Brown and I profile five of the institutions that have found creative ways to allocate funding to increase opportunities for low- and moderate-income students. The institutions we profile are:

• Franklin & Marshall College, which nearly tripled the share of Pell recipients in its incoming class between 2008 and 2016 by fostering an institutional commitment to an innovative “talent strategy,” eliminating merit-only aid and gradually reallocating other funds to need-based aid, and forming strategic partnerships with K-12 organizations.
• University of California, Berkeley, which, despite declining state funding, maintained high enrollment levels of low- and moderate-income students by increasing tuition, streamlining administrative expenses, and allocating a portion of tuition revenue and saved expenses towards need-based aid.
• University of Richmond, which increased its enrollment of Pell recipients from 9 percent in 2008-2009 to 13 percent in 2013-2014 by leveraging a strategic planning process, data-driven enrollment planning and aid policies, and careful management of its endowment.
• University of Texas at Austin, which maintained high enrollment levels of low- and moderate-income students and increased graduation rates by strategically using one-time grants to jump-start innovative student aid and support programs and using modeling to ensure program effectiveness.
• Vassar College, which tripled the share of Pell recipients by maintaining generous aid policies, increasing the commitment of endowment earnings to financial aid, deferring capital projects, and bringing compensation costs in line with peer institutions.

These institutions face different challenges and have different capacities related to factors such as their sector, endowment, size, and ability to expand. Nevertheless, each has pulled a different combination of the following financial levers to support increasing opportunity:

• Reallocating funds from merit-only aid to need-based aid;
• Making strategic use of one time grants and budgetary surpluses;
• Cutting non-instructional expenses through administrative streamlining, reductions in clerical and maintenance staff, or deferring capital projects;
• Increasing revenue through growing enrollment, increasing tuition, fundraising, and other revenue generating strategies; and
• Drawing from the endowment in strategic ways.

Additionally, the five profiled institutions have employed some common transition strategies to implement these reallocations effectively and reinforce their commitment to access and success. Specifically:

• Their leaders have visibly committed to and communicated about goals for increasing opportunity, and have framed these aims as good for their institutions as well as for the broader public.
• They have used data to persuade internal and external audiences, to identify opportunities for reducing costs, and to better target aid and support.
• They have understood the need to engage faculty, boards, and other stakeholders in a gradual and widely-supported process of change by giving stakeholders a role in budget reallocation decisions, phasing-in budgetary reallocations, and using other tactics to deepen understanding of the value of increasing socio-economic diversity.

If given the opportunity, talented low- and moderate-income students thrive at high-performing colleges and universities. America’s top institutions can help to create these opportunities, but doing so requires new practices and new financial commitments. While each of the profiled institutions has faced bumps in the road, these strategies have enabled them to reallocate funds in ways that are financially sustainable, maximally effective, and broadly supported by institutional stakeholders.

How do you, our readers, think about prioritizing and budgeting for opportunity? What other questions of practice should ATI address in future strategy papers?