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Lifelines to Learning

Lost jobs or other reductions in income can send families adrift. Some institutions are reaching out with supportive programs to keep students in the fold.

By Margo Vanover Porter

*In this still-sluggish economy, family breadwinners continue to lose their jobs and, despite exhaustive searches, struggle to find new employment. When these families discover they can no longer contribute to the tab for tuition, room, and board, higher education—once a family priority—can become an unaffordable luxury.

Fortunately, dropping out isn't the only option open to students who have run out of money. Institutions across the country have implemented emergency programs—varying from loans to grants to extended payment plans to the promise of summer employment—for financially strapped students who might otherwise fail to finish their degrees.

For example, Clarion University of Pennsylvania last year created its Last Dollar program to assist students who might otherwise be forced to abandon their studies because their cash ran out.

“We're part of the Rust Belt,” says W. Paul Bylaska, vice president of finance and administration. “Generally, our students and their parents don't have a lot of money to bring to our institution. We try to fill in financial gaps on an individual-by-individual basis. When we see a student who academically seems to be doing well and doesn't have disciplinary problems, the last thing we want is for that student to leave for financial reasons.”

In the 2009-10 school year, Clarion gave 21 students emergency grants, with an average award of $1,500, out of its regular education general funding. “Our board of governors decided, given the economic circumstances, to be more flexible in allowing us to use our taxpayer-supported funding to assist some of these students under fairly rigorous requirements,” Bylaska says. He clarifies that the institution evaluates prospective award recipients based on several factors, including outstanding balances, academic standing, and whether students are just starting out or ready to wrap up their degrees. (For more on student financial emergencies, see the sidebar, "When Institutional Support Is a Student's Last Resort.")

Given the difficult economy in Ohio and across the country, we recognized that we needed to help our families. Students First, Students Now was one way of doing that.

M. Dolan Evanovich, The Ohio State University

To bolster the financial aid IQs of students, Clarion University has started a student peer financial counseling program that is staffed by recent graduates who are pursuing master of business administration (MBA) degrees. After being cross-trained in financial aid and billing, counselors talk to students with outstanding balances, saying, “Listen, you need to finish your financial aid applications,” or “You haven't filled out a FAFSA [Free Application for Federal Student Aid], and you qualify for this award.”

“In a number of instances, we found it was a matter of reaching out to students and helping them with the process,” Bylaska says. “In some cases, it was a matter of setting them up on payment plans. For those who were willing to be diligent, we have had fairly good success in getting them back on a tuition payment plan and, frankly, keeping them in school.”

Paying Students First

Last year the Ohio State University made a couple of significant decisions to ensure all enrolled students have access to the funds to complete their degree programs: (1) senior managers did not accept their annual salary increases, donating all $722,000 to needy students, and (2) the university created a fundraiser called Students First, Students Now.

Your Professional Judgment, Please

Even when they can't furnish their own emergency funds, institutions are lending a hand to students whose parents have been hit hard by the economy. “Our institution encourages all students whose families have been affected by a reduction or loss of income to complete a special circumstance appeal,” says Janet Turner, financial aid director, University of Portland, Oregon.

When students apply for aid, they use the FAFSA, which is based on the prior year's adjusted gross income and other relevant data, she explains. “When these data elements no longer paint a true picture of a family's economic situation, we will consider a special circumstance appeal to project the actual current year income—which may only be unemployment. We then recalculate their financial aid eligibility to see if they qualify for additional financial aid.

“Sometimes students may not qualify for additional grant aid, but they may find that they are eligible for subsidized loans rather than unsubsidized loans,” she continues. “Other students may be eligible for additional federal or institutional grants.”

Special emergency appeals are most definitely increasing, reports Justin Draeger, president, National Association of Student Financial Aid Administrators, Washington, D.C. He cites two reasons. “Since the economy tanked in 2008, more students and families have experienced some sort of financial disruption in their lives,” he says. “As a consequence, the historical data on their financial aid applications don't reflect their current financial situation.”

Secondly, Draeger attributes the concerted effort by the current administration and the Department of Education to inform students and families that financial aid is available and to remind financial aid professionals that they have the authority to exercise their professional judgment in helping these students and families.

