Maintained for Historical Purposes

This resource is being maintained for historical purposes only and is not currently applicable.

The Secretary of Education announces the annual updates to the tables that will be used in the statutory ``Federal Needs Analysis Methodology'' to determine a student's expected family contribution (EFC) for award year 1998-99 for the Title IV, HEA stude

FR part
V
Attachments:
PublicationDate: 5/29/97
FRPart: V
RegPartsAffected:
PageNumbers: 29271-29275
Summary: The Secretary of Education announces the annual updates to the tables that will be used in the statutory ``Federal Needs Analysis Methodology'' to determine a student's expected family contribution (EFC) for award year 1998-99 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.
CommentDueDate:

  
[[This file contains this Federal Register in Portable Document Format (PDF).
It can be viewed with version 3.0 or greater of the free Adobe Acrobat Reader software. Scroll down
to see a text version of this document.]]

[


[Federal Register: May 29, 1997 (Volume 62, Number 103)]
[Notices]
[Page 29271-29275]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29my97-152]


[[Page 29271]]

_______________________________________________________________________

Part V





Department of Education





_______________________________________________________________________



Federal Pell Grant, Federal Perkins Loan, Federal Work-Study, Federal
Supplemental Educational Opportunity Grant, Federal Family Education
Loan, and William D. Ford Federal Direct Loan Programs; Revision of the
Need Analysis Methodology for the 1998-99 Award Year; Notice


[[Page 29272]]


-----------------------------------------------------------------------


DEPARTMENT OF EDUCATION


Federal Pell Grant, Federal Perkins Loan, Federal Work-Study,
Federal Supplemental Educational Opportunity Grant, Federal Family
Education Loan, and William D. Ford Federal Direct Loan Programs;
Revision of the Need Analysis Methodology for the 1998-99 Award Year

AGENCY: Department of Education.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Secretary of Education announces the annual updates to the
tables that will be used in the statutory ``Federal Needs Analysis
Methodology'' to determine a student's expected family contribution
(EFC) for award year 1998-99 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 Avenue, S.W. (Room 3053, ROB-3),
Washington, D.C. 20202-5444, telephone (202) 708-8242. Deaf and hearing
impaired individuals may call the Federal Information Relay Service at
1-800-877-8339 between 8 a.m. and 8 p.m., Eastern time, Monday through
Friday.

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 Needs 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 into
account inflation. The changes are based, in general, upon increases in
the Consumer Price Index.
For the award year 1998-99, 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 1996 and December 1997. However, since
the Secretary must publish these tables before December 1997, 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 1996. The Secretary estimates that the increase in the
Consumer Price Index for all Urban Consumers for the period December
1996 through December 1997 will be 2.4 percent. The updated tables for
the 1998-99 award year 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 1998-99 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 the award year 1998-99 are:

----------------------------------------------------------------------------------------------------------------
Number in college
Family size (including student) -------------------------------------------------------------------------------
1 2 3 4 5
----------------------------------------------------------------------------------------------------------------
2............................... $12,030 $9,980 .............. .............. ..............
3............................... 14,990 12,940 $10,880 .............. ..............
4............................... 18,510 16,450 14,400 $12,340 ..............
5............................... 21,840 19,780 17,730 15,670 $13,630
6............................... 25,550 23,490 21,440 19,380 17,330
For each additional family member add $2,880.
For each additional college student subtract $2,050.
----------------------------------------------------------------------------------------------------------------

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 net worth is:
----------------------------------------------------------------------------------------------------------------
Less than $1................................ $0.
$1 to $85,000............................... 40% of NW.
$85,001 to $255,000......................... $34,000+50% of NW over $85,000.
$255,001 to $430,000........................ $119,000+60% of NW over $255,000.
$430,001 or more............................ $224,000+100% of NW over $430,000.
----------------------------------------------------------------------------------------------------------------


[[Page 29273]]

3. Education Savings 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
If the age of the older parent is -------------------------
Two parents One parent

