President Clinton's proposed tax deduction for education after high school would aid middle-class families, people often too affluent to qualify for grants or loans but too strapped to afford the nation's most expensive schools.
"It's the middle-income kids that have been most neglected," said Ellery Woodworth, special assistant for federal affairs to Johns Hopkins University President William C. Richardson.
But the move could have unintended consequences, several higher education officials said last night. The deduction could lead many public colleges and universities to raise tuition, as they see middle-class families able to absorb higher rates, said Malcom Getz, an associate professor of economics at Vanderbilt University who has written extensively on student costs.
Tuition increases would seem a convenient way for public campuses to ease the pressure from years of cutbacks or limited state appropriations. At Maryland's public four-year campuses, tuition has risen 114 percent in the past decade, exactly three times the rate of inflation. But state appropriations have grown only 60.6 percent in that time, according to figures from the state Higher Education Commission.
"It does tend to bias things a little in favor of private institutions," said Donald N. Langenberg, chancellor of the University of Maryland System. "That seems a little odd to me."
The president's proposal, unveiled last night in a televised speech to the nation, would allow families making up to $100,000 to deduct up to $10,000 a year in tuition or costs for any kind of post-secondary education -- for college, graduate school, trade schools or job training programs. The deduction would taper off for families with taxable income of more than $100,000, and it would lapse for those above $120,000.
The level of the tax bracket determines the extent of the savings, so families of the upper middle class would benefit most, these university officials said. In the past decade, the average student's debt burden has risen as the government emphasized loans over grants. If accepted, the White House's proposal could lighten that debt.
Mr. Clinton's proposal appears to be aimed at seizing the issue of middle-class anger from the newly ascendant Republicans. The GOP "Contract with America" released before this fall's elections proposed scrapping virtually all federal campus-based aid programs.
During his campaign for the presidency, Mr. Clinton himself proposed replacing all aid programs with a service requirement for students who could not afford post-secondary education. Once in office, he found those pledges blocked by Congressional Democrats who backed the traditional programs.