Student Financial Aid Higher Education Appropriations Subcommittee January 24, 2008

1. Student Financial AidHigher EducationAppropriations SubcommitteeJanuary 24, 2008 David A. Feitz Executive Director Board of Regents Building 60 South 400 West Salt Lake City, UT 84101-1284 801.321.7210 dfeitz@utahsbr.edu

2. UHEAA • UHEAA is the financial aid and college savings organization of the Utah State Board of Regents (SBR). • Governed by a separate board of directors • 19-members • Acting under direction of SBR • Current UHEAA Board leadership • Chair: David Jordan • Vice Chair: Fred Hunsaker • 208 employees

3. UHEAA • UHEAA is Utah’s major financial aid provider. • Student loans • 10 grant and scholarship programs including: • Utah Centennial Opportunity Program for Education (UCOPE) • New Century Scholarship • College outreach • UtahMentor.org • 1.5 to 2 million page hits per month • Utah Educational Savings Plan Trust (UESP) – Utah’s 529 college savings plan

4. Fast Facts • UHEAA loan volume in fiscal 2007 • 102,700 student loans • $502 million: Consolidation, Stafford and PLUS loans • UHEAA’s default rate • 4.3% • Below the national rate of 4.6% • UHEAA’s student loan portfolio • 163,000 borrowers • $1.97 billion • UESP • Over 113,000 accounts • $2.5 billion total account balances

5. Fast Facts • UHEAA operating budgets • $210 million • No State appropriations for UHEAA operating expenses

6. UHEAA Student Loan Volume Stafford & PLUS Loans Fiscal Years 2001-2007 (Excludes Consolidation loans)

7. Student Loans Top Seven Schools Gross Loan Volume (In Millions) Fiscal Year 2007 University of Utah $80.2 Brigham Young University – Provo $46.0 Utah Valley State College $34.6 Utah State University $33.9 Brigham Young University – Idaho $27.9 Weber State University $22.7 Salt Lake Community College $12.7

8. Student Loans Top Seven Lenders Gross Loan Volume (In Millions) Fiscal Year 2007 Wells Fargo Bank $105.9 Zions First National Bank $70.7 America First Credit Union $43.1 US Bank $23.4 Mountain America Credit Union $22.1 Utah Community Credit Union $14.4 JPMorgan Chase $14.1

9. Average Student Loan Debt Burden National average debt for graduating seniors: $19,300* Utah average debt for graduating seniors in 2005: $11,709** *National Center for Education Statistics, The Condition of Education 2004, June 2004, http://nces.ed.gov/pubs2004/2004077.pdf **Calculations by the Project on Student Debt, based on data from Thomson Peterson’s Undergraduate Financial Aid and Undergraduate Databases. http://projectonstudentdebt.org/state_by_state-data.php

10. UHEAA Borrower Benefits: Interest Rate Discounts • “One of the best discount programs.” – Wall Street Journal (June 2, 2004)

11. UHEAA Money-Saving Benefits for Borrowers • UHEAA pays the 1% default fee for all borrowers • Zero origination fee on Stafford loans (currently equal to 1.5% of loan amount) • 0.50% rate reduction for automatic payments on Stafford and PLUS loans • 2% balance reduction after 48 on-time payments on Stafford and PLUS loans.

12. UHEAA Savings for Borrowers • UHEAA is a not-for-profit, State agency and shares its revenues with students to reduce borrowing costs. • Savings to Borrowers: • $17.6 million in FY 2007 • $110.1 million since FY 1998

15. How Do Students Pay for College? Savings Work Loans Scholarships Family Support Pell Grants Credit Cards UCOPE

16. Loans Are the Largest Source of Student Financial Aid

17. Example of Financial NeedUtah resident attending two semesters Cost of Attendance $20,000 Less Expected Family Contribution 2,200 Need 17,800 Less Aid Awarded Pell Grant $ 2,480 FSEOG 800 UCOPE 800 Stafford Loan 3,500 Work Study 2,200 Remaining Need $ 8,020 This example is based upon a dependent student from a two-parent household with a family size of six and two in college. Parental income is $60,000 with both parents working and $5,000 in savings. Student income is $3,600 with $1,000 in savings. Components of Cost of Attendance include tuition, fees, books, supplies, transportation, personal expenses, room & board, and may include loan fees, dependent care expenses, and expenses related to a student’s disability.

18. State Appropriations Student Financial Aid Programs* Fiscal Years 2004-2008 *Matching funds, UCOPE, New Century Scholarship, UECLP, UTAP, Minority Scholarship

19. UCOPE $4.2 mil $4.2 mil $2.8 mil $1.9 mil $2.8 mil $1.9 mil

21. New Century Scholarship

23. New Century Scholarship 2008 Disbursements

24. Return on Investment Brianne Moon • Southern Utah University graduate • Pell, Loans, UCOPE • UCOPE leads to internship • Internship leads to job offer • Staying in Utah to teach elementary school

25. Achieving Goals Ky Sealy • New Century Scholarship recipient • BS & MS in Electrical Engineering from Utah State University • First generation college graduate • Arrived at USU ready for the rigors of college • Siblings will receive New Century Scholarships

26. Education: The Way Out of Poverty Lanora Nielson • UCOPE recipient • Single mother of four • Honors student at Dixie State College • Goal to be a high school counselor “Without UCOPE I would not have the opportunity of going to college.”