New York State Financial Aid Administrators Association, Inc. Investing In New York’s Future – College Financial Aid A Workshop for Members and Staff of the NYS Legislature February 9, 2011 New York State Legislative Office Building Albany, New York

New York State Financial Aid Administrators Association, Inc. Higher Education ROI NYSFAAA Legislative Training Session February 9, 2011 James W. Gathard

New York State Financial Aid Administrators Association, Inc.

Higher Education ROI VALUE PROPOSITION Educational capital has a direct impact on the state’s social and economic health.

New York State Financial Aid Administrators Association, Inc. Higher Education ROI FINANCIAL - VALUE PROPOSITION As educational attainment increases financial dependency on government decreases.

New York State Financial Aid Administrators Association, Inc. Percentage of Individuals Ages 25 and Older Living in Households that Participated in Various Public Assistance Programs, by Education Level, 2008 Sources: The College Board, Education Pays 2010, Figure 1.15; U.S. Census Bureau, 2009; calculations by the authors. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Employer-Provided Pension Plan Coverage Among Full-Time Year-Round Workers Ages 25 and Older, by Education Level, 2008 Sources: The College Board, Education Pays 2010, Figure 1.12a; U.S. Census Bureau, 2009; calculations by the authors. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Unemployment Rates of Individuals Ages 25 and Older, by Education Level and Race/Ethnicity, 2009 Sources: The College Board, Education Pays 2010, Figure 1.10b; Bureau of Labor Statistics, 2010c. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Higher Education ROI “If you are a college graduate, unemployment is five percent. If you are a high school graduate, it is 10 percent or more. It is a very big difference.” Excerpt form Ben Bernanke’s Take on the Economy – CBX News, December 2, 2010.

New York State Financial Aid Administrators Association, Inc. Expected Lifetime Earnings Relative to High School Graduates, by Education Level Sources: The College Board, Education Pays 2010, Figure 1.2; U.S. Census Bureau, 2009; calculations by the authors. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Higher Education ROI  Educational Capital Investment Outcomes

New York State Financial Aid Administrators Association, Inc. Higher Education ROI Global Performance (OECD*) USA leads the world in the percentage of its population aged 55 to 64 with college degrees USA ranks 18 th in college graduation rates USA ranks 21 st in high school graduations rates USA ranks 1 st in college dropout rates *Organization of Economic Co-operation and Development 31 democracies and free market countries in NA, Europe and Asia

New York State Financial Aid Administrators Association, Inc. Postsecondary Enrollment Rates of Recent High School Graduates by Family Income, 1984–2008 Sources: The College Board, Education Pays 2010, Figure 2.1; National Center for Education Statistics, Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Annual Percentage Changes in State Appropriations for Higher Education per Full-Time Equivalent (FTE) Student and in Tuition and Fees at Public Four-Year Institutions in Constant 2009 Dollars, to SOURCE: The College Board, Trends in College Pricing 2010, Figure 10A. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Mean and Median State Appropriations for Higher Education per $1,000 in Personal Income, to SOURCE: The College Board, Trends in College Pricing 2010, Figure 11A. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. State Appropriations for Higher Education per $1,000 in Personal Income by State, (including Federal Stimulus Funds) SOURCE: The College Board, Trends in College Pricing 2010, Figure 11B. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Higher Education ROI  Shift Happens

New York State Financial Aid Administrators Association, Inc. Higher Education ROI Gaps in Educational Levels of New York’s Working-Age Population (ages 25 to 64)

New York State Financial Aid Administrators Association, Inc. Higher Education ROI U.S. educational pipeline by race/ ethnicity

New York State Financial Aid Administrators Association, Inc. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Higher Education ROI Source: U.S. Census Bureau, 5% Public Microdata Samples (based on 2000 Census). The greatest portion of U.S. population growth from ages 0 to 44 is projected to be among minorities.

New York State Financial Aid Administrators Association, Inc. Higher Education ROI Gaps in Educational Levels of New York’s Working-Age Population (ages 25 to 64)

New York State Financial Aid Administrators Association, Inc. Labor Force Participation Rates Among Individuals Ages 25 and Older, by Gender and Education Level, First Quarter 2010 Sources: The College Board, Education Pays 2010, Figure 1.8b; Bureau of Labor Statistics, 2010e. Higher Education ROI

New York State Financial Aid Administrators Association, Inc. Higher Education ROI Source: National Center for Higher Education Management Systems (NCHEMS).

