feasibility study for restructuring texas student
TRANSCRIPT
Higher
Education
Insight
Associates Feasibility Study for Restructuring
Texas Student
Financial Aid Programs
Texas Higher Education
Coordinating Board Meeting
April 24, 2008
Higher
Education
Insight
Associates
Presenters from Higher
Education Insight Associates
Larry Matejka
Ross Hodel
Sheila Pruden
Higher
Education
Insight
Associates
Historical Context
TEXAS Grant Program created
Closing the Gaps adopted
Recommended curriculum adopted
B-On-Time program created
Tuition deregulated
Recommended curriculum becomes the
default
Higher
Education
Insight
Associates
Rider 49 and THECB Additions
1. Require FAFSA for admission
2. TEXAS Grant and all student aid programs direct grant & common formula
3. Set-asides TEXAS Grant
4. Index grants to room & board
5. Disburse as stipends (maximize federal tax credits)
6. Disburse to students via debit card
7. Add a merit component to the TEXAS Grant
8. B–On-Time – role and funding
9. Collapse small grant programs
Higher
Education
Insight
Associates
Feasibility Study
In the context of Closing the Gaps’ goals
Participation
Success
“The right money to the right
students at the right time.”
Higher
Education
Insight
Associates
November 13 – April 24
Interviewed over 25 policy makers &
governmental officials
Conducted 4 Advisory Committee meetings
Conducted student focus group
Interviewed program directors in 14 Peer States
Surveyed all TX institutions
Consulted national experts
Met with THECB staff
Reviewed relevant literature and data
Participation
% of 18-24 Enrolled
0% 10% 20% 30% 40% 50%
Indiana
Texas
North Carolina
Georgia
Florida
Washington
Virginia
Ohio
US
Pennsylvania
Illinois
Massachusetts
New Jersey
New York
California
Michigan
6-Year Completion
% of First-time Full-time Freshmen
0% 10% 20% 30% 40% 50% 60% 70% 80%
Georgia
Texas
Florida
Ohio
Michigan
US
Indiana
New York
Illinois
North Carolina
New Jersey
California
Virginia
Washington
Pennsylvania
Massachusetts
Participation Completion
Texas
Sources: Measuring Up 2006. NCES , Digest of Education Statistics, 2006.
Higher
Education
Insight
Associates
College Participation
Race & Income 2002-04
% of 18-24 year olds
enrolled 2002-04Texas US Average
Top 20% income 51% 52%
White 36 39
Lowest 20% income 28 32
Non-white 26 29
Sources: Measuring Up 2006.
52
50
48
46
44
42
40
38
36
34
32
30
28
26
24
22
20
Canada
Japan
Korea
Sweden/Finland/Norway
Belgium
United States
Spain/France/Ireland
Australia/Denmark
U.K.
New Zealand
Switzerland/Iceland
Netherlands
Greece
Germany
Poland
Mexico
Massachusetts
Minnesota
North Dakota
Connecticut/Colorado/New York
New Jersey/Vermont/New Hampshire
Maryland/Nebraska/Illinois
Virginia/IowaRI/SD/WI/WA
Pennsylvania/Kansas/Delaware
Hawaii
Utah/Montana
Michigan/North Carolina/Georgia
OH/MO/OR/WY/CA/FL/ME
Indiana
Idaho/South Carolina/Arizona
Texas/Alabama/Tennessee/AlaskaOklahoma
Kentucky/New Mexico
Mississippi/Louisiana
West Virginia/Arkansas
Nevada
Percent of Adults 25-34 with Postsecondary
Degree
TexasSource: Presentation by Dwayne Matthews of the Lumina Foundation and the Hunt Institute at the National Governors Association Conference, July 2007. Data are from the Organization for Economic Co-operation and Development.
