In the United States, education through the 12th grade is free and compulsory. But is this actually the case?
For me and most other students, my education until high school was relatively inexpensive, with the only costs being notebooks and pencils. This all changed once I started high school, and AP courses, the College Board, and the SAT came into my life.
AP courses allow students to study college-level material and take a test to potentially earn college credit. While not a necessity to graduate high school, for those looking for a leg up in college admissions, it is compulsory.
This is becoming more and more the case as more students plan to go to college than ever. This is because, for Gen Z, a college degree is becoming one of the few ways to ensure you can one day earn a living wage. The rate of high school graduates attending college has risen, with 66% of 2019 high school graduates enrolled in college by October of 2019.
With more students than ever planning to enroll in college following high school, AP courses have seen massive growth. In 2018 1.24 million students took at least one AP exam equaling 4.22 million total AP exams. This represents 38.9% of the graduating class of 2018 taking at least one AP exam, which is 65% higher than in 2008 when only 25.1% of students took at least one exam. To take an AP exam and potentially earn college credit, the cost per exam for students in North America is $95.
For those students looking to apply to colleges, the cost doesn’t end there as most colleges require an SAT or ACT score. The ACT costs $55, or $70, with the writing component that is required by many colleges. The SAT is slightly cheaper at $52 or $68 with the SAT essay.
But that’s not all. For instance, the SAT has a 15$ fee to register or hear your scores by phone. However, the most egregious way that the SAT and ACT take additional money from you is through the fees they charge to send your SAT scores to colleges. The SAT sends your scores to four schools for “free” and charges $12 for each additional school, despite scores being sent electronically through an automated system. The ACT follows a similar approach but instead charges $13 per additional school.
Many people might read how expensive the SAT and ACT are but defend them, stating that they are an excellent way to judge college success or that they help in the admissions process. In reality, the only thing that SAT and ACT scores show is your family’s wealth and race.
In 2019 the average SAT score of someone whose family makes less than $20,000 a year was 970 compared to 1230 for students whose families earned over $200,000. There are many reasons for the inequities in the SAT and ACT, but the greatest one is the test prep programs that wealthier students pay for, with some parents paying as much as $10,000 in test prep. Because of this, the test prep and tutoring industry is massive, being valued at $1.1 billion, with exam prep making up 25% of this.
One silver lining is that recently due to COVID, most colleges have adopted a test-optional policy for the class of 2021 and 2022. Some colleges have gone further and are planning to permanently shift away from the SAT and ACT. One example is the UC system which adopted a test blind policy following lawsuits claiming the SAT and ACT to be racist.
With this complicated education industry of SATs, SAT subject tests, exam prep, and AP courses, there is a substantial amount of money to be made. The largest company to profit from this system is the College Board, which profited over $139 million in 2017 with an 8.6% profit margin, which is slightly higher than the average 7.71% profit margin. Additionally, the College Board had over $1.1 billion in investment and cash in 2017. All of this is despite the company being labeled a “non-profit,” allowing them to not pay any taxes.
The CEO of the college board, David Coleman, is reported to have a base salary of $550,000 with total compensation of $750,000 as of 2012. Coleman took over the position in 2012 following criticism over the previous CEO, Gaston Gaperton’s salary of $1.3 million. The executives working for Coleman have also been reported to earn average salaries of $300,000, with other College Board members making between $90,000 and $181,000.
At this point, you might be wondering how the College Board can make this much money and still be registered as a non-profit. This has everything to do with how tax laws work in the US, which is far too complicated to go into. Essentially, it has to do with how their profits are invested and