Kalamazoo Promise

Purpose: Kalamazoo Promise will pay up to 100% of a child’s tuition for 4 years of college if the student graduated from a public school in the City and if he attends a state public university or junior college.

Program started in November 2005.

Percentage of the tuition paid: depends on how long the student attended a Kalamazoo public school. All other expenses must be paid by someone else.

Length of Attendance......BenefitK-12.....................................100%1-12.......................................95%2-12.......................................95%3-12.......................................95%4-12.......................................90%5-12 ......................................85%6-12.......................................80%7-12.......................................75%8-12.......................................70%9-12.......................................65%10-12.......................................0%11-12.......................................0%

12.............................................0%

Kalamazoo Promise

Estimation of what this will save if Child starts in Kindergarten.

Year Investment

1 -$2,7252 -$2,7253 -$2,7254 -$2,7255 -$2,7256 -$2,7257 -$2,7258 -$2,7259 -$2,725

10 -$2,72511 -$2,72512 -$2,72513 -$2,72514 $13,59815 $14,41416 $15,27917 $16,195

NPV @ 6% -$66

Assumptions1. Rate on investment 6.00%2. Assumes today's tuition is 5,000 per year with 8% increases

This chart calculates the cash flow needed for a student in kindergarten, graduating from high school in 13 years and attends college for a 4 year degree

It further assumes that the cost of tuition is $5,000/yr. and rises by 8%/yr. The rate of return on the funds invested is 6%.

The result is the fund needs to invest $2,725/yr. For the initial 14 years.

Kalamazoo Promise

Results:

High School test scores improved four years in a row.

A higher percentage of African American girls graduate than any other part of the State. 90% of high school graduates go on to college.

High school test scores have improved four years in a row.

Suburban flight stopped after program was introduced.

Through August 2012 Kalamazoo Promise has paid out $35-million for post secondary study for 2,500 students. On average $4,000 was spent on each student per semester.

In the first year of the Promise added an additional 1,000 students enrolled in Kalamazoo Schools. Through fall of 20012 student population increased by 24% or 2,450 students.

39% of students are white and 44% are black.