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Budgeting and Packaging of Financial Aid

Budgeting and Packaging of Financial Aid. NYSFAAA Novice Training Scott Atkinson Director of Enrollment Services June 2014. Cost of Attendance Budgets. DEFINITION:

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Budgeting and Packaging of Financial Aid

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  1. Budgeting and Packaging of Financial Aid NYSFAAA Novice Training Scott Atkinson Director of Enrollment Services June 2014

  2. Cost of Attendance Budgets DEFINITION: • COA Budgets are standardized projections of reasonable direct and indirect education-related costs incurred by students of similar attributes for a defined enrollment period which MUST be used to determine eligibility for all Title IV aid programs.

  3. Building the COA Budget • Required considerations when building the COA, the aid administrator must: • Use actual or average expenses • Maintain documentation for each component • Update annually and timely • Allow adequate costs for moderate living • Standardize based upon categories of students with similar attributes

  4. Standard Budget Components • Tuition & Fees • Room and Board • Books and Supplies • Equipment Rental/Purchase • Personal Expenses • Transportation • Educational Loan Fees

  5. Additional Components • Non-standard educational costs as documented by the student or required for the student’s program: • Professional Credential Fees • Personal Computer • Disability-Related Expenses • Dependent Care • Consortium Study • Study Abroad Program • Co-op Program

  6. Professional Judgment • Professional Judgment may be used when an individual student has expenses that are reasonable and appropriate, but exceed amounts allotted in the standard budget. • Such adjustments to the COA under Professional Judgment must be properly documented and done on a case by case basis.

  7. Professional Judgment • Some examples of how professional judgment can be employed to adjust the COA: • Special dietary needs • Optional fees (unless paid to a third party) • Optional projects • Exceptionally high travel costs

  8. Exceptions • The following groups of students must have other than standard COA budgets: • Less than half time - exclude personal expenses • Correspondence study and Incarcerated - tuition, fees, books and supplies only

  9. Pell Grant COA • Costs for Pell Grant Budgets are the same as those for standard budgets, and are always based on full time, ¾ time, ½ time, and less than ½ time.

  10. Packaging DEFINITION: The process by which need based and non-need based aid is awarded within the parameters of the Cost of Attendance Budget.

  11. Packaging Requirements • Regulatory compliance • Defined institutional packaging policies • Development of COA Budgets • Offer best possible combination of awards • Fair and equitable distribution of awards • ISIR with official EFC • Balance total aid with COA • Rectify overawards • Student consumer information

  12. Packaging The basic premise of Needs Analysis… Cost of Attendance Expected Family Contribution = Financial Need

  13. Entitlement Aid • Must be packaged first • Federal Pell Grant • State Grant • Other

  14. Other Resources • Estimated Financial Aid (EFA) from other sources, not within the institution’s purview to award • State aid • Outside scholarships • Tuition waivers

  15. Need-Based • Awards packaged by the institution to cover remaining need • Federal Campus Based Aid • Federal Subsidized Stafford Loan • Institutional Grants and Scholarships COA-EFC-EFA=Remaining Need

  16. Non-Need Based Aid • Packaged to cover any unmet need and Expected Family Contribution (EFC) • Federal TEACH Grant • Federal Unsubsidized Stafford Loan • Federal PLUS • Private Alternative Loans • Federal Graduate PLUS COA-EFA=Non-Need Based eligibility

  17. Quick Example • Cost of Attendance $15,000 • Expected Family Contribution - 3,000 • Need $12,000

  18. Quick Example cont. • Federal Pell Grant -$2,680 • Elk’s Club Scholarship - 2,000 • Federal Subsidized Stafford Loan - 4,500 • Federal SEOG - 750 • Federal Perkins Loan - 2,000 • Unmet Need $ 70 • Non-Need Based Aid • Federal Unsubsidized Stafford Loan $2,000 • Federal PLUS $1,000 • Family Responsibility (COA-EFA) $ 70

  19. Overawards • DEFINITION: When either need-based aid exceeds calculated need AND/OR total aid exceeds COA. Over-awards must be resolved.

  20. Correcting Overawards • Never reduce Federal Pell or other entitlement • Increase COA budget with documentation • Reduce anticipated disbursements • Adjust non-need based funding first • Eliminate Stafford/PLUS before Campus-Based • Campus-based $300 tolerance/threshold • Fully disbursed Stafford MAY remain unresolved • May result in an overpayment

  21. Sample #1: slide 1Public Four-Year University • Total Family Income $33,915 • Family of 4 with 1 other family member in college • Second-year undergraduate student Order of packaging to meet need: • Grants • Federal subsidized loans • Work

  22. Sample #1: slide 2Public Four-Year University

  23. Sample #1: slide 3Public Four-Year University • Grant aid = $9,313, or 46% of COA • EFC may be covered by: • Additional parent PLUS • Direct Unsubsidized Stafford Loan

  24. Sample #2: slide 1Private Non-profit Four-Year College • Total Family Income $33,457 • Family of 3 with 1 other family member in college • First-year undergraduate, living on campus • AGI = $32,866

  25. Sample #2: slide 2Private Non-profit Four-Year College

  26. Sample #2: slide 3Private Non-profit Four-Year College Grant aid = $25,818, or 73% of COA Self-help (EFC + loans + work +unmet need) = $12,207, or 27% of COA Unmet need plus EFC may be covered by a parent PLUS loan.

  27. Sample #3: slide 1Community College, Two-Year First-year undergraduate, living with parents Once FWS has been fully allocated, unsubsidized loans are offered (up to $2,000 for dependent undergraduates, or up to $6,000 for independent undergraduates. Early applicants are more likely to get campus-based funds (FSEOG, FWS, Perkins loans). Later applicants generally receive PELL Grant and Direct Loans, and are more likely to need unsubsidized loans.

  28. Sample #3: slide 2Community College, Two-Year

  29. Sample #3: slide 3Community College, Two-Year Grants = $5,580 or 36% of COA Self-help aid (EFC + loans + work + unmet need) = $9,840, or 64% of COA. Unmet need and EFC may be covered by: • Direct Unsubsidized Stafford Loan • Direct Parent PLUS Loan

  30. Questions? • Do you know the Cost(s) of Attendance at your school? • How was it determined? • Does your school have a written Packaging Policy? • Discussion…

  31. Resources • “Developing the Cost of Attendance, ” Monograph A NASFAA Series, June 2007, Number 20. • Volume 3, Chapter 2, “Cost of Attendance (Budget),” 2013-2014 Federal Student Aid Handbook, USDE, FSA. • Volume 3, Chapter 7, “Packaging Aid,” 2013-2014 Federal Student Aid Handbook, USDE, FSA. • Volume 4, Chapter 3, “Overpayments and Overawards,” 2013-2014 Federal Student Aid Handbook, USDE, FSA.

  32. Contact Information J. Scott Atkinson Director of Enrollment Services The College at Brockport State University of New York 350 New Campus Drive Brockport, NY 14420 Phone: (585) 395-5847 Fax: (585) 395-2041 E-Mail: satkinso@brockport.edu Web site: www.brockport.edu/finaid

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