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| Agency Liaison Report Since the last Agency Liaison report in July, there have been several developments on the reauthorization front. Whether reauthorization will occur in 2005 is still up in the air, but prospects are brighter than they were just three months ago. On September 8, the Senate Health, Education, Labor and Pensions Committee passed S. 1614, the Senate version of a reauthorization bill. Additionally, both the House and Senate voted to extend the HEA through December 31, 2005, providing a new target date to have a final reauthorization bill completed. The budget reconciliation process throws an element of uncertainty into this process, however. It is becoming increasingly likely that reauthorization will be accomplished through this process. Budget considerations could derail the reauthorization process, or could require even more savings from higher education after a reauthorization bill is finalized. There are a number of issues of direct interest to guarantors in the House and Senate bills that could also have an impact on schools. The first issue of note is that both the House and Senate bills would require guarantors to charge a 1% guarantee fee, but the bills differ on how the fee would be paid. The House bill would require that the fee be deducted from the borrower’s loan proceeds, while the Senate would allow the guarantor to pay the fee from the GA Operating Fund or from other non-Federal funds. Under both bills, loan rehabilitation to regain eligibility for Title IV assistance would be easier for defaulted borrowers. Instead of requiring 12 consecutive on-time payments for rehabilitation under current rules, both bills would reduce the number of qualifying payments to 9 made within a 10-month period as long as the payments are made within 20 days of the due date. While the Senate bill would not change reinsurance rules for guarantors, the House bill would reduce reinsurance payments on defaulted loans from the current 95% to 93%. Both the House and Senate bills contain a section called “College Access Initiative”, requiring guarantors to take an active role in college access, awareness and financial literacy efforts. Many guarantors are already quite active in these areas, so to a certain degree, this merely formalizes a role guarantors have increasingly assumed over the years. Only time will tell exactly what changes will ultimately be adopted, and whether reauthorization or budget reconciliation will be the driving force. Like every other participant in the student financial assistance community, guarantors are watching and waiting for the next set of changes to how we operate. National Association of State Student Grant and Aid Programs (NASSGAP) No report submitted. National Council of Higher Education Loan
Programs (NCHELP) This fall has kept the staff and committees of the National Council of Higher Education Loan Programs (NCHELP) busy and focused on three main items: Reauthorization of the HEA and budget reconciliation; hurricane assistance and guidance; and standardizing FFELP processes. Now that the Senate and House education committees have passed Reauthorization bills, the process would seem to be well on its way to completion. However, budget reconciliation has thrown the HEA Reauthorization a curve ball. To come up with savings for budget reconciliation, the House and Senate education committees have been charged with identifying $12-13 billion in savings and a sizable portion of that has been directed toward cuts in the student loan program. Now the House is reportedly considering increasing its overall reconciliation instructions to as high as $50 billion, with $5.5 billion of the increase being targeted toward additional student loan cuts. NCHELP has been working with its colleagues and members to urge Congressional leaders not to make any more cuts to the student loan program, which would be harmful to the financing of student loans, curtail borrower benefits and compromise loan delivery. The House has postponed until next week consideration of the amendment to increase reconciliation instructions. To assist the many students, institutions and borrowers that have been affected by the devastating hurricanes, NCHELP has created a Web page that includes all federal guidance, information for institutions and students, and information from the FFELP community. In addition, the NCHELP committees have identified how the FFELP community could provide additional assistance to borrowers affected by the hurricane. NCHELP has issued a formal request with the Department of Education to provide guidance similar to that issued following the September 11 terrorist attacks. This would allow the FFELP community to assist borrowers in repayment that have lost their homes or jobs in the disasters, or been otherwise adversely affected, and are in need of an administrative forbearance. In addition, NCHELP and its committees are dedicated to identifying and developing processes that standardize systems in the FFEL Program to make things easier and more efficient for institutions and students. These efforts include expanding the Meteor Network, developing Common Record/CommonLine as an industry standard and finalizing the Common Claims Initiative. Common Record/CommonLine is awaiting confirmation from the Postsecondary Electronic Standards Council about its approval as an accepted standard for exchanging student loan data. In addition, NCHELP committees are working with the Department of Education to update a series of financial aid forms that are expiring and to incorporate into the forms an acknowledgement of changing technology to clear some of the regulatory and legal hurdles. They are also working within the community to try to standardize practices between partners that are exchanging financial aid information and records. We invite the school community to visit the NCHELP Web site (www.nchelp.org) for access to financial aid resources, announcements and FFELP updates. Alabama Alabama Commission on Higher Education The Alabama Student Assistance Program (ASAP) is the state’s only need-based grant program that provides financial support for Alabama residents attending postsecondary institutions in Alabama. During 2004-05, one thousand five hundred seventy-three (1,573) awards were given at an average of $459 per student for a total distribution of $722,500. After a drastic reduction in state funding for this program effective award year 2003-2004, the program was approved and received an one hundred percent increase in funding by the Legislature. This program has also been approved to return to participate in the federal LEAP funding for the 2005-2006 award year. The Alabama Student Grant Program is a tuition-equalization grant program that provides financial assistance to Alabama residents enrolled in independent, nonprofit Alabama colleges and universities. During 2004-05, seven thousand eight hundred ninety-one (7,891) awards were given at an average of $193 per student for a total distribution of $1,523,613. During 2004-05, the Alabama National Guard Educational Assistance Program made seven hundred twelve (712) awards at an average of $626 per student for a total distribution of $445,673. This program is designed to help professional members of the Alabama National Guard pursue undergraduate degrees and to a limited extent, graduate degrees. The Police Officers’ and Firefighters’ Survivors Educational Assistance Program provides funds for tuition, fees, books and supply expenses for undergraduate studies at Alabama public colleges and universities for dependents and spouses of officers and firefighters killed or totally disabled in the line of duty. During 2004-05, twenty-five (25) awards were given at an average of $4,665 per student for a total distribution of $116,627. Kentucky Higher Education Assistance Authority, designated guarantor for Alabama No report submitted. Florida Florida Office of Student Financial Assistance,
State Scholarship and Grant Programs
The tuition and fess increased at public institutions by 5% for the 2005-06 year.
