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Changes to State Financial Aid Programs 2009-2010 Presented by Ginny Dodds & Megan Fitzgibbon MN Office of Higher Education July 7, 2009.

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Presentation on theme: "Changes to State Financial Aid Programs 2009-2010 Presented by Ginny Dodds & Megan Fitzgibbon MN Office of Higher Education July 7, 2009."— Presentation transcript:

1 Changes to State Financial Aid Programs 2009-2010 Presented by Ginny Dodds & Megan Fitzgibbon MN Office of Higher Education July 7, 2009

2 Overview 2 Higher Education Bill and Unallotment Process General Changes Related to Financial Aid MN State Grant Program Postsecondary Child Care Grant Program State Work Study Program SELF Loan Safety Officer Survivors Grant Program Summer Transition Grant Program MN Indian Scholarship Program MN GI Bill Program Achieve Scholarship Program Q & A

3 Higher Education Bill & Unallotment Process 3

4 4 Bill was signed by the Governor on May 17, 2009 Line-item vetoes used for: OHEs TEACH program appropriation of $250,000 per year for nonprofit early childhood provider scholarships $1 million per year of funding for MnSCUs Power of You MnSCU – Cook County Education Boards $40,000 appropriation for educational programs and academic support services Implementation delayed pending outcome of Governors unallotment announcements

5 5 Higher Education Bill & Unallotment Process By law, Governor is allowed to unallot funds if projected state revenues fall short of expenditures Some argue this authority was intended for unanticipated shortfalls taking place during the biennium May be possible legal challenges to Governors use of unallotment authority Governor cannot officially unallot funding until after July 1, 2009 Governor announced unallotment plans on June 16, 2009

6 6 Higher Education Bill & Unallotment Process Governors planned unallotments: $300 million Reduction of local aids and credits $67 million Reduction of refunds and other payments $236 million Reduction in human services spending $100 million Reduction in higher education appropriations $50 million cut for both MnSCU and U of M $33 million Reduction in most state agency operating budgets $1.77 billion K-12 payment deferrals and adjustments $169 million Administrative actions

7 7 Higher Education Bill & Unallotment Process Announced unallotments did not affect state financial aid programs Governor has authority to unallot additional funds during the biennium if revenue projections fall below expenditures More likely to impact second year of biennium Legislature will reconvene in early 2010 May pass legislation affecting program funding levels for 2010-2011

8 General Changes 8

9 Definition of Eligible Institution 9 Requirement that eligible schools be participating in the Federal Pell Grant program by July 1, 2011, was delayed until July 1, 2013 OHE directed to work with small institutions to identify cost-effective methods to achieve accreditation necessary to be an eligible institution for state and federal financial aid

10 FAFSA Compliance 10 All eligible institutions must implement policies and procedures that ensure that applicants are aware they must annually complete the FAFSA to be eligible for financial aid By March 15, 2011, OHE must report to the higher education committees of the legislature on the policies and procedures adopted by institutions eligible for the state grant program to increase student awareness of the need to complete a FAFSA application with a preliminary assessment of the effectiveness of the policies and procedures.

11 Criminal Record Notice 11 Public and private institutions must give notice to each person accepted for admissions and at the time the student selects a major Notice must inform student that arrests, charges or convictions for criminal offenses may limit employment possibilities in specific careers and occupations Notice must also inform student that such offenses may limit eligibility to obtain federal, state and other financial aid and encourage student to investigate that possibility Notice must not discourage students from applying for financial aid An institution is not liable for failing to provide the notice

12 American Made Clothing 12 To extent possible, bookstore located on campus must offer for sale clothing or articles of apparel that are manufactured in the Unites States The college or university must make a report to the legislature on the results of efforts to comply with this requirement

13 Miscellaneous 13 Veterinary loan forgiveness program created For vets who treat food animals and work in rural areas Designed to serve up to 5 borrowers per year $225,000 available until expended OHE will contract with Dept of Health to run program College Emergency Grants $150,000 each year to MnSCU two-year institutions for emergency aid grants to students who are experiencing extraordinary economic circumstances that may result in dropping out of school without completing the term or program

