Government Relations Committee

Purpose

To provide expertise and tools that enable Association members to advocate at the federal and state level. To review, analyze, and/or evaluate and respond to regulatory, legislative, and programmatic issues, and to assist in the dissemination of information when appropriate. To identify, consider and develop Association positions on long-range policy issues and serves as a resource for legislators and their aides.

Composition

The Committee is chaired by individuals appointed by the President. The Committee is composed of volunteer members.

Goals & Objectives

Establish, foster, and grow a new generation of aid professionals who value and engage in advocacy at the federal and state level.
- Develop and promote innovative engagement opportunities that resonate with members across the age and experience spectrum.
- Provide training on how to interpret and advocate for change in regulation and policy at the federal and state level.
- Engage with members and institutional leaders across the Association to gather information on talent and interest in advocacy.

Promote communication between the membership and State legislators, Massachusetts Congressional delegation and related administrative staff members
- Foster relationships with key State legislators, legislative staff and administrators, and educate them on behalf of MASFAA members on key issues and concerns in the financial aid  community.
- Reimagine State House Day event and work in coordination with AICUM to increase participation of students and institutions, with particular emphasis on participation from public colleges and universities.
- Provide information on the MASFAA list-serve and website to alert the membership to important changes in federal and state regulation and legislation as needed.
- Provide training sessions on advocacy, federal and state regulations and programs, and/or changes in existing programs.
- Maintain federal compliance resources for MASFAA members regarding requirements such as private loan RFIs, loan counseling, consumer disclosures, and Constitution Day.

GRC Blog

3/26/2024 – Mika Lim

The Importance of Our Community and Your Voice Amid FAFSA Challenges

As we navigate the delayed rollout and technical hurdles of the Better FAFSA, Better Future rollout, it becomes increasingly evident that the strength of our community and professional associations has never been more important.

The FAFSA rollout has caused frustration and uncertainty among students, families, and financial aid professionals alike. More troubling is the possibility that students who lack resources will decide against enrolling in postsecondary education without timely and accurate offers of financial aid. With technical issues complicating an already complex aid year, the need for community dialogue, shared expertise, and advocacy is more crucial than ever.

Despite the challenges posed by the FAFSA rollout, there is a silver lining. The Federal disruptions of the financial aid process have highlighted the importance of what we do as financial aid professionals. It underscores our role in ensuring equitable access to higher education and supporting students on their educational journeys. It gives credibility to our voice when we advocate for student aid programs and policy changes.

There are countless examples of the power of engagement when our community is faced with challenges. A listening session hosted by the EASFAA Federal Relations Committee, held on February 20, provided a platform for members to voice their concerns and offer solutions around pressing topics, including FAFSA Simplification, Borrower Defense to Repayment, Gainful Employment, and Financial Value Transparency. The important views and ideas shared during this session helped to inform advocacy efforts, including EASFAA’s recent letters to the Department of Education and US Senators. Additionally, the listening session led to the creation of EASFAA’s new Community Resource Hub, accessible through the EASFAA Archives.

Unlike other industries, where competition outweighs collaboration, we are fortunate to have strong professional associations that encourage knowledge exchange. We are also fortunate to have a diverse community of individuals representing diverse institutions, where each individual’s unique perspective should be heard.

MASFAA’s Government Relations Committee urges each member of our professional association to actively engage in knowledge sharing initiatives and participate in community discussions. By doing so, you not only enhance our collective strength and help set association priorities, but you also reaffirm our commitment to supporting students as they pursue their education and careers.

Finally, we want to thank you for your community involvement and for remaining committed to our important profession.

3/7/2024 – Femi Stoltz

Massachusetts Proposed Legislation Update

The Joint Committee on Higher Education reported H4269 – An Act to Facilitate Student Financial Assistance favorably out of the committee in January. H4269 would require graduating high school seniors to submit the FAFSA or opt out of the FAFSA submission process before commencement. This policy would also require that high schools support students and families with the FAFSA submission process.

Louisiana became the first state to implement a universal FAFSA policy, requiring seniors to submit a federal financial aid application prior to graduation. Since Louisiana implemented its policy, 12 more states across the country have implemented similar policies. This bill is currently under review by the House Committee on Ways and Means.

