INDIANA COMMISSION FOR HIGHER EDUCATION
JUNE 11 , 2010
Financial Aid Study Update #3
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HEA 1001-2009(ss) SECTION 489
“The commission for higher education with the assistance of the state student assistance commission shall study the funding of college scholarship programs provided by the state student assistance commission and the state's public universities.”
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Caveats
The study is due June 30, 2010, and will be delivered to the State Budget Committee. Today is intended to seek Commission endorsement of the policy direction presented
The specific questions asked in the legislative charge will be addressed
The study has also raised many complicated and important issues that cannot all be addressed given the limited resources and time, but beg for further investigation
Study has found significant gaps in the data connecting financial aid to student achievement that must be addressed
Ongoing study of these issues should be a regular practice
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Specific Legislative ChargeThe study must examine the following issues:
The limits established for awards and the differences between the limits established for private and public universities.
1. Award Methodology: SSACI calculates awards caps (limits) through FAFSA data, Federal PC/EFC calculation and budget rationing2. Timing of awards: Award caps announced typically sometime between March and June3. Public / Private cap differences4. Efficacy: Are we distributing awards to the right students, and are the awards leading to access and completion
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Recommendations
Methodology SSACI should continue to use the existing
methodology
Tuition & fees (caps) – Ability to pay (PC/EFC) = Grant amounts
Caps are necessary device to ration funds and no better policy discovered in the study
FAFSA (generates PC/EFC) is a valuable tool for both collecting data and identifying relative need
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Recommendations
Timing of awards The sooner awards can be announced the better for families and
colleges Students and parents want transparency and financial planning
ability Colleges want to compete for students with financial aid packages
SSACI desires to wait crucial information is known FAFSA’s aren’t filed until March 10 – then know relative need of
students State budget is not passed until April (sometimes later) and concerns
over mid-year budget adjustments Enrollment data is better over time
Federal NPC requirements and a useful and widely available College Cost Estimator would ease some concerns over late announcements
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Recommendations
Public / Private caps Students should be able to continue to take SSACI awards to
public or private colleges The private colleges are an integral part of Indiana higher
education system and SSACI grants afford students some choice in college selection
SSACI should apply consistent methodology across programs The difference in the award cap between public and private
colleges should continue existing state policy – a higher award to a student attending a private school is acceptable because there is no state subsidy to private school
[Recommend no changes in state policy for proprietary colleges – more study is needed]
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Recommendations
Efficacy: Are we distributing awards to the right students, and are the awards leading to access and completion The answer is … Incomplete Significant gaps in data
Existing DOE, SSACI, CHE and DWD data must be married
Additional data must be identified and collected Time and resources must be garnered to study this
further
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Specific Legislative ChargeThe study must examine the following issues:
2) The extent to which criteria for establishing the eligibility of an applicant should consider receipt of Pell Grants, other wrap-around assistance provided by the university, tax credits, and other assistance. No … and Yes Do not recommend formally considering Pell grant aid
in the award methodology (though this deserves further study) Pell recipients are very low income students
However, we must recognize the total financial aid picture
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Specific Legislative ChargeThe study must examine the following issues:
Do not recommend formally considering institutional grant aid in the award methodology (though this deserves further study) The Commission recommended institutions wrap around
their financial aid with state and federal funds, but recognize the decision rests with the trustees. Models include Pell Promise and 21st Century Covenant
Institutions use financial aid to attract and retain students
A merit based financial aid program rewards achievement
However, we must recognize the total financial aid picture
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AGI / EFC Conversion
EFC Less Than $1,500
EFC From $1,500 to $4999
EFC From $5,000 to $9,749
EFC From $9,750 to $16,249
EFC From $16,250 to $26,749
EFC $26,750 or More
Mean AGI $ 23,258 $ 47,675 $ 68,940 $ 89,362 $ 109,533 $177,874
Source: CHE 2008 SIS data
Students binned by EFC divided into six roughly equal sections
Includes all students attending Indiana public postsecondary institution who filed a FAFSA
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Student Grant Sources: All Students Indiana Public Postsecondary Institutions