New York State Financial Aid Administrators Association, Inc. Investment Recommendations  Close K-16 gaps  Communicate “value”; early and often  Simplify FA process  Shift loan subsidies Higher Education ROI

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Federal Financial Aid NYSFAAA Legislative Training Session February 9, 2011 Dan Sistarenik

New York State Financial Aid Administrators Association, Inc. How To Apply For Federal Financial Aid

New York State Financial Aid Administrators Association, Inc. Federal Financial Aid Federal financial aid is awarded in the form of: Grants Work programs Loans In order to qualify for any of these federal programs the student must complete the FAFSA (Free Application for Federal Student Aid) at

New York State Financial Aid Administrators Association, Inc. Federal Financial Aid Federal financial aid is awarded to students based on the following equation: Cost of attendance - Expected Family Contribution Financial Need

New York State Financial Aid Administrators Association, Inc. Federal Grants Grants are funds that are awarded and do not have to be repaid. The following educational grants are available from the federal government: Pell Grant Federal Supplemental Educational Opportunity Grant Teacher Education Assistance for College and Higher Education Grant (TEACH Grant)

New York State Financial Aid Administrators Association, Inc. Federal Grants continued Iraq and Afghanistan Service Grant For children whose parent or guardian was a member of the U.S. Armed Forces and died as a result of service performed in Iraq or Afghanistan after September 11, 2011 may be able to receive this grant.

New York State Financial Aid Administrators Association, Inc. Work Programs Federal College Work Study Students who are awarded these funds earn the funds through jobs either on campus or off campus. The award is limited to a specific dollar amount and is based on financial need.

New York State Financial Aid Administrators Association, Inc. Federal Student Loans Federal Direct Student Loans – loans where the federal government serve as the only lender. Students must repay these loans. Subsidized - the interest on the loan is subsidized by the federal government while the student is enrolled for at least 6 credits and for 6 months after the student either graduates or drops below 6 credits. 4.5% interest for loans during the 2010 – 2011 year.

New York State Financial Aid Administrators Association, Inc. Federal loans continued Unsubsidized – the federal government does not pay the interest while the student is enrolled. The student either makes quarterly interest payments or the interest is capitalized. Interest rate is 6.8%.

New York State Financial Aid Administrators Association, Inc. Federal loans continued Direct Parent Loans for Undergraduate Students- this is a credit worthy loan from which parents can borrow. The parent, if approved, can borrow the entire cost of attendance minus any financial aid the student receives. The loan is fully unsubsidized, meaning interest is accruing while the student is enrolled. Interest rate of 7.9%.

New York State Financial Aid Administrators Association, Inc. Federal loans continued Federal Perkins Loans – these loans are from monies allocated to schools to award to students who have significant financial need. The loans are fully subsidized and when the loans go into repayment (9 months after the student has graduated or dropped below 6 credits), the interest rate is fixed at 5%.

New York State Financial Aid Administrators Association, Inc. Federal loans continued Federal Perkins Loans – these loans are from monies allocated to schools to award to students who have significant financial need. The loans are fully subsidized and when the loans go into repayment (9 months after the student has graduated or dropped below 6 credits), the interest rate is fixed at 5%.

New York State Financial Aid Administrators Association, Inc. New York State Financial Aid Institutional and Private Aid NYSFAAA Legislative Training Session February 9, 2011 Shirley Clark

New York State Financial Aid Administrators Association, Inc. How To Apply For New York State Financial Aid

New York State Financial Aid Administrators Association, Inc. New York State (NYS) Aid New York State Aid is available for NYS residents attending NYS Institutions that meet eligibility criteria in the form of: Grants (TAP) Scholarships NYHELPs Loan In order to apply for TAP you must complete a application which can be found as a LINK on the submission page of the Federal FAFSA.

New York State Financial Aid Administrators Association, Inc. What is TAP? The New York State Tuition Assistance Program (TAP) helps eligible New York residents pay tuition at approved schools in New York State. TAP is the largest entitlement state student grant program in the nation. An annual TAP award can be up to $5,000 depending on when you first receive state aid, and because TAP is a grant, it does not have to be paid back.