2/21/2024 – Betsy Mayotte

End of Week Two – the Latest on the Program Integrity Negotiated Rulemaking and What It Could Mean for Schools

Two down, one to go. Last week the Department of Education (ED) completed the second of three series of negotiations intended to strengthen the rules that protect students related to cash management, return of Title IV funds, accreditation, state authorization and distance education. If these topics sound familiar to you related to negotiated rulemaking (neg reg) they should. The ED completed a substantive neg reg session with almost this exact agenda back in 2014 as a result, in part, of a report that showed that some lenders were charging significant fees for students to access their federal aid funds.

The MASFAA Government Relations Committee is pleased to provide members with a quick summary of where the various issues are so far. Of course, we won’t know for sure what the actual regulatory changes will look like until after the Final Rule comes out, likely not until the fall, but the completion of the second week is usually a good time to do a pulse check.

Accreditation:

This proposal appears to be an attempt to add teeth to the accreditation rules that the prior administration had removed. The draft rules would prohibit public members of an accrediting body who had ties with institutions or trade associations connected or related to the accreditor or schools or programs under the accreditor. This includes current and former employees, owners, consultants and shareholders. It would also reinstate a former rule that the accreditor was “widely accepted” as an authority on the institutions and programs it provided oversight to. In an attempt to focus oversight on issues that history has shown pose the greatest risk, the ED is suggesting language that would require the agency to “visit and approve all additional locations of an institution, to approve distance education on an institution’s first offering and at the 50 percent threshold, and to approve the addition of programs at any level by an institution that has not previously offered programs at such a level.” These decisions would also no longer be allowed to be delegated to agency staff from the decision-making body. On a related note, they are proposing reducing the amount of time deemed acceptable for schools to be out of compliance to no more than the length of a program or two years – whichever is shorter. Accreditors would be required to address schools and programs with low completion rates, make more on site visits and require schools to provide teach-out plans upon certification or renewal of certification. Schools would be prohibited from changing accreditors more frequently than every two years. The discussions on these proposed accreditation rules resulted in significant lively discussion during last weeks meeting and it remains to be seen whether the ED will be successful in getting consensus from the committee.

Return of Title IV:

The current administration continues its trend of finding ways to make things easier for vulnerable borrowers in this proposal by suggesting removal of the rule that would put a loan into immediate default if a borrower received a refund in hand but failed to ever start classes – known within the industry as a “never enrolled” loan status. Instead the borrower would be put into immediate repayment. It also changes the definition of a withdrawn student to exclude a student who had completed at least 49% of a module or a student who never attended classes and the school returned all federal funds and did not charge the student tuition for that period. Schools that normally wouldn’t be required to take attendance would have to do so for courses provided entirely through distance learning.

Cash Management:

We’d describe this issue paper as a lot of little changes with the potential for big impact. This includes only being able to consider books and supplies as tuition and fees if there’s a “compelling” heath and safety reason to do so. It would cease the practice of “use it or lose it” meal plans for Title IV recipients, requiring schools to return the unused portion of these meal plans to students within 14 days of the end of the period. Schools would no longer be allowed to hold student refunds for weeks before mailing them if not picked up by the student – but would be required to mail such checks immediately. No fees would be allowed in a Tier 1 (where a school contracts with a third party to assist with Title IV credit balances) and Tier 2 (where a school partners with an entity to market financial accounts to students) in accounts for not only transactions related to federal aid funds, but also nonfederal aid funds in the same account. No fees would be allowed after the student left the institution (often called sunset fees) and insufficient funs fees would be prohibited. The definition of credit balance and its associated requirements is expanded to include non-federal funds such as scholarships and private loans. This proposal is one that seems to have consensus with all the negotiators thus far.

Distance Education:

The ED is proposing creating a ‘virtual location” that would be defined as an additional location for Title IV institutional eligibility purposes, for schools that provide 100% of their courses online. Distance learning would no longer be an option for asynchronous learning for clock hour programs.

The next and final round of negotiations is slated for March 4-7. You can follow the negotiated rulemaking sessions and read the materials and transcripts in detail here.

1/23/2024 – Brianna Juaire:

State and Federal Aid in the Aftermath of FAFSA Simplification

Changes to federal methodology can have significant ramifications for both public and private institutions, impacting their state and federal grant programs, among others. While FAFSA Simplification will yield positive outcomes, it is expected to create an additional administrative burden on institutions. Schools might consider the following when awarding for 2024-2025.

