Status of the Federal Perkins Loan Program HOW DO WE SAVE IT? TEXAS BUC$ OCTOBER 13, 2014
Presenters! Maggie Bradford Assistant Director of Compliance Institutional and Perkins Loan Team Supervisor Southern Methodist University mlbradford@smu.edu! Karen Reddick Vice President, Business Development National Credit Management COHEAO Membership Chair kreddick@ncmstl.com
Our Goals! Answer the following questions:! What are some of the challenges facing the Perkins Loan Program on Capitol Hill?! Why is the Perkins Loan Program still important?! What can we as citizens and advocates for our institutions do to save the program?! Provide data and suggestions to guide you through advocacy endeavors! Offer resources and serve as a person of contact
Status of the Program! Section 461(b) of the Higher Education Act authorizes the Perkins Program through September 30, 2014 with an automatic one-year extension through September 30, 2015.! If no specific congressional action prior to Reauthorization and the HEA is extended out as prior years, Perkins will continue! Last Reauthorization-7years! Possible options to extend the program:! Reauthorization of the Higher Education Act " As is or with modifications! Free-standing one year extensions
COHEAO Action! COHEAO submitted an official proposal to reauthorize the Perkins Loan program to both the House and the Senate authorizing Committees! Submitted Official Comment as an official record to support Harkin s Testimony at the latest Higher Education Hearing! Submitted comments to Harkin-Chairman of the Senate Committee on Health, Education, Labor and Pensions (HELP) " Support Reauthorization of the Perkins Student Loan Program " Timing of Expiration Date and Award Letters " Simplification " Allocation Formula 5
Campus Flex Proposal! Proposal Details:! Creates one appropriation for the 3 campus-based programs (Work Study, SEOG, and Perkins)! Allows schools to decide how best to disperse funds between programs each year! Achieves the goal of simplification but maintains all three programs! Allows percentage of annual interest collected on Perkins Loans to be used for SEOG and FWS! Unites proponents of the campus-based program to work together for annual appropriations! Received interest on the Hill
COHEAO Hill Visits Since 2013 COHEAO Board members, institutional members and commercial members have made over 100 hill visits on both the House and Senate side! COHEAO visits have either been with the elected official or relevant staff members! COHEAO s visits have brought attention to the Perkins issue, educated members and staff and have kept Perkins on the radar! House and Senate Committee staff have reached out to COHEAO for further statistics on the program as well as legislative language for the Campus Flex program 7
COHEAO Hill Visits 8
Texas Representatives Rubén Hinojosa, Texas (Ranking Member of the House Higher Education Subcommittee Senators Senator John Cornyn (R) Senator Ted Cruz (R) 36 Congressmen 24 Republicans 12 Democrats 9
Current Bills o H.R. 4983, Strengthening Transparency in Higher Education Act o H.R. Empowering Students through Enhanced Financial Counseling Act o H.R. 3136, Advancing Competency-Based Education Demonstration Project Act
Discussion Drafts! House Committee! Bi Partisan Bill-Fast Act " Simplification of FASFA " One Grant One Loan " Eliminating Campus Based Programs and all other federal grants! Senate HELP Committee! Simplification is the theme! Barely mentions Perkins! Intentionally Left Out " Working on a solution for Perkins-ask COHEAO for proposed legislation! Programs not mentioned in the discussion draft were left untouched! No Perkins Direct Loan Program
Our Next Steps! Know Your Stuff!! Educate Others! Engage Your Community! Advocate! Get Started and Act!
Know Your Stuff!! National Perkins Statistics! Perkins Fund value estimated at 8.67 billion! About 1500-1700 institutions participate in Perkins Program! Almost 500,000 students receive awards each year! $950 million in annual awards! Revolved 11 times! Public Service Cancellations (cumulative total close to $2 billion) " Teaching 58% " Nurse/Medical Technician 20% " Early Intervention 8% " Law Enforcement 6% " Other 8%
Perkins Fund Value by State
Texas Statistics! Texas Statistics! Total Awards: 25, 464 loans! Disbursed Amount: $49,858,323! 63 institutions! Southern Methodist University! Annual Expenditure: $950,000! Students awarded: 510 *2012-13 Campus-Based Funding (ED.gov) http://www.coheao.com/resources/facts-figures/2011-12-campus-basedfunding-by-state/
Gather Statistics Federal Campus-Based Programs Data Book 2013 (ED.gov) http://www2.ed.gov/finaid/prof/resources/data/databook2013/ databook2013.html Federal Student Aid Awarded - by State and Congressional District 2013-14 (NAICU) http://www.naicu.edu/special_initiatives/page/federal-student-aidawarded-by-state-and-congressional-district 2012-13 Campus-Based Funding (ED.gov) - by School and by State http://www.coheao.com/resources/facts-figures/2011-12-campus-basedfunding-by-state/ Orange Book Perkins Loan Cohort Default Rates http://www.ifap.ed.gov/perkinscdrguide/1213perkinscdr.html 16
Educate Your Community! Make your president aware of the impact to your institution if the Perkins Loan program is eliminated.! Inform your government relations office of the issues the Perkins Loan Program is facing. Provide them with information that they can share as they often meet with or talk to key Congressional Members and staff.! Discuss the issue with other offices affected- financial aid, business office, and admissions are just a few examples.
