Reforming Student Financial Aid in Indiana Early Progress from House Enrolled Act 1348 January 29, 2015

Indiana is a national leader in providing low-income students with financial support, but its success in enabling college access has not produced similar gains in college completion. To promote college completion, House Enrolled Act 1348 established academic benchmarks and expectations for state financial aid recipients. First-year results suggest the legislation has had a positive impact on student performance. House Enrolled Act 1348 is propelling more Hoosiers toward on-time college completion

More students are enrolling in 30 or more credit hours during the academic year The percentage of 21 st Century Scholars enrolling in 30 credits has increased: The same pattern holds for Frank O’Bannon recipients:

More students are completing 30 or more credit hours during the academic year 21 st Century Scholars showed the most pronounced improvements: But O’Bannon Recipients improved as well:

Students are using summer classes to preserve financial aid eligibility Among 21 st Century Scholars who were just shy of the 30 credit threshold, enrollment in summer courses jumped nearly 10 percentage points. This suggests that institutional efforts and incentives to enroll this population in summer courses worked. Percentage of 21st Century Scholars with credits at the end of spring semester freshmen year who decided to enroll in summer courses +9.7

Banded tuition structures promote on-time enrollment Percentage of All Full-Time Students Enrolling in 30+ Credits Prior to HEA Implementation (AY , fall and spring only) Banded63.2%63.9%75.4% Per-Credit11.8%14.0%33.8% Banded65.6%62.8%64.3% Per-Credit10.5%11.6%15.7% 21 st Century Scholars Frank O’Bannon Recipients The schools with the largest percentage of students enrolling in on-time schedules are those with a banded tuition structure But the schools that saw the greatest gains in credit enrollment following 1348 were those that do not offer banded tuition.

Dual and AP credits help students meet completion requirements but have one unintended effect AY AY students (2%) met 39+ credit threshold through freshmen-year classes alone 7 students (1%) met 39+ credit threshold through freshmen-year classes alone Students who enter with college credit have a built-in cushion to help them meet completion requirements. But the O’Bannon incentive creates a second-year funding cliff, and does not serve the purpose for which it was created.

Lessons Learned Students act on the advice they are given. The higher the expectations, the better the outcomes. Student incentives also motivate colleges. Enrollment does not guarantee completion. Passing the law was the easy part. Other completion efforts performed in tandem can increase success rates.

Commission Agenda Bill: HB 1333 EARN Indiana eligibility tied to need, not receipt of another grant National Guard Supplement Grant decoupled from Frank O’Bannon National Guard Supplement Grant residency for dependent students based on student residency CVO grade point average changed to SAP from the tiered SAP/2.25/2.5 structure

Commission Agenda Bill: SB 509 Refocuses part-time grant as adult student grant for independent students Allows hybrid enrollment (FT/PT) by removing 11-credit ceiling Peels off the “high demand high wage” subsidy in the part- time statute as separate program, administered as graduation grant Allows the Commission to transfer unused full-time funds to the adult student grant

Commission Agenda Bill: HB 1262 Launches statewide effort to get 200,000 Hoosiers with some college, no degree to return and complete Creates a limited-time graduation grant for this population (ending in 2020)

Other Financial Aid Bills HB 1042: Required “truth in lending” notices for students who take out federal loans (all CHE-eligible institutions) HB 1231: Accelerate your Success award, grant money for institutions to start accelerated programs