14 Minnesota Promise Financial aid policy. It is the policy of the legislature to provide sufficient financial aid funding so that tuition and required fees to attend a public two-year college for a student from a low-income family are covered by state financial aid when combined with federal and other sources of aid. Informational materials. The Office of Higher Education must prepare and distribute materials under section 136A.87 to promote the Minnesota Promise, the availability of financial aid, and the benefits of higher education. 14

15 QUESTIONS??

16 MN State Grant Program 16

17 17 Limit on Postsecondary Education Limit on postsecondary attendance extended from 8 to 9 full-time semesters or the equivalent Will affect any student with term(s) funded out of the 2009-2010 aid year Units cutoff increased from: 93.6 to 105.6 units – Schools on semester system 94.4 to 106.4 units – Schools on quarter system Updated transcript review spreadsheet emailed to schools and posted on OHE web site

18 18 Limit on Postsecondary Education Term during which student withdrew for major medical illness does NOT count towards limit on postsecondary attendance Student must have been under the care of a medical professional during term of withdrawal Medical professional must provide statement that student was unable to complete term due to major medical illness Instructions on revised State Grant student eligibility questionnaire direct student to contact financial aid office if s/he withdrew for major medical reasons Schools not required to ask all students if they ever withdrew due to major medical illness

19 19 Limit on Postsecondary Education If student was paid a State Grant for a term during which the student withdrew for a major medical illness, school should inform OHE so that units can be flagged on State Grant database Same applies to term(s) during which student withdrew for active military service after December 31, 2002

20 20 2009-2010 Award Calculation Parameters (changes from 2008-2009 shown in red) 4-year program tuition cap:$10,488 2-year program tuition cap:$ 5,808 Living and miscellaneous:$ 7,000* Student share: 46% Proration of parent contribution: 96% Proration of EFC for independent: With dependents 86% Without dependents 68% *prorated LME of $5,727 for clock hour schools with 900-hour academic year

21 State Grant Maximum Awards Amounts shown equal 54 percent of full-time State Grant award budget U of M/Four-Year Private:$9,444 Two-Year Private:$6,916 MnSCU Four-Year:$7,325 MnSCU Two-Year:$6,407 21

22 22 Full Awards The higher education bill has language directing OHE to make full grant awards in each year of the biennium OHE to request deficiency appropriation if funding runs short, rather than award reductions If funding shortfall during 2009-2010, can borrow from 2010-2011

23 23 Year Round Pell Grant (Federal Law Unrelated to State Higher Education Bill) Effective 2009-2010, many students will be eligible to receive up to two full-time annual Pell Grants during the same aid year Based on draft regulations currently in the process of negotiated rule making: Second annual Pell Grant available once student completes 24 semester or 36 quarter credits Schools will be required to fund a crossover term from the aid year resulting in the highest Pell Grant award for the student, as of the date of disbursement This means some schools will be forced to pay summer term as a header for some students when they havent done this in the past

24 24 Year-Round Pell Grant State Grant policy requires schools to fund State Grant for a crossover term from the same aid year selected for Federal Pell Grant This is because a students State Grant is based on the EFC and Pell Grant for a given aid year OHE will respond to negotiated rulemaking with potential problems associated with forcing schools to choose the aid year yielding the highest Pell Grant award NASFAA info on year-round Pell Grant http://www.nasfaa.org/publications/2009/ryearround05260 9.html

25 25 Year Round Pell Grant Potential problems with coordination of Pell and State Grant for crossover term: Choosing aid year yielding highest Pell Grant award may result in less COMBINED Pell and State Grant Many schools not set up to handle summer as header term of aid year Funding summer as header term may result in delayed disbursements to students Neither Pell or State Grant funds are available until July Delayed disbursement may mean reduced State Grant award if students enrollment level has changed prior to disbursement Pell available for 4 FT semesters; State Grant limited to 3

26 Year-Round Pell Grant 26 Example of dependent student attending MnSCU 4-yr full-time for summer 2009 2008-20092009-2010 EFC$ 0$3,000 Parent Contribution$ 0 Pell Grant$4,731$2,400 State Grant$2,058$4,925 Combined Pell &SG$6,789/2 = $3,395 semester$7,325/2 = $3,663 semester

