Summary: "Analysis of the Experimental Sites Initiative: 2006-07 Award Year" Report Now Available

Publication Date: July 21, 2008

Author: William Leith, Acting General Manager, Application, Operations and Delivery Services, Federal Student Aid

Summary: "Analysis of the Experimental Sites Initiative: 2006-07 Award Year" Report Now Available

Posted on 07-21-2008

The U.S. Department of Education is pleased to announce the release of the report, "Analysis of the Experimental Sites Initiative: 2006-07 Award Year." This report is available from the Experimental Sites website at https://experimentalsites.ed.gov/exp/reports.html.

Congress authorized the Experimental Sites Initiative under section 487A(b) of the Higher Education Act of 1965, as amended. The Initiative addresses concerns that Federal requirements place unnecessary burdens on postsecondary students and institutions. Since 1996, the U.S. Department of Education, Federal Student Aid, has overseen the Initiative. This Initiative-or "experiments," as they are frequently called-tests the effectiveness of statutory and regulatory flexibility for disbursing Title IV student aid at 109 postsecondary institutions. The Department of Education has waived specific statutes or regulations at postsecondary institutions, or consortium of institutions, participating in the experiments.

As a condition of participation, institutions in the Experimental Sites Initiative submit data to Federal Student Aid concerning the outcomes of the experiment(s) in which they participate. This report provides a summary of this information for all eight of the currently active experiments. These experiments include:

• Loan proration practices for graduating borrowers;
• Overaward tolerance and the disbursement of loan funds;
• Inclusion of loan fees in the calculation of student cost of attendance;
• Credit of Title IV funds to otherwise non allowable institutional charges;
• Credit of Title IV funds to prior term charges;
• Alternative entrance loan counseling procedures;
• Alternative exit loan counseling procedures; and
• Award of Title IV aid to students not passing an "Ability to Benefit" test.

This report examines the data and comments submitted by institutions participating in the Initiative for award year 2006-2007 (AY06-07). As has been the case in previous years, the outcome data supplied by the schools indicate that the flexibility accompanying the first seven experiments results in non-trivial administrative cost savings to participating schools with no indication of an increased risk to the federal student aid funds. The eighth experiment suggests that academically ineligible students, who have successfully completed the initial portion of an educational program, benefit as much or more from aid than those who pass an Ability to Benefit test required for students without high school diplomas. The comments submitted by participating institutions generally advocate a broader implementation of the administrative flexibilities that are being experimented with under the Initiative.