NASFAA has responded to the April 15 Senate request for recommendations on how to improve and strengthen the Higher Education Act (HEA) by issuing a specialized set of recommendations to Senators.
In a May 22 letter accompanying the recommendations, NASFAA President Dallas Martin thanked lawmakers for the opportunity to provide feedback on the upcoming HEA reauthorization.
"To facilitate your consideration of our package, we have arranged our recommendations according to the categories identified in your April 15 invitation," he told the Senators. "Our format identifies the issue (and statutory citation where possible), our recommendation, and rationale. We will follow-up with legislative language to support these recommendations."
The full text of NASFAA's reauthorization recommendations to the Senate is available on-line.
Some of NASFAA's recommendations are to:
- Make the Pell Grant Program a "true" entitlement and assure that such an entitlement will extend for ten years. Double the Pell Grant maximum in the next five years, with an inflation adjustment after that.
- Increase authorization levels for the FSEOG, Perkins Loan, and Federal Work-Study programs.
- Eliminate the provision that mandates that schools losing eligibility to participate in the FFEL or Direct Loan programs due to high default rates also lose their eligibility to participate in the Pell Grant Program.
- Continue and increase LEAP funding to prevent the elimination or severe reduction of some state need-based grant programs.
- Increase annual loan limits to levels specified on page 6 of the recommendation effective in 2004, with stepped increases in both subsidized and unsubsidized annual limits for undergraduates of $500 in 2007 and 2009; and stepped increases in subsidized annual limits for graduate/professional borrowers of $1,000 in 2007 and 2009. Also, increase graduate/professional borrower annual loan limits; and increase the unsubsidized loan limit to 150% of subsidized loan limit."
- Exclude the earned income credit from untaxed income and eliminate the taxation of student assistance funds.
- Eliminate the 30-day delay for first-time students and multiple disbursements for single-term loans.
- Allow loan consolidation so that borrowers with multiple loans may have a single holder. Change the interest rate from a fixed rate to a variable one to conform to the recommendation that all interest rates are variable and capped at a maximum rate of 6.8%. Clarify the single holder rule. Consider having consolidation loans carry a higher interest rate.
- Eliminate the requirement to suspend or terminate a student's eligibility for Title IV funds based on drug-related convictions.
According to Martin, "NASFAA developed these recommendations using a fourteen-member Reauthorization Task Force to carefully analyze existing law and to solicit and develop proposals from our members. An Advisory Group of more than 75 individuals also provided valuable input."
"We believe that the resulting recommendations, approved by NASFAA's Board of Directors, accomplish the goal of improving current programs, and more effectively meeting the goals and objectives of this Act, especially to provide greater access to a postsecondary education for our nation's citizens, reduce regulatory burden, and promote accountability in the wise use of taxpayer's funds," he added.
By Elizabeth B. Guerard
NASFAA Assistant Director of Communications
Posted May 23, 2003 on
www.NASFAA.org, the Web Site of the
National Association of Student Financial Aid Administrators (NASFAA).
Copyright 2003. Redistribution to non-NASFAA institutions is prohibited
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