27 Year Round Pell Grant Fall 2008 Spring 2009 Sum 2009 Fall 2009 Spring 2010 Sum 2010 Fall 2010 Spring 2011 Sum 2011 27

28 QUESTIONS??

29 Postsecondary Child Care Grant Program 29

30 30 Limit on Postsecondary Education Limit on postsecondary attendance NOT extended to 9 semesters Stays at 8 full-time semesters or the equivalent This was oversight that OHE will try to address next legislative session

31 Allocations to Campuses Higher education bill increased annual program appropriation from $6.2 million to $6.7 million Initial allocations calculated in April 2009 were based on Governors budget request 5% cut to $6.2 million appropriation = $5.9 million Initial allocations recalculated in June 2009 based on $6.7 million appropriation, since unaffected by unallotment Will be recalculated in September 2009 based on prior year utilization rate 2009-2010 application, maximum award chart, calculation spreadsheet already distributed to schools 31

32 Award Calculation 2009-2010 award calculation formula has not changed Still lesser of actual child care costs vs maximum award vs financial need Effective 2009-2010, federal veterans benefits will be ignored as estimated financial assistance when determining financial need Maximum award still $2,600 Maximum award table updated for 2009-2010 based on 2009 federal poverty guidelines Has effect of expanding income levels at which students qualify 2009-2010 application, maximum award chart, calculation spreadsheet already distributed to schools Also posted on OHE web site 32

33 State Work Study 33

34 Allocations to Campuses 34 Higher education bill increased annual program appropriation from $12.4 million to $14.9 million Initial allocations calculated in April 2009 were based on Governors budget request 5% cut to $12.4 million appropriation = $11.8 million Initial allocations recalculated in June 2009 based on $14.9 million appropriation, since unaffected by unallotment Will be recalculated in September 2009 based on prior year utilization rate Effective 2009-2010, federal veterans benefits will be ignored as estimated financial assistance when determining financial need (COA minus EFC, other financial aid & resources)

35 SELF Loan 35

36 36 SELF Loan Effective 2009-2010, federal veterans benefits will no longer be considered a form of financial aid or resource when determining eligibility for SELF loan Schools will be given discretion to include veterans benefits as resource if they would like to limit a students debt load SELF program will send out newsletter to campuses regarding changes

37 Safety Officer Survivors Grant 37

38 38 SOS Grant Annual appropriation still $100,000 Approximately 15 – 20 recipients per year Limit on postsecondary attendance decreased from 10 to 9 semesters Renewal language in statute still says award is granted for one year and renewable for another 4 years OHE will use 9 semester limit for new applicants and 10 semester limit for recipients initially awarded prior to 2009-2010 year

39 QUESTIONS??

40 Summer Transition Program Grant 40

41 41 Summer Transition Program Effective summer 2010 Public and private institutions encouraged to offer research-based high school-to-college developmental transition program and enroll students who will receive grant

42 42 Summer Transition Program Program must, at a minimum: Include instruction to develop the skills and abilities necessary to be ready for college-level work when the student enrolls in a program leading to credential Must address the academic skills identified as needing improvement by a college readiness assessment completed by the student Not constitute more than the equivalent of one semester of full- time study occurring the summer following high school graduation Must be identified on a students transcript with unique identifier to distinguish it from other developmental courses/programs

43 Summer Transition Program Grant $4.9 million per biennium from State Grant appropriation One-time grant to help pay expenses of summer transition program For students who graduate from high school after December 31, 2009 Cannot receive both Summer Transition Grant and MN State Grant for same term Can receive Summer Transition Grant and Pell Grant for same term Does count towards limit on postsecondary education for State Grant program 43

