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PRESENTATION TO THE CALIFORNIA STUDENT AID COMMISSIONERS

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Title: PRESENTATION TO THE CALIFORNIA STUDENT AID COMMISSIONERS


1
PRESENTATION TO THE CALIFORNIA STUDENT AID
COMMISSIONERS
  • California Association of Student Financial Aid
    Administrators (CASFAA)
  • California Community College Financial Aid
    Administrators Association (CCCSFAAA)
  • California Lenders for California (CLFE)

2
History of Financial Aid
  • Financial Aid began in the Private Sector
  • Private Colleges Harvard College in the
    1600s. No Public Funds until much later.
  • Federal Government
  • 1944 GI Bill enacted by Congress to assist WWII
    Veterans returning from the war.

3
  • 1958. The Soviet launch of Sputnik gave Congress
    the occasion to justify a limited form of student
    assistance in the name of national security. The
    National Defense Education Act of 1958 provided
    low-interest loans for college students, with
    debt cancellation for those who became teachers
    after graduation. (NDSL to Perkins Loans)

4
1965. The Kennedy legacy, the civil rights
movement, and the Johnson Administration's War on
Poverty converged in the mid-1960s. The 89th
Congress presided over the broadest sweep of
social legislation since the New Deal. Along with
breakthroughs in civil rights came large-scale
aid to education, including the Higher Education
Act . (Federal Student Aid Policy History and
an Assessment Lawrence E. Gladieux)
5
  • California
  • 1955 Creation of the California State
    Scholarship Commission
  • Cal Grant Program Fueled by the GI Bill
    benefits, the numbers of students in California
    pursuing post-secondary education exceeded
    available class room space at public
    universities. Rather than building more
    campuses, the state created a scholarship program
    with funding that students could use at private
    institutions institutions which had available
    classroom space.
  • The Scholarships were portable meaning the
    students took them to the institution of their
    choice.

6
Today California Student Aid Commission 2006
Cal Grant Tuition/fee amount at private
postsecondary institutions 9708 Cal Grant
Tuition/fee amount at University of
California 6141. Cal Grant Tuition/fee amount
at California State University 2520. Cal
Grant B access grant 1551 Cal Grant C Books
and supplies Tuition
3168
7
History Of Need Analysis How to determine how
much to award a student
  • 1954 The College Scholarship Service, founded
    by private colleges, developed a standard need
    analysis formula to award scholarship money.
  • 1957 A national system of analysis was being
    used.
  • 1974 A uniform need analysis was used to award
    private and government money.

8
The Formula is used to determine how much a
family can be expected to contribute to their
students education
  • CSAC used uniform need analysis to award Cal
    Grant funds.
  • Today, CSAC uses the current need analysis, known
    as federal methodology (FM), to award to Cal
    Grant funds.

9
What is included in the Formula?
  • Income from all sources (past year year ahead)
  • Parents employment status
  • Number of Dependents
  • Federal income taxes
  • State income tax
  • Included reported assets and indebtedness
  • Assets
  • Family Size
  • Number of children in college
  • How many parents working
  • Age of the older parent

10
Cost of Attendanceor The Student Budget
  • COA is defined in HEA Sec. 472 where RULES are
    set by federal law and the actual BUDGETS are set
    by the colleges.
  • Budgets must include tuition, fees, books,
    supplies, room and board, transportation,
    miscellaneous personal.
  • May also include child care, disability related
    expenses, computer expenses.
  • May be increased or decreased by the college for
    an individual student if justified and documented
    and in accord with federal regulations.

11
CSAC assists budget determination in California
  • Student Expense and Asset Survey (SEARS)
  • Collects Students data every four years
  • Based on data determines average expense for
    students
  • Transportation
  • Housing and Food
  • Personal expenses
  • Books and Supplies
  • Many Colleges use some or all of these figures,
    relying on CSAC documentation to meet federal
    requirements to support their budget figures.

12
The Financial Aid Process
13
Goals of Financial Aid
  • Institutions desire to
  • Provide ACCESS and CHOICE.
  • Conduct an accurate and fair assessment of the
    familys ability to pay for college.
  • Promote equity by assuring funds go to the
    neediest students first.
  • Promote efficiency by making the process work for
    all students.
  • Be accountable for tax dollars and institutional
    funds.

