Barry Simmons Fires Back -

- Our House Commitee on Education and the Workforce Takes Liberties with the Truth

by Barry Simmons
Thursday, September 18, 2003 12:00 p.m.

Our House Committee on Education and the Workforce, the committee that represents our educational interests in the House, has decided that the approval of Senator Jon Corzine's (D-NJ) amendment blocking changes that would reduce the amount of federal aid students receive is a bad thing.

They even cite as evidence an editorial in the Wall Street Journal by Brendan Miniter, who decries the amendment while providing evidence, that is arbitrary at best.

The result of the amendment is to block changes to financial aid tables and schedules that would cause an increase in a family's EFC, or expected family contribution, which is the amount a family can be expected to contribute toward a student's college costs. The data used to calculate a student's EFC comes directly from the financial information students provide on the FAFSA form (Free Application for Federal Student Aid).

When students submit there FAFSA forms, some of the data is adjusted using these tables and schedules. The resulting data is then placed into a series of forms provided by the Department of Education that look very much like your federal tax return. There are columns for income, columns for allowances used to reduce your income, and columns for assets.

The federal government allows us to protect some of our income and some of our assets which helps decrease the amount we have to pay for our college education.

The forms used vary depending upon many circumstances including whether a student is a dependent or independent, whether the family's income is above or below $49,999. Those families having incomes below $49,999 may be eligible to use forms that don't consider a families' assets when calculating aid - a huge benefit in increasing your financial aid.

After all the calculations are done, the resulting number is called the expected family contribution or EFC.

Let's take a look at what the committee said, and then will put their arguments to the test.

"Pell Grants have not been cut. The formula to calculate federal aid including Pell Grants, was not changed. What the Department of Education did was update state tax tables which are one of many variables used to determine how much financial aid a student and family will qualify for. Why did they update these tables? Because they are required to do so by a law passed by a Democratic controlled Congress in 1992. The department was previously using data from 1988, and did nothing more than follow the law when they updated tables with the most up to date information from 2000."

Wrong! Wrong!! Wrong!!! On all accounts....!!!

Pell Grant Cuts. One of the tables in question that's causing such an uproar is the State and Other Tax Allowance Table.

This table, which lists a series of percentages by state (i.e. 5% for Alabama), protects a portion of the parents' and students' income from being considered available for college educational expenses.

Here's an example of how this table is used. With the current table, if you live in the state of California, are the parents of a dependent student, and make more than $15,000 a year, 7% of your total income will be protected from being used when calculating college financial aid. In other words, if you've made $40,000 the previous year, $2800 becomes part of an allowance used to reduce your income, thereby reducing the amount of money you will have to contribute to your child's education. Using the updated table that the Senate amendment blocked, the percentage for that situation decreased to 5%. That's a decrease of $800. And the result is, of course, your parent contribution is higher, your financial aid is less.

According to information in the Federal Register/Vol. 68 No. 104/Friday, May 30, 2003 that publishes the updates to the EFC tables, the percentages for all our states for that table have decreased, many being very significant. The bottom line, a higher percentage of your income is used to calculate your college financial aid.

Here are examples of other states that have been affected. For those families making over $15,000/year, New York goes from 11% to 7%, Oregon from 9% to 6%, and West Virginia from 5% to 2%.

The formula used to calculate the aid is exactly the same. But the data in tables used to derive the results has changed. And its the tables, that affect the aid. Has the committee taken liberties with the truth.

Now as to why these tables change, the Secretary of Education is required under Part F of Title IV of the HEA (Higher Education Act) of 1965, as amended by Title IV, HEA Amendments of 1992, to adjust four of the tables on a yearly basis - the Income Protection Allowance, the Adjusted Net Worth of a Business or Farm, the Education Savings and Asset Protection Allowance, and the Assessment Schedules and Rates. The changes take into account inflation, and are based upon increases in the Consumer Price Index.

The Secretary is charged with adjusting the tables based upon inflation that took place between December 2002 and December 2003. But because the tables have to be published before December 2003, the table updates are made based upon the Consumer Price index for 2002, and estimates for 2003. The bottom line, many of the changes made to these tables for the school year 2004 -2205 are based on data from 2002.

Referring to the argument that the Department of Education was merely following the law in updating the tables, why haven't the tables been updated for so many years? Maybe because the federal government is short on money these days.

And now to the committee's ammunition, referring to a Wall Street Journal editorial by Brendan Miniter who writes , 'the only thing that is happening is some of the higher-income applicants may get no grants or smaller ones.' Miniter continues, 'It's not even clear how many students would lose their grants.'

The first question to ask yourself is who exactly are the higher-income applicants Miniter is referring to when we're dealing with universities that charge upwards of $40,000 per year. And why is Miniter so determined to decry the amendment when admitting that 'it's not even clear how many student's would lose their grants'. It sounds a bit callous to me.

Miniter also says that 'Mr. Corzine's amendment would require the Education Department to calculate each Pell grant application twice, first with the new numbers and then with the old ones. Officials would have to use whichever is more advantageous for the student.'

I don't know about you, but I think that's a good thing. After all, isn't this financial aid for the student we're speaking about. Correct me if I'm missing something here.

I spoke to Dan Madzelan of the Department of Education recently who told me that even though the Senate amendment has blocked the EFC table changes, they will stay in effect as recorded in the Federal Register until the House acts. So I would urge all of my readers to contact the House Committee on Education and the Workforce and tell them that you're one of those Americans who may be affected by a reduction in college financial aid and it would be in the best interest of our country to support the blockage of those scheduled changes as listed in the Federal Register/Vol. 68, No. 104/Friday, May 30, 2003.

We need grass roots support.

What can you do to ensure that the 'Committee on Education and the Workforce' lives up to its agreement to the American student? Complain!!! They do have a web site.

Click here==> Go to the Committee On Education and the Workforce

or

Click here==> Go to the Committee Members

or

For those of you who still write letters

Committee on Education and the Workforce

U.S. House of Representatives

2181 Rayburn House Office Building

Washington, D.C. 20515

And to Call.

(202) 225-4527 TDD/TTY: (202) 226-3372

And while your at it, call your own representative to the House:

Click Here==> Contact your own representative in the House