44 Summer Transition Program Grant Award calculation when EFC/PC > $0 is: State Grant term award budget adjusted for enrollment level - 46% student share - Term adjusted parent contribution (dep) or EFC (independent) 9-month FM PC prorated to 96% then divided by 2 (sem) or 3 (qtr) 9-month FM EFC prorated to 86% indep with deps; 68% indep w/o deps then divided by 2 (sem) or 3 (quarter) - Pell Grant (only if student is actually receiving Pell Grant) = Summer Transition Program Grant (minimum $50 sem; $33 qtr) This presents incentive for transition program to NOT be eligible for Pell Grant Saves one term of Pell Grant eligibility for future use 44

45 Summer Transition Program Grant Award calculation when EFC/PC = $0 is: State Grant term award budget adjusted for enrollment level - $1,200 summer work expectation - $ 0 Pell Grant (even if student is receiving Pell Grant) = Summer Transition Program Grant (minimum $50 sem; $33 qtr) Transition program students with zero EFC will always want to opt for Summer Transition Grant rather than standard State Grant 45

46 Summer Transition Program Grant For student with $0 EFC for 2009-2010, Summer Transition Grant for summer 2010 would be: MnSCU 2-YrMnSCU 4-YRUofM/Private 4-Yr 15 credits$4,642$5,487$7,544 12 credits$3,474$4,150$5,795 9 credits$2,305$2,812$5,246 6 credits$1,137$1,475$2,299 3 credits $ 0$ 137$ 549 Some students might also be eligible for Federal Pell Grant, if accepted into credential program 46

47 Summer Transition Program Grant Enrollment level based on credits (or credit equivalencies) of remedial course work OHE will need to determine whether and how other program activities can be translated into credits 47

48 Summer Transition Program Grant Schools definition of summer term used for other state financial aid programs will be used Most schools combine mini-sessions into one summer term If term crosses fiscal year (July 1), it is considered crossover term Crossover terms can be funded from either aid year Must select same aid year for Summer Transition Grant and Pell Grant, IF Pell Grant being subtracted State Grant application deadline for aid year selected applies 48

49 Summer Transition Program Grant OHE will seek advice from campus financial aid administrators re: program implementation and design Possible working group At issue: Should program be integrated into State Grant program, whereby records for transition grant are included in State Grant batch with special identifiers? Should program be designed like Work Study and Postsecondary Child Care Grant, whereby funding advanced to campuses and campus submits final report with student data and awards? 49

50 50 Summer Transition Program – Evaluation OHE must establish and convene a data working group to develop: Data methodology used to evaluate programs effectiveness at improving academic performance, including identification of comparison groups Timeline for institutions to submit data to OHE Must report annually Procedures to ensure consistency of data collected Data group must: Have members with expertise in data collection and delivery of academic programs to students Represent the types of institutions offering transition programs Help OHE director analyze and synthesize data for annual evaluation report submitted to legislature

51 Summer Transition Program – Evaluation At a minimum, evaluation data collected must include: Demographic information about participants Names of high schools from which students graduated College readiness test used to determine the student was not ready for college-level academic work Academic content areas assessed and the scores received on the readiness test Description of services, including any supplemental noncredit academic support services provided to students Data on registration load, courses completed, and grades received by students Retention of students from summer to fall term and subsequent terms 51

52 Summer Transition Program – Evaluation Transition Program participants will need to be tracked even if they transfer to another college OHE can use ISIR/State Grant database to determine if student enrolled for fall and subsequent terms Potentially, OHE can contact these campuses for data on subsequent enrollment (e.g., GPA, etc.) 52

53 QUESTIONS??

54 MN Indian Scholarship Increase in appropriation by $125,000 in each year Approximately 30 additional full year awards As of July 1, 2010: Over 1300 applications received Over 600 students who meet basic eligibility requirements with complete applications to be reviewed School budgets can and should still be completed Enormous thanks to institutions that heeded the call for budgets to be completed as soon as possible if students had completed the financial aid process at their institution Our intent was be able to provide scholarships to students who had completed the process regardless of their institution Students not awarded with complete applications will be placed on a waiting list 54

55 MN GI Bill 2009-2010 Award Year No changes in program for 2009-2010 aid year Appropriation to program was changed from a base amount to a open appropriation Initial appropriation made based on forecasted usage but MN Dept of Veterans Affairs can request additional if needed Effect of Post 9/11 GI Bill (Chapter 33) is unknown Not all students will benefit from utilizing Chapter 33 benefits instead of Chapters 1606, 1607 or 30 Not all students will qualify at 100% of benefit and may still have need 55

