[Federal Register: June 1, 1998 (Volume 63, Number 104)]
[Notices]
[Page 29893-29897]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01jn98-45]
[[Page 29893]]
_______________________________________________________________________
Part XII
Department of Education
_______________________________________________________________________
Office of Postsecondary Education; Notice of Revision of the Need
Analysis Methodology for the 1999-2000 Award Year; Notice
[[Page 29894]]
DEPARTMENT OF EDUCATION
Office of Postsecondary Education; Notice of Revision of the Need
Analysis Methodology for the 1999-2000 Award Year
SUMMARY: The Secretary of Education announces the annual updates to the
tables that will be used in the statutory ``Federal Need Analysis
Methodology'' to determine a student's expected family contribution
(EFC) for award year 1999-2000 for the Title IV, HEA student financial
assistance programs (Title IV, HEA Programs). An EFC is the amount a
student and his or her family may reasonably be expected to contribute
toward the student's postsecondary educational costs. The Title IV, HEA
Programs include the Federal Pell Grant, campus based (Federal Perkins
Loan, Federal Work Study, and Federal Supplemental Educational
Opportunity Grant Programs), Federal Family Education Loan, and William
D. Ford Federal Direct Loan Programs.
FOR FURTHER INFORMATION CONTACT: Ms. Edith Bell, Program Specialist,
General Provisions Branch, Policy Development Division, U.S. Department
of Education, 600 Independence Ave., S.W. (Room 3053, ROB-3),
Washington, D.C. 20202-5444, telephone (202) 708-8242. Individuals who
use a telecommunications device for the deaf (TDD) may call the Federal
Information Relay Service (FIRS) at 1-800-877-8339 between 8 a.m. and 8
p.m., Eastern time Monday through Friday. Individuals with disabilities
may obtain this document in an alternate format (e.g., Braille, large
print, audiotape, or computer diskette) on request to the contact
person listed in this paragraph.
SUPPLEMENTARY INFORMATION: Part F of Title IV of the Higher Education
Act of 1965, as amended (HEA), specifies the criteria, data elements,
calculations and tables used in the Federal Need Analysis Methodology
EFC calculations.
Section 478 in Part F requires the Secretary to adjust four of the
tables--the Income Protection Allowance, the Adjusted Net Worth of a
Business or Farm, the Education Savings and Asset Protection Allowance,
and the Assessment Schedules and Rates--each award year to take
inflation into account. The changes are based, in general, upon
increases in the Consumer Price Index.
For the award year 1999-2000, the Secretary is charged with
updating the income protection allowances, adjusted net worth of a
business or farm, and the assessment schedules and rates to account for
inflation that took place between December 1997 and December 1998.
However, since the Secretary must publish these tables before December
1998, the increases in the tables must be based upon a percentage equal
to the estimated percentage increase in the Consumer Price Index for
all Urban Consumers for 1997. The Secretary estimates that the increase
in the Consumer Price Index for all Urban Consumers for the period
December 1997 through December 1998 will be 2.5 percent. The updated
tables are set forth in sections 1, 2, and 4.
The Secretary must also revise, for each award year, the table on
asset protection allowance as provided for in section 478(d). The
Education Savings and Asset Protection Allowance table for the award
year 1999-2000 has been updated below in section 3.
Section 477(b)(5) of Part F also requires the Secretary to increase
the amount specified for the Employment Expense Allowance to account
for inflation based upon increases in the Bureau of Labor Statistics
budget of the marginal costs for a two-earner compared to a one-earner
family for meals away from home, apparel and upkeep, transportation,
and housekeeping services. Therefore, the Secretary is increasing this
allowance as described in section 5.
The HEA provides for the following annual updates:
1. Income Protection Allowance
This allowance is the amount of reasonable living expenses that
would be associated with the maintenance of an individual or family.
The allowance is offset against the family's income and varies by
family size. The income protection allowances for parents of dependent
students and independent students with dependents other than a spouse
for award year 1999-2000 are:
----------------------------------------------------------------------------------------------------------------
Number in college
Family size ----------------------------------------------------------------
1 2 3 4 5
----------------------------------------------------------------------------------------------------------------
2.............................................. 12,260 10,160 ........... ........... ...........
3.............................................. 15,260 13,180 11,080 ........... ...........
4.............................................. 18,850 16,750 14.670 12,570 ...........
5.............................................. 22,240 20,140 18,060 15,960 13,880
6.............................................. 26,010 23,920 21,830 19,740 17,650
----------------------------------------------------------------------------------------------------------------
For each addiional family member add $2,940.
For each additional college student subtract 2,090.
2. Adjusted Net Worth (NW) of a Business or Farm
A portion of the full net value of a farm or business is excluded
from the calculation of an expected contribution since: (1) the income
produced from such assets is already assessed in another part of the
formula; and (2) the formula protects a portion of the value of the
assets. The portion of these assets included in the contribution
calculation is computed according to the following schedule. This
schedule is used for parents of dependent students, independent
students without dependents other than a spouse, and independent
students with dependents other than a spouse.
