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New Era of Accountability Diane Auer Jones Assistant Secretary for Postsecondary Education U.S. Department of Education. Restoring Confidence. Federal Student Aid Programs Borrower Benefits/Choice Transparency Compliance Financial Aid Administrators - PowerPoint PPT Presentation
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New Era of Accountability
Diane Auer JonesAssistant Secretary for
Postsecondary EducationU.S. Department of Education
2
Restoring Confidence
• Federal Student Aid Programs• Borrower Benefits/Choice• Transparency• Compliance
• Financial Aid Administrators• FFEL Lenders and Guarantee Agencies• Department of Education
3
College Attendance Rates
U n d ergrad u ate E n ro llm en t b y A tten d an ce S ta tu s1986-2016
Sou rce: U .S . D epartm ent o f E du cation
0
2 ,0 0 0 ,0 0 0
4 ,0 0 0 ,0 0 0
6 ,0 0 0 ,0 0 0
8 ,0 0 0 ,0 0 0
1 0 ,0 0 0 ,0 0 0
1 2 ,0 0 0 ,0 0 0
8 5 -8 6
8 8 9 0 9 2 9 4 9 6 9 8 0 0 0 2 0 4 0 6 0 8 1 0 1 2 1 4 1 5 -1 6
Full-time Part-Time
5,618,000
9,009,000
5,094,000
7,169,000
6,259,000
10,333,000
4,271,000
6,348,000
4
College Prices
InstitutionalType
AverageCost
1996-97
Average Cost
2006-07
Increase over past 10 years,
%
Increase 2005/6 to 2006/7, $
Increase in 2005/6 to 2006/7, %
2 yearPublic
$1,465 $2,272 55% $90 4%
4 year TF
Public$2,975
$7,142
$5,836
$12,796
96%
79%
$344
$681
6%
6%
4 year TF
Private$12,994
$18,357
$22,218
$30,367
71%
65%
$1,238
$1,624
6%
6%
TF
TFRB
TFRB
T (tuition); F (fees); R (room); B (board)Source: College Board
5
Helping Students MakeInformed Choices• FAFSA4Caster• College Navigator
• FIPSE Student Achievement and Institutional Performance Pilot Project•AAC&U, ASCU, & NASULGC
6
Federal Student AidTOTAL PELL GRANT EXPENDITURES
$0
$2,000,000,000
$4,000,000,000
$6,000,000,000
$8,000,000,000
$10,000,000,000
$12,000,000,000
$14,000,000,000
$16,000,000,000
1987
-198
8
1988
-198
9
1989
-199
0
1990
-199
1
1991
-992
1992
-199
3
1993
-199
4
1994
-199
5
1995
-199
6
1996
-199
7
1997
-199
8
1998
-199
9
1999
-200
0
2000
-200
1
2001
-200
2
2002
-200
3
2003
-200
4
2004
-200
5
2005
-200
6
2006
-200
7 *
2007
-200
8 *
2008
-200
9 *
* Estimate
7
Pell Grant Maximum Awards2000-2012
Fiscal Year Award Year Authorized Appropriated
2000 2000-01 $4,800 $3,3002001 2001-02 $5,100 $3,7502002 2002-03 $5,400 $4,0002003 2003-04 $5,800 $4,0502004 2004-05 $5,800 $4,0502005 2005-06 $5,800 $4,0502006 2006-07 $5,800 $4,0502007 2007-08 $5,800 $4,3102008 2008-09 -------- + $4902009 2009-10 -------- + $4902010 2010-11 -------- + $6902011 2011-12 -------- + $6902012 2012-13 -------- +1,090
8
Academic Competitiveness GrantsPell Grant Eligible Enrolled Full-Time & U.S. Citizen
Rigorous Secondary School Program of Study• Recognized State-submitted programs; or• Courses similar to State Scholars Initiative; or • 2 AP Courses with test score of 3 or better; or• 2 IB Courses with test score of 4 or better
Award Size: $750/$1300
2006: $233,038,410 awarded to 299,089 students
http://www.ed.gov/admins/finaid/about/ac-smart/state-programs06.html
http://www.ed.gov/admins/finaid/about/ac-smart/2007/state-programs-07.html
9
Academic Competitiveness GrantsInnovative Strategies to Identify Eligible Students:
• Institutions and states can establish a branded core curriculum for college admissions.
