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Here's How Tuition Benefits Work

Jose Suarez has five children. They’re strong students, but to send them all to a university like AU would cost over half a million dollars. 

Suarez, though, is chief building engineer at Washington College of Law. So like other staff and faculty, if his children are admitted to AU, they receive an AU tuition scholarship that covers the cost of tuition for four years of undergraduate school.

So far, two of his children have graduated from AU. Another is using an AU benefit—eligibility for a tuition exchange scholarship—to fund his architecture study elsewhere. And a fourth child, a high-school honor student with top grades in math and chemistry, is getting ready to apply to AU next year.

“It’s the best benefit we have,” says Suarez, a 20-year veteran of AU. “It has given my children a great advantage in life.”

Last year, 36 dependents of faculty and staff used the AU tuition scholarship, while 34 attended other schools on a tuition exchange scholarship. This fall alone, 218 employees and 34 spouses and same-sex domestic partners also attended AU on tuition remission.

“Trust me, it feels pretty good not to have to experience all those student loans—not to mention that AU is such a great school,” says Brooke Bailey, who graduated in December from the School of Public Affairs after using two years worth of benefits, thanks to her father’s staff job, and hopes to use benefits for graduate school as well.

Here’s how it works.

AU Tuition Scholarship

Once you’ve worked at AU full time for two years, your child can attend AU with a tuition scholarship that covers undergraduate and sometimes graduate tuition. The child must have started full-time study before turning 21—though not necessarily at AU—and has to have been claimed continuously as a dependent on your tax return and accepted through the regular admissions process.

Jeanie Gordon is an AU student whose tuition benefits also apply to her AU Abroad program at Oxford University in England, where she is studying this year.

Sue Gordon, AU’s director of career development, didn’t insist that her daughter go to AU. But once it was clear that Jeanie wanted “a mid-sized university in an urban but nice setting with a campus,” her parents did make a case for it. Jeanie’s father, an engineer, even put together a spreadsheet showing the differences in price between her various school options.

“By the time the decision point came, she really had some clarity about what she wanted and her options. It was largely her decision,” Gordon says. The history major and education minor has lived on campus, though, to get a full AU experience.

Bailey wasn’t initially eligible for the scholarship, since her father, Capt. Norman Bailey, had joined Public Safety too recently when her time came to apply to college. So the family did their research and followed a thoughtful strategy. She’d go to a school with lower tuition and transfer to AU if she chose when the tuition benefits kicked in.

“AU was one of my top choices because I was in political science, but I didn’t have $50,000 to pay,” says Brooke Bailey frankly.

Instead, she went for a year and a half to a historically black college where Bailey felt she’d have a broadening experience. “I really fell in love with it. It was a home away from home,” says Brooke. “But it wasn’t all that great for my major, at least not compared to AU. It didn’t have the internships or that Washington experience. So when the time came for me to be eligible for AU, I was very happy to come here and have both experiences.”

What was it like being on campus with dad? “I’m very close to my dad, so having him around was actually kind of nice. And since I knew a lot of staff at AU already, it was easy to acclimate. It was sometimes a little weird, just because of the position my father does hold in Public Safety. It’s like your parents are the police.”

But she soon found out she wasn’t alone; her roommate turned out to be a tuition exchange student with a parent working at the University of Southern California.

Because Bailey only used part of her tuition benefits, she’ll be eligible for graduate school benefits, too, if she goes directly to Wesley Theological Seminary next fall as she plans.

As long as a child is still a dependent and has not used all four years of the undergraduate benefit, then tuition scholarships can be used for two years of graduate education at AU. In contrast to the undergraduate degree, however, tuition benefits for graduate school are taxable.

Of course, not every child is set on going to AU. That’s where tuition exchange scholarships come in.

Tuition exchange

Anne Kaiser’s daughter is a student at Skidmore, one of the nation’s most expensive schools. But thanks to a tuition exchange scholarship, “we’re paying what we’d pay if she went to the University of Maryland,” says Kaiser, an academic counselor at the College of Arts and Sciences.

