1. Jerry McKeen San Juan College

2.  Section 479A of the Higher Education Act  No specific regulations- the US DOE is prohibited from making regulations  Some clarification in Handbook (Application and Verification Guide)  Dear Colleague Letters

3.  Some areas to consider for professional judgment: ◦ Dependency Override ◦ Calculation of EFC ◦ Cost of Attendance ◦ SAP Appeals ◦ Unsubsidized loan eligibility

4.  PJ decisions should be for individual students or case-by-case  Uncommon or unusual circumstances  Should be documented  Cannot use PJ to waive general eligibility requirements

5.  Reviewed on a case-by-case basis  May be considered for students who are removed from the parents’ home, experienced abuse, unable to locate a parent, incarcerated parents, etc.  Can override an automatic independent status with documentation (like through verification) but cannot use PJ to make an independent student dependent

6.  Situation must be documented ◦ What is the reason for the override and documentation must be maintained ◦ Supporting documentation should be obtained  Counselors and teachers  Clergy  Government agencies  Courts or prison administration  If third party documentation cannot be obtained then may use signed statements from friends, relatives, and student.

7.  Beginning 09-10, schools may accept an override conducted by another school  Still must review annually, as in prior years  Some reasons are strictly prohibited as a reason to allow independent status ◦ Parent refuse to contribute ◦ Parents unwilling to provide information ◦ Parents do not claim the student on taxes ◦ Student has resources to be self-sufficient

8.  Example:  Tom is 21. He got into trouble in high school and was convicted of passing bad checks. Now he is on probation with strict criteria including forbidden from any contact with his mother who works for the probation office. He comes to you because he does not know how to get his FAFSA information. His father is deceased but he has a sister who lives close by.

9.  Lauren lives with her grandparents. After her mother died when she was 12 her father was so distraught that he left Lauren with his parents. He gave them $500,000 of insurance money to take care of Lauren and left town. Lauren and her grandparents hear from him periodically. Sometimes he sends presents or cards but sometimes months or even years go by with no contact. They don’t have a current address or a means to contact him.

10.  May change specific data elements within the needs formula such as AGI, untaxed income, household size, assets, etc.  May NOT change formula itself or adjust the EFC without a calculations  Adjustment only valid at school that made the determination

11.  Situations that may be considered: ◦ Loss of job / dislocated worker ◦ Death or divorce of parents ◦ Medical and dental expenses not covered by insurance ◦ Educational costs of other family members ◦ Homelessness ◦ Reduced work hours / loss of income ◦ Parent in college ◦ Other situations

12.  Situations that are not ‘unusual’ ◦ Standard living expenses- having 2 car payments or a mortgage is not unusual ◦ Other consumer debt (credit cards) ◦ Routine expenses (utilities, home repairs) ◦ Moving expenses ◦ Vacation expenses

13.  Remember- as with dependency overrides ◦ Must be ‘special circumstances’ ◦ Case-by-case situations ◦ Adequate documentation

14.  Dear Colleague Letters GEN-09-04 & GEN- 09-05  A letter was also sent to those getting unemployment benefits encouraging them to apply for Pell Grant  Encouraged financial aid offices to consider special circumstances during the rough economic times ◦ Fewer grant and scholarship dollars ◦ Students maxing aid eligibility sooner ◦ More people losing jobs and income

15.  DOE and DOL strongly urges financial aid offices to use these letters proactively and as documentation for special circumstances  Letter reminded FAO’s  Ability to make changes  Ability to use an alternate 12 month period  Your students may be back to school for special job training  Compare the verification documents with the original FAFSA information

16.  To adjust the EFC: ◦ Must adjust a data element (AGI)  May not: ◦ Change the formula itself ◦ Make an adjustment to the PC, SC, EFC ◦ Make an adjustment on the initial FAFSA

17.  Remember: ◦ Conflicting information must be resolved ◦ Must verify base year first, esc. if selected for verification ◦ Adjustment is valid only at school making the change ◦ Must use the new EFC for all federal funds ◦ Income protection allowances change with all the changes you make

18.  Rob is married and has two children. He worked almost full time until June, then lost his job and has not been able to find another. He is the only family member in college. His wife earns $750 month babysitting for a neighbor’s child.

19.  Sarah’s parents own a rental home with a net worth of $150,000. The rental home burns down. The family loses potential rental income but has the potential for an upcoming insurance settlement.

20.  COST OF ATTENDANCE ITEMS  Tuition and Fees  Room and Board  Books and Supplies  Transportation  Miscellaneous personal expenses  Dependent Care Allowance  Computer Allowance

21.  COST OF ATTENDANCE ITEMS  Loan Fees  Study Abroad Expenses  Cost of Obtaining a first professional lic. or credential  Cooperative education expenses  Disability related expenses for reasonable accommodations

22.  Must document the reason for adjusting a COA item  Must maintain the documentation  Examples include: ◦ Medical bills not paid by insurance ◦ Child care bills ◦ Pay stubs ◦ Documentation of unemployment ◦ Tax returns

23.  Can never get enough documentation  Can ask for additional documentation to resolve questions or conflicting information  Can add to the suggested list

24.  When might it be appropriate to adjust a data element and recalculate the EFC?  When is it appropriate to increase the COA?  Is one better than the other?

25.  If student fails SAP standards students should be given an opportunity to appeal  Student completes an appeal and submits documentation to support the ‘unusual’ or ‘extenuating’ circumstances ◦ Injury or illness ◦ Death of a relative ◦ Other special circumstances  Reviewed on a case-by-case basis

26.  Unsubsidized loans may now be offered to students without parental information on the FAFSA if the FAO verifies:  Parent no longer provides or will provide in the future, financial support  Parent refuses to file a FAFSA  FAO MUST collect a signed statement verifying the above circumstances

27.  Not making a professional judgment is making one  Be consistent; but  Your decision may differ from another’s and that is OK  Should be exercised with discretion  Doesn’t always mean yes or no  Be sure to retain all documentation, including the ultimate decision  Notify students of all decisions

28.  Matt is a 21 year old student. His parents do not believe the federal government had the legal right to levy income tax, so they have not paid taxes or filed a return for the last ten years. He has worked since he was 18 and files a tax return each year. His parents refuse to provide any information to sign the FAFSA.

29.  Evan is a 20 year old student. Evan had lived with his mother and two younger siblings until his mother recently remarried. His mother and stepfather have a prenuptial agreement than the stepfather will cover household expenses but no extra costs for Evan and his siblings like tuition, music lessons, etc. Evan asks that his stepfather’s income not be included because his mother and stepfather have only been married for six months and Evan has not lived with them.

30.  Dory has requested an income reduction due to the fact that her husband’s business is not making the same money this year as last year. He makes and installs cabinets and has had to drop his hourly rate from $26 to $14 to get business.