EFC Less Than $1,500
EFC From $1,500 to
$4999
EFC From $5,000 to
$9,749
EFC From $9,750 to $16,249
EFC From $16,250 to
$26,749
EFC $26,750 or More
-
1,000
2,000
3,000
4,000
5,000
6,000 SSACI Grants Pell Grants Institutional Grants Other Grants
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Student Grant Sources: Dependent Resident Students at 4-year Public Institutions
EFC Less Than $1,500
EFC From $1,500 to
$4999
EFC From $5,000 to
$9,749
EFC From $9,750 to $16,249
EFC From $16,250 to $26,749
EFC $26,750 or More
-
2,000
4,000
6,000
8,000
10,000
12,000
SSACI Grants Pell Grants Institutional Grants Other Grants
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Specific Legislative ChargeThe study must examine the following issues:
3) The relative amounts of assistance provided on the basis of merit and on the basis of need. Does not require a policy position – data to be
distributed However, Commission believes SSACI should focus on
need-based financial aid O’Bannon grant amounts based on high school
graduation diploma should continue SSACI programs that are primarily based on other than
need based analysis should be reconsidered
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Specific Legislative ChargeThe study must examine the following issues:
4) Whether means tests should be required for students participating in the twenty-first century scholars program as those students enter college. The 21st Century Scholars Program has some proven
benefits to students (high school graduation) and other benefits that need to be better identified and measured
The 21st Century Scholars Program has been a national model for student aid programs around the country for several years
It is a well known and beloved program both in the eyes of the public and among policy makers
Any changes to the program must be well reasoned and carefully implemented
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Specific Legislative ChargeThe study must examine the following issues:
IC 21-12-6-1Twenty-first century scholars program; established Sec. 1. The twenty-first century scholars program is established to do the following: (1) Reduce the number of students who withdraw from high school before graduation. (2) Increase the number of students who are prepared to enter the workforce upon graduation. (3) Increase the number of students entering postsecondary educational institutions in Indiana. (4) Encourage eligible students to attend postsecondary educational institutions in Indiana by reducing the financial burden on the eligible students and their families. (5) Decrease drug and alcohol abuse by encouraging higher educational pursuits. (6) Increase individual economic vitality. (7) Improve the overall quality of life for many Indiana residents.
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Recommendations
The 21st Century Scholars Program must refocus itself as a program intended to raise the ability, aspiration and preparation of low income students to be good citizens, complete high school, attend and be successful in college, and successful in life
All administrators of the program must improve their delivery and efficacy of program services from enrollment in the program to college completion
All participants in the program must commit to participating in the programs designed for their benefit
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Recommendations
The fidelity of the 21st Century Scholars Program must be maintained through rigorous monitoring of enrollment and participation
The fiscal environment of the state and burgeoning enrollment in the program lead to an inescapable conclusion that Indiana must consider a means test for 21st Century Scholars students as they attend college. Further study is needed.
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Specific Legislative ChargeThe study must examine the following issues:
5) Scholarships and awards provided for members of the military and national guard. Substantial financial aid is available from the federal and state
governments for current and former members of the military and their families
Coordination of these awards is minimal and needs to be improved The SSACI programs for military families is financed by SSACI, but
administered by the IDVA and National Guard The recommendation is the fiscal and administrative duties should
be assigned to one entity –that is, either these are student aid programs administered by SSACI and follow SSACI policies, or they are military benefits administered by the appropriate military agency
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Specific Legislative ChargeThe study must examine the following issues:
6) Scholarships and awards provided to the individuals being held in state correctional facilities. There is a positive public policy rationale to funding education
for incarcerated prisoners at taxpayer expense Reduced recidivism, good behavior in correctional institutions, job
prospects upon release, time off sentence for education attainment Paying for prisoner education through SSACI has several
disadvantages Limited academic offerings because of SSACI rules Deadlines and SSACI procedures including March 10 deadline and
inconsistent funding levels across institutions State should consider funding prisoner education through the
Indiana Department of Corrections
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Next Steps
CHE and SSACI staff will complete white paper
CHE will hold executive committee meeting to act on the white paper before June 30, 2010
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