Higher
Education
Insight
Associates
Progress
Improved college prep course-taking
Increased college participation rates
Increased overall enrollment 20%
Improved 6-year baccalaureate
completion (96-97 to 03-04)
Texas 44% up to 51%
US 52% up to 55%
Sources: Measuring Up 2006. THECB data, NCES Digest of Education Statistics
Higher
Education
Insight
Associates
Principles1. Develop comprehensive system with
consistent eligibility criteria, purposes, & transitions
2. Build on strengths of current programs
3. Support state’s highest priorities
4. Focus on low- & middle-income students
5. Simplify for students & families
6. Incorporate positive financial incentives
7. Address needs of both traditional & non-traditional students
8. Improve accountability structure
Higher
Education
Insight
Associates
Recommendations
14 recommendations
Laying the cornerstone
Participation and success
Efficiency and accountability
Higher
Education
Insight
Associates
Findings and Recommendations –
Laying the Cornerstone
Findings
TEXAS Grant is “the student aid program
of the future”
TEXAS Grant is making a difference
Higher
Education
Insight
Associates
TEXAS Grant
Making a Difference
2000 Public
University Cohort
by 2006
% Graduated % Still
Enrolled
% Graduated
+ Enrolled
All Students 57 18 75
No Grant 64 14 78
TEXAS Grant 54 22 76
Other
Financial Aid
48 20 68
Source: THECB Staff
Higher
Education
Insight
Associates
Findings and Recommendations –
Laying the Cornerstone
Recommendation 1:
Maintain the TEXAS Grant as the cornerstone
program for a comprehensive student financial aid
system.
Recommendation 2:
Develop a long-range plan for aligning and merging
the Tuition Equalization Grant and the Texas
Educational Opportunity Grant with the TEXAS
Grant to form one comprehensive financial aid
program based on family financial strength and
academic merit.
Rider 49 – TEXAS Grant –direct grant & common formula
0 10 20 30 40 50 60 70
More explainable to students
Combined effort to secure funds
Loss of flexibility
More low-income students served
Easier program administration
More equitable treatment of students
More explainable to policymakers
Percent age
Disagree
Neither
Agree
Expected Results of One Program
Source: Institutional Survey
Higher
Education
Insight
Associates
Findings and Recommendations –
Laying the Cornerstone
Recommendation 3:
Align the award criteria and allocationformulas for TXG, TEG, and TEOG whilekeeping separate funding streams.
Recommendation 4:
Assure that the least advantaged students,those from families in the three lowest familyincome quintiles, receive the greatest benefitfrom public funds.
Higher
Education
Insight
Associates
2006 Texas Family Income Quintiles
MIN MAX MEAN
Q1 $0 $22,000 $12,208
Q2 $22,001 $39,299 $30,587
Q3 $39,300 $61,684 $49,345
Q4 $61,685 $98,249 $77,490
Q5 $98,250 on up $173,724
Source: Current Population Survey
Source: THECB Staff
Distribution of Aid by Income
Pell, Texas Grant, & Tuition Equalization Grant2006-2007
0
10
20
30
40
50
60
70
$0-20,000 21,001-40,000 40,001-60,000 60,001-80,000 80,001-
100,000
Pell
TXG
TEG
Higher
Education
Insight
Associates
Findings and Recommendations
Participation and Success
Findings
Few independent students are served
Merit programs in other states are
entitlements
About one half of the eligible students are
getting a TEXAS Grant
Recommended curriculum now default
Renewal criteria may be counterproductive
Number of Recipients
Dependent and Independent
0
100,000
200,000
300,000
400,000
Pell TXG TEG TEOG
Dep Ind
Source: THECB Staff
Higher
Education
Insight
Associates
Findings and Recommendations –
Participation and Success
Recommendation 5:
Maintain components of the TEG Grant
and the TEOG Grant that serve non-
traditional students until they can be
consolidated into the TEXAS Grant
program.
Recommendation 6:
Maintain the set-aside funds as institution-
based and administered programs.
Rider 49 – Set-asides –TEXAS Grants
Higher
Education
Insight
Associates
Characteristics of Public- 4
TPEG Recipients, 2006-07
Dependent Independent
# recipients 33,955 33,290
Mean taxable income $40,131 $19,114
% with zero EFC 25.0 42.2
% Male 40.8 34.8
% Minority 65.2 48.1
% Father, no college 51.5 47.9
% Mother, no college 53.5 51.8
% with Pell Grant 61.4 49.6
% with TXG Grant 32.1 2.8
% with Stafford Sub 60.5 75.4
Source: THECB Data Base
Higher
Education
Insight
Associates
Findings and Recommendations
Participation and Success
Recommendation 7: Add a merit criterion
for initial eligibility for the Texas Grant to
provide incentives for students with the
most potential.
