Note to College Donors: Make the Check Out to Students

Student Loan Girl — Fri, 21 Nov 2008 23:28:00 GMT

As the economic downturn continues to impact families’ ability to pay for college, schools are redirecting their fundraising efforts to focus on financial aid, reports The Wall Street Journal (“Colleges Shift Donor Appeals Toward Student Aid,” Nov. 19, 2008).

In order to help meet the increased demand for financial aid, some schools are urging donors to contribute money directly to a school’s general fund, which universities reserve for their most pressing needs, or to a school’s scholarship program, rather than to new building construction.

Bobbi Mark, vice president of institutional advancement at Barnard College in New York, said it makes more sense for colleges to delay the construction of a new building than to “say to the entire sophomore class: Why don’t you take a year off?

“Certain things have to be priorities,” Mark added, “and financial aid is one of them.”

What Some Schools Are Doing To Boost Financial Aid

To help students get the financial aid they need, some schools are giving their priorities a makeover:

Barnard College is asking donors to participate in its endowed scholarship giving program to make up for a reduction in family contributions and to meet an anticipated $1.2 million increase in demand for aid. The program’s donors agree to pledge $100,000 to help a particular student meet his or her tuition costs.

With its families taking a big hit from the mortgage crisis and unemployment, Stanford University has seen an “increase in demand for aid above and beyond our expanded aid commitment,” said Karen Cooper, director of financial aid. The school plans to delay certain building projects and cut its $800 million general funds budget — which pays for faculty and staff salaries, administrative costs, and non-research-related expenses — by 10 to 12 percent over the next few years.

The University of Texas at Austin, which has seen its state funding decrease, recently announced a new $3 billion fundraising campaign with a “primary focus” on making school affordable, said Carolyn Connerat, the school’s campaign director. Giving toward scholarships is up by $4 million this year compared to last year.

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FBI Investigates California College That Overpaid Financial Aid to Some Students, Underpaid Others

Student Loan Girl — Tue, 14 Oct 2008 01:32:00 GMT

A California community college is being investigated by the FBI and the Department of Education for overpaying students more than $327,000 in financial aid during the 2005–06 school year, reports the Contra Costa Times (“Berkeley City College Overpaid Financial Aid,” Oct. 8, 2008).

Berkeley City College, under former financial aid director Robert Vergas, was also found to have underpaid Pell Grant recipients by nearly $40,000.

The federal government has ordered Berkeley City College to repay the Department of Education for the funds it overpaid to its students. The school has already repaid $40,000 and will pay about $37,000 per quarter until the balance is paid off.

The school must also pay the affected Pell Grant recipients the remainder of the grant awards that they should have originally received.

An independent audit of Berkeley City College found, in all, more than 400 mistakes in the files of 1,135 financial aid recipients.

Vergas, who retired in April shortly before he was to be fired by the community college district for “negligence and incompetence,” has denied any wrongdoing and said he is being blamed for deficiencies in the school’s financial aid process.

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Student Loan Blog : financial aid directors

Note to College Donors: Make the Check Out to Students

FBI Investigates California College That Overpaid Financial Aid to Some Students, Underpaid Others