14
Financial Aid Process Outline
  • Student requirements for obtaining financial aid
  • Documents the student will receive (CAR, FAN),
    and from whom
  • Significance of each document, and how they
    relate to one another

15
The Initial Process Filing the FAFSA
  • Each student must complete and file a FAFSA (Free
    Application For Federal Student Aid) annually
  • Deadlines
  • FAFSA
  • CAL Grant
  • Parent and student income requirements
  • List of schools

16
The Basic Formula
  • This formula guides the college award process,
  • Determines eligibility for every student,
  • And is enacted and regulated by federal and state
    authorities while being implemented by the
    college
  • Cost of Attendance
  • Minus Expected Family Contribution
  • Equals Need

17
Cost of Attendanceor The Student Budget
  • COA is defined in HEA Sec. 472 where RULES are
    set by federal law and the actual BUDGETS are set
    by the colleges.
  • Budgets must include tuition, fees, books,
    supplies, room and board, transportation,
    miscellaneous personal.
  • May also include child care, disability related
    expenses, computer expenses.
  • May be increased or decreased by the college for
    an individual student if justified and documented
    and in accord with federal regulations.

18
Expected Family Contribution
  • The EFC is calculated by the federal processor
    from the data on the FAFSA.
  • The formula is determined by federal law and
    adopted for California use by state law.
  • It includes both the student and the parent(s)
    ability to pay for a 9-month time period.
  • Is sent to the college electronically on an
    ISIR.
  • The EFC may be adjusted at the campus level based
    on verified information or special student or
    parent circumstances.

19
Determination of Eligibility
  • The college determines the budgets (COA) and
    places the student in an appropriate cost
    category.
  • The college receives an ISIR and verifies the
    students EFC.
  • COA - EFC Cal Grant Eligibility (Need)
  • The college now works to find funding sources to
    fill the eligibility in a process called
    packaging.
  • See the sample of Determination of
    Eligibility on the next slide...

20
How The Formula Works
  • CC CSU UC Private
  • Cost 15,000 18,000 20,000
    47,000
  • EFC - 2,600 - 2,600 - 2,600
    - 2,600
  • Need 12,400 15,400 17,400
    44,400
  • In the best of all possible worlds, full need
    will be met with a financial aid package that is
    made up of grants and scholarships along with
    reasonable amounts of work and loan

21
COA - EFC Federal Need
22
CAL Grant GPA Verification
  • This is a CAL Grant process requirement
  • Filing date is November - March 2nd
  • Student files individually
  • Most High Schools and Institutions submit the GPA
    verification document electronically for all
    enrolled students

23
The California Aid Report (CAR)
  • The student receives a CAR directly from The
    California Student Aid Commission (CSAC) based on
    information provided on the FAFSA and GPA
    Verification.
  • Identifies the CAL Grant (A, B, and C) for which
    the student is eligible

24
The Financial Aid Notice (FAN)
  • The student will receive a FAN directly from the
    campuses for which they have applied and have
    been accepted
  • Provides the student with a complete financial
    aid award package
  • Indicates what open requirements the student may
    have

25
Financial Aid Notice (FAN) Details
  • Cost of Attendance (COA)
  • 9 month budget
  • Expected Family Contribution (EFC)
  • Awards being offered
  • Federal (PELL Grant, SEOG, Loans, Work-Study)
  • State (CAL Grant Estimates)
  • Campus (Grants, Scholarships, Loans)
  • Outside Aid (Independent Scholarships, Tuition
    Assistance, Fee Waivers)

26
Sample UC Davis Financial Aid Notice (FAN)
  • COA 20,256
  • EFC - 0
  • Need 20,256
  • -Pell Grant - 4,050
  • -Cal Grant A - 6,141
  • Need 10,065
  • Loan - 4,500
  • Work - 4,000
  • Need 1,565
  • UC Grant - 1,565
  • 0

27
Financial Aid Notice - Open Requirements
  • Verification Process
  • Loan Documentation/Entrance Loan Counseling
  • INS-Citizenship
  • Selective Service
  • Social Security Number

28
Accountability
  • The colleges are held accountable by many
    authorities
  • USDE conducts thorough program reviews.
  • Congress requires every college to contract for
    an annual review (with results submitted to
    USDE).
  • The federal government conducts other
    miscellaneous reviews (INS, IRS, Inspector
    General, etc.).
  • CSAC conducts grant audits.
  • EdFund conducts loan reviews.
  • USDE follows-up on consumer and student
    complaints.
  • Proprietary Institution administrators have to be
    certified by the State of CA and fall under
    closer scrutiny than other segments.

