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Higher Ed Roundup: Week of February 16 - February 20
Aid Administrators Ask Ed. Dept. to Stave Off Experimental Program Termination
Penn. Turning to Poker to Increase College Aid
Briefly Noted...
Aid Administrators Ask Ed. Dept. to Stave Off Experimental Program Termination
Financial aid administrators are pushing back against a Bush administration decision to end an initiative that aimed to find ways to improve efficiency and reduce administrative burdens in the federal student aid programs. This experimental sites program, which relaxed federal student aid regulations at roughly 100 colleges, will cease at the end of June following a December decision by the Department of Education that none of the experiments tried were successful enough to be replicated on a wide scale. In response, the National Association of Student Financial Aid Administrators (NASFAA) wrote a letter to the Department last week, calling the termination decision "ill-conceived," and asking it to reinstate the program. The letter defended the experimental sites program, saying it has "proven that alternative approaches do not result in higher default rates and students benefit by having timely access to loan funds to pay their expenses. Resources, both financial and human, are freed to better serve student aid recipients and their parents." There was no word as to whether the new Department leadership planned to reverse the decision.
Penn. Turning to Poker to Increase College Aid
Pennsylvania is taking a gamble on video poker to make college more affordable for low- and middle-income state residents under Democratic Governor Ed Rendell's Pennsylvania Tuition Relief Act. According to Rendell's plan, students from families making less than $32,000 a year will have to pay only $1,000 a year for tuition at 28 public universities, colleges, and community colleges. (Penn State University and the University of Pittsburgh, both large public institutions, are not included.) Students with familial incomes greater than $32,000 but below $100,000 could receive anywhere from $2,700 to $7,600 in additional tuition relief. The plan will be funded by increasing allocations for grants to community college students and the Pennsylvania Higher Education Assistance Agency (PHEAA), which administers a state grant program for students. Rendell plans to obtain money for the funding increases by getting the state General Assembly to legalize video poker machines and then tax a portion of the proceeds.
Briefly Noted...
- National Law Journal reports that the federal government is filing more lawsuits against delinquent student loan borrowers.
- Former deputy education secretary says too many students are not college ready.
- Historically Black Colleges and Universities particularly hard-hit by economic woes
Experimentation Needed to Find Best Practices
The decision to eliminate the Experimental Sites program, as well as Voluntary Flexible Agreements with some student loan guarantors and the Exceptional Performer program for lenders/servicers, shows an unwillingness on the Education Department’s part to think outside of the box when it comes to innovating the financial aid program. VFAs, Experimental Sites and Exceptional Performer all had one thing in common: They tested new ways to administer the student aid program, whether it was through improved debt management services for student loan borrowers, enhanced delivery methods, or relaxed regulations. We in the federal student aid community don’t always take the time to review the effectiveness of the rules (some of which are decades-old) that govern our programs. Financial aid professionals and policymakers should be dedicated to finding best practices, through experimentation, research and development, that work with students in the 21st century. Hopefully, a new administration that’s open to change will see the value in reinstating all three experimental programs. While “exceptions to the rule” may pose administrative headaches, the end result for the students is worth the initial pain. We’ll never know what truly works until we try it.
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