• Cooper Union for the Advancement of Science, in the heart of New York City, is returning to full-tuition scholarships for all graduating seniors over the next four years.
• The college is working its way back to providing free tuition for every student — a promise it was founded on.

In a move years in the making, the Cooper Union for the Advancement of Science announced Tuesday a return to full-tuition scholarships for all graduating seniors.

The New York City-based private college, founded in 1859, had long been tuition-free for all grade levels. But in 2014 it dialed back its longtime commitment that education be "as free as air and water" and began offering students only half-tuition scholarships.

A few years later, the school presented a 10-year plan to restore full-tuition scholarships through saving, cost cutting and fundraising. Now roughly half of the student body attends tuition-free, and, on average, undergraduates pay less than 15% of the college's $44,550 tuition, according to the school. There are currently 891 undergraduate students enrolled, including 228 seniors.

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"In 2018, we began an ambitious journey to provide full-tuition scholarships for all of our undergraduate students," outgoing school President Laura Sparks said in a statement. "Thanks to the generosity of three extraordinary alumni donors, we are removing a major financial burden for our graduating classes and reaffirming the ideals that have been foundational to this institution since Peter Cooper opened its doors in 1859." (Cooper was an industrialist and philanthropist who, before founding Cooper Union, also invented the first American steam train in 1829.)

Current seniors will receive refunds for any tuition payments made for the fall semester and will not have to pay for the spring semester. First-, second- and third-year students will receive full-tuition scholarships in their senior years, according to the school.

"Cooper has long been a leader in full-tuition scholarships for all students, dating back to its founding," said Robert Franek, editor-in-chief of The Princeton Review. "This decision is a massive step forward to fulfilling that goal."

Colleges and universities are struggling

When Cooper Union began offering students only half-tuition scholarships, there was an initial drop in applicants. The decline in total applications and increase in the number of students admitted caused the acceptance rate to jump to 14.4% that year, up from 7.7% a year earlier. Currently, the college has an acceptance rate of 12%.

Other schools, too, have been under pressure from declining enrollment. Not only are fewer students interested in pursuing any sort of degree after high school, but the population of college-age students is also shrinking, a trend referred to as the "enrollment cliff."

Steadily, college is becoming a path for only those with the means to pay for it outright, other reports also show. The rising cost and ballooning student loan balances have become a massive burden for undergraduates and their families, resulting in a college affordability crisis across the board.

As a result, many colleges and universities are struggling amid fewer students and declining tuition revenue, according to Colin Hatton, senior consultant of NEPC's endowments and foundations team.

"The higher educational system is under stress," Hatton told CNBC earlier this year.

Making college affordable could help

To stay competitive, some institutions are trying to make college more accessible, in part by eliminating education debt from the outset. 

Such efforts could likely result in more students applying, which can also boost a college's yield — or the percent of students who choose to enroll after being admitted — which is an important statistic for schools, according to Franek. It could also help the bottom line.

Meanwhile, New York state has been trying to get more graduating high school seniors interested in attending the state's public colleges through automatic acceptance letters and its own free-tuition program.

The Excelsior Scholarship applies to all schools at City University of New York and State University of New York. It was the first in the nation to cover four years of tuition without being tethered to academic performance, although research shows only a fraction of eligible students are Excelsior recipients.

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