The daunting cost of college has led to a six-year trend of steadily decreasing university enrollment. Colleges are now proposing a controversial alternative to loans as a means of appealing to lower-income students.

Last December, Inside Higher Ed reported that colleges have seen enrollment drop each year since the 2011-2012 academic year. This is likely due to the steep cost of a college education in America, which can range from approximately $10,000 per year for in-state students attending public universities ($40,000 to complete a four-year degree) to $25,620 per year for out-of-state students at public colleges (more than $100,000 for a four-year degree), to $34,740 per year at private colleges (more than $128,000 over the course of four years), according to figures from the College Board. And that’s not including room and board, which is a significant cost on its own.

However, the Los Angeles Times recently reported that Norwich University in Vermont is offering an alternative to the traditional federal loans that college students take on in order to pay for college — income-sharing agreements.

Under the school’s proposal, students could opt out of paying tuition and instead agree to give the university a share of their future paychecks in the years following their graduation. While this may seem like a better alternative to paying back federal loans, which carry interest and exorbitant fees, critics say they disproportionately affect students who take jobs in lower-paying industries.

“If income share agreement providers aren’t careful, they can definitely see unintended consequences in discriminatory terms toward students. This is one of the biggest differences between income share agreements and federal student loans,” Clare McCann, the deputy director of education policy at the New America Foundation told the Times. “Federals[sic] loans offer the same terms to all borrowers.”

However, income-sharing agreements are not new, nor are they exclusive to Norwich University. Vemo Education, which works with Norwich on its income-sharing plan, also has contracts with roughly 30 other public and private accredited colleges and universities. Its first partnership was with Purdue University in Indiana in 2016.

Using the College Board’s figures for average cost of tuition for a four-year degree for an in-state student attending a public university, in addition to room and board fees ($10,800 on average, or $43,200 for four years), that would put a student on the hook for more than $80,000 in money from future paychecks to be given to the university over the course of their career.

A 2017 survey from My Student Voices found that more than two-thirds of college graduates still didn’t have job prospects after obtaining their degree. But even if a graduate managed to land a job paying the median U.S. household income of $56,516, that graduate would have to set aside 10 percent of their monthly income ($4,709.67 before taxes) for 14 years in order to pay down that debt, assuming the income-sharing agreement only asked for 10 percent of monthly income, and assuming a graduate was able to keep the same job for 14 years (millennials will change jobs an average of four times before age 32).

The $1.48 trillion student debt crisis has prompted proposals of making public colleges tuition-free, as many European countries already do for both citizens and international students. Senator Bernie Sanders (I-Vermont) ran on a platform of tuition-free college, saying it was “insane and counter-productive to the best interests of our country and our future” to shackle young people with decades of debt for simply getting the education necessary to get a decent job.


Nick Jewell is a freelance political writer, and a proud resident of Bed-Stuy, Brooklyn. Email him at 

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