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C18 ISAC Update: State and Federal Financial Aid Issues
The Illinois Student Assistance Commission (ISAC) aims to increase the proportion of adults with postsecondary credentials to 60% by 2025, and to help 45% of low-income students complete college. The document discusses financial aid initiatives, the importance of education for economic stability, and outlines various programs and legislative updates related to higher education financing. Additionally, it highlights the need for improved college access and support for students, particularly those from backgrounds without prior college experience.
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C18 ISAC Update: State and Federal Financial Aid Issues
- 1. Honoring the past– Embracing the future IACAC 2012 Conference ISAC Update: State and Federal Financial Aid Issues Presented by Sam Nelson and Sarah Wahab Ghazi
- 2. “Making college accessible and affordable for Illinois students.” ‐ Mission Statement The Illinois Student Assistance Commission (ISAC) is the financial aid agency in the state of Illinois that administers scholarship, grant, and prepaid tuition programs. CollegeIllinois.org
- 3. What We Know– Setting the Context • U.S. lags other countries in higher education completion • Lifetime earnings are greater for those with more education • Annual income increases with additional education • Unemployment during recessions is worst for those with least education • By 2018, 54% of Illinois jobs will require associate’s degree or more • Currently, 41% of Illinois residents age 25‐64 have an associate’s degree or more
- 4. Percentage of Young-Adults (Age25-34) with College Degrees U.S. ranks 10th among industrial nations (39%)
- 5. Students-in-Need Do NotComplete College % Of Students Who Complete Within 12 Years Of Graduating 8th Grade By Income Quintile 60% 52% 50% 39% 40% 30% 24% 20% 11% 10% 0% Lowest 2nd Lowest Top 3 Overall Average Income Quintiles Source: Goldberger, Susan, “Doing the Math: What It Means to Double the Number of Low‐Income College Graduates,” Minding the Gap: Why Integrating High School with College Makes Sense and How to Do It, 2007.
- 6. Summary of theProblem Source “The Illinois Public Agenda for College and Career Success.” Illinois Board of Higher Education, 2004, p4.
- 7. National Goal President Obama has set the goal: “By 2020, America will once again have the highest proportion of college graduates in the world.” February 24, 2009 Vice President Biden issues call to action to boost college graduation rates nationwide and releases College Completion Took Kit March 22, 2011
- 8. ISAC’s Big Goal Help Illinois Increase to 60%the Proportion of Adults with a Postsecondary Credential by 2025 Specifically, Help Illinois Increase to at Least 45% the Postsecondary Completion Rate of Low‐Income Students
- 9. ISAC’s Goal IsConsistent with Major Foundation Goals • Lumina’s “Big Goal” • Gates Foundation Goal • Complete College America • Illinois P‐20 Council • Illinois Public Agenda for College and Career Success
- 10. ISAC Can HelpIllinois Meet College Attainment Goal • Improve high school to college transition • Support students in college or returning to college • Help families pay for college • Provide high quality, informed research • Build external support to foster systemic change • Align agency financial strategies and support services with program goals
- 11. College Changes EverythingConference • Statewide college access and success conference • July 12, 2012 – save the date • Tinley Park Holiday Inn/Convention Center • More details and registration information to come
- 12. FAFSA Completion andMAP Update • Continue to encourage students to complete the FAFSA • 2012 ‐ 13 Suspension date for MAP ‐ March 20, 2012 • 2012 ‐ 13 MAP appropriation ~$387 million (Governor’s proposed budget) • 2012 ‐ 13 MAP awards determined after state budget is approved *Every dollar allocated to ISAC from state funds goes t t d t i th f f t id
- 13. State Legislative Update • MAP 2+2 • Illinois DREAM Commission • College Illinois Prepaid Tuition Program
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- 15. The Corps inAction • During the 2010‐11 school year, Corps members, with your help, reached about 156,000 people, provided one‐on‐one assistance to almost 12,000 students, and had on‐going mentoring relationships with almost 8,000 students. • Between January and March of this year ISAC staff and Corps members conducted 651 FAFSA completion workshops assisting just under 10,000 students and their families. • The Corps will also be key to administering the Illinois College Planning Act. This program provides early college planning for students from families without prior college experience. Through the plan they can receive ongoing structured college planning assistance beginning in 8th grade and continuing through and including postsecondary enrollment.