New York State Financial Aid Administrators Association, Inc. TAP Eligibility Criteria Must be a U.S. citizen or eligible noncitizen & a legal resident of New York State Have graduated from high school in the United States, earned a GED, or passed a federally approved "Ability to Benefit" test as defined by the Commissioner of the State Education Dept. Matriculate in an Approved Program of Study at an Approved Postsecondary institution in New York State (This includes declaring a major in required time frame for undeclared acceptance)

New York State Financial Aid Administrators Association, Inc. TAP Eligibility Criteria Be enrolled as a full-time student taking 12 or more credits per semester Meet the NYS Net Taxable Income limitations Not be in default on a Student Loan Tuition charged must be at least $200 a year Remain in Good Academic Standing for State Aid

New York State Financial Aid Administrators Association, Inc. Factors in Determining TAP Awards First Year State Aid is Received Type of Institution and the Tuition Charged Combined family NYS taxable income and Federal, State or local pension income (for 2010 academic year add private pension and annuity amount excluded in 2009), if applicable. Financial Status (Dependent or Independent) Other Family Members Enrolled in College

New York State Financial Aid Administrators Association, Inc.

New York State Scholarships NYS Higher Education Service Corporation (HESC) administers all the New York State Aid programs including the New York State Scholarships Applications for NYS Scholarships can be found on HESC s Website under the following link:

New York State Financial Aid Administrators Association, Inc.

What is a NYHELPs Loan? NYHELPs is a state-sponsored, supplemental loan program administered by New York State. It is available to eligible borrowers that have applied for and accepted all of the State, Federal and Institutional Aid for which they were eligible, however still need more funding to attend college. Available only at participating colleges.

New York State Financial Aid Administrators Association, Inc. New York State Aid Funding Post Secondary New York State Aid funding is part of the New York State Budget Process each year: Governor proposes budget Assembly can counter-propose new budget Governor can Veto items Senate can vote to override the Vetoes

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Institutional and Private Aid

New York State Financial Aid Administrators Association, Inc. Institutional and Private Aid Check with the Admissions and the Financial Aid offices at schools where students may be applying to or currently attending to get information on financial aid offered by the school and/or other private resources that offer student financial aid for higher education.

New York State Financial Aid Administrators Association, Inc. Institutional and Private Aid Each Institution may have their own Scholarship programs Private entities and corporations may have various scholarships they endow There are various Private Alternative Loan products available from lending institutions

New York State Financial Aid Administrators Association, Inc. Systemic Retention NYSFAAA Legislative Training Session February 9, 2011 Dr. Kenneth Clough

New York State Financial Aid Administrators Association, Inc. What is Systemic Retention? Systemic retention often refers to individual student retention in higher education across varying institutions. New and Expanded Definition Systemic retention is the ability of a state to attract, educate, and retain citizenry for the economic and common benefit of the state.

New York State Financial Aid Administrators Association, Inc. Dimensions of Systemic Retention Attracting, retaining and graduating students in higher education. Attracting, retaining and graduating students as citizens of New York State. Attracting, retaining and graduating students as economic contributors in New York State.

New York State Financial Aid Administrators Association, Inc. Why is Systemic Retention Important? Improved retention optimizes the student’s investment in higher education. Improved retention optimizes the taxpayer investment in higher education. Improved retention optimizes an institution’s investment in the education process. Improved retention optimizes New York State’s economic vitality.

New York State Financial Aid Administrators Association, Inc. Improving Student Retention Multiple factors contribute to improved student retention – Academic preparation before attendance – Academic support during attendance – Funding – direct, indirect, and financial aid – Student support from family and friends

New York State Financial Aid Administrators Association, Inc. Systemic Retention is a Partnership The Student – a commitment and understanding of the education process. The Institution – provides academic programs, academic support, financial assistance. New York State – provides direct support, indirect support, financial aid, policy direction and guidance with an ability to have a broad perspective.

New York State Financial Aid Administrators Association, Inc. Systemic Retention Policy Needs Identification and recognition of systemic retention needs and potential outcomes. Academic preparation – are students entering higher education prepared? Funding – direct aid, indirect aid, and student financial aid are essential.

