Table of Contents

President's Profile
Announcements
From the Editor
Career School Sector Profile
Vocational-Technical Report
Service Sector Report
Financial Aid Awareness Committee Report
Career School New Member Interview
CAFAA Survey
Channel 9 News and CAFAA, In Partnership To Help Students
Words From our Sponsors and Friends

Disclaimer:
The Colorado Association of Financial Aid Administrators (CAFAA), the Board of Directors and the Executive Committee are not responsible for the accuracy of any information contained in this newsletter as an authority, but rather its use as a guide. Further, the opinions expressed by the contributors are the opinions of the authors themselves and do not necessarily represent the official opinion of CAFAA, the Board of Directors or the Executive Committee.

Article Policy:
Articles may be submitted by any person, company, or organization for consideration by the CAFAA Crier staff and are subject to approval prior to printing the newsletter. The editor reserves the right to reject or edit the content of any article or information submitted. Articles are intended to be informational and for the benefit of CAFAA members and not for company promotion or advertising. Articles should be in 12 point Times New Roman.

Editor: Greg Thomason, Colorado Student Loan Program
Co-Editor: Cyndeth Allison, University of Colorado at Denver

E-mail your articles and advertisements to GThomason@cslp.org or send disk to:

Greg Thomason, CAFAA Crier Editor
999 18th St, Suite 425
Denver, CO 80202

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President’s Profile
by Rick Lee, Pikes Peak Community College

Can it get any better?

Today is Valentine’s Day 2003! Mylar balloons in heart shapes, roses on desks and the aroma of chocolate in the air. Can it get any better? Sure! Budget parameters are posted on the CCHE website. 03-04 ISIR’s are flowing freely into our offices. The myriad of forms that are required of our students to begin the new financial aid processing year are creating work for our staff and student assistants. Each day we make the journey to the mailroom to deliver the letters requesting information and documentation and each day we pick up the answers to those request with what our students hope will “complete their file”. And even though as of today we are still uncertain as to the maximum dollar amount for the Federal Pell Grant for 03-04 - life is good!

Unlike many today, we are employed. And although we grow weary at times, we still have passion for our work. After all – we are the chosen ones! We are the rare individuals who possess the ability to utilize both the left and the right sides of our brains, in full synchronization, to counsel students with empathy while running calculations in our heads. Our task is to find adequate funding, even in times of shrinking resources, to make the dream of education a reality for those that cross our thresholds. Yes, we are magicians.

“Experience the Magic of CAFAA” will be the theme for the Spring 2003 Conference at the Pueblo Marriott and Convention Center April 23 – 25th. The theme seems appropriate for a group of magicians! Audrey Osswald is your conference chair and together with her committee will have a wonderful agenda for all those in attendance. This year, with input from the membership, the RMASFAA Decentralized Training will be held in conjunction with the conference. I’m sure that Audrey will be providing additional information in this edition as well as through the CAFAA list serve on both of these opportunities. I look forward to seeing all of you in Pueblo!

February 28 – March 1st I’ll be in Salt Lake City with Jim Swanson and the rest of the RMASFAA Board of Directors and the RMASFAA Executive Committee. I do appreciate the opportunity that you, the membership, have afforded to me as the President of CAFAA in working with this talented group of individuals.

As always, thank you for taking the time out of your busy schedule to read “The Crier” and by participating in this great association.

Rick

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Announcements

Not to be outdone, Sunny Staninger of Bel-Rea Institute gave birth to a healthy baby girl on October 11, 2002. Solange Ambriel Reese Staninger weighed 8 lbs, 2 oz. and was 19 inches long. Sunny is now officially back from maternity leave and Solange is beginning her training for American Idol 2020 very soon!