------------------------------------------------------------------------
If the net worth of a business or farm
is Then the adjusted new worth is
------------------------------------------------------------------------
Less than $1........................... 0
$1 to $85,000.......................... $0 + 40% of NW
$85,001 to $260,000.................... $34,000 + 50% of NW over
$85,000
$260,001 to $435,000................... $121,500 + 60% of NW over
$266,00.
$435,001 or more....................... $226,500 + 100% of NW over
$435,000
------------------------------------------------------------------------
[[Page 29895]]
3. Education Savingss and Asset Protection Allowance
This allowance protects a portion of net worth (assets less debts)
from being considered available for postsecondary educational expenses.
There are three asset protection allowance tables--one for parents of
dependent students, one for independent students without dependents
other than a spouse, and one for independent students with dependents
other than a spouse.
Dependent Students
------------------------------------------------------------------------
And there are
-------------------------
then the
education
If the age of the older parent is two parents savings and
one asset
parent protection
allowance
is
------------------------------------------------------------------------
25 or less.................................... 0 0
26............................................ 2,500 1,600
27............................................ 5,000 3,200
28............................................ 7,500 4,800
29............................................ 10,000 6,400
30............................................ 12,500 8,000
31............................................ 15,000 9,600
32............................................ 17,500 11,200
33............................................ 19,900 12,900
34............................................ 22,400 14,500
35............................................ 24,900 16,100
36............................................ 27,400 17,700
37............................................ 29,900 19,300
38............................................ 32,400 20,900
39............................................ 34,900 22,500
40............................................ 37,400 24,100
41............................................ 38,400 24,500
42............................................ 39,400 25,100
43............................................ 40,400 25,600
44............................................ 41,400 26,200
45............................................ 42,500 26,800
46............................................ 43,500 27,400
47............................................ 44,600 28,000
48............................................ 45,800 28,700
49............................................ 46,900 29,400
50............................................ 48,400 30,100
51............................................ 49,600 30,700
52............................................ 50,900 31,600
53............................................ 52,500 32,300
54............................................ 53,800 33,100
55............................................ 55,400 33,900
56............................................ 57,100 34,700
57............................................ 58,900 35,700
58............................................ 60,700 36,500
59............................................ 62,500 37,600
60............................................ 64,400 38,700
61............................................ 66,600 39,700
62............................................ 69,000 40,900
63............................................ 71,000 42,000
64............................................ 73,400 43,200
65 and over................................... 75,900 44,400
------------------------------------------------------------------------
Independent Students Without Dependents Other Than a Spouse
------------------------------------------------------------------------
And the student is
---------------------------
then the
education
If the age of the student is savings and
married asset
single protection
allowance
is
------------------------------------------------------------------------
25 or less.................................. 0 0
26.......................................... 2,500 1,600
27.......................................... 5,000 3,200
28.......................................... 7,500 4,800
29.......................................... 10,000 6,400
30.......................................... 12,500 8,000
31.......................................... 15,000 9,600
32.......................................... 17,500 11,200
33.......................................... 19,900 12,900
34.......................................... 22,400 14,500
35.......................................... 24,900 16,100
36.......................................... 27,400 17,700
37.......................................... 29,900 19,300
38.......................................... 32,400 20,900
39.......................................... 34,900 22,500
40.......................................... 37,400 24,100
41.......................................... 38,400 24,500
42.......................................... 39,400 25,100
43.......................................... 40,400 25,600
44.......................................... 41,400 26,200
45.......................................... 42,500 26,800
46.......................................... 43,500 27,400
47.......................................... 44,600 28,000
48.......................................... 45,800 28,700
49.......................................... 46,900 29,400
50.......................................... 48,400 30,100
51.......................................... 49,600 30,700
52.......................................... 50,900 31,600
53.......................................... 52,500 32,300
54.......................................... 53,800 33,100
55.......................................... 55,400 33,900
56.......................................... 57,100 34,700
57.......................................... 58,900 35,700
58.......................................... 60,700 36,500
59.......................................... 62,500 37,600
60.......................................... 64,400 38,700
61.......................................... 66,600 39,700
62.......................................... 69,000 40,900