Children of faculty and staff can go to other colleges at huge savings—often, even, the full tuition amount—if the school is part of the Tuition Exchange. That’s a scholarship program for faculty-staff dependents at over 600 institutions, and because AU participates, families can cast their net widely when it comes time for college. The average scholarship awarded is around $24,000 a year.

Start your research early, though, because this is more complicated than the AU tuition scholarship. Exchange scholarships are competitive—applicants compete with faculty and staff children from around the country—and every school sets its own rules.

“It’s not an automatic thing,” notes Marla Boren, a CAS academic counselor whose son Michael won a tuition exchange scholarship to his first-choice school, DePaul University in Chicago. “It’s a great benefit that does require a little bit of research on the part of the staff member and student to make it work.”

There are excellent schools that admit almost all qualifying students—if they can meet the admissions criteria, they get a tuition exchange scholarship—but many others have few scholarships available.

As an AU staff member, Boren wasn’t shy about calling staff at other universities and asking frank questions. For instance, if a student doesn’t get a scholarship offer freshman year, what’s the possibility of getting one later? Some schools use the scholarships as a recruitment tool; others might offer them later to strong students. “You have to find out how it works at that particular institution,” she says.

Another frank tip from Boren: “Our strategy was to apply to schools where we were pretty certain Michael would be an ideal candidate, on the top end of people they were admitting. We weren’t looking for a reach school. Look at what the SAT requirements are, look at what kind of grades they’re interested in and visit and talk to people.”

Once Michael had set his heart on DePaul, he visited three times—even during a Chicago winter—and applied for another small scholarship that required him to write an essay, hoping the effort would show his seriousness.

And talk at home. “Have a good conversation with your kids about what tuition exchange means and what will happen if they don’t get the scholarship,” Boren says. In her role as an academic counselor,

“One of the frustrating things I’ve seen happen with students is the student falls in love with the place and hopes to get the finances together and parents don’t want to say, but there’s really no long-range plan to afford the school.”

Many parents and their children joke about “the list” shown to them by parents like Kaiser. “We told her from day one, ‘Here’s the list. You can apply to other schools, but if you don’t get merit aid, we’re not going to pay when we have this option here.’

“I’ve had kids who’ve come here on tuition exchange and I say to them, ‘So, did your parents give you the list?’ ‘Yes, the list.’” 

To start compiling your own list, go to www.tuitionexchange.org. Look under “Conducting a School Search” to get admit rates and other details.

Cash grants

This is a third option, with a more limited reach. If you were a full-time employee at AU before July 1, 1995, and your child decides not to go to AU and doesn’t receive an exchange scholarship, they may be eligible for a cash grant of $1,450 per academic year. This past year, 29 students received the grant.

Yourself and your spouse or same-sex domestic partner

Go to any department on campus, and you’re bound to find employees who are also AU students or whose spouses or partners are students. As with many benefits, you must know the rules of the road.

You need to have worked for AU full time for at least four months before the last day of late registration for a semester. After that, tuition remission covers eight credits per semester. The rules are the same whether the student is the employee, the employee’s spouse, or a same-sex domestic partner.

It covers a maximum of 20 credits per academic year, and it may not apply to every possible class—certain mini-sessions, institutes, and other courses aren’t included—but it can be applied to all levels of study, from undergraduate to doctoral.

Jeanie Gordon is not the only member of Sue Gordon’s family to take advantage of tuition benefits. Her father is taking education classes with a long-term goal of teaching. So far, he hasn’t been in the same class as his daughter, an education minor, but “they shared some of the same classes in succession, and I believe he’s used one of her old books instead of buying a new one,” says Sue Gordon.

In most cases, the benefit is taxable. Faculty and staff are advised to review the details in the benefits manual, available online on the my.american.edu portal.

“You’re still saving a good deal of money, but it can affect your take home pay. Be sure to read the manual and call us with any questions,” says Nancy Welcome, Human Resources benefits operations specialist, who handles tuition benefits.

“It’s been a great benefit to my family and to my daughter,” Norman Bailey says. “It’s something we market heavily in our hiring program. It’s part of the salary discussion. The education benefit has a major dollar value.”

There’s no doubt about that. Just ask Jose Suarez—or any of the thousands of staff, faculty, and their families who’ve found out exactly how much the benefit is worth.