- 16. Consolidated Appropriations Act – 2012 See DCL GEN-12-01
- 17. 2012-2013 Pell GrantAmounts • 2012‐2013 Pell maximum award ‐ $5,550 • 2012‐2013 Pell minimum award ‐ $550 • Maximum Pell eligible EFC is 4995 • Was 5273 in 11‐12
- 18. Auto-Zero EFC IncomeThreshold • Reduces the income threshold for an automatic zero expected family contribution (EFC) from $30,000 to $23,000 • For the 2012‐2013 award year was scheduled to be $32,000 • FAFSA on the Web and the Central Processing System (CPS) have been updated, and both began 2012‐ 2013 FAFSA processing using $23,000 as the auto‐ zero EFC threshold
- 19. Ability-to-Benefit (ATB) • EliminatesTitle IV eligibility for students without a high school diploma (or equivalent) • Exceptions for • Home schooled students • Students who were enrolled in a Title IV eligible program of study prior to July 1, 2012
- 20. Ability-to-Benefit (ATB) • Students who are or were, enrolled in a Title IV eligible program anytime prior to July 1, 2012, may continue to qualify under one of the ATB alternatives – • Passing an independently administered, approved ATB test • Successfully completing at least six credit hours or 225 clock hours
- 21. Pell Grant Durationof Eligibility • Reduces the duration of a student’s eligibility to receive Pell Grant from 18 semesters (or its equivalent) to 12 semesters (or its equivalent) • Applies to all students effective with the 2012‐13 award year • Calculation includes all earlier years of the student’s receipt of Pell
- 22. Pell Grant Durationof Eligibility • Calculate the equivalency by adding together each of the annual percentages of a student’s scheduled award that was actually disbursed to the student • LEU – Lifetime Eligibility Used • Once LEU reaches 600%, student no longer eligible • If LEU more than 500% but less than 600%, partial eligibility for next award year
- 23. Grace Period InterestSubsidy • Temporarily eliminates the interest subsidy on Direct Subsidized Loans during the six month grace period • Applies to new Direct Stafford Loans for which the first disbursement is made on or after July 1, 2012, and before July 1, 2014
- 24. CCRAA of 2007Interest Rate Reductions First disbursement of a loan: Interest rate on the unpaid balance Made on or after And made before July 1, 2008 July 1, 2009 6.0 percent July 1, 2009 July 1, 2010 5.6 percent July 1, 2010 July 1, 2011 4.5 percent July 1, 2011 July 1, 2012 3.4 percent
- 25. CCRAA of 2007Interest Rate Reductions • Will sunset on June 30, 2012 • All Stafford Loans, grad and undergrad, sub and unsub, first disbursed on July 1, 2012 or later • WILL HAVE INTEREST RATE OF 6.8% • 6.8% WAS THE PRE‐CCRAA RATE • Requires change in law to prevent automatic increase
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- 27. FY 13 ProposedBudget $5,635 maximum Pell Grant award for 2013‐2014 Maintain the subsidized loan interest rate for undergraduate students at 3.4 percent for undergraduates until July 1, 2013 Limit the duration of the Stafford Loan in‐school interest subsidy to 150 percent of the normal time required to complete the borrowers’ educational program
- 28. FY 13 ProposedBudget Expand and improve the Perkins Loan program to provide $8.5 billion in loans annually Provide $150 million in new funds for the Work‐ Study Program Reform and expand Federal allocations in the campus‐based programs
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- 30. Required Verification Items Which elements must be verified? 1. 2. Number 3. Food Household Enrolled in Stamps Size College (SNAP) 5. U.S. 6. Non‐ 4. Child Income Tax tax Filers paid/Certain Support Untaxed Income paid Income & From Benefits Work Federal Student Aid (FSA) will give notice of data elements that must be verified. Items will be listed on the Student Aid Report. In addition, a school can choose to verify any other application items, requiring any necessary documentation, in accordance with consistently applied institutional policies.