• Example: The University of California’s A-G coursework requirements for Admissions are well-known by high schools students throughout the State and constitute an ACG-approved course of study.
• The state can certify AC Grant eligibility by sending to postsecondary institutions reports listing eligible students.
• Example: Students in the State of Florida who have completed the ACG-approved curriculum are eligible to receive the Bright Futures Scholarship. Florida sends universities the names of Bright Futures recipients.
• Institutions can reach out to all Pell Grant recipients, not just students who self-identify as eligible.
• Example: Brigham Young University, Idaho, contacted all students who self-certified on their FAFSA as well as other students who appeared to be potentially eligible based on a review of transcripts and financial aid records.
10
National SMART Grants
Eligibility: Pell Grant Eligible Enrolled Full-Time & U.S. Citizen 3rd and 4th year college students enrolled in and making progress toward a degree in STEM or Critical Needs Foreign Language; GPA 3.0 or better.
Award Size: $40002006 - $195,544,735 awarded to 60,976 students
ChangesAdditional SMART Majors added Enrollment requirements clarified
11
Institutional AidInstitutional Aid by Academic Year
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
1996-1997
1997-1998
1998-1999
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
Academic Year
Am
ou
nt
$ thousands
12
State AidState Aid by Academic Year
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
1996-1997 1997-1998 1998-1999 1999-2000 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007
Academic Year
Am
ou
nt
$ thousands
13
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
Without consolidations With consolidations
Federal Student Loan Volume(FFEL & Direct Loans)
$ millions
14
Average Federal Student Loan Debt
Undergraduate students with a 4-Year Degree (Percent of students borrowing)
$0
$2,000
$4,000$6,000
$8,000
$10,000
$12,000
$14,000$16,000
$18,000
$20,000
1993 1996 2000 2004
66%62%
58%
40%
15
Average Federal Student Loan Debt Cumulative Amount of Student Loans by Percentiles for Graduating Seniors
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
1992-93 1995-96 1999-2000 2003-04
10th 50th 75th 90th
Monthly Payment$207
Monthly Payment$411
16
Student Loans• Stafford/Unsubsidized Stafford/PLUS• Direct Loans/FFEL
• Competition yields better borrower benefits• Private Loans
• Fill gap above Federal Student Loan limits• Should not displace grant aid or Federal loans• Marketing Practices• Dept. of Education - Interagency Group• Ombudsman
• 877-557-2575 (borrowers) • 202-377-3800 (Financial aid professionals)
Presenter Name(s)
17.2
21.4
22.4
17.8
15
11.610.7
10.49.6
8.8
6.9
5.6 5.95.4 5.2
4.55.1 4.6
0
5
10
15
20
25
1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
4.6
National Student Loan Cohort DefaultNational Student Loan Cohort Default RatesRates
Per
cent
age
18
Ripped from the Headlines
Lenders Misusing Student DatabaseImproper Searches Raise Privacy Fears
Swimming With Student Loan Sharks
University named in report detailing student loan abuse
Rules proposed to curb loan abuse
Panel Finds Wide Abuse in Student Loan Program
19
ComplianceDear Colleague Letters
Negotiated Rulemaking – Began in 2006
Publication of Final Rule – Nov. 1, 2007
College Cost Reduction & Access Act
Changes Affecting FFEL Lenders and Guaranty Agencies
•Effective October 1, 2007 --• Reduced:
• FFEL guaranty agency retention percentage from 23% to 16%.
• FFEL lender special allowance payments (SAP) by 55 basis points (40 for non-profit lenders).
• GA account maintenance fee from .10% to .06% • Increased lender loan fee from .50% to 1.0%.• Eliminated Exceptional Performer Designation for FFEL
lenders, servicers, and guaranty agencies.
Increased Pell Grants
TEACH Grants*
Loan Forgiveness for Public Service Employees*
PLUS Auction Pilot
College Access Challenge Grants
College Cost Reduction & Access Act
* - Requires negotiated rulemaking
College Cost Reduction & Access Act
Negotiated Rulemaking
Regional Hearings:
11/2 (LA); 11/14 (DC); 11/29 (CA)
Nominations: November 29, 2007
Target Dates:
• TEACH: Publication (6/1/08) and Implementation (7/1/08*)
• FULL PACKAGE: Publication (11/1/08) and Implementation (7/1/09)
HEA
Reauthorization?
Thank you!