Packaging How it works
Dec 26, 2015
PackagingHow it works
Learning Objectives Today we will learn
o Definition of packagingo Funds we typically packageo Estimated Financial Assistance & its affecto Steps to package awardso Packaging categories & sequenceo Packaging modelso Overawardso Hands-on exampleo Notifying students of their awards
So what IS packaging? Per the FSA Handbook*
o Packaging is the process of awarding aid without exceeding the student’s financial need
o More simply: it’s how you decide what students are awarded (in what combination)
Funds we typically package
Federal programso Pell, SEOG, Perkins, Federal Workstudy,
Direct Loans, PLUS Loans, Graduate PLUS Loans, TEACH, Iraqi & Afghanistan Service Grant
State programso TPEG, TEXAS Grant, TEG, BOT, CAL,
Texas Workstudy, Set-Aside Funds Institutional programs
Estimated Financial Assistance
Estimated Financial Assistance (EFA) is taken into consideration when packaging
Examples include (but not limited to)o Pell (first source of aid)o Other federal, state, institutional grantso Subsidized & Perkins loanso Work studyo Unsubsidized loans*o PLUS loans*o Private loans*
* Indicates funds that can replace all or part of the EFC as long as the COA is not exceeded.
Other Examples of EFA ROTC living allowances Scholarships (including athletic & ROTC) Employer reimbursement of tuition & fees Tuition and fee waivers Fellowships and assistantships Americorps Funds Exceptions to EFA:
o Iraq & Afghanistan Service Granto Prepaid tuition plano Federal veteran benefits
Steps to Packaging
Steps to Packaging Determine the student’s Cost of Attendance
(COA) budget & Expected Family Contribution (EFC)
Award Federal Pell Grant Calculate the student’s financial need Package campus-based, state, federal, and
institutional funds Package or refer students to other supplemental
sources of assistance
Packaging Steps: STEP 1
Determine the COA & EFC
A typical COA consists of*o Tuition & Feeso Books & Supplieso Room & Boardo Transportationo Personal Expenses
EFC comes from…?
* COA amounts are determined by the institution & could include PJ adjustments
Packaging Steps: STEP 2
Award PELL Grant
Pell Grant awarded based on EFC o Pro-rated based on enrollment status
and EFC range
Packaging Steps: STEP 3
Calculating Student’s Remaining NeedCost of Attendance
-- Expected Family Contribution-- EFA_____________________________
Initial Need-- PELL award (if any)
__________________________________Remaining Need to package
other funds
Packaging Steps: STEP 3
Calculating students’ non-need eligibility
Cost of Attendance-- PELL-- EFA-- Need-based aid awarded________________________________
Room for non-need based aid
Packaging Steps: STEP 4
Package Campus-based, Federal, State, Institutional
o Package other aid programs listed above according to your school’s packaging philosophy/policy
o Keep in mind that each school is different!
Packaging Categories &
Sequence
Packaging Guidelines Responsibility for paying for college rests with the
student and their family Federal Pell Grant is the foundation of
undergraduate student aid packages Families can borrow from some aid programs to
replace all or a portion of their EFC Scholarships cannot be substituted for the EFC Must take expected financial assistance (EFA) into
account
Goals of an Administrator
Provide as many students as possible with resources to meet their financial need
Distribute aid in an equitable manner Provide assistance that will be the most beneficial
to the student Manage financial aid funds Recruit and retain students Meet areas of national need
Sometimes these are competing goals!
Packaging Categories Schools can organize their packaging
categories based o Enrollment statuso Classification o Academic program or major field of studyo Application dateo Need Based vs. Non-Need Basedo Residency Criteria
Packaging philosophy must be detailed in the school’s policy and procedures
Packaging Sequence What gets awarded 1st? 2nd?