“Congress has delegated to the institution's financial aid administrator the authority to compensate for special circumstances on a case-by-case basis with adequate documentation,” says Draeger. “Professional judgment refers to the authority of a school's financial aid administrator to make adjustments to the data elements on the FAFSA and to override a student's dependency status.”

Draeger emphasizes that institutions cannot change the federal need-analysis formula or make direct adjustments to the expected family contribution. However, institutions can adjust the figures used in the formula based on the family's new status. “Ultimately, you want students to complete their studies,” he says. “The ultimate goal isn't just funding. It's student success.”

“Given the difficult economy in Ohio and across the country, we recognized that we needed to help our families,” says M. Dolan Evanovich, vice president for strategic enrollment planning. “Students First, Students Now was one way of doing that. We reached out to our generous alumni and the fundraising departments across all our campuses, raising a pool of money that we were able to use to help students who were running into problems, such as a parent losing a job.”

Using these private funds, in FY10 the institution awarded $169,000 in scholarships and $1.2 million in loans. This year, Ohio State has given needy students $207,000 in financial aid and $532,000 in loans, and Evanovich expects those numbers to increase as the year progresses.

Already planning his next challenge, Evanovich anticipates that portions of the Students First program will be rolled into a new capital campaign, which has a target of $2.5 billion. “Financial aid is one of the strategic priorities of our fundraising initiatives,” he says. “Raising money to provide access and opportunity for students who are from low-income situations and are often first in their families to go to college is a strategic priority as part of our land-grant mission.”

Separate and apart from the Students First, Students Now program, Ohio State in 2010 allocated $97 million in institutional financial aid. “That figure is based on a combination of need-based grants, merit-based scholarships, and employment programs,” he explains. “It's a huge commitment to ensure that the students we recruit are successful. Financial aid is not the only reason why a student chooses a university, or chooses to stay or go, but in tight economic times, it's an important consideration.”

Despite the bleak economic picture, Ohio State has managed to maintain a retention rate of 93 percent for freshmen students returning for their sophomore year. “Our total enrollment is just over 63,000 students, and we have a freshman class of 6,600 at our Columbus campus,” says Evanovich. “We are pleased to retain 93 percent of them to their sophomore year, despite financial setbacks.”

“These are difficult times,” he continues. “What's significant is that we are able to keep students enrolled and moving toward their degrees in spite of some very challenging financial situations.”

See the sidebar, "Your Professional Judgment, Please," for details about special circumstance appeals for financial aid.

Easing Hardships

The idea for Madison for Keeps blossomed during a brainstorming session with the business and development offices, says Lisa L. Tumer, director of the office of financial aid and scholarships, James Madison University (JMU), Harrisonburg, Virginia. “We saw a lot of students whose parents were laid off. People were having a hard time paying their bills. We reached out to alumni and friends of JMU asking, 'Do you want to give?' We got a tremendous response and ended up with $433,337.”

To spread the word about the one-time program, the institution created marketing pieces, put table tents in dining halls, sent newsletters to parents, and created a Web site where givers could donate with the click of a mouse. Soon, students were waving the Madison for Keeps banner at flag football games and ordering meals at restaurants that promised donations.

In total, the program assisted 110 students who might otherwise have dropped out. “A lot of money went to juniors and seniors who wanted to finish,” Tumer says. “This program kept them here. They were able to come back.”

To qualify for funding, each student had to submit an appeal explaining how and why his or her family was a victim of the economic crisis. “It was very time-consuming,” she says. “We had a lot of appeals submitted, many of which were heart-wrenching. We felt lucky that we had the money to help students stay here.”

Student Services Conference to Advise on Customer Service, Costs, and Compliance—and Methods for Motivating Staff

Today's challenging environment calls for the kinds of skills and knowledge updates that make the NACUBO Student Financial Services Conference a must-attend event. Scheduled for March 6-8, in San Diego, this multitrack conference focuses on (1) managing internal operations in ways that provide top-notch customer service; (2) financing postsecondary education, from both the institution and student perspectives; and (3) meeting your many compliance obligations—from new federal regulations on aid disbursements and refunds to guidelines for guarding against identity theft.

Opening general session keynote, Jorge Cherbosque, psychologist and codirector, UCLA Staff and Counseling Center, will kick off the meeting with a talk about the importance of emotional intelligence in creating a positive, motivated staff team.