From the Editor
by Greg Thomason, Colorado Student Loan Program

Sector Profile - Career School Sector Profile
by Greg Thomason, Colorado Student Loan Program

Hello- I hope you all survived the spring semester start-up…

Just a couple of items this issue…Tisha Corbett with Emily Griffith Opportunity School is expecting her first child March 18th, and as you can tell by her name, she was recently married… Larry Hollstein is still holding down the fort at San Juan Basin, although rumor has it he may try to slip out the door in a year or so…. and we have a new director, Tony Bowling, at Delta Montrose Technical School. Tony has been the director for about a year now, and is looking forward to joining us at the next CAFAA conference. Welcome and Congrats!

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Service Sector Report
by Lori Gloer, Colorado Student Loan Program

How times flies and it’s already time for another compilation of words for the CAFAA Crier! As your Service Sector rep to the CAFAA Board of Directors, I’d like to update the membership with recent activities. The service sector is working on revising the CAFAA membership brochure, giving the brochure some ‘zip’ with a new design. The revised brochure will be reviewed at the next CAFAA Board meeting in April.

As you may have ascertained by Rick’s emails requesting your input, our organization has a few challenges to deal with this year. Dealing with challenges is something we all must face from time to time. I received an email from a friend that I thought was very clever in illustrating different perspectives in dealing with challenges.

So I ask you, ‘ARE YOU A CARROT, AN EGG OR A COFFEE BEAN?’

Here’s how the analogy goes… A young woman went to her mother and told her about all the challenges in her life. Her mother took her to the kitchen. She filled three pots with water. In the first, she placed carrots, in the second she placed eggs, and in the last she placed ground coffee beans. She let them sit and boil without saying a word. In about twenty minutes she turned off the burners. She fished the carrots out and placed them in a bowl. She pulled the eggs out and placed them in a bowl. Then she ladled the coffee out and placed it in a bowl. Turning to her daughter, she asked, "Tell me what do you see?"

"Carrots, eggs, and coffee," the daughter replied. She brought her closer and asked her to feel the carrots, which had gotten soft. She then asked her to take an egg and break it and she found a hard-boiled egg. Finally, she asked her to sip the coffee. The daughter smiled as she tasted its rich aroma.

So what's the point, Lori? The carrot, egg and coffee beans each faced the same challenge--boiling water--but each reacted differently. The carrot went in strong and after being subjected to the boiling water, it softened and became weak. The egg went into the boiling water fragile and after sitting through the boiling water its inside became hardened.

The ground coffee beans were unique, however. After they were in the boiling water they changed the water.

Next time you feel overwhelmed with challenges, ask yourself this question, ARE YOU A CARROT, AN EGG, OR A COFFEE BEAN?

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We have been extremely busy this fall with high school presentations, high school counselor workshops, Channel 9 Call-in events sure makes the time pass swiftly!

We did over 19 high school Financial Aid presentations around the state from Brighton, to Montrose. I want to thank the volunteers that assisted: Tresa England, Aimee Rogers, Mary Anne Hunter, Thad Spaulding, Diane DeReyes, Dave Aker, Peg Mason, Peggy Hill, Cindy Vadeboncueur, Linda Crook, Ruben Guerrero, Jennifer Helgeson, Ellie Miller.

A couple of highlights:

Chatfield High School: We had over 150 attendees at the Chatfield presentation from nearby Columbine, Bear Creek and Dakota Ridge.

Arvada High School: Another large turnout, with students and parents attending from Standley Lake, Arvada, Arvada West and Ralston Valley.

West High School: Thanks to the Daniels Fund and Diane DeReyes for making this a great presentation. Daniels Fund supplied breakfast for the students and their parents and language translators. The University of Denver supplied students who helped parents with their tax returns. CAFAA volunteers assisted parents and students with doing the FAFSA online….

The first Channel 9/CAFAA Call-in Event occurred on Tuesday January 28th. Many thanks to Rick Lee, Cindy Vadeboncueur, Thad Spaulding, Dave Aker and Peg Mason for their expert assistance. We received over 190 calls from parents and students!

