Aurora school district officials this week took a big step toward finalizing a one-of-a-kind, multi-million dollar deal in which the district will be trading new office space for tuition discounts for its staff and students.
The deal, which the school district has worked on for more than two years, required legislators to change Colorado law, voters to approve a local tax hike for a bond, and the federal government to bless it.
Some earlier concerns that were raised by previous board members have been addressed — such as allowing students to enroll directly out of high school — but other questions remain. And although a lease has been signed detailing how much CSU-Global, the online state university leasing the district’s new building, will pay the school district each month, the district must still complete a scholarship plan for how they will distribute that money to students.
All staff and students from Aurora are already eligible for some discounted tuition rates. In addition to those discounts, the university’s lease payments for the building will now be used to create district scholarships so students pay even less.
If enough students enroll and qualify for a district scholarship, the online university will not pay rent. However, officials couldn’t say what combination of students and staff might need to enroll to fully offset the monthly obligation to Aurora. It will depend, in part, on the parameters set by the district for the scholarship and how many students choose to take advantage.
Aurora officials said in a written response, “it is our hope to provide assistance to several hundred students in addition to the universal rate that can be accessed by all students.”
Aurora is already constructing the new building of approximately 25,000 square feet, and officials told the school board they expect work to be completed by May. The $8 million project will be fully financed by proceeds from bonds that district voters approved in 2016. The deal required federal approval because the selected location, off of 6th Avenue and Airport Boulevard, was owned by the federal government, and, now owned by the district through a deed, can only be used for educational purposes.
According to the lease that the district’s school board approved Tuesday, CSU-Global will owe Aurora monthly amounts that start at $44,625, increasing annually to $58,020 by the 10th year. Aurora expects to receive $6.2 million in tuition offsets for scholarships from the 10-year lease.
Although that falls short of the $8 million spent on the building, officials have previously stated the main goal of the deal is to increase opportunities for more Aurora students to go to college. Whether that result is achieved will take some time to track.
For CSU-Global, officials say the benefit is to be able to use their rent payments to support education, as opposed to just giving it to a landlord.
The only questions the school board had as they discussed the lease last week were about a line that would require the school district to pay CSU-Global if the building is not ready for move-in at a certain point, and a question about whether the lease terms are typically 10 years.
“We thought that would be a good term to see if this is going to stick, if this works for both parties,” said Brandon Eyre, the district’s legal counsel. “It’s long enough that we can get real traction on it without tying ourselves to something that’s eternal.”
The online university offers bachelor’s and master’s degree programs. CSU-Global’s regular undergraduate tuition is $350 per credit, or approximately $8,400 per year for a full-time student.
Under the deal, Aurora high school graduates (including those from 2012 on) and staff can pay discounted rates, some of which are already being offered. Current Aurora students who enroll in a bachelor’s degree program at CSU-Global would pay $198.60 per credit. Aurora staff taking graduate-level courses would pay a reduced $335 per credit instead of the full cost of $500 per credit.
Based on those fees, and the required lease payments per year, the district scholarships funded by the lease payments may be enough to make tuition free for up to 112 full-time students per year, if all are taking undergraduate courses and if none qualified for other financial aid. The number is likely higher, after allowing students to use financial aid towards their tuition bill first.
Eyre, said district officials are “optimistic” many students will be able to attend at no cost.
Officials from the school district and university said they could not say how many current Aurora graduates attend CSU-Global, and how many are taking advantage of the discounted rates already.
The lease, however, does state that if scholarship discounts provided in a year don’t amount to what is owed to Aurora, CSU-Global would be required to cover the shortfall, or the district can choose to roll over the owed credits to another year. Any cash payments would not go into the district’s general fund. Instead, officials said they would be set aside for more tuition offsets.
Among the concerns raised earlier in the process was regarding Aurora’s selection of CSU-Global as its higher education partner.
Some had raised questions about the dual roles of Rico Munn, who proposed the deal and who is both superintendent of Aurora schools and chair of the governing board for the Colorado State University system.
One board member had questioned if an online school was the best place for students from Aurora, many who are considered from at-risk populations. Though more research exists for K-12 online schools than colleges, online programs don’t have a good track record of serving at-risk students well.
But Munn said he believed that is why it was the right school to work with. As a fully-online, nonprofit school, CSU-Global is geared for alternative students, he said.
Munn had said some Aurora students don’t enroll in college because they can’t move away from their community, or because they have a need to work while going to school. Both problems that could be avoided by enrolling at an online school.
“While we recognize that an online experience may not be right for every student, we want to continue to pursue partnerships that expand offerings and reduce barriers to earning postsecondary certificates and degrees,” Marques Ivey, the Aurora school board president, was quoted as saying in a statement from CSU-Global. “This partnership is another significant effort toward achieving our vision that every APS student shapes a successful future.”