Additional research by Daniela Bloch

Mapped Out Inflation-adjusted total college costs rose 47 percent, from $11,133 to $16,328, at Illinois public universities between fiscal 1997 and 2007. Tuition and fees, up 117 percent, fueled the increase. The Monetary Assistance Program (MAP), need-based grants from the State of Illinois for undergraduate tuition and fees, has failed to keep pace.

Just as a luxury car’s sticker price is usually higher than the final sale amount, the ever-increasing full cost of attendance at Illinois colleges and universities is not what many families pay. Increases in financial aid over the past decade have outpaced ballooning tuition and fees—even for relatively wealthy families.

Within the past ten years, Princeton, Yale, Penn, and Harvard have all announced financial-aid programs for working- and middle-class students that consist only of grants—no loans. Students receiving these packages pay a discounted price and graduate with no debt. Now, Northwestern and the University of Chicago have jumped on the bandwagon. In January, Northwestern announced two new programs: a policy of grants and work-study, not loans, in which 80 percent of recipients have family incomes below $55,000, and a plan to cap federal loan debt for any student at a total of $20,000 for four years. The U. of C. received an anonymous $100-million gift in the spring of 2007, creating the Odyssey scholarships, which will replace some student loans with grants starting this fall. Entering freshmen with a family income below $60,000 will receive $5,225, while those with a family income between $60,000 and $75,000 will receive $2,615.

At other Chicago schools, such as DePaul, Loyola, and the University of Illinois at Chicago, tuition is rising fast, but so is financial aid—loans more quickly than grants. An expansion of the federal Stafford Loan program has increased loans at colleges locally and nationwide. For example, at DePaul (total cost of attendance $36,308 as of 2007), federal assistance increased by 52 percent while state aid dropped 3 percent between 2001 and 2007. Over the same period, DePaul’s institutional grants grew by 75 percent, according to Jon Boeckenstedt, associate vice president for enrollment management. DePaul tuition is up 44 percent over that period.

Average tuition nationwide is up $5,613 for private universities and $1,982 for public universities over the past decade—34 percent in inflation-adjusted dollars at private schools and 52 percent at publics.

The most surprising thing about these programs may be their focus on the middle class. Chicago’s Odyssey scholarships go to families with incomes up to $75,000—above the 2006 median Illinois household income of $63,121. And as the hypothetical aid packages below show, even a six-figure income doesn’t mean having to pay that eye-popping price.

By the Numbers

Financial aid at the Chicago area’s elite colleges cuts down the sticker shock, even for the rather well off. Here are sample 2008 aid packages at the University of Chicago and Northwestern for students from families with adjusted gross incomes of $40,000, $65,000, and $100,000.

Loan Star

A sea change in financing postsecondary education in the past ten years has come from the growth of the private-loan industry. In 2006 dollars, $2.017 billion in private loans funded higher education in the 1996-1997 school year. In 2006–2007, the figure was $17.1 billion. Source: The College Board