Channel 9 graciously invited us to do a second Call in event on Saturday February 15th. Thanks to all of the volunteers who braved the very early morning weather to be there. Dave Aker, Thad Spaulding, Mary Davis and I got a lot of TV time….I think our 15 minutes are up! Mary Davis gave an excellent interview (she didn’t know she was going to be the focus of the interview when she walked in to Channel 9) and she hasn’t hurt me yet for volunteering her for it! Oh – and congratulations go to Mary Davis – she became a grandmother about and hour before the Channel 9 program aired…..

CAFAA produces a financial aid brochure that is used by multiple committees for financial aid presentations at high schools. We have received confirmation that both CESDA and CCHSCR will split the cost with CAFAA to have them re-printed for the upcoming year. We mailed out over 5,000 this past year at the request of high school counselors around the state. (I still have a couple of hundred if anyone needs them for presentations.) And thanks to the Diversity Committee for translating the brochures into Spanish and getting those printed for use.

We were also able to produce (thanks to Ruben Guerrero, Katie Kramer of Boettcher Foundation and ASAP/Union Bank and Trust) over 500 copies of the financial aid presentation on CD’s for distribution to high school counselors during their workshop/training sessions in the fall. We plan on repeating this project when the new high school counselor workshops commence in the fall of 2003.

That’s all for now. We already have two high school presentations scheduled for 2004 and Channel 9 wants to do a series of spots highlighting financial aid next year. Thanks to everyone who has assisted in making this a successful year!

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Career School New Member Interview
By Greg Thomason, Colorado Student Loan Program

Richard Semakula is the financial aid director for Cambridge College in Aurora, a division of High Tech Schools in Phoenix, Arizona, and a new CAFAA member. He expresses excitement for his new role with Cambridge College, and for being involved in the higher education industry. He sees his role at Cambridge College as providing him the opportunity to help people make a difference in their lives.

To this discussion, Richard brings an academic degree in finance from one of the world’s leading universities, experience in the mortgage banking industry, and a desire to help others help themselves. He has first hand experience at overcoming hardship to achieve his goals. Growing up in Uganda, Africa, Richard says political persecution forced him in 1996 to flee his homeland and immigrate to America.

In the few months that he has been associated with Cambridge College, Richard has learned that most students just need a helping hand in understanding the procedural requirements for receiving financial aid. There is a minority of students though, who, he says, see financial aid as a handout—an income stream—and have no intention of investing in their futures by going to their classes or studying. With these individuals, Richard says, he engages in a frank discussion concerning the purpose for attending college.

As a new member of the CAFAA, Richard looks forward to networking with other members, sharing with, and learning from others in the association. “One of the things that I see myself doing is participating in discussions and lending my background experience to be a good advocate for the industry.” Richard is registered to attend CAFAA’s Spring Conference in Pueblo, and looks forward to having an opportunity to build his network of contacts and friends in Colorado’s financial aid community.

In addition to his wife, Jacqueline, Richard has a younger sister who resides in Colorado. He also has a sister and a brother who both live in Texas. Richard’s hobbies include tennis, soccer, and ping-pong. He also enjoys traveling throughout his adopted homeland with his wife.

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Survey: Should Increase The Loan Limits for
Title IV Loan Programs?
By Greg Thomason, Colorado Student Loan Program

Response to the CAFAA Crier survey questions on whether or not Congress should increase the loan limits for Title IV loan programs drew a good cross-section of opinions. A total of 10 out of the 28 respondents provided permission to the Crier to reprint their comments to specific questions.

According to the responses that were tallied, CAFAA’s membership holds some strong views on the role of the federal government in providing education loans to students enrolled in postsecondary education programs. The dichotomous response format used in the survey accentuates the appearance that CAFAA’s membership holds to a set of stratified—yes/no—views. While limiting the ability to understand the extent of a middle view, the use of a yes/no structured response format helps to simplify the process of summarizing the data.

CAFAA’s membership appears to like a good debate. When asked in question #1 to indicate whether the interests of Colorado’s financial aid community should be represented through one or multiple viewpoints, respondents expressed a near 50/50 split in opinion.

