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The 2014 National Student Aid Profile: Overview of Federal Programs

This presentation covers federal financial aid programs, need analysis, and NASFAA tools, among other topics.


on 24 June 2015

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Transcript of The 2014 National Student Aid Profile: Overview of Federal Programs

The 2014 National Student Aid Profile: Overview of Federal Programs
2014 National
Student Aid Profile

NASFAA Policy Department
Justin Draeger, President
Joan Berkes, Senior Policy Analyst
Karen McCarthy, Senior Policy Analyst
Megan McClean, Managing Director for Policy and Federal Relations
Jesse O’Connell, Assistant Director for Federal Relations
Blondeen Philemond, Policy Intern
Charlotte Pollack, Research Analyst
Presentation Overview
Brief History of Federal Government's Role in Student Aid
Higher Education Today
Federal Financial Aid Programs
History of Federal Government's Role in Student Aid
History of Federal Government's Role in Student Aid
Morrill Act of 1862
Land Grants to fund state colleges

"G.I. Bill" - Servicemen's Readjustment Act of 1944
Educating and retraining returning servicemen
History of Campus-based Aid
Federal Perkins Loan Program
Sputnik, 1957
National Defense Education Act of 1958
Federal Work-Study Program (FWS)
Economic Opportunity Act of 1964
FSEOG Program
Federal Supplemental Educational Opportunity Grant
Higher Education Act (HEA) of 1965
created precursor program (Educational Opportunity Grant - EOG)
HEA Amendments of 1972 replaced EOG with FSEOG
History of FFEL and DL
FFEL (Federal Family Education Loan)
Higher Education Act (HEA) of 1965
PLUS (Parent Loans for Undergraduate Students
Higher Education Amendments of 1980
DL (Direct Loan)
Higher Education Amendments of 1992
History of Pell Grant Program
Higher Education Amendments of 1972
Basic Educational Opportunity Grant
Program (BEOG) or Basic Grant
Renamed after Senator Claiborne Pell
Senator Claiborne Pell
Higher Education Today
Quick Stats:
62% of total students are full-time
41% of total students are 18-24 years old
57% of total students are women
More than 74% of Pell Grant recipients had a family income of less than $30,000 in 2011-12