Different dynamics. Concurrent sessions address emerging issues and explore new approaches for improving student services and related operations. Tackling such significant issues takes the concerted efforts of a trained and tuned-in staff. You'll learn to refine your management skills by exploring generational differences in today's workplace and ways to draw the best from each group. Allen Goben, president of Heartland Community College, Illinois, will offer further insights from the student perspective in a talk on “Collaboration Power: Serving Intergenerational Student Needs.”

Interactive format. Informal sessions and breaks allow you to connect with newcomers as well as seasoned student financial services professionals from large and small institutions to share your successes and struggles. Network with faculty, fellow business officers, bursars, and student services and financial aid professionals.

Plan to meet with representatives from more than 30 student financial services companies to learn about the latest products and services. And learn how you can contribute to NACUBO's advocacy and research efforts in the student financial services area.

To register or for more information on this and other NACUBO professional development programs, visit NACUBO's Web site or call 800.462.4916. In addition, don't miss the chance to join our experienced faculty members in a more intimate setting for a concentrated learning experience on “Bursar Fundamentals,” a preconference seminar on Sunday, March 6.

Although Madison for Keeps is the program that makes headlines, JMU also sponsors a less-publicized program that few even know exists. “We have another pot of money that we call the financial hardship scholarship,” explains Linda Combs, director, university business office, at JMU. “This is not publicized at all. If the collections department identifies students who are having trouble paying their bills and have exhausted everything they have, then we consider them for the financial hardship scholarship.”

This scholarship money is applied directly to students' university accounts. For instance, if an out-of-state student has a balance of $6,000—and no way to pay it—the scholarship might provide $5,000 toward the tab. “The student would still owe $1,000, which is a little more manageable,” Combs says.

In the past year and a half, the scholarship has provided almost $27,000 to eight students. “We're giving either the balance on an account or up to $5,000 for an out-of-state student, or the balance on an account and up to the in-state rate for in-state students,” Combs says. “The criteria are simply that students have accepted all financial aid that they can—which might include student loans, scholarships, and grant money—and that they have a documented financial hardship, such as a parent losing a job or a parent who is seriously ill and not able to work. This is the very last chance they have. It's so nice to have this quiet little pot of money for those students who absolutely need it—and certainly deserve it.”

No Free Lunch

The Midwestern work ethic continues to thrive at the College of Wooster, Wooster, Ohio, where students can find summer jobs painting a resident hall, answering office phones, or toiling in the physical plant. The institution created the program, called WooCorps, two years ago in response to the recession.

“Many students who tried to go home and get summer jobs discovered there were no jobs,” says Laurie L. Stickelmaier, vice president for finance and business, and treasurer. “Some of our students could not afford to go to a private college without their summer jobs.”

WooCorps allows students to work 40 hours a week at minimum wage during the summer and to live in the residence halls, paying a minimal amount for room and board. Students who finish the required summer hours receive a $1,000 scholarship. “In the first year, the 2009 summer, we also offered a forgivable loan program funded by one of our donors,” Stickelmaier says. “When those students graduate, the loans will be forgiven. The money for that went very quickly, but part of it helped to fund the WooCorps.”

The institution paid 2010 participants by using money from operating surpluses or money left over from student work-study budgets. To be eligible, students must be making satisfactory academic progress and have demonstrated financial need. “The qualifications are really that you need a job, and there's one available,” she says.

The College of Wooster plans to continue the program, which is a collaborative effort among the student life department, the student employment office, and the business office, until the economy gets much stronger.

“We feel there is a corps of 150 to 200 students who just have to have this,” Stickelmaier says. “Not only are these students' parents losing their jobs and finding it difficult to find new jobs, but with all the unemployment, the students are the last on the totem pole to get work when they go home for the summer. We've heard from many students who say they would not be able to return without this program.”

In addition, the institution is currently considering bringing in-house a new loan program for fall 2011. “We're looking at forgivable loans to help more students complete their degrees at Wooster,” says Stickelmaier. “If we can make a loan with the stipulation that the student must graduate in order to have a portion forgiven, then we may increase our retention and graduation rates without compromising the academic enterprise by reducing net tuition.”