An overwhelming majority of survey participants (67.8% vs. 32.1%) indicated the belief “that congress should have acted sooner on the question of whether to increase loan program limits.” By all appearances, if you agreed with question #2, you took exception with question #3, which asked: “Do you agree that undergraduate students should rely on the alternative loan programs offered by private lending institutions to help them bridge the gap between the amounts they are allowed to borrow under the federal loan program and their unmet tuition needs?”

As a collective group of professionals who represent the financial aid community, you show greater empathy toward the financial needs of undergraduate students than graduate students. Nearly three-quarters of the responses to question 4a expressed the belief that the proposed increases in loan limits for undergraduate students, as set forth by The American Council on Education, are necessary. Yet in 4c, the same percentage that agreed with question 4a stated that there wasn’t a need to increase graduate loan limits by more than what ACE is recommending.

You are also less supportive of independent undergraduate students, as indicated in question #5. According to the submitted responses, opinion was nearly 50/50 over whether a need exists to increase the $46,000 loan limit that is currently in place for independent undergraduate students. As noted above, survey responses indicate an overwhelming opinion that graduate students need to go figure out--on their own--ways to fund an advanced degree. Over 67% of the respondents said that the current $138,500 ceiling on graduate loan borrowing is adequate.

Finally, as a group, CAFAA members believe in the benefits provided through the Department of Education’s Pell Grants for lower income students. By nearly 3 to 1, survey respondents indicated the expectation that through increases in the Pell Grant limits over the next six years, low-income students will have an improved opportunity to receive a postsecondary education.

I hope I haven’t given away too much information. There still are a lot of interesting opinions to take in by reviewing the individual comments provided below. And here’s the disclaimer: The comments that follow are the expressed beliefs of the individual to whom they are attributed, and do not necessarily represent the opinions of the school or other employees at the institution.

Responses

Question #1: No matter what the differences, should higher-education
associations and special interest groups put aside their differences and
present a unified voice on the issues affecting increases in the current
borrowing limits for federal student loan programs?

Cheryl Barbour
Asst. Vice President
Student Administrative Services
Naropa University

Answer: "Yes, as long as the voice put forth allows for enough flexibility to represent the interests of the various constituencies represented."

Linda Crook
Director of Financial Aid
Red Rocks Community College

Answer: "I think a unified front might tend to leave out the good reasons that people might have for their viewpoints."

Allison Dean
Director of Financial Aid
Westwood College of Technology

Answer: “We are all coming from different institutions and have various opinions, mostly based on our background. It is always good to hear different opinions and know that we are not all equal!!!"

Susan Fuller
Financial Aid Office
University of Southern Colorado

Answer: "Who says we have to be unanimous?!"

Carolyn Giarratano
Assistant Director
Colorado School of Mines

Answer: “The loan limits have not changed appreciably from the birth of Stafford loans. I have been doing them for 16 years and the freshman level has never increased and we all know how tuition costs and the cost of living in general have skyrocketed over the past 16 years.”

Jeff Gregory
Program Director
Student Financial Assistance
Aims Community College

Answer: "This is a controversial issue and both sides need to be heard. A unified voice for the sake of action doesn't guarantee a 'good' decision."

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "If you, or your association, feel strongly enough to voice an opinion, you should not compromise that position to merely 'go along'."

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: "I feel a unified voice is important however, I'd like to see the NASFAA position incorporate enough flexibility to accommodate the broader spectrum (e.g. variable loan limits tied to COA)."

Question #2: Given the rate at which tuition costs have increased since
1986-when Congress last set the limits for federal tuition loan programs-
do you believe that Congress should have acted sooner on the question of
whether to increase loan program limits?

Art Figel
Assistant Director
Operations and Data Processing
Office of Financial Aid
University of Colorado at Boulder

Answer: "The question at this point in time is whether Congress should act now. If we want to look at the past, then ideally, Pell Grants would have increased at a greater rate in addition to any adjustments to the loan limits."

Jeff Gregory
Program Director
Student Financial Assistance
Aims Community College

Answer: "Coulda, woulda, shoulda. Doesn't matter that much, they didn't."

