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Funding Wraparound Services at Community Colleges

Community College Insights
October 24, 2024

Community colleges play a crucial role in providing accessible education and support to diverse populations. However, many students face challenges that can impede their academic success, such as financial instability, mental health issues, and lack of academic guidance. To address these challenges, community colleges increasingly offer wraparound services — comprehensive support systems designed to meet students' holistic needs. Funding these services, however, requires strategic resource allocation and diverse funding sources.

Understanding Wraparound Services

Wraparound services encompass a wide range of support, including academic advising, mental health counseling, child care assistance, financial literacy programs, and career services. Overall, these services aim to address barriers that may prevent students from completing their education.

In a 2022 brief titled Centering Equity in Wraparound Student Services, the Hunt Institute identified 10 main barriers to community college student success:

  • Administrative process of higher education
  • Lack of flexibility in financial aid
  • Housing insecurity
  • Transportation challenges
  • Unexpected financial burdens
  • Balancing work and academic workloads
  • Increasing child care costs
  • Accessing mental health services
  • Food insecurity
  • Lacking a sense of belonging on campus

In our conversations with community college leaders, we hear a similar refrain: The barriers that keep students from succeeding are often not academic.

Funding Sources for Wraparound Services: The Challenge and Innovative Solutions

Why is funding wraparound services so challenging? First, community colleges often operate with limited budgets, prioritizing core educational functions over additional support services. Many community colleges rely heavily on local, state and federal funding, which typically does not cover wraparound services, and grants for such initiatives can be competitive and inconsistent. Additionally, policy restrictions and reporting requirements may limit how funds can be allocated and how much administrative time is needed to access this funding.

The diverse needs of the student population further complicate funding strategies, often leading to fragmented support that does not adequately address individual circumstances. Moreover, there is frequently a lack of awareness about the importance of these services among policymakers and stakeholders, hindering effective advocacy efforts. As institutions focused on higher education and workforce development, colleges must balance funding between academic programs and student support services, which often results in a preference for direct educational costs over comprehensive wraparound services. These factors together contribute to the difficulty in securing consistent funding for student services at community colleges.

According to a survey recently conducted by the Richmond Fed about Fifth District community colleges and wraparound services, the responses show that the majority of community colleges have established their own foundations. (The survey results will be released later this year.) These foundations allow community colleges to provide financial assistance to students and allow them to engage in fundraising efforts, such as applying for grants and soliciting donations from alums.

In general, community colleges fund wraparound services through a combination of sources:

  1. State and Federal Grants: Community colleges often rely on government funding to support wraparound services. Programs like the Pell Grant provide financial assistance to students, while targeted grants from state and federal agencies can fund specific initiatives aimed at improving student support systems. Initiatives like the Strengthening Institutions Program, the Student Support Services Program, and the newly formed Postsecondary Student Success Grant program are examples of federal programs designed to enhance student services at community colleges. In North Carolina, many community colleges indicated using federal funds from the Finish Line Grants program, whose goal is to help students with financial hardships finish their training. Finish Line Grants can be used for course materials, housing, medical needs, dependent care, or other financial emergencies.
  2. Private Donations and Foundations: Community colleges often seek financial support from alums and local foundations dedicated to education and community development. These donations can provide essential resources for specific programs, such as scholarship funds or mental health initiatives. Engaging the community in fundraising efforts not only enhances funding, but also fosters a sense of ownership and investment in the institution.
  3. Partnerships with Local Organizations: Collaborations with local businesses, nonprofits, and social service agencies can provide additional resources for wraparound services. For instance, collaborations with local businesses can create internship opportunities for students, while partnerships with mental health organizations can facilitate access to counseling services. Such partnerships can also lead to shared funding initiatives, thereby reducing costs. Many community colleges in the Fifth District use an online screening tool called Single Stop which assists students with accessing public benefit programs and other wraparound services at no cost. Additionally, several Fifth District community colleges indicate that they partner with local public transportation authorities to provide free or low-cost transportation options to students, and with their regional Community Services Boards to provide mental health services to students in need.
  4. Fees and Tuition Revenues: Some community colleges implement specific fees that contribute to funding wraparound services. These may include student activity fees or technology fees, which can be allocated toward enhancing student support systems.
  5. Operational Funding From State Appropriations: Many community colleges allocate a portion of their budgets specifically for wraparound services. This funding can be used to hire dedicated staff, develop programs, and maintain resources necessary for effective service delivery. Strategic budgeting allows colleges to prioritize student success initiatives even amid financial constraints. Using operational funding for wraparound services, however, can be difficult for the majority of community colleges. Since community colleges have a high volume of part-time students, the full-time enrollment is much lower than headcount enrollment. Moreover, in many states, noncredit students are not counted in state funding formulas. This means that typically these schools receive fewer dollars per student than their four-year college counterparts.

The Importance of Comprehensive Support

Investing in wraparound services is essential for fostering a supportive educational environment. Research has shown that students who receive holistic support are more likely to persist and graduate. By addressing the multifaceted challenges students face, community colleges can improve retention rates and better prepare graduates for the workforce.

Targeted student supports in community colleges play an important role in enhancing student success and retention, particularly for underrepresented populations. Federal TRIO programs, which include initiatives like Upward Bound and Student Support Services, provide essential resources such as academic tutoring, financial aid assistance, and personalized counseling. By addressing barriers to education and offering tailored guidance, these programs empower students to navigate their academic journeys.

A 2019 study conducted by the University of Chicago Inclusive Economy Lab found that offering wrapround services to community college students increased full-time enrollment by 13 percent and increased retention from one term to the next by 11 to 16 percent.

Conclusion

Funding wraparound services at community colleges requires a multifaceted approach that leverages various resources. By combining state and federal grants, institutional funding, private donations and partnerships, community colleges can create a robust support system for their students. As these institutions continue to evolve, their commitment to holistic student support will be vital in ensuring that all students have the opportunity to succeed on their educational journeys. In the coming months, we will share more about the results from the wraparound services data we collected from community colleges in the Fifth District, and we hope to gain even more insight into what services are provided.

2024 Survey of Community College Outcomes

On Tuesday, Nov. 19, we will be hosting a webinar to release the initial results from our 2024 Survey of Community College Outcomes. Interested in attending? Visit our Survey of Community College Outcomes: 2024 Results and the Future of the Survey events page to sign up and learn more.


Views expressed are those of the author(s) and do not necessarily reflect those of the Federal Reserve Bank of Richmond or the Federal Reserve System.

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