Nearly 34.2 million FAFSA applications, 2012-13
71% of the total amount of federal student aid was Title IV Federal dollars
105% increase over 10 years of total amount of Title IV federal student aid
$82.7 billion, 2002-03
$169.7 billion 2012-13
Free Application for Federal Student Aid (FAFSA)
FAFSA Filing Process
Free Application for Federal Student Aid (FAFSA) is the central element of the federal student aid application process
FAFSA data is used to:
1) Compute the expected family contribution (EFC)
2) Confirm certain student eligibility criteria via database matches with federal agencies
There are multiple ways of filing the FAFSA:
FAFSA on the Web (FOTW)
Financial Aid Administrator (FAA) Access to Central Processing System (CPS) Online
The paper FAFSA
FAFSA on the Phone
Internal Revenue Service Data Retrieval Tool
Process enables students and parents to transfer tax return information from IRS website directly to FOTW application
IRS Data Retrieval Tool also available for corrections
Available February 2, 2014 for 2014-15 processing cycle
Federal Aid Available for Packaging:
Pell Grant
Perkins Loans
Direct Loans
Iraq and Afghanistan Service Grant
CPS database
CPS sends info to student, school, and state
School Packages Student
Federal Student Aid Today: A National Profile
output sent to:
Student Aid Report (SAR)
Institutional Student Information Record (ISIR)
State Agency
Institutional Student Information Record (ISIR)
Federal Pell Grant Program
"Foundation" of aid package
awarded to undergraduate students with lowest EFCs who have not already earned a baccalaureate degree
Unaffected by student's other aid
For 2014-15
Maximum award is $5,730
Minimum award is $587
Campus-Based Programs
Annual appropriation is allocated among participating institutions
Statutory formula
Institutions must apply by Oct 1 (FISAP)
School awards funds to eligible students based on program requirements
School may draw cost allowance to offset costs of administering campus-based and Pell programs
Federal Supplemental Educational Opportunity Grant Program (FSEOG)
Awarded to undergraduate students with lowest EFCs who have not already earned a baccalaureate degree
Priority is given to Pell Grant recipients
Award must be made in order starting with lowest EFCs
Schools must contribute at least 25% of funding, with limited exceptions
Schools may transfer up to 25% of allocation to Federal Work-Study Program
Federal Work-Study Program (FWS)
Schools must award FWS employment "to the maximum extent practicable, that will complement and reinforce each recipient's educational program or career goals
Campus-based program
School generally must match allocation with its own funds, 75% federal, 25% school
Institutional share varies by nature of job or employer
Some schools exempt from matching
Match can also be "in-kind"
FWS employers may be:
The school itself
Limitations if the school is for-profit
A Federal, State, or local public agency
A private nonprofit organization
A private for-profit organization
Earnings must be monitored to avoid exceeding award
Student may be paid up to $300 over need
This is basis for campus-based over-award tolerance when student gets unanticipated additional aid
Additional flexibility:
Carry forward (10% limit)
Carry back (10% limit unless for summer)
Transfer to FSEOG and/or Perkins (25% limit)
Federal Perkins Loan Program
Provides low-interest loans to financially needy students attending institutions of higher education to help them pay their educational costs.
Campus-based program Revolving Fund
Federal Capital Contribution (FCC)
Institutional Capital Contribution (ICC):
1/3 of FCC
Collections on previously made loans
Reimbursements for loan cancellations
Up to 25% of allocations (FCC) may be transferred to FSEOG and/or FWS
Undergraduate, graduate, professional students
Priority must be given to exceptionally needy students
School defines "exceptionally needy"
Willingness to repay
Loan limits are listed on NASFAA's Student Aid Reference Sheet
Interest rate: 5%
Interest begins to accrue when repayment begins
9 months after borrower is no longer enrolled at least half-time
Repayment period: 10 years
No interest accrues during deferment or 6-month post-deferment grace period
In school and certain fellowships or rehab
While in service eligible for loan cancellation
While seeking but unable to find employment
Economic hardship (including Peace Corps)
Certain military service
Loan discharged if borrower dies, becomes permanently or totally disabled, or manages to pass bankruptcy requirements
Loan canceled for certain types of employment, volunteer activities, or military service
Direct Loans
William D. Ford Federal Direct Loan Program
Umbrella for four loan programs:
Federal Direct Stafford/Ford Loan Program
Federal Direct Unsubsidized Stafford/Ford Loan Program
Federal Direct PLUS Program
Federal Direct Consolidation Loan Program
William D. Ford
Robert T. Stafford
Direct Loans
Direct Subsidized Loans
Direct Unsubsidized Loans
Direct Stafford Loans
Stafford Loans
Subsidized Stafford Loans
Unsubsidized Stafford Loans
Direct Subsidized Loans
Undergraduate Students
- Prior to July 1, 2012, graduate/professional students
- COA minus EFC minus other aid, up to applicable limit