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- 32. Acceptable Documentation Household Size Number Enrolled in Food Stamps (SNAP) • Signed statement College • Documentation deemed • Name & age of each • Signed statement sufficient by the household member • Name, age of students, institution • Relationship to applicable institutions • Ex: documentation from applicant • Institutional statement providing agency • Only if reason to believe household members attending elsewhere • Not needed if number in college is one
- 33. Acceptable Documentation Child Support paid U.S. Income Tax paid Non Tax‐Filers • Signed statement • IRS Data Retrieval • W‐2s • Child’s name, amount • Tax return transcript • Signed statement and recipient’s name • W‐2s certifying: • Inaccurate information: • Dependent status: ‐ Individual has not filed • Decree/custody order parents’ W‐2s and not required to file • Copies of child support • Independent status: ‐ Sources and amounts checks or receipts student’s W‐2 of income earned from • Statement from support • Extension filers work as reported on the recipient FAFSA • Copy of IRS Form 4868 • Amendments • Tax account transcript
- 34. Acceptable Documentation forVerification Update as of April 16th, 2012: In the limited set of cases where an aid applicant, who has filed a tax return and attempted unsuccessfully to use the IRS Data Retrieval Tool or to obtain IRS Tax Return transcripts, needs a timely alternative for meeting the 2012‐2013 verification requirements, institutions may, until July 15, 2012, use a signed copy of the relevant 2011 IRS Tax Return as acceptable verification documentation for the 2012‐13 award year. (GEN‐12‐07)
- 35. Conflicting Information A school must resolve all conflicting information before disbursing FSA funds, except when a student dies. Discrepant Other Offices Subsequent ISIRs Tax Data EXAMPLES: Missing high Required to review subsequent Obligated to know: school diploma; Academic transactions for a student for the (1) who is required to file Progress; Enrollment Status; entire processing year, even if (2) the correct filing status etc… verification has been conducted (3) limits on who can be in an earlier transaction. claimed as an exemption A school has an internal system to identify conflicting information that may affect a student’s eligibility – regardless of the source and regardless of whether a student is selected for verification.
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- 37. IRS Tax ReturnTranscript & IRS Tax Account Transcript Both are free and can be requested online, via telephone or by mail. An IRS Tax Return Transcript is a typed copy of what was entered on an applicant’s original federal tax return. Most line items should be reflected – including IRS calculations and the final determination of the amount on each line item. An IRS Tax Account Transcript shows basic information from an applicant’s federal tax return including his or her marital status, return type, AGI, and taxable income. The IRS Tax Account Transcript also reflects any changes made after the initial filing of the tax return, including changes made by the IRS or the applicant, such as the filing of an amended tax return. Applicants should receive the transcript within 5 to 10 calendar days after their request has been received.
- 38. Requesting an IRSTax Return Transcript or IRS Tax Account Transcript Tax filers can request either a 2011 tax return transcript or a tax account transcript from the IRS in one of three ways: Online Request • Available on the IRS Web site at www.irs.gov Telephone Request • Available from the IRS by calling 1‐800‐908‐9946 Paper Request • Download IRS Form 4506T at http://www.irs.gov/pub/irs‐ pdf/f4506t.pdf • Mailed or faxed to: • RAIVS Team Stop 37106 Fresno, CA 93888 • (559) 456‐5876 * Please note that tax transcripts are not the same as copies of tax returns.
- 39. Stay Connected ISAC’s e‐Messaging Service • Notifies you when new information and/or announcements are added to College Illinois • Summaries of new information, along with links, will be sent to your e‐mail Get Printed Materials • ISAC Printed Materials – www.collegeillinois.org • FSA Publications Ordering System (FSAPubs) – www.FSAPubs.org
- 40. Making college accessibleand affordable for Illinois students. ‐ ISAC’s Mission Statement Deerfield 1755 Lake Cook Road Deerfield, IL 60015‐5209 ISAC's Big Goal: Springfield 500 W. Monroe, 3rd Floor Increase the proportion of Illinois Springfield, IL 62701‐1876 adults with a postsecondary Chicago James R. Thompson Center 100 W. Randolph, Suite 3‐200 credential to 60 percent by 2025 Chicago, IL 60601‐3219 800.899.ISAC (4722) www.collegeillinois.org .................................................. College Illinois The official Web site of the Illinois Student Assistance Commission (ISAC)