August 16, 2018
Purdue’s Back a Boiler selected for better government award
WEST LAFAYETTE, Ind. – A Boston-based think tank has selected Purdue University’s Back a Boiler income share agreement program, which provides an alternative to Federal Parent PLUS and private student loans, as its winner of the 27th annual Better Government Competition.
The Pioneer Institute said it selected the Back a Boiler program after reviewing more than 80 entries from think tanks, universities, job training programs, nonprofits and state government agencies nationwide. Purdue University will receive the $10,000 top prize, which it will donate to the Back a Boiler ISA Fund.
Unlike student loans, ISAs have no principal balance or interest. The program offers students and their families an alternative financing option in which a student receives education funding in exchange for an agreed-upon percentage of post-graduation income over a set number of years. The Back a Boiler - ISA contract payback period is about 10 years.
Since launching the Back a Boiler program in the 2016-17 academic year, Purdue has seen the fund distribute $5.9 million through nearly 500 contracts and to students in more than 100 majors.
“Although still new and relatively small, our ISA initiative continues to attract national attention and inquiries from other schools interested in emulating it,” said Purdue University President Mitch Daniels. “Even at this early stage, this vehicle shows great promise as another way we can help our students launch their lives with less debt and greater financial security.”
The Purdue Research Foundation, a private, nonprofit foundation created to advance the mission of Purdue University, which is about to celebrate its 150th anniversary, announced in May that income commitment rates for the Back a Boiler-ISA would remain at the 2016 level.
Purdue has frozen tuition at 2012-13 levels through at least 2019-20. This means students at the West Lafayette campus will be paying nearly the same in tuition and fees as they were in 2012-13, and five graduating classes will have earned their Purdue degrees without ever having a tuition increase. When combined with room and board rates that have been held flat or lowered and potential textbook savings through Purdue’s Amazon partnership, current students’ total cost of attendance is lower than in 2012-13.
It is estimated that from fiscal years 2013-19 Purdue families have saved a total of about $465 million through the university’s deferral of tuition, fee, and room and board increases. Current Indiana resident students would be paying $1,400 a year more if Purdue had raised its tuition by the national average for four-year public universities; non-resident students would be paying $5,560 more per year if tuition had increased by the Big Ten average.
Jim Stergios, executive director at Pioneer, praised the Back a Boiler program.
“Our country is at a crisis point where, on one side, the models for providing and financing higher education and workforce training are changing fast and, on the other, we have an old system that has saddled the young with debt that is a drag on their ability to pursue their dreams and fully participate in the economy,” he said. “The ideas Pioneer is honoring aim to allow Massachusetts to reimagine how we provide access to affordable higher education and training.”
The 2018 winners were selected by a distinguished panel of judges with backgrounds in education, government, business, and workforce development. The Back a Boiler program will be honored at the Better Government Competition Awards Gala on Sept. 24 at the Seaport Hotel in Boston. Pioneer Institute’s Better Government Competition, founded in 1991, is an annual citizens’ ideas contest that rewards some of the nation’s most innovative public policy proposals.
Purdue Research Foundation contact: Tom Coyne, 765-588-1044, firstname.lastname@example.orgSource: Mary-Claire Cartwright, 764-588-1051, email@example.com