-------------------------
(1)Then the education savings and asset
protection allowance is--
------------------------------------------------------------------------
25 or less.................................... 0 0
26............................................ 2,400 1,600
27............................................ 4,800 3,300
28............................................ 7,300 4,900
29............................................ 9,700 6,600
30............................................ 12,100 8,200
31............................................ 14,500 9,800
32............................................ 16,900 11,500
33............................................ 19,400 13,100
34............................................ 21,800 14,800
35............................................ 24,200 16,400
36............................................ 26,600 18,000
37............................................ 29,000 19,700
38............................................ 31,500 21,300
39............................................ 33,900 23,000
40............................................ 36,300 24,600
41............................................ 37,300 25,200
42............................................ 38,200 26,700
43............................................ 39,200 26,300
44............................................ 40,200 26,900
45............................................ 41,200 27,400
46............................................ 42,300 28,100
47............................................ 43,300 28,800
48............................................ 44,400 29,300
49............................................ 45,500 30,000
50............................................ 46,700 30,700
51............................................ 48,100 31,500
52............................................ 49,400 32,200
53............................................ 50,900 33,000
54............................................ 52,100 33,800
55............................................ 53,700 34,700
56............................................ 55,400 35,600
57............................................ 57,100 36,400
58............................................ 58,800 37,500
59............................................ 60,600 38,500
60............................................ 62,400 39,400
61............................................ 64,500 40,500
62............................................ 66,800 41,700
63............................................ 68,700 42,900
64............................................ 71,100 44,000
65 and over................................... 73,500 45,500
------------------------------------------------------------------------


Independent Students Without Dependents Other Than a Spouse

And the student is
If the age of the student is -------------------------
Married Single

-------------------------
(1)Then the education savings and asset
protection allowance is--
------------------------------------------------------------------------
25 or less.................................... 0 0
26............................................ 2,400 1,600
27............................................ 4,800 3,300
28............................................ 7,300 4,900
29............................................ 9,700 6,600
30............................................ 12,100 8,200
31............................................ 14,500 9,800
32............................................ 16,900 11,500
33............................................ 19,400 13,100
34............................................ 21,800 14,800
35............................................ 24,200 16,400
36............................................ 26,600 18,000
37............................................ 29,000 19,700
38............................................ 31,500 21,300
39............................................ 33,900 23,000
40............................................ 36,300 24,600
41............................................ 37,300 25,200
42............................................ 38,200 26,700
43............................................ 39,200 26,300
44............................................ 40,200 26,900
45............................................ 41,200 27,400
46............................................ 42,300 28,100
47............................................ 43,300 28,800
48............................................ 44,400 29,300
49............................................ 45,500 30,000
50............................................ 46,700 30,700
51............................................ 48,100 31,500
52............................................ 49,400 32,200
53............................................ 50,900 33,000
54............................................ 52,100 33,800
55............................................ 53,700 34,700
56............................................ 55,400 35,600
57............................................ 57,100 36,400
58............................................ 58,800 37,500
59............................................ 60,600 38,500
60............................................ 62,400 39,400
61............................................ 64,500 40,500
62............................................ 66,800 41,700
63............................................ 68,700 42,900
64............................................ 71,100 44,000
65 and over................................... 73,500 45,500
------------------------------------------------------------------------


Independent Students With Dependents Other Than a Spouse

And the student is
If the age of the student is -------------------------
Married Single

