TASFAA NAOW Workshop 2010

1. TASFAANAOW Workshop 2010 Packaging Financial Aid Martin R. Hernandez Director of Financial Aid Paul Quinn College

2. What is Packaging? • Packaging is a process by which the financial aid office awards a combination of aid from several sources to meet part or all of a student’s financial need.

3. Packaging Goals of Financial Aid Administrator • Provide as many students as possible with resources to meet their financial need • Distribute resources in an equitable manner • Provide assistance that will be the most beneficial • Attract students to the school

4. Resources • Resources include (but are not limited to): • Pell Grant (first source of aid) • Scholarships • Other Federal, State and Institutional Grants • Subsidized Stafford and Perkins Loans • Need-based employment • Waivers of tuition and fees • Fellowships or assistantships Source: FSA Handbook 2009-10, Vol. 3, Pages 79 - 147

5. Resources • Resources include (but are not limited to): • VA Benefits • Americorps Funds • Unsubsidized Stafford Loans* • PLUS Loans* • Private Loans* *indicates resources that may exceed need, but may not exceed COA. Source: FSA Handbook 2009-10, Vol. 3, Pages 79 - 147

6. Additional Guidelines • Enrollment criteria • Classification • Annual and Aggregate Maximums • Annual Minimums • Need Based vs. Non-Need Based • Academic Criteria • Residency Criteria

7. Steps in Packaging • Determine the cost of attendance (COA). • Calculate financial need • Determine eligibility for individual funds • Develop package using funds for which student qualifies • Refer to supplemental sources of assistance as needed

8. Step 1- Determining the Student’s Cost of Attendance (COA) • Tuition & Fees • Books & Supplies • Room & Board • Transportation • Miscellaneous/Personal • Dependent Care • Loan Fees • Cost of approved study-abroad program Source: FSA Handbook 2009-10, Vol. 3, Chapter 2

9. Cost of Attendance -EFC Financial Need Step 2 – Calculating the Student’s Financial Need

10. Step 3 – Determine Eligibility for Individual Resources • Determine Pell Grant eligibility first • FSEOG • Generally awarded to neediest students (Pell Grant recipients) • State Grants • Examples: Texas Grant, TEG • Criteria set by the state • Institutional Grants & Scholarships - criteria set by the institution

11. Step 3 – Determine Eligibility for Individual Resources • Work-Study • Examples: FWS, TCWSP • Awarded within need and according to institutional policy • Perkins Loan • Generally awarded to neediest students and according to institutional policies • Subsidized Stafford Loan • Awarded within need, maximums determined by federal regulations

12. Step 4 – Develop Package • Develop package using funds for which the student qualifies • Institution’s award packaging policy can influence the resulting package • Total of package cannot exceed COA

13. Step 5 – Other Supplemental Assistance • Unsubsidized Stafford • PLUS Loan • Private Loans

14. Five Basic Packaging Techniques • First-Come, First-Served • Special Targeted Groups • Self-Help Concept • Equity Concept • Absolute Dollar Equity • Fixed Percentage Equity • Packaging to Cost of Attendance

15. Packaging Techniques • First-Come, First-Served • Based on the order in which completed applications are received by the aid office until funds are exhausted.

16. Packaging Techniques • Targeted Groups • Separate packaging criteria for specific groups of students in addition to specific criteria required by law or regulation. (Good for institutional scholarships)

17. Packaging Techniques • Self-Help • Self-help assistance awarded after the family contribution and before any consideration for gift aid.

18. Packaging Techniques • Equity Concept • Absolute Equity • Students funded up to an institutional maximum fixed dollar amount with gift aid before their remaining need is filled with self-help. • Fixed Percentage Equity • An institutional maximum percentage of NEED or COST for all gift aid is used.

19. Packaging Techniques • Packaging to Cost of Attendance • Student’s FA need is met as much as possible according one or a combination of the previous techniques • Unmet COA is filled using remaining unsubsidized Stafford loan eligibility, PLUS and/or Private Loans.

20. Packaging Techniques • Many institutions do not use a specific model by itself. Variations of the models can be used to best fit the institutional objectives.

21. Award Notification • Institutions are required to inform the student of: • the amounts • terms and conditions of his/her award • manner and timing of payments • Signature of acceptance by the student is no longer required. However, many institutions continue this practice.

22. Packaging Example Holly B. Needy • Incoming first-year student, AY 10/11 • COA = $20,000 EFC = $500 • Qualifies for state residency • Has PTA scholarship of $2000 • Eligible for Pell Grant of $5500 • Maximum awards: State Grant - $2500, Stafford Loan - $3500, Work Study - $2500, • Institutional grant to fill remaining gap in gift aid. Package this student with the “FIXED PERCENTAGE OF NEED” equity model with a maximum of 70% gift aid (scholarship considered part of gift aid).

23. Packaging Example • Determine need COA – EFC = Financial Need $20,000 - $500 = $19,500 Financial Need • Determine gift aid Financial Need * Gift Pct = Max gift aid $19,500 * 70% = $13,650

24. Packaging Example • Need 19,500 • Max Gift Aid 13,650 • Pell Grant 5,000 • PTA Scholarship 2,000 • State Grant 2,500 • Institutional Grant 4,150 • Gift Aid Awarded 13,650 • Remaining FA Need 5,850 • Work Study 2,500 • Sub Stafford Loan 3,350 • Total Self-Help 5,850 • Unmet FA Need 0 • Total Package 19,500 • Can Holly get anything else?

25. Thank you for your attention! Questions? Martin R. Hernandez 214-379-5530 mhernandez@pqc.edu