Interest accrues but is paid by the federal government during periods of study or deferment
Direct PLUS Loans
Graduate, professional students
Parents of dependent undergraduate students
- COA minus other aid, no limit
Interest accrues and is payable, but may be capitalized during periods of study or deferment.
Direct Unsubsidized Loans
Undergraduate, graduate, professional students
- COA minus other aid, up to applicable limit
Interest accrues and is payable by borrower, but may be capitalized during periods of study or deferment
Direct Loan Summary
Loan limits: See the Student Aid Reference Sheet
1 Grace period: period after borrower graduates, leaves, or falls below half-time status
2 Grace Period Interest Subsidy is temporarily eliminated on Direct Subsidized Loans during the six month grace period. This change is effective for new Direct Stafford Loans for which the first disbursement is made on or after July 1, 2012, and before July 1, 2014.
Direct Loan Repayment Plans
Income-Based (except parent PLUS)
Income-Contingent (except parent PLUS)
Repayment Features
Need Analysis
Definition of Need:
Cost of Attendance (COA)
Expected Family Contribution
Eligibility for non-need-based programs (Direct Unsubsidized and PLUS loans) does not consider EFC
COA and EFC defined in Part F of the HEA, Title IV
Professional Judgment
ED may not regulate
Tuition and fees
Books and supplies
Room and board
Transportation, miscellaneous personal expenses, personal computer
Dependent care costs
Costs related to disability
Loan fees
Calculated as a dollar amount
Often viewed more as a rationing device
Three EFC models
with dependents
other than a spouse
with no dependents
other than a spouse
Married, no children or other dependents
(full data element)
(excludes assets)
One EFC short cut: Automatic Zero EFC (Auto Zero)
Two EFC formulas
Parental AGI (or earnings for non-filer) under $50,000
Parents were not required to file 1040 long form, or family member received means-tested Federal benefit, or parent is a dislocated worker
For independent student, apply tests to student and, if married, spouse
Applicable to dependent model and independent with dependents model
AGI of parents (or independent student and spouse) was no greater than $24,000 (for 2014-15)
Same tax filing criteria as for simplified
Expected Family Contribution (EFC)
Cost of Attendance (COA)
Need Analysis Continued
Independent students with dependents
Independent students with no dependents
Parent's Contribution
Student's Contribution
Dependent Student's EFC
Budget and Appropriations Update
Maximum Pell Grant for award year 2014-15: $5,730
Impact of sequestration for upcoming award year:
Direct Loans & Origination Fees
Iraq Afghanistan Service Grants
How will sequestration impact future award years?
For Members
For the Policy Community
Student Aid Index
Today's News
Policy White Papers
NASFAA University
National Conference
Code of Ethics & Code of Conduct
Self-Evaluation Guides
Policies and Procedures Tools
Journal of Student Financial Aid
Resources and Q&A
NASFAA Mission Statement: The National Association of Student Financial Aid Administrators supports the training, diversity, and professional development of financial aid administrators; advocates for public policies and programs that increase student access to and success in postsecondary education; and serves as a forum for communication and collaboration on student financial aid issues.
NASFAA Statement of Ethical Principles
-Please see handout
2014 National Profile of Programs in Title IV of the Higher Education Act
For students, parents, and counselors information can found on the NASFAA website
Contact Information
Justin Draeger: draegerj@nasfaa.org
Megan McClean: mccleanm@nasfaa.org
Jesse O'Connell: oconnellj@nasfaa.org
Joan Berkes: berkesj@nasfaa.org
Karen McCarthy: mccarthyk@nasfaa.org
Charlotte Pollack: pollackc@nasfaa.org
Blondeen Philemond: philemondb@nasfaa.org
Richard Heath: rcheath@aacc.edu
Federal Appropriations in Current and Inflation-Adjusted Dollars (in Millions), 2002-03 to 2012-13
SOURCE: U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS), Spring 2001 through Spring 2013.
Source: The College Board, Trends in Student Aid, 2013.

SOURCE: U.S. Department of Education, Federal Pell Grant Program End-of-year Report, 2011-12.

Need Analysis
Budget and Appropriations
HEA Reauthorization
Resources and Q & A
FY 2015 Budget and Appropriations
HEA Reauthorization
Senate Bills
House Bills
Major Themes
Competency-Based Learning
Predictions for movement?
Budget and Appropriations Update Cont'd
Financial Aid Administrator: Rich Heath, Director of Financial Aid & Veteran's Benefits at Anne Arundel Community College
Final Step: School packages student
SOURCE: U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS), Fall 2000 through Fall 2012, Institutional Characteristics component.
Federal Appropriations for the FWS Program in Current and Inflation-Adjusted Dollars
(in Millions), 2002-03 to 2012-13
Source: The College Board, Trends in Student Aid, 2013.
Federal Student Loan Volume (Inflation-Adjusted Dollars, in Millions), 2002-03 to 2012-13
Source: The College Board, Trends in Student Aid, 2013.
Full transcript