There is increasing recognition in California and nationally that the financial aid students receive to attend college should address the cost of attendance beyond tuition and fees, since living expenses – particularly housing expenses – often make up the largest share of students’ budgets. Consequently, recent financial aid reform efforts at the state and federal levels have focused on aligning the structure of financial aid with the total cost of attendance. Cost of attendance estimates are determined by individual higher education institutions and are used by state and federal financial aid departments to calculate students’ financial aid award amounts. Currently, there is no standardized methodology for how colleges calculate off-campus housing cost of attendance estimates, which can create inaccurate and incomparable estimates across colleges. Bringing consistency and uniformity to how the cost of college is reported across institutions will better support students in their college investment decisions and create a standardized process by which financial aid eligibility is calculated. This Issue Brief compares three potential options for calculating off-campus housing costs and the benefits and limitations of each, and outlines approaches state policymakers could take to ensure cost estimates are standardized at higher education institutions across California.
