Amanda Seitz

Financial aid applications spiked last semester as more students filed the Free Application for Federal Student Aid (FAFSA) and new legislation could affect how Miami doles out that federal assistance.

The U.S. House of Representatives passed the Student Aid and Fiscal Responsibility Act Sept. 17, 2009, while the U.S. Senate is currently working on it, according to Randi Thomas, director of institutional relations.

The legislation could change how Miami distributes financial assistance through the Direct Perkins Loan program (Perkins), according to Chuck Knepfle, director of student financial assistance.

“For Perkins, the schools get an allocation and we decide who to give it to,” Knepfle said. “That provision in that (House) bill actually puts six times as much Perkins loan money available for schools. I’ve actually talked to some of the staff who wrote this, and I think their intent is for what is leftover (to) hand it out to schools based on how well (they) are doing for graduating high-need students.”

Knepfle said this area of the bill is highly contentious among his colleagues and other schools.

While the government plans to impose its power more broadly on the university, Miami will be taking a step back from giving financial advice to students, according to Knepfle.

“We’re required to push federal loans and make it very clear to students to take out federal loans,” Knepfle said. “When a student takes out federal loans and they still have a lot to borrow, they usually turn to private loans.”

Knepfle said schools would be pushed to keep quiet on what they favor for private loan lenders.

“Because of some abuses by schools in the last couple of years, we are very limited in what we can recommend,” Knepfle said. “What you will see from Miami is a list of lenders and facts about the loans. Now we are limited to saying here’s a list of all of them. It’s frustrating to us because I think students want us to help them pick and we are being limited in that.”

Other new measures included in the House bill affect federal aid.

Under provisions of the current bill, the federal aid Pell Grant program will be administered year round and the available loan amount will increase.

Thomas said this increase has been long awaited.

“There is a maximum amount,” Thomas said. “It hasn’t kept pace with tuition as it has gone up.”

According to Thomas, the Pell Grant award will increase from a maximum of $5,500 to the amount of $6,900 in 2019.

“It would also look to increasing the amount every year for 10 years,” Thomas said.

Thomas said the university supports most of the House version’s stipulations, but still believes certain points in the bill need to be clarified in the Senate bill.

“Generally speaking we are extremely supportive but there are a few things that cause us to pause,” Thomas said. “One of the things the House version does now is it sets aside a pool of money to ‘make available’ to students. What we don’t want to see is states setting a one-size fits all for that money.”

Thomas said the university hopes the House bill will not force a formulaic approach to issues such as graduation rates onto the university by means of federal funding.

“We want them to avoid the concentration of funding or persistence of completion activities in state bureaucracies,” Thomas said.

Thomas was concerned the federal government may also try to leverage power through the Secretary of Education.

“Right now they are thinking of giving some of that authority to the Secretary of Education,” Thomas said. “We believe the Secretary of Education should not be given new authority either explicitly or implicitly to write or approve institutional outcome measures.”