Transcript Recommendations on the Reauthorization of the Higher

Gearing up for Reauthorization of the
Higher Education Act:
Work of NASFAA’s Task Force
Ron Day, NASFAA Chair
Reauthorization Task Force
Richard Heath, NASFAA Board Member
Reauthorization Task Force
Loan Issues Sub Committee
EASFAA
May 8, 2013
Task Force Members
Name
Region
Institution
Sector
Richard Heath
EASFAA
Anne Arundel CC
2-Yr. Public
Mark Lindenmeyer
EASFAA
Loyola Univ, Maryland
4-Yr. Private
Michael Pede
EASFAA
SUNY Upstate Medical Univ
Grad/Prof.
Thomas Babel
MASFAA
DeVry, Inc.
Proprietary
Laurie Wolf
MASFAA
Des Moines CC
2-Yr. Public
Robert Gamez
RMASFAA Kansas State Univ
4-Yr. Public
Craig Munier
RMASFAA Univ of Nebraska
4-Yr. Public
Bonnie Joerschke
SASFAA
Univ of Georgia
4-Yr. Public
Brent Tener
SASFAA
Vanderbilt Univ
4-Yr. Private
Frank Valines
SASFAA
Florida International Univ
4-Yr. Public
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Task Force Members
Name
Region
Institution
Sector
Governor Jackson
SWASFAA Texas Woman’s Univ
4-Yr. Public
Kay Soltis
WASFAA
Pacific Lutheran Univ
4-Yr. Private
Georgette
DeVeres
WASFAA
Claremont McKenna Coll
4-Yr. Private
Patricia Hurley
WASFAA
Glendale CC
2-Yr. Public
George Chin
Advisor
AASCU
Higher Ed.
Assn.
Dan Madzelan
Advisor
Retired, Office of
Postsecondary Education
Fed.
Government
Ron Day, NASFAA
National Chair
SASFAA
Kennesaw State Univ
4-Yr. Public
Pam Fowler, Past
National Chair
MASFAA
Univ of Michigan
4-Yr. Public
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NASFAA Staff
• Justin Draeger, President & CEO
• Megan McClean, Managing Director of Policy
& Federal Relations
• Joan Berkes, Senior Policy Analyst (RTF Project
Director)
• Karen McCarthy, Policy Analyst
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Task Force Process
• Gather member comment in listening sessions
• Identify themes running through comments
• Revisit and update work of past
Reauthorization Task Force
• Form into subcommittees by major themes
• Subcommittees recommend issues for full
Task Force debate
• Meet in person and by conference call
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Contribution from the Membership
670 comments from 37 sessions at State, Regional,
National conferences, forums, etc., through Feb. 2013
Need Analysis 24%
Pell Grant 6%
Loans 23%
Administrative Burden 6%
R2T4 9%
Verification 5%
Miscellaneous 8%
FAFSA 3%
Programs 7%
Campus-Based Aid 2%
Consumer Information 7%
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Campus-Based Aid
2%
Total
Comments
Need Analysis
24%
Verification
5%
Pell Grant
6%
Miscellaneous
8%
R2T4
9%
Loans
23%
Programs
7%
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Contribution from the Membership
Need Analysis
• Include all income…14%
• Use prior prior year…13% (opposed: 1%)
• Include more assets, in formula or as PJ…10%
• Change use of negative AGI…6%
• Review noncustodial parents…6%
• Redefine “couple”…5%
• Auto zero reform…5%
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Contribution from the Membership
Loans
• Loan limits
– Let schools limit loans…26% (opposed: 2%)
– Set loan limits by sector…11%
– Eliminate current proration…9%
– Set or prorate by enrollment status…8%
• Curtail private loans by:
– Adjusting Federal loan interest rates…11%
– Raising Federal loan limits…7%
• Create more options for repayment…9%
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RTF Subcommittees
• Need Analysis & FAFSA
• Loans & SAP
• R2T4
– Also Verification, Administrative Burden
• Consumer Information
– Also Pell, C-B Aid, Programs, General Provisions
• Full Task Force—Everything!