63.......................................... 71,000 42,000
64.......................................... 73,400 43,200
65 and over................................. 75,900 44,400
------------------------------------------------------------------------
Independent Students With Dependents Other Than a Spouse
------------------------------------------------------------------------
And the student is
---------------------------
then the
education
If the age of the student is savings and
married asset
single protection
allowance
is
------------------------------------------------------------------------
25 or less.................................. 0 0
26.......................................... 2,500 1,600
27.......................................... 5,000 3,200
28.......................................... 7,500 4,800
29.......................................... 10,000 6,400
30.......................................... 12,500 8,000
31.......................................... 15,000 9,600
32.......................................... 17,500 11,200
33.......................................... 19,900 12,900
34.......................................... 22,400 14,500
35.......................................... 24,900 16,100
36.......................................... 27,400 17,700
37.......................................... 29,900 19,300
38.......................................... 32,400 20,900
39.......................................... 34,900 22,500
40.......................................... 37,400 24,100
41.......................................... 38,400 24,500
42.......................................... 39,400 25,100
43.......................................... 40,400 26,600
44.......................................... 41,400 26,200
45.......................................... 42,500 26,800
46.......................................... 43,500 27,400
47.......................................... 44,600 28,000
48.......................................... 45,800 28,700
49.......................................... 46,900 29,400
50.......................................... 48,400 30,100
51.......................................... 49,600 30,700
52.......................................... 50,900 31,600
53.......................................... 52,500 32,300
54.......................................... 53,800 33,200
55.......................................... 55,400 33,900
56.......................................... 57,100 34,700
57.......................................... 58,900 35,700
59.......................................... 62,500 37,600
60.......................................... 64,400 38,700
61.......................................... 66,600 39,700
62.......................................... 69,000 40,900
63.......................................... 71,000 42,000
64.......................................... 73,400 43,200
65 and over................................. 75,900 44,400
------------------------------------------------------------------------
4. Assessment Schedules and Rates.
Two schedules, one for dependent students and one for independent
students with dependents other than a spouse, are used to determine the
expected contribution toward educational expenses from family financial
resources. For dependent students, the expected parental contribution
is derived from an assessment of the parents' adjusted available income
(AAI). For independent students, with dependents other than a spouse,
the expected contribution is derived from an assessment of the family's
AAI.
The AAI represents a measure of a family's financial strength which
considers both income and assets.
The parents' contribution for a dependent student is computed
according to the following schedule:
[[Page 29896]]
------------------------------------------------------------------------
If AAI is Then the contribution is
------------------------------------------------------------------------
Less than -$3,409 ($3,409)............. $-750
($3,409) to $11,000.................... 22% of AAI
$11,001 to $13,700..................... $2,420+ 25% of AAI over $11,000
$13,701 to $16,500..................... $3,095+ 29% of AAI over $13,700
$16,501 to $19,300..................... $3,907+ 34% of AAI over $16,500
$19,301 to $22,100..................... $4,859+ 40% of AAI over $19,300
$22,101 or more........................ $5,979+ 47% of AAI over $22,100
------------------------------------------------------------------------
The contribution for an independent student with dependents other
than a spouse is computed according to the following schedule:
------------------------------------------------------------------------
If AAI is Then the contribution is
------------------------------------------------------------------------
Less than -$3,409 ($3,409)............. -$750
($3,409) to $11,000.................... 22% of AAI
$11,001 to $13,700..................... $2,420+25% of AAI over $11,000
$13,701 to $16,500..................... $3,095+29% of AAI over $13,700
$16,501 to $19,300..................... $3,907+34% of AAI over $16,500
$19,301 to $22,100..................... $4,859+40% of AAI over $19,300
$22,101 or more........................ $5,979+47% of AAI over $22,100
------------------------------------------------------------------------
5. Employment Expense Allowance
This allowance for employment-related expenses, which is used for
the parents of dependent students and for married independent students
with dependents, recognizes additional expenses incurred by working
spouses and single-parent households. The allowance is based upon the
marginal differences in costs for a two-earner family compared to a
one-earner family for meals away from home, apparel and upkeep,
transportation, and housekeeping services.
The employment expense allowance for parents of dependent students,
married independent students without dependents other than a spouse,
and independent students with dependents other than a spouse is the
lesser of $2,800 or 35 percent of earned income.
6. Allowance for State and Other Taxes
This allowance for State and other taxes protects a portion of the
parents' and student's income from being considered available for
postsecondary education expenses. There are four tables for state and
other taxes, one each for parents of dependent students, dependent
students, independent students without dependents other than a spouse,
and independent students with dependents other than a spouse.
