Publication Date: May 30, 2014
Posted Date: May 30, 2014
Subject: Federal Need Analysis Methodology for the 2015-2016 Award Year
FR Type: Notice
[Federal Register Volume 79, Number 104 (Friday, May 30, 2014)] [Notices] [Pages 31103-31109] From the Federal Register Online via the Government Printing Office [www.gpo.gov] [FR Doc No: 2014-12569] ------------------------------------------------------------ DEPARTMENT OF EDUCATION Federal Need Analysis Methodology for the 2015-16 Award Year-- Federal Pell Grant, Federal Perkins Loan, Federal Work-Study, Federal Supplemental Educational Opportunity Grant, William D. Ford Federal Direct Loan, Iraq and Afghanistan Service Grant and TEACH Grant Programs AGENCY: Federal Student Aid, Department of Education. ACTION: Notice. ------------------------------------------------------------ Catalog of Federal Domestic Assistance (CFDA) Numbers: 84.063; 84.038; 84.033; 84.007; 84.268; 84.408; 84.379. SUMMARY: The Secretary announces the annual updates to the tables used in the [[Page 31104]] statutory Federal Need Analysis Methodology that determines a student's expected family contribution (EFC) for award year 2015-16 for these student financial aid programs. The intent of this notice is to alert the financial aid community and the broader public to these required annual updates used in the determination of student aid eligibility. FOR FURTHER INFORMATION CONTACT: Marya Dennis, U.S. Department of Education, Room 63G2, Union Center Plaza, 830 First Street NE., Washington, DC 20202-5454. Telephone: (202) 377-3385. If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1- 800-877-8339. 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 the Department uses in the Federal Need Analysis Methodology to determine the EFC. Section 478 of part F of title IV of the HEA requires the Secretary to annually update the following four tables for price inflation--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. The updates are based, in general, upon increases in the Consumer Price Index (CPI). For award year 2015-16, the Secretary is charged with updating the income protection allowance for parents of dependent students, adjusted net worth of a business or farm, the Education Savings and Asset Protection Allowance and the assessment schedules and rates to account for inflation that took place between December 2013 and December 2014. However, because the Secretary must publish these tables before December 2014, the increases in the tables must be based on a percentage equal to the estimated percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) for 2014. The Secretary must also account for any misestimation of inflation for the immediately preceding year. In developing the table values for the 2014-15 award year, the Secretary assumed a 2.5 percent increase in the CPI-U for the period December 2012 through December 2013. Actual inflation for this time period was 1.5 percent. The Secretary estimates that the increase in the CPI-U for the period December 2013 through December 2014 will be 1.8 percent. Additionally, section 601 of the College Cost Reduction and Access Act of 2007 (CCRAA, Pub. L. 110-84) amended sections 475 through 478 of the HEA affecting the income protection allowance (IPA) tables for the 2009-10 through 2012-13 award years and required the Department to use a percentage of the estimated Consumer Price Index to update the table in subsequent years. These changes to the IPA impact dependent students, as well as independent students with dependents other than a spouse and independent students without dependents other than a spouse. As amended by the CCRAA, this notice includes the new 2015-16 award year values for the IPA tables. The updated tables are in sections 1 (Income Protection allowance), 2 (Adjusted Net Worth (NW) of a Business or Farm), and 4 (Assessment Schedules and Rates) of this notice. As provided for in HEA section 478(d), the Secretary must also revise the education savings and asset protection allowances for each award year. The Education Savings and Asset Protection Allowance table for award year 2015-16 has been updated in section 3 of this notice. Section 478(h) of the HEA also requires the Secretary to increase the amount specified for the Employment Expense Allowance, adjusted for inflation. This calculation is based on increases in the Bureau of Labor Statistics' marginal costs budget for a two-worker family compared to a one-worker family. The items covered by this calculation are: Food away from home, apparel, transportation, and household furnishings and operations. The Employment Expense Allowance table for award year 2015-16 has been updated in section 5 of this notice. The HEA requires the following annual updates: 1. Income Protection Allowance (IPA). This allowance is the amount of living expenses associated with the maintenance of an individual or family that may be offset against the family's income. The allowance varies by family size. The IPA for the dependent student is $6,310. The IPAs for parents of dependent students for award year 2015-16 are as follows: NOTE: CHARTS OMITTED - SEE PDF FILE FOR CHARTS Accessible Format: Individuals with disabilities can obtain this document in an accessible format (e.g., braille, large print, audiotape, or compact disc) on request to the contact person listed under FOR FURTHER INFORMATION CONTACT in this notice. Electronic Access to This Document: The official version of this document is the document published in the Federal Register. Free Internet access to the official edition of the Federal Register and the Code of Federal Regulations is available via the Federal Digital System at: www.gpo.gov/fdsys. At this site you can view this document, as well as all other documents of this Department published in the Federal Register, in text or Adobe Portable Document Format (PDF). To use PDF you must have Adobe Acrobat Reader, which is available free at this site. You may also access documents of the Department published in the Federal Register by using the article search feature at: www.federalregister.gov. Specifically, through the advanced search feature at this site, you can limit your search to documents published by the Department. Program Authority: 20 U.S.C. 1087rr. Dated: May 27, 2014. James W. Runcie, Chief Operating Officer Federal Student Aid. [FR Doc. 2014-12569 Filed 5-29-14; 8:45 am] BILLING CODE 4000-01-P