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RTF Presentation to Board of Directors
1. Presentation of recommendations
– Subcommittee chairs, by topical area
2. Initial vote
– If >2/3 majority in favor, recommendation
approved
3. Discussion
– If <2/3 in favor, 10 minute discussion period
4. Final Vote
– Approve
– Reject
– Return to Task Force for further work
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RTF Presentation to Board of Directors
Need Analysis recommendations
• 13 approved
• 1 rejected
• 2 returned to Task Force
– Definition of “dependent” in family size
– Treatment of unmarried partners or single
sex couples
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Need Analysis
Approved
• Use prior prior year (PPY) data
• Eliminate Simplified Need Test
• Eliminate dislocated worker as qualifier for
Auto Zero
• Add SSI, TANF, and General Relief benefits as
sole qualifiers for Auto Zero
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Need Analysis
• Treat Foreign Income Exclusion as untaxed
income
• Adjust treatment of certain “paper” tax losses
that cause negative AGI
• Eliminate exclusions of small business and
family farm assets (discussion continues…)
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Need Analysis
• Reflect regional cost of living in Income
Protection Allowance (IPA)
• Revise independent student definition related
to homelessness
• Strengthen school authority to set living costs
in COA based on enrollment status or other
factors
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Need Analysis
• Expand and refine IRS Data Download to
maximize use
• Explore use of technology to broaden use of
FAFSA data and application process by states
and institutions
• Conduct feasibility study to use tax return as
an application for federal student aid
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RTF Presentation to Board of Directors
Loan recommendations
• 12 approved
• 1 reserved as a fall-back position subject
to further development by Task Force
• RTF directed to incorporate relevant
Indebtedness Task Force (ITF)
recommendations
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Loans
Fall Back/ Develop Further: Loan Limits
• Eliminate year-related differences in loan limits
• Increase annual and aggregate limits
• Step aggregate: lower limit for first 2 years
• Prorate limits based on enrollment status
• Simplify the sub/unsub structure of loan limits
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Loans
Approved
• Reform interest rates (market-based stability)
• Eliminate loan fees
• Increase flexibility for schools to reduce loan
amounts by school-defined categories
• Eliminate proration for remaining periods
• Separate Grad PLUS and Parent PLUS programs
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Loans
• Allow unequal loan disbursements
• Reinstate cost-neutral repayment incentives
• Allow late origination after enrollment ends
• Restrict consolidation to single holder/payment
and default prevention purposes
– Allow separate refinance provisions
• Reinstate loan subsidies
– Coordinate with ITF recommendations
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RTF Presentation to Board of Directors
Pell Grant recommendations
• 3 approved
• 1 returned to Task Force
– Year-round Pell
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Federal Pell Grant Program
Approved
• Make Pell Grant a true entitlement
• Eliminate tie to default rates
• Allow 1 more payment beyond LEU to enable
completion
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RTF Presentation to Board of Directors
Campus-based program recommendations
• 6 approved
• 1 remains in development at Task Force
request
– Allocation formula
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Campus-Based Programs
Approved
• Increase flexibility on transfers of funds
• Revise distribution of school’s Perkins Fund if
program ends
• Expand FWS definition of community service
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Campus-Based Programs
• Set aside funds for community service based
on separate request
• Eliminate private sector employment cap
• Tie FSEOG eligibility to Pell-eligible EFC range
rather than actual receipt, and eliminate
lowest EFC order
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RTF Presentation to Board of Directors
General provisions recommendations
• 7 approved
• 1 remains in development at Task Force
request
– Issuance of final report of program review
– Pending school survey
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General Provisions
• Increase overaward tolerance and include DL
• Restore earned credit ability-to-benefit
• Eliminate tie to Selective Service registration
• Eliminate tie to drug convictions
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General Provisions
• Maximize consistency of reinstatement of
student eligibility among programs
• Accept data base match as documentation for
I-9 employment eligibility verification
• Allow payment of currently non-automatic
allowable charges unless student opts out
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RTF Presentation to Board of Directors
Consumer Information recommendations
• 4 approved
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Consumer Information
• Require review of current requirements and
restrict to undergraduates
• Shift provision of loan disclosures to ED
and/or servicers
• Decouple Constitution Day, voter registration,
athletic disclosures
• Shift requirement to provide State assistance
information to central Federal site
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RTF Presentation to Board of Directors
R2T4 recommendations
• 11 approved
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Return to Title IV Funds
• Restrict law and regulation to undergraduates
• Narrow definition of schools that are required
to take attendance
• Continue to require that schools have an
accessible, publicized withdrawal procedure
that recognizes student’s withdrawal as date
he/she initiates that procedure.
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Return to Title IV Funds
• Allow school to set withdrawal date for
students unofficial withdrawals
• Continue pro-rata approach but simplify the
rules and use weeks rather than days
• Put parameters in law rather than details;
clarify school discretion
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Return to Title IV Funds
• Restore institution’s authority to determine
post withdrawal disbursement
• Modify assumption that Title IV aid is applied
to institutional charges first
• Increase from 45 to 60 days period of time
school has to return funds
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Return to Title IV Funds
• Amend the order of return language and make
it subject to regulation
• Direct ED to solicit public input on ways to
decrease burden and complexity of R2T4
regulations and procedures, and to conduct a
subsequent negotiated rulemaking session
devoted solely to R2T4
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Additional Areas To Be
Considered???
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