Florida Office of Student Financial Assistance, Federal Family Education Loan Programs No report submitted. Georgia Note: In July 2005, Georgia Governor Sonny Perdue appointed Tim Connell to be President of the Georgia Student Finance Commission. Connell previously served as the Director of the Governor’s Office of Planning and Budget, and in many other leadership roles in state government and the private sector. GSFC celebrates its 40th anniversary
This is a great success story for our agency and a tribute to our political leadership and all the people of Georgia who have made higher education such a top priority for our state. Shelter from the storm
GAcollege411.org “2nd launch” Kentucky Kentucky Higher Education Assistance Authority No report submitted. Mississippi USA Funds, designated guarantor for Mississippi USA Funds commits $2.3 million to help college students affected
by hurricanes USA Funds’ financial support will provide assistance to low-income students attending schools in counties in five states—including Mississippi—designated as federal disaster areas by the Federal Emergency Management Agency following hurricanes Dennis, Katrina and Rita. In addition, assistance will be provided to low-income students displaced from colleges in the Hurricane Katrina disaster areas and to residents of those disaster areas who are attending college elsewhere. Awards of up to $35,000 may be made to eligible postsecondary institutions that apply. Financial-aid offices at institutions awarded grants will distribute the funds to eligible students affected by the disaster to supplement the students’ financial-aid packages. For additional information about the program and to apply for a grant, campus financial-aid administrators should visit www.disasterrelief.scholarshipamerica.org. USA Funds awards Mississippi students $534,000 in scholarships USA Funds awarded $216,000 in scholarships to 144 first-time recipients of USA Funds Access to Education Scholarships® in Mississippi for the 2005-2006 academic year. In addition, USA Funds awarded $318,000 in renewal scholarships to 215 Mississippi students who previously had received awards under the program. Because USA Funds serves as Mississippi’s designated guarantor of federal education loans, Mississippi residents receive priority consideration for the awards. Applications will be available Jan. 2 for the USA Funds Access to Education Scholarships for the 2006-2007 academic year. For more information, visit the USA Funds Web site, www.usafunds.org. North Carolina North Carolina State Education Assistance
Authority New legislation in 2005 created a state lottery with proceeds funding public school construction, class size reduction in early grades and need-based scholarships for college students. The first scholarships are anticipated to be available after January 2007. In addition to the lottery scholarships, the NC General Assembly created two new loan forgiveness programs to attract prospective teachers into the field: Future Teachers of North Carolina, for college juniors and seniors interested in teaching math, science, special education or English as a Second Language; and Physical Education-Coaching Scholarship Loan to attract students into coaching in rural and underserved areas of the state. The General Assembly also transferred the administration of the Prospective Teachers Scholarship Loan from the Department of Public Instruction to the State Education Assistance Authority effective January 1, 2006. Finally, the prestigious Teaching Fellows Program was expanded from 400 to 500 first year awards effective for the 2005-06 academic year. Other legislation affecting financial aid for college students included an increase in the UNC Need-Based Grant Program from $47 million to $60 million, as well an increase in the community college program from $10 million to $13 million. In addition the General Assembly provided for foster children by waiving tuition if they do not receive enough financial aid to cover their tuition. At the fall NCASFAA meeting in November, College Foundation Inc.(CFI) and the State Education Assistance Authority will jointly celebrate 50 and 40 years of service, respectively, to the citizens of North Carolina. In 1955, Governor Luther Hodges and the NC General Assembly chartered CFI 10 years prior to the passage of the Higher Education Act of 1965 to assist students who could not afford the cost of a college education. The two entities are proud of their long history working in partnership to increase opportunities for North Carolinians to get a college education. South Carolina South Carolina Tuition Grants Commission The SC Tuition Grants Program is a “need-based” grants program for eligible South Carolina residents attending in-state, independent colleges on a full-time basis. During the 2005-2006 fiscal year, the SC Tuition Grants Program projects to award a total of $28.6 million to 12,125 SC students attending the 20 participating SC independent colleges. The average dollar grant amount will be $2,360 and will cover 15.2% of the $15,490 average tuition and fee charge at a SC independent college for the 2005-2006 year. The maximum grant approved for the 2005-2006 school year is $2,600. A new feature beginning in the 2005-2006 award year is the use of electronic award notifications in place of the normal paper award letters. The SC Education Assistance Authority, the state agency governing the SC Student Loan Corporation, is providing the service at no cost to the SC Tuition Grants Commission. The experience thus far has been that 81.36% of the eligible students have e-mail addresses (taken from the FAFSA) to which