29
Summary of Delivery
  • The college is the bottom line in the student aid
    process -- both for the students and for the
    government agencies.
  • The college receives data, works individually
    with students, parents and families, verifies and
    documents the financial data and other
    eligibility features (citizenship, residency,
    etc.), determines eligibility, selects funds for
    the student aid package, determines unit load and
    eligible programs and determines continuing
    eligibility.

30
Summary of Delivery - Continued
  • Delivery systems (other than Cal Grant) differ
  • For Pell Grant, colleges identify eligible
    recipients from among all applicants based on set
    EFC criteria.
  • For FSEOG, FWS, Perkins Loan, and State Work
    Study colleges select recipients from among
    eligible students.
  • For most loans, colleges provide access to
    capital.
  • For segmental programs, colleges select
    recipients from among eligible students (when
    funds are limited) or identify recipients when
    funds are available to all eligible students.
  • However, all of these programs have something in
    commonthe college names the recipients, not the
    federal or state government.

31
WHO ARE WE?
  • CASFAA
  • CCCSFAAA
  • CLFE

32
CASFAA
  • CASFAA is a non-partisan, non-profit professional
    organization with a membership of more than 1700
    California student financial aid administrators
    (and financial aid administrators from other
    states who can belong as Associate members).
    Representing more than 500 colleges and
    universities, its members share a common goal of
    improving access to and delivery of federal,
    state, institutional and private donor financial
    aid to students in the State of California.

33
CASFAAMISSON STATEMENT
  • It is our mission to provide training and
    professional development opportunities to the
    financial aid community and to advocate on behalf
    of the financial aid profession for student
    educational access and choice.

34
CASFAAVision Statement
  • CASFAA will
  • Serve as a resource for all financial aid
    professionals in California.
  • Provide members with opportunities to become
    actively involved in the activities of the
    Association.
  • Prepare members to assume leadership roles in the
    student aid profession, the Association, and
    other financial aid associations.
  • Serve as an authority in the State on student aid
    issues and be consulted regularly by Federal and
    State policy makers, the media, and other
    educational partners and
  • Be proactive with regard to positions on State
    and national financial aid policy issues, and in
    protecting the interests and rights of California
    students for educational access and choice.

35
CCCSFAAAMission Statement
  • The California Community Colleges Student
    Financial Aid Administrators Association is
    founded on three fundamental principles that
    define the mission of the Association
  • First, accessibility to higher education is
    essential to the development of human potential
    and the human condition and financial aid is an
    essential access vehicle to higher education and
  • Second, that the effective administration of
    financial aid programs require accurate, current
    and focused information on federal and state
    legislation and regulations governing student
    financial aid programs and
  • Third, communication between members of the
    profession, government agencies, and private and
    community organizations is critical to the
    development of effective financial aid programs
    and the advancement of the profession.

36
CCCSFAA MISSION(continued)
  • To achieve this mission, the Association will
  • Provide training through regional meetings,
    workshops, statewide conferences and other
    related activities and services
  • Keep the membership apprised of changing
    legislation, regulations and policies and
    procedures that will affect the administration of
    financial aid programs
  • Monitor and respond to state and federal issues
    that will adversely affect the community college
    student population
  • Advocate for adequate funding for student
    financial aid programs and accessibility to
    higher education
  • Network with other governmental agencies,
    community organizations and associations to seek
    support on common issues and
  • Work through the existing formal process to bring
    forward issues, to increase awareness and to seek
    support on issues that affect students.

37
CLFEWHO WE ARE
  • Formed in 1988 and incorporated as a
    non-profit mutual benefit corporation, The
    California Lenders for Education (CLFE) is an
    association represented by lenders, secondary
    markets, servicers and guaranty agencies.

38
CLFE Mission
  • To define common goals and engage in
    activities that improve and preserve the quality
    and integrity of education loan products and
    services delivered to students and schools in
    California through a diverse coalition of
    industry participants.

39
CLFE Goals
  • Committed to serving the needs of California
    students, parents and schools. partners in the
    delivery and administration of education loans.
    We promote responsible borrowing, default
    prevention/aversion and debt management. We
    believe that honest and fair competition in a
    regulated industry enhances product and service
    quality. We encourage and participate in the open
    exchange of ideas and information to maximize the
    synergy of our efforts. We support community
    outreach and develop and articulate legislative
    and regulatory positions.

40
CLFE
  • There are over 1900 lenders nationally
  • The top 10 lenders originated over 52
  • The top 25 lenders originated over 71.0
  • The top 50 lenders originated over 82.9
  • of the 2005 FFELP volume nationally
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