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "I do not feel that there should be any increase at all. Should they have looked at the loan program sooner -- yes. If your question is really asking "should they have recommended an increase sooner", then I say no. If I feel that in 2003 there should not be an increase--I would have said the same thing in 1996."

Question #3: According to figures from the College Board, alternative
loan volume for enrolled students has increased from approximately
$1-billion in 1995-96, to $5 billion in 2001-02. Do you agree that under-
graduate student should rely on the alternative loan programs offered by
private lending institutions to help them bridge the gap between the amounts
they are allowed to borrow under the federal loan program and their unmet
tuition needs?

Cheryl Barbour
Asst. Vice President
Student Administrative Services
Naropa University

Answer: "This is an enormous concern and while these loans are currently a relatively good deal, for the most part they have no interest rate cap which could skyrocket leaving the student extremely at risk."

Art Figel
Assistant Director
Operations and Data Processing
Office of Financial Aid
University of Colorado at Boulder

Answer: “Students should not have to RELY on alternative loans. While the increase in alternative loan-volume seems to indicate that Stafford limits need to increase, we should keep in mind that there are other factors (e.g., personal savings habits, college choice, economic trends, grant/scholarship availability) that have also contributed. Thus, increasing Stafford limits is only part of the solution.”

Carolyn Giarratano
Assistant Director
Colorado School of Mines

Answer: "Interest costs are unreal and these students will be spending their entire lives trying to get out from under the debt."

Jeff Gregory
Program Director
Student Financial Assistance
Aims Community College

Answer: Preferably, they will rely on their savings, support from parents, and part time employment."

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "The student now has the opportunity to 'rely' on their parents, grandparents, scholarships, part-time work, reduction in course load, etc. to complete their education; why not have other loan opportunities available?"

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: "I don't agree that UG students should have to RELY on alternative loans s a supplement."

Question #4a: In NCHELP's Morning Briefing, The American Council on
Education is attributed with recommending increases in the overall amount
that dependent undergraduate students can borrow from $23,000 to $30,000 (a
$7,000 increase over current limits). According to Morning Briefing, under
this plan ACE proposes a $1,375 increase in Stafford loan limits for
freshman from $2,625 to $4,000).

Cheryl Barbour
Asst. Vice President
Student Administrative Services
Naropa University

Answer: "Students are having to resort to private loans to make up the difference, and low freshman limits lead to schools front-end loading students with scholarships to help meet need and then lowering them as students are eligible for increased loan limits."

Art Figel
Assistant Director
Operations and Data Processing
Office of Financial Aid
University of Colorado at Boulder

Answer: "It is for some students, in some situations. Hopefully the average aggregate loan debt for undergrads who borrow $4,000 as freshmen would be between $18,000 and $20,000."

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "No! the second word in "financial Aid" means assistance or help. It does not mean instead of. It does not mean a free ride. It does not mean you will not have to write a check--ever. It means help! If the costs are out of reach of your budget, then enter a vocational program for one year and become a wage earning, tax paying citizen, and earn the amount you need
to get that degree. I suggest that there are many people wearing $14.95 shoes from a discount store because they cannot afford the $85.00 shoes they would prefer. Why not have the same attitude about educational costs?"

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: "Some type of increase is necessary (see my response to question #1 for an example of another idea)."

Question #4b: Are the proposed loan limits that ACE members
recommend too generous given current levels of unmet need?

Cheryl Barbour
Asst. Vice President
Student Administrative Services
Naropa University

Answer: "The unmet need has increased drastically over the last ten years due to skyrocketing tuition and housing expenses, while family contributions and Pell grants have remained fairly stable comparatively."

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: “Are the proposed loan limits that ACE members are recommending too generous given current levels of unmet need?”

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: "Maybe, maybe not; (it) depends on the cost at particular institutions and among different student categories (e.g., NR or Res., at home or on-campus, etc.)."

Question #4c: Should the federal loan program limits be increased by a
greater amount?

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "See 4a, above."

