Special Circumstances and Dependency Overrides

1. Special Circumstances and Dependency Overrides Troy Martin, Director of Financial Aid St. Bonaventure University

2. Special Circumstances

3. FAFSA • Information is as of the date the form is completed – snapshot in time of the family’s resources • But, as we know, sometimes “life” happens. There are changes in a family’s situation. There are changes in a family’s ability to pay for college expenses.

4. Special circumstances • The economy has impacted many families this year

5. Definition of professional judgment • The sound evaluation of and response to a student’s exceptional circumstances according to the technical and ethical principles of federal student aid. • Decision process to alter standard assessment when unique or exceptional circumstances impact a family’s ability to pay for college

6. Section 479A of the Higher Education Act of 1965, as amended “Nothing … shall be interpreted as limiting the authority of the financial aid administrator, on the basis of adequate documentation, to make adjustments on a case-by-case basis to the cost of attendance or the values of the data items required to calculate the expected student or parent contribution to allow for treatment of an individual eligible applicant with special circumstances.”

7. Professional judgment • It’s a subjective process – there is no right or wrong answer • Must be on a case-by-case basis • Must be documented • Approaches and results will be different for each financial aid administrator • Adjustment is only valid at the school making it • Cannot use to waive eligibility requirements or circumvent the law

8. Examples of special circumstances • Student or parent has recently lost a job • Unusually large medical, dental, or nursing home bills that are not covered by insurance • Elementary or secondary school tuition • Unusually high child or dependent care expenses • Parents enrolled at least half-time • Other changes in a family’s income or assets • Being homeless or a dislocated worker

9. Needs analysis • Measures ability to pay for college not willingness to pay • PJ cannot adjust for willingness to pay; only ability to pay

10. Role and responsibilities of the financial aid administrator • Steward of funds, student advocate, systems manager • The financial aid administrator must document and support the reason for the determination and maintain documentation supporting the decision • The financial aid administrator’s decision is final and cannot be appealed to the US Department of Education

11. Examples of documentation • Medical bills not reimbursed by insurance • Elementary/secondary tuition bills • Child care or dependent care bills • Pay stubs • Unemployment benefit statement • Tax returns

12. Professional judgment • May not – • Make an adjustment on the initial FAFSA • Change the formula itself or the tables • Change “bottom line” contribution • Cannot make an independent student dependent • No student or parent should be charged a fee for collecting, processing, or delivering such supplemental information

13. Unreasonable professional judgments • Vacation expenses • Tithing expenses • Standard living expenses such as utilities • Credit card expenses • Standard maintenance items such as lawn care and home repair

14. Professional judgment • Cannot be based on a “feeling” – it must be based on a reasonable level of data and information • Is not at tool to manipulate the system • Is not a tool to legitimize “negotiation” or to barter • Is not a tool to manage enrollment

15. Professional judgment – best practices • Make process as simple as possible – many families already dealing with trauma • Open ended questions rather than a checklist • Institutional forms • Committee decision • May be proactive or reactive • Is consistent • Adequate documentation • Like a doctor – examines, evaluates symptoms, diagnosis, treatment plan

16. Dependency Overrides

17. Dependency questions on the FAFSA • Step Three (Student): • Questions #45 - #57 • If the student answers “NO” to every question in Step Three, then they are considered to be dependent and must complete Parent Information • If the student answer “YES” to any question in Step Three, then they are automatically independent and are not required to complete Parent Information

18. FAFSA • #45 – Were you born before January 1, 1990? • #46 – Are you married? • #47 – Will you be working on a master’s or doctorate program? • #48 and #49 – Are you a veteran or currently serving in the US Armed Forces? • #50 and #51 – Do you have children or other dependents who live with you and you provide more than half of their support?

19. FAFSA (continued) • #52 – Are both parents deceased, were you in foster care, or were you a ward of the court? • #53 – Are you an emancipated minor as determined by a state court? • #54 – Are you in legal guardianship as determined by a state court? • #55 – Did your high school or school district homeless liaison determine that you were an unaccompanied youth who was homeless?

20. FAFSA (continued) • #56 – Did the director of an emergency shelter or transitional housing program funded by HUD determine that you were an unaccompanied youth who was homeless? • #57 – Did the director of a runaway or homeless youth basic center or transitional living program determine that you were an unaccompanied youth who was homeless or were self-supporting and at risk of being homeless?

21. FAFSA dependency questions • The financial aid administrator at the college may require the student to provide proof if the student answers “YES” to any question in Step Three

22. Examples of dependency overrides • Student’s voluntary or involuntary removal from parents’ home due to an abusive situation that threatened the student’s safety and/or health • Incapacity of parents such as incarceration or a disability or mental or physical illness • Inability of the student to locate the parents after making reasonable efforts • Other extenuating circumstances sufficiently documented by a signed letter from a third party

23. Third party • Counselor or teachers • Clergy • Community groups • Government agencies • Medical personnel • Courts • Prison administrators

24. A student can not be determined to be independent just because • The parents are unwilling or don’t want to provide the information on the FAFSA • The parents don’t feel it’s their responsibility to provide financial assistance for college or refuse to contribute • The parents do not claim the student as a dependent on their taxes • The student no longer lives at home • Student demonstrates total self-sufficiency

25. Dependency overrides • A dependency override is an annual determination. The institution must affirm each year that the unusual circumstances still exist. • While an institution may make an otherwise dependent student independent, an institution may not make an independent student dependent.

26. Role of the guidance counselor • If you have a student who you believe has special circumstances or should be independent, you should encourage the student to: • Contact the financial aid administrator at the school he or she plans to attend • Gather as much written evidence as possible including a letter from a third party who knows the situation

27. Sources • NASFAA – “Exercising Professional Judgment” • USA Funds – “Professional Judgment” • Heather McDonnell – “Using Professional Judgment” • US Department of Education – • Counselors and Mentors Handbook • Student Financial Aid Handbook • “Use of Professional Judgment to address families impacted by the economy”