Parents of Dependent Students
------------------------------------------------------------------------
And parents' total
income is
-------------------------
less than $15,000 or
If parents' State or territory of residence is $15,000 or more
-------------------------
then the then the
percentage percentage
is is
------------------------------------------------------------------------
Wyoming, Tennessee, Nevada, Alaska, Texas..... 3 2
Louisiana, Florida, Washington, South Dakota.. 4 3
Alabama, Mississippi.......................... 5 4
North Dakota, Illinois, Connecticut, New
Mexico, Missouri, West Virginia, Arizona,
Indiana, Oklahoma, Arkansas.................. 6 5
New Hampshire, Pennsylvania, Colorado,
Georgia, Kansas, Kentucky, Idaho............. 7 6
North Carolina, Virginia, Delaware, South
Carolina, Ohio, Utah, Nebraska, Montana,
California, New Jersey, Iowa, Vermont, Hawaii 8 7
Massachusetts, Rhode Island, Michigan,
Minnesota, Maine, Maryland................... 9 8
District of Columbia, Wisconsin, Oregon....... 10 9
New York...................................... 11 10
Other......................................... 4 3
------------------------------------------------------------------------
[[Page 29897]]
Independent Students With Dependents Other Than a Spouse
------------------------------------------------------------------------
And student's total
income is
-------------------------
less than $15,000 or
If student's State or territory of residence $15,000 or more
is -------------------------
then the then the
percentage percentage
is is
------------------------------------------------------------------------
Wyoming, Tennessee, Nevada, Alaska, Texas..... 3 2
Louisiana, Florida, Washington, South Dakota.. 4 3
Alabama, Mississippi.......................... 5 4
North Dakota, Illinois, Connecticut, New
Mexico, Missouri, West Virginia, Arizona,
Indiana, Oklahoma, Arkansas.................. 6 5
New Hampshire, Pennsylvania, Colorado,
Georgia, Kansas, Kentucky, Idaho............. 7 6
North Carolina, Virginia, Delaware, South
Carolina, Ohio, Utah, Nebraska, Montana,
California, New Jersey, Iowa, Vermont, Hawaii 8 7
Massachusetts, Rhode Island, Michigan,
Minnesota, Maine, Maryland................... 9 8
District of Columbia, Wisconsin, Oregon....... 10 9
New York...................................... 11 10
Other......................................... 4 3
------------------------------------------------------------------------
Dependent Students
------------------------------------------------------------------------
The percentage
If student's State or territory of residence is is
------------------------------------------------------------------------
Alaska, Texas, South Dakota, Wyoming, Washington,
Tennessee, Nevada...................................... 0
Florida, New Hampshire.................................. 1
Connecticut, Louisiana, Illinois, North Dakota.......... 2
Mississippi, Arizona, Alabama, Pennsylvania, New Jersey,
Missouri............................................... 3
Nebraska, Indiana, Colorado, New Mexico, Oklahoma,
Kansas, West Virginia, Rhode Island, Virginia, Georgia,
Arkansas, Vermont, Michigan............................ 4
Montana, Idaho, Utah, Kentucky, Massachusetts,
California, North Carolina, South Carolina, Ohio, Iowa,
Delaware, Maine, Wisconsin............................. 5
Oregon, Maryland, Minnesota, Hawaii..................... 6
District of Columbia, New York.......................... 7
Other................................................... 2
------------------------------------------------------------------------
Independent Students Without Dependents Other Than a Spouse
------------------------------------------------------------------------
The
If student's State or territory of residence is percentage
is
------------------------------------------------------------------------
Alaska, Texas, South Dakota, Wyoming, Washington,
Tennessee, Nevada......................................... 0
Florida, New Hampshire..................................... 1
Connecticut, Louisiana, Illinois, North Dakota............. 2
Mississippi, Arizona, Alabama, Pennsylvania, New Jersey,
Missouri.................................................. 3
Nebraska, Indiana, Colorado, New Mexico, Oklahoma, Kansas,
West Virginia, Rhode Island, Virginia, Georgia, Arkansas,
Vermont, Michigan......................................... 4
Montana, Idaho, Utah, Kentucky, Massachusetts, California,
North Carolina, South Carolina, Ohio, Iowa, Delaware,
Maine, Wisconsin.......................................... 5
Oregon, Maryland, Minnesota, Hawaii........................ 6
District of Columbia, New York............................. 7
Other...................................................... 2
------------------------------------------------------------------------
Electronic Access to This Document
Anyone may view this document, as well as all other Department of
Education documents published in the Federal Register, in text or
portable document format (pdf) on the World Wide Web at either of the
following sites:
http://ocfo.ed.gov/fedreg.htm
http://www.ed.gov/news.html
To use the pdf you must have the Adobe Acrobat Reader Program with
Search, which is available free through either of the previous sites.
If you have questions about using the pdf, call the U.S. Government
Printing Office toll free at 1-888-293-6498.
Program Authority: 20 U.S.C. 1087rr.
(CFDA Nos.: 84.063 Federal Pell Grant; 84.038 Federal Perkins
Loan; 84.033 Federal Work-Study; 84.007 Federal Supplemental
Educational Opportunity Grant; 84.032 Federal Family Education
Loan; and 84.268 William D. Ford Federal Direct Loan Programs)
Dated: May 27, 1998.
David A. Longanecker,
Assistant Secretary for Postsecondary Education.
[FR Doc. 98-14426 Filed 5-29-98; 8:45 am]
BILLING CODE 4000-01-P