Roger Koester
Director of Financial Aid
Colorado School of Mines

Answer: "Two points: 1) It is incumbent upon fin aid administrators to limit their own students' borrowing if their COA (like a community college), placement rates, graduation rates, etc. would indicate a lower amount is appropriate. 2) Even with the ACE limits, high-cost schools are still short and students must go to the alternative loan programs."

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: "With qualifications. This is definitely not a "one size fits all" situation in my opinion."

Question #5: Should the $46,000 loan limit for independent undergraduate
students be increased?

Linda Crook
Director of Financial Aid
Red Rocks Community College

Answer: "I believe that students will spend more money if they are allowed to borrow more. I prefer that students look elsewhere for funding of their education (additional earnings, family, alternative loans, scholarships, military benefits, etc.)."

Art Figel
Assistant Director
Operations and Data Processing
Office of Financial Aid
University of Colorado at Boulder

Answer: "How about $53,000? Only enough to accomodate the increase in the...(? -the statement stops here)...dependent undergraduate loan limit (i.e., the difference between the
independent and dependent undergraduate loan limits would remain the same).”

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "See 4a, above."

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: "See above (answer 4c)."

Question #6: Should the $138,500 loan limit for graduate students
be increased?

Art Figel
Assistant Director
Operations and Data Processing
Office of Financial Aid
University of Colorado at Boulder

Answer: "Perhaps only by amount of the increase of the undergraduate limit, such that the difference between the grad and undergrad limits remains the same."

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "See 4a, above."

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: "See above (answer 4c)."

Question #7: Under the initial reauthorization recommendations submitted to
the House Committee on Education and the Workforce on behalf of 45 ACE
members, council members recommend doubling Pell Grant limits for low income
students over the six-year term of reauthorization. Do you agree that this
proposal will directly increase the ability of low-income students to
receive a postsecondary education?

Jeff Gregory
Program Director
Student Financial Assistance
Aims Community College

Answer: "If passed, (good luck given current economic realities) doubling Pell Grant awards would go a long way to increase access for this group."

Larry Hollstein
Director of Financial Aid
San Juan Basin Technical School

Answer: "No! In addition to my comments in 4a (above), I feel that the serious student seeking a two or four-year degree, or a 1-2 year certificate understands the importance of obtaining that goal and will make whatever accommodations that are necessary to achieve that goal. A zero EFC student who understands the educational process and the importance of that process
will be darn thankful for the $4000.00 that paid their tuition and helped buy a book. Those who are after a free ride (see 4a above) will not prosper, no matter how much money you throw at them.

Roger Koester
Director of Financial Aid
Colorado School of Mines

Answer: "In general, yes. However, I believe I would support indexing the max. award to college costs. How much federal (public) money do you want to go toward living expenses at a low cost school, without the students working or borrowing?"

Rick Willis
Director of Financial Aid
Fort Lewis College

Answer: “But it probably doesn't stand a snowball's chance in the Arabian Desert, given the economic environment and the erosion of domestic program funding as we bolster defense."

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Channel 9 News and CAFAA, In Partnership
To Help Students
By Greg Thomason, Colorado Student Loan Program

From the obvious, to the not so obvious, the phone lines kept lighting up, frequented by callers with questions concerning the five-Ws of financial aid: WHO, WHEN, WHERE, WHAT, and HOW. No question was too trite for members of CAFAA’s Financial Aid Awareness Committee who participated on January 28, 2003, in the Financial Aid Call-in Night, co-sponsored by CAFAA and Channel 9 News. For some committee members it was their first time as volunteers on the phones. Other members had logged in numerous sessions in prior years. Yet, all six of the volunteers were taken aback with the volume of calls that came in during the two-and-a-half-hours that Channel 9 News promoted this special event to its viewers.

The appeal generated by the Financial Aid Call-in Night event is best gauged by the fact that Channel 9 invited Committee members to come back to the studio on two subsequent dates, February 15 and 23, to answer viewer questions concerning the ins and outs of financial aid.