-------------------------
(1)Then the education savings and asset
protection allowance is--
------------------------------------------------------------------------
25 or less.................................... 0 0
26............................................ 2,400 1,600
27............................................ 4,800 3,300
28............................................ 7,300 4,900
29............................................ 9,700 6,600
30............................................ 12,100 8,200
31............................................ 14,500 9,800
32............................................ 16,900 11,500
33............................................ 19,400 13,100
34............................................ 21,800 14,800
35............................................ 24,200 16,400
36............................................ 26,600 18,000
37............................................ 29,000 19,700
38............................................ 31,500 21,300
39............................................ 33,900 23,000
40............................................ 36,300 24,600
41............................................ 37,300 25,200
42............................................ 38,200 26,700
43............................................ 39,200 26,300
44............................................ 40,200 26,900
45............................................ 41,200 27,400
46............................................ 42,300 28,100
47............................................ 43,300 28,800
48............................................ 44,400 29,300
49............................................ 45,500 30,000
50............................................ 46,700 30,700
51............................................ 48,100 31,500
52............................................ 49,400 32,200
53............................................ 50,900 33,000
54............................................ 52,100 33,800
55............................................ 53,700 34,700
56............................................ 55,400 35,600
57............................................ 57,100 36,400
58............................................ 58,800 37,500
59............................................ 60,600 38,500
60............................................ 62,400 39,400
61............................................ 64,500 40,500
62............................................ 66,800 41,700
63............................................ 68,700 42,900
64............................................ 71,100 44,000
65 and over................................... 73,500 45,500
------------------------------------------------------------------------

4. Assessment Schedules and Rates. Two separate assessment
schedules--one for dependent students, and one for independent students
with dependents other than a spouse--are used in determining the
expected family 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 financial strength which considers
both income and assets.

----------------------------------------------------------------------------------------------------------------
If AAI is-- Then the contribution is--
----------------------------------------------------------------------------------------------------------------
Less than -$3,409........................... -$750.
-$3,409 to $10,800.......................... 22% of AAI.
$10,801 to $13,500.......................... $2,376 + 25% of AAI over $10,800.
$13,501 to $16,200.......................... $3,051 + 29% of AAI over $13,500.

[[Page 29274]]


$16,201 to $19,000.......................... $3,834 + 34% of AAI over $16,200.
$19,001 to $21,700.......................... $4,786 + 40% of AAI over $19,000.
$21,701 or more............................. $5,866 + 47% of AAI over $21,700.
----------------------------------------------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
If AAI is-- Then the contribution is--
----------------------------------------------------------------------------------------------------------------
Less than -$3,409........................... -$750.
-$3,409 to $10,800.......................... 22% of AAI.
$10,801 to $13,500.......................... $2,376 + 25% of AAI over $10,800.
$13,501 to $16,200.......................... $3,051 + 29% of AAI over $13,500.
$16,201 to $19,000.......................... $3,834 + 34% of AAI over $16,200.
$19,001 to $21,700.......................... $4,786 + 40% of AAI over $19,000.
$21,701 or more............................. $5,866 + 47% of AAI over $21,700.
----------------------------------------------------------------------------------------------------------------

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--
If parents' State or territory of residence is -------------------------
Less than $15,000 or
$15,000 more
------------------------------------------------------------------------

(1) Then the percentage 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
------------------------------------------------------------------------


Independent Students With Dependents Other Than a Spouse
------------------------------------------------------------------------
And student's total
income is--
If student's State or territory of residence -------------------------
is Less than $15,000 or
$15,000 more
------------------------------------------------------------------------

(1) Then the percentage 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

[[Page 29275]]


Other......................................... 4 3
------------------------------------------------------------------------


Dependent Students
------------------------------------------------------------------------
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
------------------------------------------------------------------------


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
------------------------------------------------------------------------

Dated: May 23, 1997.
David A. Longanecker,
Assistant Secretary for Postsecondary Education.
(Catalog of Federal Domestic Assistance Numbers: 84.007 Federal
Supplemental Educational Opportunity Grant; 84.032 Federal Family
Education Loan Program; 84.033 Federal Work-Study Program; 84.038
Federal Perkins Loan Program; 84.063 Federal Pell Grant Program;
William D. Ford Federal Direct Loan Program, 84.268)

[FR Doc. 97-14068 Filed 5-28-97; 8:45 am]
BILLING CODE 4000-01-P




]

Last Modified: 08/02/1998