New York State Financial Aid Administrators Association, Inc. NYSFAAA and Systemic Retention Contributions of NYSFAAA to Systemic Retention – Early awareness of higher education – General financial aid awareness – Extensive personal student interaction – Uphold high academic standards through satisfactory academic progress

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Default Prevention and Management NYSFAAA Legislative Training Session February 9, 2011 Michael Williams

New York State Financial Aid Administrators Association, Inc. Default Prevention Tools Various Loan Repayment Options Forbearance Deferment Loan Consolidation Financial Literacy Training

New York State Financial Aid Administrators Association, Inc. Student Loan Default -Default occurs on a student loan after a loan delinquency has persisted for 270 days -During a student loan borrowers delinquency period, the loan holder must exercise "due diligence" in attempting to collect the loan

New York State Financial Aid Administrators Association, Inc. Student Loan Default (cont’d) “-Due Diligence” includes repeated efforts to locate and contact a borrower regarding their loan delinquency -If the loan holder’s initial collection efforts are unsuccessful, the borrower is notified and a pre- default claim is filed with the Guaranty Agency or the Dept of Education -If the delinquency remains unresolved, a default claim is being filed with the guaranty agency or Dept of Education, which “purchases” the student loan

New York State Financial Aid Administrators Association, Inc. Consequences of Default Once a student loan is purchased, the following steps may be taken to recover the outstanding balance due: The Department of Treasury may offset the borrower’s federal tax refund which is authorized by law. In New York state tax refunds may also be seized.offset the borrower’s federal tax refund A borrower will be required to pay additional collection costs collection costs A borrower may be subject to Administrative Wage Garnishment- a borrower’s employer will be required to forward up to 15% of the bor’s disposable pay toward repayment of the defaulted loanAdministrative Wage Garnishment

New York State Financial Aid Administrators Association, Inc. Consequences of Default (cont’d) Federal employees face the possibility of having 15% of their disposable pay offset by the Department toward repayment of their loan through Federal Salary Offset Legal action may be taken to force a borrower to repay their loan adding add’l court costs Legal action  Credit Bureaus will be notified damaging the borrowers credit rating Credit Bureaus will be notified

New York State Financial Aid Administrators Association, Inc. Default: Loss of Financial Aid Eligibility Once a loan is declared in default, a borrower is no longer eligible for additional federal or NYS financial aidno longer eligible for additional federal or NYS financial aid Reference Source: ault.html

New York State Financial Aid Administrators Association, Inc. Resolving a Default thru Loan Rehabilitation Loan(s) will no longer be considered to be in a default status The default status reported to the national credit bureaus will be updated Benefit eligibility is restored (such as deferments, forbearance, and Title IV aid) Wage garnishment and Internal Revenue Service/state tax offsets cease

New York State Financial Aid Administrators Association, Inc. How to locate a Defaulted Loan Borrowers can call FED-AID ( ) for the address and telephone number of the agency that holds their defaulted loan(s) The National Student Loan Data System (NSLDS) also contains information on the amount and types of loans outstanding

New York State Financial Aid Administrators Association, Inc. Additional Resource Information for Defaulted Borrowers Contact the U.S. Department of Education’s Federal Student Aid (FSA) Default Resolution Group at: Phone : Website

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The New York State Financial Aid Administrators Association NYSFAAA Legislative Training Session February 9, 2011 Dan Sistarenik

New York State Financial Aid Administrators Association, Inc. What is NYSFAAA?  Financial Aid Professionals  1,371 Members in NYS  A Charitable Volunteer Association  Advocates for Access for All Students to Post-Secondary Education  Eight Regions  Training of Members  Outreach Activities  Partnerships With State and Local Agencies  Information and Impact Specialists on Financial Aid Programs  The NYSFAAA Website is

New York State Financial Aid Administrators Association, Inc. Major Partners 1)NYS Grant and Guaranty Agency (NYSHESC) 2)NYS School Counselors 3)Federal and State Advisory Boards/Government Relations 4)Student Groups 5)National Financial Aid Association

New York State Financial Aid Administrators Association, Inc. NYS Higher Education Services Corporation  NYS Grant and Guaranty Agency  Partnership with NYSFAAA  Joint Outreach Activities  College Aid Awareness  School Counselor Workshops  Legislative Training Sessions  GEAR UP (Gaining Early Awareness and Readiness for Undergraduate Programs)  New York HELPs  The HESC website is

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