CAFAA’s Financial Aid Awareness Committee members
Relent, after repeated requests, and pose with 9 News-announcer
Paula Woodward. From left to right (backrow) Peg Mason,
Judy Ransom, Paula Woodward, Dave Aker, (front row) Rick
Lee, Cindy Vadeboncoeur, and Thad Spalding.

On this first night of call-in questions, 9 News-announcer Paula Woodward provided the on-camera promotions that encouraged viewers to take advantage of the in-studio expertise presented by Dave Aker, Rick Lee, Peg Mason, Judy Ransom, Thad Spalding, and Cindy Vadeboncoeur. Over the nine years that CAFAA has served as the lead sponsor for the Financial Aid Call-in Night, the event has served to correct many of the misconceptions that people have adopted about student loans.

Serving in her eighth year as a call-in night volunteer, Ransom, chair for the Financial Aid Awareness Committee, said the most common question from both prospective students and/or parents was, “What is a FAFSA, and where do I get one?” Ransom says she spoke to 35 callers in the time allotted.

Mason said that among the 30+ callers she spoke to, the most common question she encountered was, “Where do I get the free money.” She noted that many of the individuals she spoke to didn’t know where to begin the process of applying for financial aid. For Mason, the ability to assist people in overcoming both their confusion and frustrations toward the financial aid process has, over the nine years that she has volunteered for the call-in night, provided her with the greatest sense of reward.

No one really knows whether it was
by accident that Rick Lee’s chair
at the 9 News Financial Aid Call-in Night
also happened to be the closest to the
chocolate candy dish.

“Great fun,” is how Thad Spaulding characterized his participation with the 9 News call-in night. He cites the ability to help people who don’t “have the first notion of how to
seek federal student aid,” as his reward for dedicating time to this event. “It feels great to get them oriented and on their way to their high school counselors, financial aid counselors or schools. I love that!” he says.

Participating in his first-ever call-in night session, CAFAA President Rick Lee observed that a large percentage of the questions he responded to were asked by individuals who were recently laid off, and wanted to know if financial aid would cover both tuition and living expenses, if they went back college. The experience, he said, was made rewarding by, “Watching my peers working side-by-side, practicing what we preach.”

How to receive scholarship funds and apply for financial aid were the two most commonly asked questions that Vadeboncoeur said she responded to during her first ever Call-in Night. She notes that her greatest reward came from hearing the people she spoke to express appreciation “for what I think of as very basic information.”

During the subsequent call-in shows, on February 15 and 23, volunteers responded to approximately 225 additional queries related to financial aid issues. Volunteers for these call-in programs included Dave Aker, Mary Davis, Peggy Hill, Mary Anne Romero-Hunter, Judy Ransom, Gloria Shelden, and Thad Spaulding.

Paula Woodward works at her desk in the production room at
Channel 9 News. Following the overwhelming response to the
first 9 News Financial Aid Call-in Night on January 28, members
from CAFAA’s Financial Aid Awareness Committee were invited
back to work two additional, unscheduled programs.

Just when you think you've heard them all!

From a recent CAFAA listserv e-mail sent by Larry Hollstein

“I was wondering if anyone else has heard this one?

“Well now that I have graduated and have these huge loan payments - is there any type of grant that I can apply for to make the loan payments with?”

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Expanded Higher-Education Tax Benefits Highlighted
Submitted by Kathy Bixby, USA Funds Services account executive

Students and parents who paid college expenses during 2002 may qualify for larger deductions or credits when they file their federal income-tax returns. Recent tax-law changes have added new higher-education tax benefits and expanded several existing benefits.

As they prepare their 2002 federal income tax returns, students and families should be advised to see if they qualify for savings under the following higher-education tax benefits:

Student-loan interest deduction — The new law eliminates the former 60-month limitation on education-loan interest that qualifies for the student-loan interest deduction. Taxpayers now may be able to deduct qualified interest that they were required to pay throughout the term of their student loans. The new law also raises the income limits for taxpayers to qualify for this deduction. Single taxpayers with modified adjusted gross incomes of between $50,000 and $65,000 can take a partial deduction. Single taxpayers whose incomes are below $50,000 qualify for the full deduction. Married taxpayers with modified adjusted gross incomes of between $100,000 and $130,000 also qualify for a partial deduction. The maximum deduction is $2,500.