Schools designate the order in which it awards funds from various programso Again, this can vary from school to
schoolo It can depend on the categories
designatedo This should be noted in the policy and
procedure manual for your institution
Packaging Models
Six Basic Packaging Models
First-Come, First-Served Gift Aid First Self-Help Concept Special Targeted Groups Equity Concept
o Absolute Dollar Equityo Fixed Percentage Equity
Individualized Packaging
First Come, First Served
Financial aid awards based on the order in which completed applications are received by the aid office until funds are exhausted
Benefits:o Rewards students who get their stuff done
early Drawbacks:
o May not have funds available for students that need it most
Gift Aid Gift aid is awarded first and self help aid is
awarded to meet any remaining need Benefits:
o Decreases likelihood of loan debt Drawbacks:
o Limited gift aid funding
Self Help Self-help assistance is awarded after
the family contribution and before any consideration for gift aid
Benefits:o Places same burden on all studentso Allows gift aid to those who do not have
same access to self-help Drawbacks:
o Increases likelihood of higher loan debt
Targeted Groups Separate packaging criteria for
specific groups of students in addition to specific criteria required by law or regulation
Benefits:o Easier to tie packaging philosophy to
institutional goals Drawbacks:
o Tougher to defend – watch the “bait and switch”
Equity Concept Absolute Equity
o All students are funded up to an institutional maximum fixed dollar amount with gift aid before their remaining need is met with self-help.
Fixed Percentage Equityo An institutional maximum percentage level of NEED or
COST for all gift aid is used rather than a fixed dollar amount.
Benefits:o Provides for an equitable distribution
Drawbacks:o Difficulty in managing overawards and maintaining that
equitable distribution
Individualized Packaging based on the FAA’s
evaluation of a student’s individual costs, resources and needs
Benefits:o Each financial aid packaged is customizedo Personal touch with each student
Drawback:o Time consumingo High subjectivity
Which Should You Use This depends on your institution Most institutions do not use one
specific model…o A variation of one or more of these
models is used by institutions to fit in with that school’s objectives
Overawards & Packaging
Overawards Overawards occur when:
o Aid exceeds a student’s need or COA How does this happen?
o EFC changes (due to verification or updates)o COA changes (possibly due to enrollment)o Additional financial assistance comes in (late
scholarship, exemption payment)• This is the student’s responsibility to report to us
When overawards happen, we make adjustments
Hands-On Example
Packaging Example: Self Help
Sally is attending Cowboy College (CC). She is a dependent senior. CC employs a self-help packaging model and awards work study prior to loans.
COWBOY COLLEGECOA $20,000EFC $500Scholarship $2,500Pell Grant $4,800
AWARD MAXIMUMSPerkins $1,500Work Study$3,000Institutional Grant $3,000Direct Loan$5,500
Packaging Example: Self Help
• Cost of Attendance• EFC• Need• Scholarship (EFA)• Pell • Remaining Need• Work study• Perkins• Stafford Loan• Remaining need before grants• Institutional Grant• Unmet Need• Anything Else????
20,000(500)19,500(2,500)(4,800)12,200(3,000)(1,500)(5,500)2,200(2,200)0Remaining unsub
eligibility?
Packaging Example: Self Help
What if after you have packaged, you are informed that the student is receiving another $500 scholarship?o Does this fit in the COA as is?o Does it fit within the need? • If not what would you reduce?
Notifying Students of Awards
Notifying Students of Awards
Institutions are required to inform students:o Amount of award(s)o Terms and conditions of awardo Manner and timing of payments
Institutions have the option of confirmation or notificationo Confirmation – Student formally accepts awardso Notification – Student not required to accept
award, but must notify school if they do not want aid
Notifying Students of Awards
What if there aren’t enough funds?o Caveat may be included on award
notification stating that the award is subject to the availability of funds and may be revised if funds not available or eligibility changes
Wrapping Up Today we learned
o Definition of packagingo Funds we typically packageo Estimated Financial Assistance & its affecto Steps to package awardso Packaging categories and sequenceo Packaging modelso Overawardso Hands-on exampleo Notifying students of their awards
Questions?