how it works. learning objectives today we will learn definition of packaging funds we typically...
TRANSCRIPT
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How it works
Packaging
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Learning Objectives
Today we will learn• Definition of packaging• Funds we typically package• Estimated Financial Assistance & its affect• Steps to package awards• Packaging categories & sequence• Packaging models• Overawards• Hands-on example• Notifying students of their awards
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So what IS packaging?
Per the FSA Handbook• Packaging is the process of awarding aid without
exceeding the student’s financial need• More simply: it’s how you decide what students
are awarded (in what combination)
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Funds we typically package
Federal programs• Pell, SEOG, Perkins, Federal Workstudy, Direct
Loans, PLUS Loans, Graduate PLUS Loans, TEACH, Iraqi & Afghanistan Service Grant
State programs• TPEG, TEXAS Grant, TEG, BOT, CAL, Texas
Workstudy, Set-Aside Funds
Institutional programs
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Estimated Financial Assistance
Estimated Financial Assistance (EFA) is taken into consideration when packagingExamples include (but not limited to)• Pell (first source of aid)• Other federal, state, institutional grants• Subsidized & Perkins loans• Work study• Unsubsidized loans*• PLUS loans*• Private loans*
* Indicates funds that can replace all or part of the EFC as long as the COA is not exceeded.
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Other Examples of EFA
ROTC living allowancesScholarships (including athletic & ROTC)Employer reimbursement of tuition & feesTuition and fee waivers Fellowships and assistantshipsAmericorps fundsExceptions to EFA:– Iraq & Afghanistan Service Grant– Prepaid tuition plan– Federal veteran benefits
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STEPS TO PACKAGING
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Steps to Packaging
Determine the student’s Cost of Attendance (COA) budget & Expected Family Contribution (EFC)Award Federal Pell GrantCalculate the student’s financial needPackage campus-based, state, federal, and institutional fundsPackage or refer students to other supplemental sources of assistance
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Packaging Steps: STEP 1
• Determine the COA & EFC
A typical COA consists of*o Tuition & Feeso Books & Supplieso Room & Boardo Transportationo Personal Expenses
EFC comes from…?
* COA amounts are determined by the institution & could include PJ adjustments
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Packaging Steps: STEP 2
Award PELL GrantPell Grant awarded based on EFC • Pro-rated based on enrollment status and
EFC range
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Packaging Steps: STEP 3
Calculating Student’s Remaining NeedCost of Attendance
- Expected Family Contribution_____________________________= Initial Need- PELL award (if any)- Estimated Financial Assistance (EFA)
__________________________________Remaining Need to package other funds
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Packaging Steps: STEP 3
• Calculating students’ non-need eligibilityCost of Attendance
- PELL- EFA- Need-based aid awarded________________________________
Room for non-need based aid
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Packaging Steps: STEP 4
Package Campus-based, Federal, State, Institutional• Package other aid programs listed above
according to your school’s packaging philosophy/policy
• Keep in mind that each school is different!
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PACKAGING CATEGORIES & SEQUENCE
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Goals of an AdministratorProvide as many students as possible with resources to meet their financial needDistribute aid in an equitable mannerProvide assistance that will be the most beneficial to the studentManage financial aid fundsRecruit and retain studentsMeet areas of national need
Sometimes these are competing goals!
