Reforming And/Or Reconfiguring Student Aid Programs
November 18, 2008 11:45 am Campus-Based Programs, Grants, Loans, SimplificationDuring recent NCI Listening Sessions, some have suggested a reform and reconfiguration of the existing Title IV programs. Several of these ideas appear below. Please review these ideas, and then express your thoughts on the current structure of the Title IV programs, whether it should be changed, and if so, how it should be changed?
- Some feel that the Title IV programs should be reformed to provide one grant, one loan, and one work assistance program. This would mean the elimination of the FSEOG and Perkins Loan programs, and possibly redirecting the funding to a larger Federal Pell Grant program. How do you feel about this idea?
- Alternatively, some suggest the campus-based programs be modified to combine the monies and provide those funds to schools in a “block grant” to be used any way the school desires for student aid or student retention and/or graduation enhancement programs. Do you agree?
- Those who argue against these consolidations of aid programs into single types or provision of block grants suggest it would result in a total loss of these federal appropriations or make them a juicer target in times of budget crises. What do you think of these arguments?
November 19th, 2008 at 9:13 am
I feel very strongly that we must do something to level the playing field in terms of student with self employed parents and their break that many receive on the FAFSA. We have tracked many of these self employed folks, and in reviewing the fianancial aid packages for many of these students we have certainly seen a trend developing. The trend is most of these stdudent only accept the gift funds and decline all loans, including the Plus Loans.
Compare this to dual wage earning families who have an efc of 4200…just outside Pell eligibility…these folks certainly have need…but most of these families will be forced to load their students up with huge amounts of loan debt.. Most aid administrators know this unfair situation exists, however, our hands have been tied since the Tax Reform Act of 1986. Many of the parents that we see, who are self employed, certainly have the ablilty to pay…but not the desire.
I also have some personal experience regarding business owners..having two brothers that are self employed.
All 3 of my brothers childern have attended four year public colleges no loans…they take the free or merit money and they pay the remainder of the bill.
We simply need to bring back home equity as a measure of a families ability to pay.
November 19th, 2008 at 9:37 am
Title IV programs should be reformed to provide one grant, one loan, and one work assistance program - at our school this would benefit many more students than to have a separate SEOG with only a small pot of money.
November 24th, 2008 at 8:04 am
I absolutely agree with Kirk. People who have $500,000 homes should not be Pell eligible and yet, that is what we see for self employed families. Not to mention all the personal expenses they run through their business and write off. If it wasn’t for our statement of expenses, which entails detailed work on our part, we would not be able to prevent abuse of these funds. Simplifying the FAFSA to run off IRS information will not change this problem.
I also agree that we should have one federal grant program to replace the various federal grant programs we have now. If they want students with science or language majors to have special funds then they should run it like they do the Gilman Scholarship and have students apply directly to them for the funds.
November 24th, 2008 at 10:17 am
I think that all of the grant programs should be combined into one program and given to more middle income students. I also feel that the loan program should stay in place however allowing for ALL applicants to get a certain amount of subsidized loan and anything over that amount to be undsubsidized for all applicants. It is not fair basing interest accrued on loan based upon a parents income. This puts students behind from the beginning and leaves them with a larger debt to pay.
November 24th, 2008 at 10:55 am
I agree with the one grant, one loan, and one work assistance program concept. This would allow for more efficient use of funds through consolidation, and be much less confusing to student applicants.
In the application process, I would eliminate the questions that have to do with enforcing other agency requirements such as selective service and drug convictions.
November 24th, 2008 at 12:19 pm
I agree with the one grant, one loan and one work study idea; however, I do not think eliminating FFELP for Direct is the answer.
I think that STUDENTS should have the option of selecting DIRECT or a FFELP lender when they complete the MPN. Still one “Stafford Loan” program, but DIRECT becomes a “lender” available in the program–not an institutionally-based provider.
