Ethics, Prejudice and Professional Judgment

Ethics, Prejudice and Professional Judgment

Catherine Boscher-Murphy

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

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

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

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

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

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-sufficiencyfrom DCL GEN-03007 May 2003

Using Professional Judgment

• Some financial aid administrators (FAAs) are reluctant to use professional judgment – why?

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)

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

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

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

Objectivity in PJ

• Are all students completing same form• Are all students submitting similar

documentation• Do different staff members do things

differently

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?

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

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

Would you consider…

• COA adjustments for:• computer or computer software• trips required by the class• equipment/tools/supplies • uniforms

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

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

Would you consider…

• A PJ for a student who willingly and deliberately quit their job to go back to school?

Would you consider…

• Unemployment of a dependent student?

Would you consider…

• One time events inflating the AGI:– insurance payout– pension distribution– gambling winnings

Would you consider…

• Reduction in over time pay?

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

The Wilder Side of PJ

• How about this one?

The Wilder Side of PJ

The Wilder Side of PJ

• Transgender student – Unusual expenses– Surgery

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

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

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?

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

For further review

• NASFAA Statement of Ethical Principles

• NASFAA Guide to Addressing Special Circumstances (2003-04)

• www.finaid.org