Professional Judgment for Our Times

PJ Presentation Topics Impacts on PJ from the American Recovery and Reinvestment Act Displaced or Dislocated Workers Marriage Separation after the FAFSA Death or loss of household wage earner Medical & Dental Expenses Dependent students unable to provide parental income information Institutional Best Practices

Impacts from the American Recovery & Reinvestment Act First of two major Economic Downturns Unemployment Push by Workforce Development to postsecondary education State Fiscal Stabilization Fund (SFSF): must be obligated by September 30, 2011 Balance speed and stimulus with careful planning and effective reforms National Unemployment Rate – 9.7% (AUG09) Regional Unemployment Rates by state

Impacts from the American Recovery & Reinvestment Act Second of two major Economic Downturns Youth Homelessness Researchers estimate that about 5 to 7.7 percent of youth experience homelessness each year Creation of the United States Interagency Council on Homelessness Each year, the United States has over 2,000,000 youth experiencing homelessness with over 110,000 living day-to-day on the streets. Half of the 110,000 youth are minors (17 years or younger) and half are youth 18 to 24 years old

Displaced & Dislocated Workers Defined Loss of employment Layoff or receipt of layoff notice from employer Receiving unemployment benefits due to being laid off or losing a job and are unlikely to return to a previous occupation They are self employed but are unemployed due to economic conditions or natural disasters They are a displaced homemaker – no longer supported by the spouse who is unemployed or underemployed and is having difficulty finding employment Generally if a person quits work, he or she is not considered a dislocated worker even if, for example, the person is receiving unemployment benefits.

Marriage Separation after the FAFSA With a professional judgment There is no change to the marital status on the FAFSA – FAFSA reflects marital status as of the date submitted Household size and number in college can change Support documentation necessary to verify separate addresses or divorce filing Student information can be calculated based on documentation in the instance filing status was Married Jointly

Death or loss of household wage earner Support documentation is necessary although sensitive If wage earner has lost employment, will need to document that earner has actually lost income. Letter from employer, lay-off slip or unemployment determination. Year to date income from last pay stub or letter from employer. Copy of previous year federal income tax return. Documentation can vary from funeral program, obituary to death certificate Calculation of surviving spouse verification data elements can be extracted in the instance filing status was Married Jointly

Medical & Dental Expenses Documented expenses ‘paid’ for 2008 and not itemized on Federal Tax Return Documented expenses ‘paid’ or ‘estimated’ for 2009 will need to be verified during the upcoming award year ONLY if another PJ request is made Tax liability does not need to be recalculated, only the AGI

Dependent students without parental income information Not a PJ Students do not want to pursue getting parent information Parents do not wish to provide income information Student is eligible for Unsubsidized Stafford

Institutional Best Practices INSTITUTIONAL CONSIDERATIONS Determine whether you will use base year or projected year for PJs that change the EFC calculation. Can develop a grid for various conditions, and policy that will not mix a “base year” with a “projected year” PJ in the same FAFSA year. DOCUMENT, DOCUMENT, DOCUMENT Can only do PJ on a case by case basis. Cannot do a whole class of students together. Must differentiate each student’s circumstance. Have sufficient documentation to prove whatever circumstances are involved. Submit PJ change electronically, via FAA Access to CPS Online. Signature of student or parent is not required.

Institutional Best Practices Student and/or parent grossly underestimates earnings for 2008, providing the student with financial assistance otherwise not eligible to receive; the student submits a new PJ Request for What do you do? For schools who perform PJs for medical/dental expenses, do you apply a percentage maximum of the AGI? Sample forms

Resources on Professional Judgment NASFAA Monograph – May 2009 (#22) FSA Handbook VGCh5.pdf VGCh5.pdf College Board – PJ Tip Sheets ed/financial-aid/im/tips ed/financial-aid/im/tips FINAID-L (Financial Aid Administrators)

Contact Information Maureen Terese ‘mo’ Amos Associate Director Northeastern Illinois University Financial Aid Office (773) Rebecca ‘Becky’ Powell Director Montcalm Community College (989)