If implemented, the loan program would forgive 25 to 30 percent of a student's outstanding balance upon graduation. “It costs $45,000 a year to go to the College of Wooster,” Stickelmaier explains. “We have some students who have less than a $3,000 balance, and they just can't come up with it. They've pretty much run out of financial aid, their parents have done whatever they can do, and the students just can't come up with that last $3,000. This is an avenue to keep them in school.”

MARGO VANOVER PORTER, Locust Grove, Virginia, covers higher education business issues for Business Officer.

When Institutional Support Is a Student's Last Resort

Let's face it: Students encounter financial emergencies, some of their own making, some that are out of their control. To assist those students who are dealing with a cash crisis, institutions have set up emergency funds, often using these four guidelines:

1. Ensure that the infrastructure allows a timely and coordinated response. “Any time we talk about meeting student emergency needs, we should acknowledge that students benefit when aid officers and business officers work closely together and form a partnership,” says Justin Draeger, president, National Association of Student Financial Aid Administrators, Washington, D.C.

M. Dolan Evanovich, vice president for strategic enrollment planning at the Ohio State University, agrees. That's why employees who work in his institution's student business service center—and report to different vice presidents—are cross-trained in the functions of financial aid, bursar, and registrar. “We have gone a step beyond the average one-stop shop for student business services,” Evanovich says. “We've cross-trained 30 people who can perform aid analysis while the student and family are there, online, or on the telephone. This collaborative approach has enabled us to use technology better and our systems more effectively.”

2. Define what constitutes an emergency. Janet Turner, financial aid director, University of Portland, Oregon, provides students with examples of special family circumstances that may qualify them for additional emergency aid. These include: 

  • Loss or reduction of income because of a layoff, illness, forced reduction of hours, or temporary employment.
  • Private elementary and secondary tuition for siblings.
  • Catastrophic medical or dental expenses.
  • Death, divorce, or separation of parents or spouse.
  • Loss of unemployment, disability, Social Security, veteran's, child support, or alimony benefits.

3. Determine eligibility. “You need to think about the criteria very carefully and how they will be evaluated before you start handing out money,” says Lisa L. Tumer, director of the office of financial aid and scholarships, James Madison University, Harrisonburg, Virginia.

At Clarion University of Pennsylvania, a high grade point average (GPA) is a factor that is considered when students apply for emergency aid. At other institutions, such as University of Portland, satisfactory academic progress will do. “GPA is only a factor if students are already in a financial aid suspension status, and, therefore, would not be eligible for any institutional, state, or federal aid,” Turner explains.

The same is true at Ohio State. “We adhere to federal regulations,” Evanovich says. “Students have to be eligible to return to the university and also demonstrate a significant financial need. Some may have a 4.0 GPA. Some may have a 2.1 or 2.2. As long as they meet the eligibility requirements, we feel we have a responsibility to help all students.”

As far as residency, “In our freshman class this year, about 20 percent of our students are from out of state,” Evanovich continues. “Those students typically pay twice as much in tuition, so their cost of attendance is much more. We don't discriminate between in-state and out-of-state. We just try to help Ohio State students be successful.”

4. Document the data. “You have to weigh whether or not this program will help your retention rate,” says Laurie L. Stickelmaier, vice president for finance and business, and treasurer, College of Wooster, Wooster, Ohio. “One of the things we were concerned about the first year we did WooCorps was 'Would these students have returned anyway?'”

Stickelmaier is pleased that the institution's sophomore retention rate has increased by 2 percent from fall 2009 to fall 2010, thanks in part to the WooCorps summer work program. “We believe it has had a positive effect on revenues,” she says, adding that “I would never have tried something like this if it weren't for the poor economy right now.”

Establishing a baseline and measuring results, particularly graduation rates, helps your program, agrees W. Paul Bylaska, vice president of finance and administration, Clarion University of Pennsylvania. “When you set these things up, if you're careful about assessing what's happened and you can report back, it can be a success story,” he says. “In these tough times for universities, our stakeholders are asking us to be more entrepreneurial and to show results.”

He believes that providing needy students with the money to finish their studies can be a wise investment for the institution. “If you lose a student because of $1,500, it doesn't make financial sense,” he says. “Those dollars we invest give a good return to the students by allowing them to finish their education, and they give a good return to the taxpayers and parents who pay tuition and fees.”

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