I also think that capping federal aid at an average 2- or 4-year public school level would be a good idea. A commitment to provide at least a basic public college opportunity is commendable. A student can choose to attend a more expensive public or private college if they can pay for it (or receive institutional aid).
I like the idea of giving a student an award AT THE FEDERAL (FAFSA) LEVEL and letting them use it anywhere. Student completes FAFSA and brings me a voucher which they can use to pay. But they can’t get more than COA (or some similar type of figure). State or institutional aid could provide additional funds if available/necessary.
November 24th, 2008 at 3:31 pm
The idea sounds great but my concern is what are the side effects it will have on the student body. Will the government look at this as an opportunity to cut funding or charge us (students/parents) more money or take away some of our funding. Majority of our world have some type of conviction on their records these days. What are the plans for those students who have made a mistake in their lives and looking for a second chance? How can they benefit from this?
November 24th, 2008 at 3:43 pm
Congress wants things simple and then everytime they pass a law things are more and more complex. Creating new specialized programs creates a real burden on everyone. It requires more administration and is harder for students to understand.
I think we need more Pell Money and less ACG, SMART, TEACH. The SEOG formula is so skewed to expensive private schools that it is a joke.
We need one grant and one loan.
November 24th, 2008 at 5:23 pm
When Congress passes new laws pertaining to Title IV funding, they should take into consideration how it will effect Financial Aid Offices and their ability to serve students. New programs, new regs, more paperwork means less time for students. Federal grants should be combined into only one program and Financial Aid Administrators should be given the authority to administer the program with one set of guidelines, not five different grants with five sets of rules.
Isn’t it about time for middle income familes to receive something other than loans? They pay the majority of the taxes but receive nothing. Right now, families who pay no taxes and whose children refuse to work, are the ones who benefit most from taxpayer’s money, not the taxpayer’s children. Something needs to change.
November 24th, 2008 at 7:37 pm
I can’t say that I like the idea of consolidating all federal aid into one grant, one loan, and a work-study program. Really, the one grant would be the problem. While I would definitely (!) cut the TEACH Grant before students get hit with the dark side, and even cut SEOG and funnel it into Pell, I like ACG and SMART grants. Merit should not always be a factor for aid, but exemplary students who have need should receive some extra help for their efforts, and the government should be encouraging students to go into critical programs like math and computer science (and this coming from a BA in literature and philosophy!).
I couldn’t support cutting the Perkins loan either. Our office uses that to supplement some specific programs, like nursing, where we don’t have enough gift aid to really support those students who need it.
The idea of combining campus-based aid into one block-grant to be used “any way the school desires” seems bad. The financial aid office talks to our students and knows which ones are hurting for money; we would like to give it to them. “Retention” funds, however, with no caveats, don’t usually come to us, so we have no say in where, or to whom, they go.
November 25th, 2008 at 8:41 am
At a minimum, grants such as the ACG, SEOG and Pell grants should be combined in to one portable grant. Any money that we can get for students is good but consideration of the benefit versus the cost of administration should be weighed.
Particularly with the ACG, we see students with extremely good grades who did not have a foreign language offered at their rural school and do not qualify. Whereas other students fail then re-take classes and qualify for ACG1 with D’s and rarely, if ever, can attain the 3.0 GPA to receive the 2nd year award.
Hopefully, ACG will “sunset” after its 5 yr. appropriation has expired.
November 25th, 2008 at 11:16 am
The federal college loan program should be rebuilt with a focus on the borrower as a “consumer.” To date, the major focus of the FFELP vs. DL debate has been about delivery systems and which program costs the government less. But the debate has missed the bigger issue, which is that the federal student loan borrower has consumer rights to choice and education debt management
As BGRick states above, combining FFELP and DL into one program with one delivery system, where students can choose to borrow from a private lender or the government, makes the most sense. Student loan lenders, guarantors and the government could then compete on what matters — helping students and parents to manage the debt they must incur for college.