Transition from EFC to SAI:
Predictive modeling suggests that a greater number of students will qualify for increased financial aid under the SAI formula. The transition from Expected Family Contribution (EFC) to Student Aid Index (SAI) will necessitate reimagining and redistributing state and federal funds. SAI also introduces the possibility of negative SAI, a departure from EFC, which could not dip below 0. This change could lead to additional demands on state funds, particularly those based on either Pell eligibility or EFC limits.

Last-Dollar Programs:
Data suggests that the total number of Pell-eligible students will increase, and Pell grant dollar amounts will rise at both an aggregate and student level. An increase in Pell eligibility could strain last-dollar programs, especially if Pell eligibility is a criterion. Many last-dollar programs also have complex awarding requirements, and an increase in eligible students will likely worsen the school’s administrative burden.

Campus-Based Funds:
Increased federal aid eligibility will also expand the number of students eligible for campus-based federal funds such as the Federal Supplemental Educational Opportunity Grant (FSEOG) and Federal Work Study (FWS). Schools may need to modify or implement priority deadlines and additional awarding paradigms for these funds to cover a larger student population. Alternately, students with high-need SAIs may increasingly rely on state grant programs if campus-based federal grants aren’t available.

Impact on Independent Students:
An October 2023 report by SHEEO anticipated that most independent students would experience a decrease in SAI relative to EFC. The decrease was greatest for independent students with no dependents but was also found in independent students with dependents. Community colleges, which typically attract more independent students, may need to consider awarding paradigms for this population.

Increased Professional Judgements (PJs):
The new SAI calculation eliminates the impact of the number in college on students’ need determinations. Institutions may experience an uptick in Professional Judgements (PJs). NASFAA advises that schools may consider performing a PJ if additional family members in college create financial hardship. However, these PJs cannot be processed by changing the number in college on the Institutional Student Information Record (ISIR). Financial aid administrators will have to collect documentation to consider adjustments such as reducing income or adjusted gross income (AGI), considering payments made for college expenses against an allowance for assets, or adjusting the miscellaneous personal expenses component or another component of the Cost of Attendance (COA) to reflect additional costs.

Impact of FWS Reporting:
Since institutions must now report students’ annual Federal Work Study (FWS) earnings by calendar year, there may be an increase in ISIR corrections as schools adapt to these new requirements. This could impact students’ eligibility for both state and federal aid, leading to more award revisions. Although FWS earnings have always been excluded from the EFC calculation, more accurate reporting may further reduce the SAI of working students. If FWS funding is in limited supply and cannot be awarded to all students with need, schools may need to consider best practices for equitable awarding.

12/18/2023 – Betsy Mayotte:

Update on Broad Student Loan Forgiveness

This month saw the third and final (probably) meeting of the negotiated rulemaking session tasked with developing a program of broad forgiveness for federal student loans. This session was announced the day the Supreme Court shot down the Biden administrations first attempt at broad forgiveness that would have seen up to $20K forgiven for Federal Direct loan borrowers with incomes under $125K.

This time around, the administration is attempting to provide more limited forgiveness under what they, and others, have said is the Secretary of Education’s authority under the Higher Education Act. While during the first two meetings, the Department of Education’s (ED) proposal was somewhat vague, draft regulatory language was issued to the negotiators prior to the final meeting that clarified at least some of what might be attempted during this second bite at the forgiveness apple.

The proposal creates five possible categories of borrowers that may be eligible for some, or all, of their loans to be forgiven.

The first category is borrowers whose loan balances are higher than what they originally borrowed. For those in this category who are on an income driven plan (IDR) other than the new SAVE plan, they could be eligible for some forgiveness if their income is less than 225% of the poverty level associated with their family size and state. For a single borrower that would be an income of under $32,805. For borrowers on the SAVE plan, the income maximum would be $125K for a single borrower, $250k for a married borrower. In both of these scenarios the forgiveness amount would be the LESSER of:

$20K or
The amount over what they borrowed for loans disbursed prior to January 1, 2005 or
The amount over what they owed on the last day of their grace period for loans disbursed after January 1, 2005 or
The total principal of loans paid in full via consolidation

For borrowers not on an IDR plan of any kind, forgiveness would be the lesser of $10K or the amount over what they originally borrowed.