Score 1300 or above on the SAT or
Rank in the top 40% of the class or
Complete the Distinguished
Curriculum
THECB – Adding a merit component
SAT Scores - Texas Students
Average Scores by Race/Ethnicity,
Income, and Class Rank
100
300
500
700
900
1100
1300
1500
1700
1900
All
Mex
Amer
Other H
isp
Afri/Amer
$50-
60K
$40-
50K
$30-
40K
$20-
30K
$10-
20
$0-1
0K
Top 10
%
2nd 10
%
3rd & 4th
Lowes
t 60
%
Race/Ethnicity Income Class Rank
Source: College Board SAT, 2007 College-Bound Seniors, State Profile Report, Texas. *US Sum of Means = 1511, range 600-2400
Higher
Education
Insight
Associates
Findings and Recommendations
Participation and Success
Recommendation 8:
Develop an eligibility pathway for needy non-
traditional and independent students for a Texas
Grant:
Earn an associate degree or
Complete 12 hours of transferable general
education courses with a GPA of 3.0 or
Complete 24 hours of transferable courses
(general education and/or major-specific courses)
with a GPA of 3.0
THECB – Adding a merit component
Higher
Education
Insight
Associates
Findings and Recommendations
Participation and Success
Recommendation 9:
Align renewal criteria for TEXAS Grant with
the satisfactory academic progress
standards for the Pell and institutional
programs.
THECB – Adding a merit component
Primary Need-Based Grant Program
Initial Merit Requirement? Requirement
RenewalRequirements
California Yes 2.0 - 3.0 GPA Federal SAP
Texas Yes RHSC 2.5/24hrs/75%
New York No Federal SAP
Florida No Federal SAP
Illinois No Federal SAP
Pennsylvania No Federal SAP
Ohio No Federal SAP
Michigan Yes
ACT = 90
comprehensive Federal SAP
Georgia Yes
College Prep 3.0
GPA; other 3.2
3.0 and 30 semester
Hrs.
North Carolina No Federal SAP
New Jersey No Federal SAP
Virginia No Federal SAP
Massachusetts No Federal SAP
Washington No Federal SAP
IndianaDepends on HS
Diploma
Incentives for
Some Diplomas Federal SAP
Source: Peer State Interviews
Higher
Education
Insight
Associates
Findings and Recommendations
Efficiency and Accountability
Recommendation 10: Maintain a decentralized
approach to administration of the TXG and the
TEG Grant with the following changes:
A uniform formula for determining students’ awards
based on family financial strength and merit.
A common process for allocating grant funds to
institutions.
A common FAFSA application priority date
Phase out priority for renewals
Higher
Education
Insight
Associates
Findings and Recommendations
Efficiency and Accountability
Recommendation 11:
Maintain the B-On-Time program as a
secondary incentive program for the 36%
of Texas students who attend college on a
full-time basis.
THECB – Role and funding of Be-on-Time and Small Programs
Higher
Education
Insight
Associates
Findings and Recommendations
Efficiency and Accountability
Recommendation 12:
Collapse several smaller programs into
two; a workforce shortage program and a
college readiness/early commitment
program.
Add sunset provisions to all new small
programs.
Higher
Education
Insight
Associates
Findings and Recommendations
Efficiency and Accountability
Recommendation 13:
Continue use of institution-level debit
cards. Do not use a debit card at the state
level to distribute aid. Ensure the state’s
contribution is recognized on institutional
award notifications.
Rider 49 – Disburse grants via debit card
Higher
Education
Insight
Associates
Findings and Recommendations
Efficiency and Accountability
Recommendation 14:
Develop an accountability system that
monitors:
students’ progress and success
institutional effectiveness in administering
state programs
progress toward state-wide goals for
participation and success.
Rider 49 – Disburse grants via debit card