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Packaging Guidelines
Responsibility for paying for college rests with the student and their familyFederal Pell Grant is the foundation of undergraduate student aid packagesFamilies can borrow from some aid programs to replace all or a portion of their EFCScholarships cannot be substituted for the EFCMust take expected financial assistance (EFA) into account
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Packaging Categories
Schools can organize their packaging categories based • Enrollment status• Classification • Academic program or major field of study• Application date• Need Based vs. Non-Need Based• Residency Criteria
Packaging philosophy must be detailed in the school’s policy and procedures
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Packaging Sequence
What gets awarded 1st? 2nd? Schools designate the order in which it awards funds from various programs
Again, this can vary from school to schoolIt can depend on the categories designatedThis should be noted in the policy and procedure manual for your institution
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PACKAGING MODELS
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Six Basic Packaging Models
First-Come, First-ServedGift Aid FirstSelf-Help ConceptSpecial Targeted GroupsEquity Concept• Absolute Dollar Equity• Fixed Percentage Equity
Individualized Packaging
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First Come, First Served
Financial aid awards based on the order in which completed applications are received by the aid office until funds are exhaustedBenefits:• Rewards students who get their stuff done early
Drawbacks:• May not have funds available for students that
need it most
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Gift Aid
Gift aid is awarded first and self help aid is awarded to meet any remaining needBenefits:• Decreases likelihood of loan debt
Drawbacks:• Limited gift aid funding
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Self Help
Self-help assistance is awarded after the family contribution and before any consideration for gift aidBenefits:• Places same burden on all students• Allows gift aid to those who do not have same
access to self-help
Drawbacks:• Increases likelihood of higher loan debt
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Targeted Groups
Separate packaging criteria for specific groups of students in addition to specific criteria required by law or regulationBenefits:• Easier to tie packaging philosophy to institutional
goals
Drawbacks:• Tougher to defend – watch the “bait and switch”
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Equity Concept
Absolute Equity• All students are funded up to an institutional maximum fixed
dollar amount with gift aid before their remaining need is met with self-help.
Fixed Percentage Equity• An institutional maximum percentage level of NEED or COST for
all gift aid is used rather than a fixed dollar amount.
Benefits:• Provides for an equitable distribution
Drawbacks:• Difficulty in managing overawards and maintaining that
equitable distribution
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Individualized
Packaging based on the FAA’s evaluation of a student’s individual costs, resources and needsBenefits:• Each financial aid packaged is customized• Personal touch with each student
Drawback:• Time consuming• High subjectivity
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Which Should You Use
This depends on your institutionMost institutions do not use one specific model…• A variation of one or more of these models is used
by institutions to fit in with that school’s objectives
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OVERAWARDS & PACKAGING
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Overawards
Overawards occur when:• Aid exceeds a student’s need or COA
How does this happen?• EFC changes (due to verification or updates)• COA changes (possibly due to enrollment)• Additional financial assistance comes in (late
scholarship, exemption payment) This is the student’s responsibility to report to us
When overawards happen, we make adjustments
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HANDS-ON EXAMPLE
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Packaging Example: Self Help
Sally is attending Cowboy College (CC). She is a dependent senior. CC employs a self-help packaging model and awards work study prior to loans.
COWBOY COLLEGECOA $20,280EFC $500Scholarship $2,500Pell Grant $5,280
AWARD MAXIMUMSPerkins $1,500Work Study $3,000Institutional Grant $3,000Direct Loan $5,500
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Packaging Example: Self Help• Cost of Attendance• EFC• Need• Pell • Scholarship (EFA)• Remaining Need• Work study• Perkins• Stafford Loan• Remaining need before grants• Institutional Grant• Unmet Need• Anything Else????
20,280(500)19,780(5,280)(2,500)12,000(3,000)(1,500)(5,500)2,000(2,000)0Remaining unsub eligibility?
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Packaging Example: Self Help
What if you are informed that the student is receiving another $500 scholarship after you have packaged?• Does this fit in the COA as is?• Does it fit within the need? • If not what would you reduce?
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NOTIFYING STUDENTS OF AWARDS
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Notifying Students of Awards
Institutions are required to inform students:• Amount of award(s)• Terms and conditions of award• Manner and timing of payments
Institutions have the option of confirmation or notification• Confirmation – Student formally accepts awards• Notification – Student not required to accept award,
but must notify school if they do not want aid
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Notifying Students of Awards
What if there aren’t enough funds?• Caveat may be included on award notification
stating that the award is subject to the availability of funds and may be revised if funds not available or eligibility changes
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Wrapping Up
Today we learned• Definition of packaging• Funds we typically package• Estimated Financial Assistance & its affect• Steps to package awards• Packaging categories and sequence• Packaging models• Overawards• Hands-on example• Notifying students of their awards
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QUESTIONS?