Starbucks Offers Workers Free College Tuition

TEMPE, Ariz. — Starbucks employees nationwide will be eligible for a free college education through Arizona State University's online program beginning this fall.

The new initiative, touted as the first of its kind, will allow many of Starbucks' 135,000 workers to graduate debt free from ASU with no requirement to repay or stay on with the company. The funding will come from a partnership between ASU and Starbucks.

ASU President Michael Crow is scheduled to appear in New York on Monday with Starbucks CEO Howard Schultz and U.S. Secretary of Education Arne Duncan to launch the Starbucks College Achievement Plan, as it is called.

Under the program, Starbucks employees who work at least 20 hours a week will receive full tuition reimbursement if they enroll in ASU's online program as juniors or seniors.

Others will be able to apply for scholarships worth $6,500, on average, if they enroll as freshmen or sophomores in ASU's online program. And ASU advisers will help them apply for other, need-based financial aid, including coveted Pell Grants, the university said.

In a phone interview, Crow said the partnership is a way to help students across the country graduate from college without debt.

"Starbucks decided human capital is one of the most important things they can invest in," Crow said. "Everybody is concerned about what are the ways to get through college."

In a news release, Schultz talked about "the fracturing of the American Dream." He said: "There's no doubt, the inequality within the country has created a situation where many Americans are being left behind. The question for all of us is, should we accept that, or should we try and do something about it."

In recent years, ASU has built its online program into one of the nation's largest, becoming a leader among public schools in a field that had been dominated by for-profits. This spring, about 10,000 students were enrolled fully online, of which about 6,700 were undergraduates. ASU offered 33 undergraduate and about 30 graduate programs online.

ASU's online programs have gained a national reputation as well. The university was the only school in the Pac-12 to have its online bachelor's-degree programs ranked in the top 10 by U.S. News & World Report in the publication's most recent survey.

ASU has structured its tuition prices for online so that the division is a moneymaker that helps subsidize other areas of the university. Online classes are less expensive to offer than traditional, in-person ones because there are fewer infrastructure costs and instructors can handle more students.

For online students, ASU undergraduate tuition ranges from $480 to $543 per credit hour, regardless of residency status, with no additional program fees. Students enrolled in 12 credit hours are considered full time.

Starbucks spokeswoman Laurel Harper said Starbucks' total investment in the program won't be known until the company sees how many students sign up. But about 70 percent of Starbucks workers — including those at Teavana, La Boulange, Evolution Fresh and Seattle's Best Coffee — are students or aspiring students, she said.

The program is the company's most significant investment in its workforce since it began a stock-sharing program in 1991, Harper said.

"Last year we were able to share $234 million with our partners (through stock sharing)," Harper said. "Over time, we are committed to a similar level of investment with the College Achievement Plan."

Enrollment in the program begins Aug.15, and students can start online classes Oct.15.

Harper noted that nearly half of college students drop out before graduating.

"We will focus on helping our partners cross the finish line and complete their bachelor's degrees," she said.