Ethics, Prejudice and Professional Judgment

1. Ethics, Prejudice and Professional Judgment Catherine Boscher-Murphy

2. Goals of this Session • Quickly define professional judgment • Review current statute and areas where professional judgment can be exercised • Outline ethical and prejudicial stumbling blocks to performing PJ’s • Interactive discussion

3. What is Professional Judgment? • Professional judgment is the authority provided under the Higher Education Act for financial aid administrators to exercise discretion in specific areas of student aid administration • Professional judgment is not regulated by the Department of Education

4. Why is PJ Important? • Enables FAA to respond appropriately to student’s individual circumstances that were not anticipated in legislation or regulation • something unique • merits individual attention

5. Areas where PJ does not apply • Professional judgment may not be used to: • Change a student’s status from independent to dependent • Devise a new category of costs • Adjust the bottom-line EFC • Change the EFC formula itself

6. Areas where PJ does not apply • Make an otherwise ineligible student eligible for Title IV aid • Circumvent the intent of the law or regulations • Include post-enrollment expenses in COA (except where allowed in regulation) • Circumvent FSEOG selection criteria

7. Cases where a dependency override is not allowed • Parents refusing to contribute to the student’s education • Parents unwilling to provide information on the FAFSA or for verification • Parents not claiming student as a dependent for tax purposes • Student demonstrating total self-sufficiency from DCL GEN-03007 May 2003

8. Using Professional Judgment • Some financial aid administrators (FAAs) are reluctant to use professional judgment – why?

9. Ethics - a definition from the Josephson Institute • Principles that define behavior as right, good, and proper • provides for respect for others • provides a means of evaluating and deciding among competing options • not the same as values (which can change from person to person and over time)

10. Ethics in PJ • Focus on circumstance that impacts family’s ability to pay • Review entire financial situation • may be items that offset the circumstances • Collect data from other campus staff • can they round out or complete the picture? • Although there is no requirement that the FAA reach the same decision in two similar cases, an ethical approach suggests consistency be the guiding principle

11. Institutional Issues • Does your school/director allow for PJ’s? • Has staff been trained? • Is there a consistent process? • Are you pressured to do PJ’s by institutional colleagues? Admission, athletics

12. Personal Prejudice in PJ • Does your background or upbringing get in the way of performing a PJ under certain circumstances? • Let’s explore different opportunities for PJ and see if prejudice may exist and inhibit decision making

13. Objectivity in PJ • Are all students completing same form • Are all students submitting similar documentation • Do different staff members do things differently

14. Subjectivity in PJ • Discretionary vs. non-discretionary items • cost of living expenses, credit card expenses, allowances • Necessities vs. lifestyle choices • vacations, weddings, expensive cars • Decisions made by one school are not binding at another school • Administrators do not have to agree • Do your policies include or exclude circumstances? • Can you make a logical argument for the PJ?

15. Typical Examples of Unusual Circumstances • Loss of employment of family member • Separation/Divorce of parent or independent student • Disability or Death of parent or independent student’s spouse

16. Typical Examples of Unusual Circumstances • Unusual family medical or dental expenses not covered by insurance • Tuition expenses at elementary or secondary school for student’s siblings or dependents • Prejudice? • Extraordinary dependent care expenses

17. Would you consider… • COA adjustments for: • computer or computer software • trips required by the class • equipment/tools/supplies • uniforms

18. Would you consider… • Independent status: • living with relatives due to violence, abuse but no official intervention • no court papers or DYFS involvement • cultural differences related to higher education

19. Would you consider… • Reducing student income if they help pay for family expenses? • Student earned $12,000 last year and gave $10,000 to parent for household expenses

20. Would you consider… • A PJ for a student who willingly and deliberately quit their job to go back to school?

21. Would you consider… • Unemployment of a dependent student?

22. Would you consider… • One time events inflating the AGI: • insurance payout • pension distribution • gambling winnings

23. Would you consider… • Reduction in over time pay?

24. The Wilder Side of PJ • Subsequent year requests? • year 1 - loss of employment • following year, loss of unemployment benefits • what about the second year of a pension distribution (again, to pay for basic living expenses or college) • What about the teacher or construction worker that is unemployed every year for several months

25. The Wilder Side of PJ • How about this one?

26. The Wilder Side of PJ

27. The Wilder Side of PJ • Transgender student • Unusual expenses • Surgery

28. Documentation • Documentation serves the following purposes: • Provides information in addition to that reported on FAFSA and other application documents (e.g., third-party documentation, copies of receipts, or canceled checks) • Provides history of student’s circumstances for future reference

29. Two Types of Documentation • One type encompasses materials collected to support the student’s request • Other type constitutes a clear record of school’s decision, how it was reached, and the actions taken

30. Things to remember: • Performing PJ’s is optional, not mandatory • Are the decisions following the intent of the regulation? • Decisions must not discriminate against the student • Are multiple cases treated in the same way?

31. Things to remember: • For Dependency Overrides, the situation must be revisited each year to determine that the circumstances are still in effect • PJ decisions combine common sense and economics with ethics • What you do on the federal side cannot always be repeated for state grant funds

32. For further review • NASFAA Statement of Ethical Principles • NASFAA Guide to Addressing Special Circumstances (2003-04) • www.finaid.org