Educate! Share key information about Perkins:! Risk Sharing: Schools have skin in the game.! Self-sustaining: The revolving fund continues even without federal contribution.! Financial Literacy: Schools award, counsel, disburse, and service the loans providing assistance to borrowers throughout repayment.! Accountability: Schools are responsible for their cohort default rates and in managing their revolving fund.! Affordability: Low-cost loan program - 5% fixed rate, subsidized interest throughout enrollment and grace, offers many repayment and postponement options, and the only subsidized loan program available for graduate students.! Workforce & Community Benefits: Perkins contains many options for full or partial forgiveness; promotes careers in areas of economic need as well as shortage areas.
Educate! Countering the Opposition:! Many simplification proposals sound great in theory, but do not account for the realities on the ground.! Loss of campus-based grants and loans removes the flexibility of the financial aid office to assist low-income and lower-middle income students who need additional low-cost aid options.! Subsidized loans are critical for need-based population of borrowers.! Many Perkins recipients would not be eligible for private loans, or if eligible, would pay a much higher rate of interest.! Loss of cancellation benefits will be detrimental to both borrowers and communities.
Engage! Engage future students and parents! Work with your Admissions Department to incorporate information about the Perkins Loan Program into First Year and Transfer Admission events! Engage your student groups! Love to support a good cause and have a greater reach to students! Provide guidance and a sample letter they can send! Work with key offices on campus that have contact with students, parents, and alumni! Contact colleagues from other institutions in your district and/or state to join! Collective effort! Work with local, regional, and/or national education association groups
Advocate! Research your Representative! Party affiliation? (Democrats currently control Senate, Republications control House.)! Is your institution their alma mater? If so, highlight that fact.! Does he/she sit on any relevant Committees? " House or Senate Education Committee or Budget Committee?! Contact your Congressional Representatives! House of Representatives and Senate! See handout for contact information! November 2014- Election Year! Go vote!
Advocate! Contacting your Congressional Representative:! Quickest way to delivery your letter is to email it to the Representative s education staffer.! Identify your institution (if you are advocating as a citizen- list county and/or alma mater) and the program you are writing to highlight! Bring focus to the major issue: The Perkins Loan Program is in danger of being eliminated!! Provide background information about the program " Include national statistics, individual institutional statistics, and the statistics for your Member s district and/or state
Advocate! Expound on the impact on your students if program is eliminated " Higher cost-private/alternative loans or dropping out entirely! Mention that there is NOTHING to take the place of the Perkins Loan Program! Ask for their support and provide possible solutions! COHEAO S Campus Flex Proposal! Follow up! Stay in touch by email and/or phone.! Make the contact personal! Members want to know how they can make a difference in their district or in their state - the more personalized you make the letter, call or visit, the more effective you ll be.
Let s Get Started!! Action Timeline:! Research Statistics! Create an Impact Statement for your University! Ask your University President and key campus colleagues to write or sign a letter of support! Engage students, borrowers, and parents " Current and former students " Parents who depend on Perkins to close the gap between funding " Borrowers who have benefitted from loan cancellation options! Gather testimonials of how the program has impacted their life " Affording college and after
What You Can Do! Contact your Congressional Representatives! Visit your respective member in their local office! Write, email, and call (please share communications w/coheao)! Network with local colleges and higher education groups! Texans for Perkins Advocacy Committee?! Participate in webinars/conferences to stay updated! Continue to award Perkins Loans! Contact COHEAO with questions, for direction, and/or advice
Get Involved! Join COHEAO! www.coheao.org! Join COHEAO s Texas Work Group! Strategy Meetings! Contribute in HEA Language! Participate in Congressional Conference Call Meetings! Contact Lynn Heineman, Texas State Captain " 716-480-3391 cell " LHeineman@accountcontrol.com
Example -State Progress SUNY & New York State Action: Letter writing campaign COHEAO, SUNYFAP & NYSFAAA - Ad Hoc Committee Get core group of Presidents to unite Engage government relations Emails to engage membership Targeted action in NYS districts with largest loan volume Commercial Member Action: Meetings on Capitol Hill and home district Letters to Representatives Sharing the advocacy process with clients Participate in COHEAO organized phone calls in key member states & districts Ongoing support of COHEAO 27
Final Check Off List-Act Now! " Your Action Checklist: o o o o o o o o o Put together statistics and an impact statement for your campus Educate your colleagues and ask for their support Ask your University President and key campus colleagues to write or sign a letter of support Engage - students, borrowers and parents gather testimonials o Current and former students who were able attend your school because of Perkins o Parents who depend on Perkins to fund the cost of attendance o Borrowers who have benefitted from a Perkins loan cancellation Visit your Congressional Representatives in their local offices Write, email and call your Congressional Representatives (share communications with COHEAO) Network with local colleges and higher education groups Continue to award Perkins Loans - business as usual! Contact COHEAO with questions, for direction or advice 28
Discussion
Resources Federal Campus-Based Programs Data Book 2013 (ED.gov) http://www2.ed.gov/finaid/prof/resources/data/databook2013/ databook2013.html Federal Student Aid Awarded - by State and Congressional District 2013-14 (NAICU) http://www.naicu.edu/special_initiatives/page/federal-student-aidawarded-by-state-and-congressional-district 2012-13 Campus-Based Funding (ED.gov) - by School and by State http://www.coheao.com/resources/facts-figures/2011-12-campus-basedfunding-by-state/ Orange Book Perkins Loan Cohort Default Rates http://www.ifap.ed.gov/perkinscdrguide/1213perkinscdr.html 30