Federal student loan guarantor American Student Assistance has put forth a proposal to unify FFELP and DL. Read the entire proposal at: http://www.amsa.com/policy/issues/unifyingstudentloanprograms.cfm
December 1st, 2008 at 5:01 pm
Yes, please take away ACG and SEOG and TEACH and SMART and CAMP, MCNAIR, SSS, ETC. Put all those funds into Pell and make more people eligible for Pell!
Yes, have one loan program that supports students (not lenders) and offer significantly higher annual limits and much lower interest rates (2%)…eliminating lender subsidies would pay for it!
Work Study is great but the distribution of funds is so inequitable, it doesn’t make a lot of sense. Perhaps the amounts can be increased for schools based on the number of poverty level students in attendance…!
December 2nd, 2008 at 8:48 am
A reconfiguration on how federal student aid is delivered is long overdue.
1). Eliminate ACG/SMART/SEOG and move these appropriated funds to the Federal Pell Grant Program.
2). Reinstate FCC to Federal Perkins Loans so that the neediest of students continue to benefit from this low-cost borrowing option.
3). Increase Stafford Loan limits with shared risk on program participants. FAA’s have an obligation to make sure that students are borrowing wisely. Institutions with high default rates, low graduation rates, and low program completion rates should share the responsibility for managing and repaying defaulted loans granted by such institutions. While the rising cost of higher education is now subject to new reporting requirements, cost reductions are near impossible for tuition-driven institutions with limited endowment; operational expenses alone force cost increases. Thus, with increased loan limits, students will benefit from a federal program (not private/alternative) that closes the gap between cost and aid. Institutions with shared risk to participate in such loan programs will need to implement added measures for both educating students to borrow wisely as well as control costs so that loan funds are not borrowed in excess.
December 9th, 2008 at 8:02 pm
I agree, we need to expand Pell to the lower middle class families..perhaps those with EFC’s from 4100-6500 or so who would benefit greatly.
TEACH needs to go away or if you really want to encourage students to go into teaching simplify the program and reduce the amount of time they need to teach to one year for every year they receive the grant. Also a student should be accepted into the schools teaching program increasing the chances that the student will go into teaching. Since the studentcan only now get these funds for 2 years reducing loan burdens if it turns into a loan.
ACG and SMART are labor intensive programs. Scrap ACG and roll it into Pell to help serve more middle class students.
SMART is encouraging certain majors and good grades, keep this one but again increase the maximum EFC number so it will widen the range of students who can receive this grant.
As far as a simplified FAFSA, great for those who file a 1040EZ or 1040A, then tighten up the form for those who do a 1040 to uncover those who are finding ways to “hide” their wealth.
Get rid of Perkins loans and add money to Stafford Program.
Right now FAA’s are not allowed to tell students “no” to loans, yes we counsel students but if they say they want that money we cannot stand in their way. Schools should not be punished if they are not allowed have a say on the “rules” that are used to give out the loans.
December 23rd, 2008 at 2:53 pm
One federal grant, one federal loan, and one federal work-study program. That is simplification! The states can add their programs on top and that’s already enough confusion for families and students.
Stop trying to use aid programs to fix society’s ills (trying to encourage more people to go into teaching by offering some lame grant/loan when they are 20). Stop using work-study for community service. That’s like double dipping….can’t take credit for both. If you want community service programs, fund the peace corps. If you want to help students work for money for school, leave on campus employment as a 100% option. The value to the student’s success of working on campus in any job is great; they develop skills and form a deeper connection with the institution.
April 11th, 2010 at 8:55 am
Не ломай себе голову над этим!…
Руководитель проекта
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April 20th, 2010 at 4:12 am
Это весьма ценное мнение…
Помощник руководителя During recent NCI Listening Sessions, some have suggested a reform and reconfiguration of the existing Title IV programs. Several of these ideas appear below…..
May 18th, 2010 at 10:08 pm
Имеются ли аналоги?…
оператор Пк During recent NCI Listening Sessions, some have suggested a reform and reconfiguration of the existing Title IV programs. Several of these ideas appear below…..
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