56 MN GI Bill Important Info for Vets Higher Education Technical Amendments Bill signed by President Obama on July 1 st, 2009 Veterans education benefits no longer considered Estimated Financial Assistance now effective July 1, 2009 For more info on other changes visit NASFAA.org or IFAP Does everyone know about MyMilitaryEducation.org? One-stop resource for veterans and their families Sponsored by the MN Department of Veterans Affairs – Higher Education Veterans Programs and MNSCU – MN Online Provides FAQ powered by RightNow Includes info on all aspects of higher education Online Chat, Email and Telephone assistance 56

57 QUESTIONS??

58 Achieve Scholarship Major changes made to program and student eligibility for students who graduate from high school on or after January 1, 2009 Original program and student eligibility requirements in place for students who graduated between January 1, 2008 and December 31, 2008 $4.35 million available in each year for scholarships Fact Sheet available at www.ohe.state.mn.us/FAForms 58

59 Achieve Scholarship All Students To be eligible, all students must: Be a U.S. citizen or eligible non-citizen Be a Minnesota Resident for state financial aid purposes Complete a FAFSA for the financial aid year Graduate from a Minnesota High School Enroll at an eligible Minnesota institution Apply for the scholarship no later than 30 days after the term starts in order to receive funds in that term Complete one of the four sets of rigorous programs of study while in high school or in a home-school setting 59

60 Achieve Scholarship 2008 High School Grads To be eligible, students who graduated between January 1, 2008 and December 31, 2008 must : Have a family adjusted gross income of less than $75,000 reported on the FAFSA for the academic year during which the scholarship is used Be enrolled for at least 3 credits in an eligible institution Take and receive at least a grade of C in each of the courses, unless otherwise stated, in one of four rigorous programs of study 60

61 Achieve Scholarship 2008 High School Grads Award Process Eligible student receives an Eligibility Letter Notifies student of eligibility and asks student to acknowledge award by going online and entering what school and in what term they would like to receive their first payment Eligible students awarded $1,200 to be disbursed in two equal payments of $600 at the requested institution The first payment made within the first term of enrollment The second payment made in the second term of enrollment provided student successfully completes the first term Enrollment and Successful completion of the first term information is provided by the institution online For more information on the online process download the Online Tools Guide at www.ohe.state.mn.us/FAForms 61

62 Achieve Scholarship 2009 High School Grads To be eligible, a student who graduates on or after January 1, 2009 must: Be eligible to receive either a Federal Pell Grant or Minnesota State Grant Complete all of the required courses in one of four rigorous programs of study and graduate with an unweighted grade point average of 2.5 or higher Enroll full time (15 Credits) in an eligible institution within the first academic year immediately following high school graduation Example: 2009 High school graduates only eligible in the 2009-2010 aid year 62

63 Achieve Scholarship 2009 High School Grads Foreign Language Waiver The foreign language requirement in both the State Scholars Initiative and the MN Coursework rigorous programs can be waive if a students first language is not English and they have attained English language proficiency Can be indicated on application or contact us to request a waiver Denial letter will include this information for students who may have not indicated this on their applications Online Course Bonus Eligible students who completed at least one online course while in high school are eligible to receive an additional award of $150 Can be indicated on application, have it listed on their high school transcript or contact us Award Letter will include this information for students who may have not indicated this on their applications 63

64 Achieve Scholarship 2009 High School Grads Award Process Eligible students will receive an award letter that includes award amount and postsecondary institution listed on application Some applications submitted under old guidelines did not have institutions listed Matched first institution on FAFSA to old applications Award letter will provide instructions to update the institution and online course completion status online Students will only be able to do this once and will have to contact us if they need to make additional updates Institutions notified when Award Rosters are available online Institutions required to mark if students are enrolled for at least 15 credits Institutions notified when payments are made and Payment Rosters available 64

65 QUESTIONS??


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