In April, President Biden shared his American Families Plan, which aims to support low and middle-income families and children. The plan includes a proposal to allocate $109 billion for two years of free community college for all Americans, including Dreamers.
Community colleges are a critical access point to higher education in the United States. They provide a gateway to four-year degrees for many, especially for historically underserved populations. Roughly half (47 percent) of all students in the U.S. who completed a bachelor’s degree previously attended a community college.
Most colleges and universities, including community colleges, fall under the category of 501(c)(3) public charities within the U.S. tax code. They generate revenue through tuition, fees, and federal funds; and like other nonprofits, they also rely on charitable gifts to operate.
Since 2008, private philanthropy in the U.S. has awarded over $3.5 billion in grants specifically for “community college education,” according to Candid data.1 Community colleges educate many people but attract less than four percent of philanthropic dollars in higher education, which totals $98 billion. They simply don't attract big donations in the way that more elite institutions do. In this blog, we examine who the players are in this space and look at what this funding picture means in relation to President Biden’s free community college proposal.
What are community colleges?
According to the American Association of Community Colleges (AACC), there are 1,044 community colleges, comprised of 936 public, 35 tribal, and 73 independent colleges. (Check out AACC’s Fast Facts for more about community colleges.)
Many of these institutions have foundations, which are separate 501(c)(3) entities that exist to raise and/or manage private support for a single institution or system of institutions. According to the Council for Advancement and Support of Education (CASE), there are 900 foundations serving community colleges.
Under Candid’s taxonomy, we track funds supporting “community college education,” which encompasses funding both to community colleges and to their foundations. When we use this same code on Candid’s GuideStar, it returns 1,192 organizations. Some of these are community colleges, some are community college foundations, and others are a mixture of support organizations, including those that help students get to or through community college. The following analysis looks at support to all of these types of organizations together.
Philanthropic funding to community colleges
Looking just at funding from private and community foundations, the top recipient of grant dollars is the Foundation for California Community Colleges ($188 million), followed by the Miami Dade College Foundation ($118 million). This is unsurprising given that California is home to the greatest number of community colleges, and Miami Dade is the second-largest single college in the U.S.
Interestingly, the third highest recipient is Achieving the Dream ($76 million), a nonprofit that supports a national network of community colleges to achieve sustainable institutional transformation for the betterment of students. These types of support organizations are neither a college nor a college’s foundation, but they still play an important role in understanding the overall picture of funding for community college education.
Where is funding coming from?
The largest source of funding for community colleges predictably comes from federal dollars ($2.2 billion), namely the United States Department of Education (USDOE). The second largest federal funder of community college education is the United States Bureau of Indian Affairs (BIA), which has distributed $125 million to the 35 tribal colleges.2
Earlier this year, MacKenzie Scott awarded sums ranging from $3 to $30 million to numerous community colleges, many which are not often the usual higher education beneficiaries of big-time philanthropy. These awards, which total at least $348 million, make MacKenzie Scott the second largest donor to community college education, behind the USDOE.
The single largest grant ($100 million) was made by a private funder, the Jay Pritzker Foundation, to the California Community Colleges Foundation to support student scholarships. Another notable private funder is the Bill & Melinda Gates Foundation, which has awarded 217 grants to a number of community colleges. Their largest grant of $16.5 million was awarded to the support organization MDC to “learn what it will take for community colleges and states to implement systemic and comprehensive reforms of developmental education that translate into greater academic success for their students.” Additionally, the Mitchell Wolfson, Sr. Foundation has awarded over $84 million to the Miami Dade College, making up nearly 75 percent of their institutional funding. Many more funders are making meaningful grants of all sizes to community college education.
One common strategy of local donors and alumni is awarding grants to specific programs at a college, which can have a significant impact. For example, an award of $2.3 million to Cerritos College’s woodworking program made headlines as its largest donation to date. And the Oregon Community Foundation awarded a $25,000 grant to the Portland Community College to support their DREAMers Resource Center.
Looking at funding to community colleges within the overall picture of funding to higher education paints a more complicated story. Despite analysis of higher education confirming that “elite” institutions do a worse job of promoting economic mobility, the fundraising gap between elite schools and community colleges continues to widen.
Grants to support community college education grew from $181 million in 2008 to $336 million in 2018—an 85 percent increase. Meanwhile, funding to higher education overall has grown by over 260 percent between 2008 and 2018, when it totaled $13.5 billion.3 In recent years, however, more has been written about funders who are becoming aware of this disparity and acting on it.
There is little debate that the more support students receive, the better the outcomes. The proposal for free community college has garnered bipartisan support, for the most part. Across the board, there is recognition that obtaining a higher education provides a path to greater social and economic mobility, and that expanded federal support for higher education could help close some of the income disparity, especially for lower-income, Black, Indigenous, and people of color (BIPOC) communities.
How does this impact funders? While the $109 billion in planned expenditures for free community college are set to come from state and federal governments, private philanthropy still has a crucial role. For one, the American Families Plan is still sitting in Congress and philanthropy can play an integral part in building advocacy and awareness.
Funders should also continue to support scholarship opportunities, retention programs, emergency grants, day care for the children of college students, mental health services, and the plethora of other resources that influence student access and success before, during, and after attending college. (Check out Scholarships for Change to learn more about some of these opportunities and how funders are already making a difference.)
As the cost of education continues to skyrocket, funders—regardless of their alma mater—can demonstrate their commitment to turning around decades of underinvestment and inequity by strengthening community colleges and reducing the financial burden on students.
Excludes U.S. federal funders. Includes private, community, and independent funders. Data gathered on September 13, 2021 from Foundation Maps.
Candid sources data on federal funding from USAspending.gov. Figures captured here reflect select funding from government agencies awarded since 2012.
Totals exclude U.S. federal funds.