“We need to have some kind of control (on college costs),” he told The Atlanta Journal-Constitution after the meeting.
Rahman’s proposal, commonly called “income sharing agreements,” is used by a small number of schools nationally and is a much-debated idea in industry circles. Some education experts say they’re unregulated and worry it’s potentially predatory.
Purdue University in Indiana is the best-known school offering the grants. Its “Back a Boiler” program, funded by its research foundation, gives students at least $5,000 per semester or up to 15 percent of their expected annual income. Purdue doesn’t charge interest, but the amount of money students are required to pay can increase if the former student’s income increases. The program began in the 2016-17 school year with 160 students receiving grants. One Georgia official said Thursday that Purdue’s program requires students to pay back 1 or 2 percent of their future earnings for up to 10 years.
The Flatiron School, a for-profit coding school that opened a campus in Atlanta last year, has an income sharing agreement that requires students to pay 10 percent of their monthly gross income as long as they’re making at least $40,000 a year. The school started offering agreements late last month. Students make a maximum of up to 48 monthly payments up to 96 months, according to information on its website a spokeswoman shared with the AJC. The school has 23 students.
The committee did not vote on the bill. Rahman plans to rewrite it.