Influencing Transfer and Baccalaureate Attainment for Community College Students Through State Grant Incentives: Quasi-Experimental Evidence From Texas

• In Event: Promising Scholarship in Education: Dissertation Fellows and Their Research

Abstract

This study uses longitudinal data from Texas to estimate the impact of a state grant program intended to encourage low-income community college students to transfer to four-year institutions and complete the baccalaureate. Specifically, I examine the Towards Excellence, Access and Success (TEXAS) program, a means-tested grant program that covers recipients’ tuition and fees at public two- and four-year institutions. Using propensity score matching to identify observationally equivalent students who were and were not awarded the grant (due in part to constraints on the availability of these grants), I find that the TEXAS grant program significantly raises transfer outcomes, particularly for Latino/a recipients, but does not have a statistically significant impact on baccalaureate attainment.
In the overall sample, the grant raised the probability of transferring within three years and five years by 2.6 (p=0.015) and 5.6 percentage points (p=0.01) respectively. In the Latino subsample, the grant raised the probability of transferring within three years and five years by 3.0 (p=0.011) and 7.0 percentage points (p=0.01). To put these probabilities in perspective, the transfer probabilities within five years for Latino recipients and non-recipients respectively are 28.3 and 21.8 percent respectively (setting all other covariates at their mean values). The estimated treatment effects for the Hispanic subsample are larger in both absolute and relative terms. Given Latino students’ lower baseline probability of transfer, the percentage increase in probability of transferring within five years for Hispanic grant recipients is substantial, at 29.8 percent, compared to a 17.9 percent increase for the same in the overall sample.
In contrast, the effect of the TEXAS grant on baccalaureate attainment is statistically insignificant. The limited impact of the TEXAS grant on this key outcome raises concerns about the grant’s actual portability across sectors and the institutional reception that students receive at their transfer destinations. Transfer students may be less likely to receive renewal awards even when they are eligible for them because of how institutional financial aid offices are directed to distribute TEXAS grant dollars by the state. Due to inadequate funding to cover all eligible students, institutional financial aid offices disburse grant dollars using a complex scheme where renewal awards are prioritized over initial awards, and as a result, continuing students are effectively prioritized over incoming transfer students. In addition, the TEXAS grant stimulates transfer to less selective regional institutions rather than the public flagships that have greater resources available to support and engage low-income students and students of color from community colleges.
This study contributes to the literature on financial aid for community college student, an understudied population, by using a methodology that minimizes selection bias. It also calls attention to the importance of program design and implementation for financial aid and explores implications for designing grant interventions for community college students.

Author

• Loni Bordoloi, Teagle Foundation