award notifications have been sent. The 19% without e-mail addresses are mailed paper award notifications. The savings to the SC Tuition Grants Commission from postage, paper, and employee work time is significant. Merit-based programs continue to be highly emphasized in South Carolina. The state’s top merit program, the Palmetto Fellows Program ($6,700 award), was funded at $26.4 million, the LIFE Scholarship Program($5,000 award) was funded at $135 million, the HOPE Scholarship Program ($2,650 award) was funded at $6.7 million, and the Lottery Tuition Assistance Program (Technical College students) was funded at $43 million. Approximately 60,000 SC students receive assistance each year through the merit-based programs. However, statistics reveal that of the 12,347 SC independent college students receiving the “need-based” SC Tuition Grant in 2004-2005, only 40% of these students qualify for merit-based aid from the State of South Carolina. Efforts are being made by the SC General Assembly to increase funding of the “need-based” programs while at the same time continue the funding levels of the merit-based programs. South Carolina Student Loan Corporation,
designated guarantor for South Carolina The South Carolina Student Loan Corporation is continuing its efforts to make higher education accessible and affordable to all. The following are some of the activities that we are involved with and which might be of interest to the Board. We continue to make schools, students and parents aware of the South Carolina College and Career Planning System which we sponsor and which provides a wealth of college and career-planning opportunities, from skill, interest, and work-value assessments, to help in choosing the right college. We are participating in CACRAO’s (Carolinas Association of Collegiate Registrars and Admissions Officers) ‘Educational Opportunity’ activities and will be present at over 80 high schools providing information on the availability of financial aid and the affordability of college. Our ‘Money Management’ seminars to college freshmen continue to expand with more colleges requesting our presentations. Efforts to assist High Schools with the printing of their guidance counselor materials, newsletters, etc. has been a big hit and we continue to provide these services as needed. Presentations on subjects such as leadership, stress management, effective communications, teamwork and others are being offered to colleges, high schools and community groups. ‘Financial Aid Night’ presentations are being offered across the state on a regular basis. Tennessee Tennessee Student Assistance Corporation Tennessee Lottery Scholarship Program New legislative enhancements have not only increased the value of existing lottery scholarship programs for 2005-2006 but also give good students who lost the award another opportunity to regain the award. Other legislative program enhancements include Dual Enrollment (college and high school) Grants and Foster Care Grants. We expect another successful year with awards to more than 60,000 students. Tennessee Student Assistance Award Program Loan Guarantee Program Compliance Activities TSAC is partnering with the Tennessee Higher Education Commission (THEC) and TASFAA to bring the College Goal Sunday Program to Tennessee. The state’s first College Goal Sunday event is scheduled for February 12, 2006. We’re excited about this opportunity to implement a statewide marketing campaign to encourage students and their families to attend this free financial aid awareness program. Virginia State Council of Higher Education for
Virginia (SCHEV) The State Council of Higher Education for Virginia is preparing its state financial aid funding recommendations for the FY2006-08 biennium. Over $150 million in new funding is recommended over the next two years for programs serving undergraduate and graduate students enrolled at Virginia's participating public and private institutions. The agency is also in process of conducting an affordability study of Virginia's colleges and universities. The study is due for completion as of the end of this calendar year. Educational Credit Management Corporation
(ECMC), designated guarantor for Virginia ECMC has been actively involved with the creation of the Commonwealth College Access Network. CCAN’s goal is to create a network of existing college access and awareness providers in Virginia, as well as to nurture new programs in underserved areas of the Commonwealth. ECMC has committed $150,000 over three years as seed money to help CCAN get up and running. ECMC has pledged $75,000 in 2005, $50,000 in 2006 and $25,000 in 2007. The vision for CCAN is that it will eventually develop support within the business community to be financially self-sufficient. ECMC is also providing web and administrative support while CCAN is in the organizational stage. ECMC recently produced its first Spanish-language publication, “Esta Usted Preparado?” (Are You Prepared?), an entrance and exit counseling guide. The English language version was translated to Spanish using the Postsecondary Education English-Spanish Glossary. This Glossary was developed to standardize the translation of industry-specific terms and is available in the General Reference section of the NCHELP e-Library at www.nchelp.org. Since September, ECMC has distributed over 70,000 copies of “Opportunities”, an awareness and access publication targeting high school juniors and seniors. This booklet is jointly sponsored by ECMC, SCHEV and VASFAA and is distributed primarily through high school guidance offices and community-based organizations.
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