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Starbucks tuition deal not as simple as seems

Starbucks contribution to online degree program more complicated than it may seem


Starbucks workers who attend Arizona State online receive a discount in tuition their freshman and sophomore years. Starbucks will reimburse them their junior and senior years.


NEW YORK — The scholarship portion of a new education program Starbucks is offering to help workers pay for an online degree consists entirely of a discount from Arizona State University and not money from the chain.

The Seattle-based company this week unveiled a benefit that is designed to let college juniors and seniors earn a degree from ASU at no cost. For the freshman and sophomore years, workers would pay a reduced tuition. Workers who are admitted to ASU could pick from 40 degrees and wouldn’t be required to stay with Starbucks after graduation.

A major aspect of the program is an upfront scholarship Starbucks said is an investment between itself and Arizona State University. When asked how much of that scholarship the company is providing, Starbucks initially said terms weren’t being disclosed.

Following the announcement, however, Arizona State University President Michael Crow told the Chronicle of Higher Education that Starbucks is not contributing any money. Instead, Arizona State will charge workers less than the sticker price for online tuition.

Starbucks said Thursday that the scholarship is a reduced tuition rate. It estimates the reduction in tuition would average about $6,500 over two years to cover tuition of $30,000.

To cover the remainder in the freshman and sophomore years, workers would apply for federal aid and pay for the rest either out of pocket or by taking out loans.

For the junior and senior years, Starbucks would reimburse workers for whatever tuition they had to cover.

Matt Ryan, chief strategy officer for Starbucks, said on Thursday that for a worker’s junior and senior years, the company could potentially cover up to 58 percent of the tuition. If workers did qualify for grants, he said Starbucks could be responsible for very little, if anything. He noted that workers’ financial situations can vary greatly.

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