Deduction for higher-education expenses — Taxpayers now may qualify to deduct up to $3,000 in qualified higher-education expenses. This new deduction is available to single taxpayers with adjusted gross incomes of $65,000 or less, or married couples who file joint returns reporting incomes of $130,000 or less. In general, expenses eligible for the deduction are tuition and fees paid for an individual or a spouse or dependent. Student-activity fees and fees for course books, supplies and equipment may be included if the student was required to pay those fees to the institution in order to attend. Room and board is not an eligible expense, however. This deduction and higher-education tax credits — such as Hope of Lifetime Learning credits — may not be claimed for the same student in the same year.

529 college-savings plans — Students and families may exclude from their taxable income any earnings distributed from state-sponsored Qualified Tuition Programs, commonly known as 529 plans, if the proceeds were used for qualified education expenses. In the case of room-and-board costs, students and families should check with the educational institution to determine the amount considered “reasonable” for that school for the deduction. Taxpayers also may contribute to 529 plans established by one or more education institutions, although any earnings distributed from educational institutions’ plans prior to 2004 will be taxable.

Coverdell Education Savings Accounts — The maximum contribution that students and their families may make to these savings accounts, formerly known as Education IRAs, has been increased to $2,000 per year from $500. Contributions are not deductible, but earnings accrue tax-free for qualified education expenses. Income limits for married couples filing jointly have been increased. Married couples who report a modified adjusted gross income of $190,000 or less may contribute the maximum amount. The maximum contribution is lower for those whose modified adjusted gross incomes are more than $190,000. Married taxpayers whose incomes exceed $220,000 may not contribute to these accounts. Single taxpayers must have incomes of less than $110,000 to contribute. Students and their families now have until the April 15 tax-filing deadline, or the due date of their tax returns — excluding filing extensions — rather than Dec. 31 of the tax year, to make their contribution for the year. Contributions to Coverdell accounts and 529 plans are permitted for the same beneficiary in the same year. Additionally, taxpayers now may take a tax-free distribution from a Coverdell Education Savings Account in the same year that they claim a Hope of Lifetime Learning Higher-education credit, as long as they don’t use their Coverdell-account distribution for the same expenses for which they claimed the credit.

Employer-provided education benefits — The new tax-law changes extend indefinitely provisions that permit students and their families to exclude from their taxable income up to $5,250 in employer-provided education assistance. Beginning with the 2002 tax year, this benefit has been extended to graduate-education costs in addition to undergraduate expenses.

Hope Tax Credit — Students, their parents or their guardians may claim up to $1,500 for each student for out-of-pocket tuition and fees for each of the first two years of classes toward a degree or certificate from a college or vocational school. Students must be enrolled at least half time to qualify for this tax credit. Single tax filers with modified adjusted gross incomes of $51,000 or more, or joint filers with incomes of $102,000 or more, do not qualify for this credit.

Lifetime Learning Credit — This credit is available for any education beyond high school, including vocational, college, graduate and professional education. The amount that a taxpayer may claim under the Lifetime Learning Credit equals 20 percent of the first $5,000 of qualified expenses, for a maximum of $1,000. Income limits are the same as for the Hope Credit. You cannot claim both the Hope Credit and the Lifetime Learning Credit for the same student for the same year.

Please note that this information is intended as a general summary of these tax benefits. Financial-aid administrators should refer students and their families to a qualified tax adviser or the Internal Revenue Service (IRS) to determine eligibility for any of these benefits. They may reach the IRS on the Web at www.irs.gov or by phone at (800) 829-1040. For additional information, they may order IRS Publication 970, “Tax Benefits for Higher Education.”

Further information is available in the free USA Funds® brochure “Higher-Education Tax Benefits — Expanded Taxpayer Savings.” The brochure is available to view and to order by visiting www.usafunds.org/forms/order_pubs.asp on the USA Funds Web site.

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