The next category of borrowers would be what the industry has taken to calling “the long haulers” who are those who have been in repayment for over 20 or 25 years. While most of these borrowers would end up getting forgiveness prior to any implementation of this potential new regulation under the one-time account adjustment, this proposal would cover such scenarios in the future. It would forgive he remaining balance of loans in repayment on or before July 1, 2005 for a borrower with only undergraduate loans and those who entered repayment prior to July 1, 2000 for those with graduate or Parent Plus debt. A related proposal would also forgive the outstanding balance of a loan that would have been forgiven under and IDR plan if the borrower has applied for it and met the criteria.

The language also provides the ED authority to forgive the remaining balance for borrowers that should have otherwise had their loans discharged under programs such as disability discharge, closed school and borrower defense to repayment.

The fourth category falls under what the ED is calling “Secretarial Actions.” This proposal would forgive up to the full balance of the loans if a school or program within the school fails to meet the required accountability standards related to borrower outcomes. Essentially, this proposal appears to allow the ED to forgive loans where the program or school are denied recertification or has been found to engage in misrepresentation of student outcomes such as job placement or income potential.

The final category that was discussed during the negotiated rulemaking session was related to gainful employment programs. In this proposal, the outstanding balance of the loans would be forgiven by the ED if the school or program closed and:

The program was not a medical or dental program
While the borrower attended, the GE data shows that the average loan payment is higher than 20% of the average income for graduates, minus 150% of the applicable poverty level or
The average income of graduates is not greater than the average income for workers in the same state with only a high school diploma aged 25-34
- Or nationally if 50% of the students do not live in the school’s state or the school is a foreign school

None of these proposals, if passed as written, would provide refunds to affected borrowers.

There was a sixth category of borrowers that, while widely discussed, no actual proposed language was presented by the ED. Many of the borrowers and consumer protection representatives at the table requested that the ED provide relief for borrowers experiencing overall financial hardship. While the federal negotiators expressed interest in this, no language was produced or voted on, leaving the issue open to ED interpretation during the next stage of the negotiated rulemaking process, which will be the publication of draft language for public comment under a Notice of Proposed Rulemaking. Many negotiators begged the ED to hold an additional session to flesh out such a proposal, but the ED would not commit to this. With the NPRM due to be published this coming May, and the administration anxious to have final rules out on this forgiveness prior to the election, the chances of an additional meeting seem slim.

While the ED and the White House seem confident that the legal authority for these programs exists, we can be fairly certain that once final rules are published that there will be lawsuits and possibly Congressional actions to attempt to prevent the programs from implementation. The Government Relations committee will continue to keep the MASFAA community informed as this issue progresses.

11/8/2023 – Femi Stoltz:

New Tuition Equity Law Grants Additional Access to State Financial Aid and In-State Tuition
With Governor Healey’s signing of the FY 2024 state budget, some previously ineligible students will now have access to in-state tuition and state financial aid. The new Tuition Equity Law creates a pathway to in-state tuition rates and state financial aid for some non-US citizen students, including undocumented students who attended high school in Massachusetts for at least 3 years and earned a high school diploma (or the equivalent) in the Commonwealth. Students will be eligible to be considered for need-based aid once the Department of Higher Education has developed a state-approved FAFSA equivalent, which is anticipated to be finalized by or before January 1, 2024. Eligibility determinations made during FY2024 will be retroactive to July 1, 2023.

Full eligibility criteria for access under new Tuition Equity Law
In order for a student to receive in-state tuition under this section, students must provide the public institution of higher education where they are is or plan to become enrolled with a high school transcript or certificate demonstrating completion of the equivalent in the commonwealth and:

(i) a valid social security number
(ii) a document reflecting issuance of an individual taxpayer identification number
(iii) if that individual is not a citizen of the United States or a legal permanent resident of the United States, an affidavit signed under the pains and penalties of perjury stating that the individual has applied for citizenship or legal permanent residence or will apply for citizenship or legal permanent residence in accordance with federal statute and federal regulations within 120 days of eligibility for such status; or
(iv) documentation of registration with the selective service, if applicable