Publication Date: May 27, 2010

Posted Date: May 27, 2010

Subject: Notice of revision of the Federal Need Analysis Methodology for the 2011-2012 award year.

FR Type: Notice

[Federal Register: May 27, 2010 (Volume 75, Number 102)]
[Notices]              
[Page 29744-29749]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27my10-47]                        

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DEPARTMENT OF EDUCATION


Federal Pell Grant, Federal Perkins Loan, Federal Work-Study,
Federal Supplemental Educational Opportunity Grant, William D. Ford
Federal Direct Loan, and TEACH Grant Programs

AGENCY: Federal Student Aid, U.S. Department of Education.

ACTION: Notice of revision of the Federal Need Analysis Methodology for
the 2011-2012 award year.

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SUMMARY: The Secretary 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
2011-2012 for the student financial aid programs authorized under title
IV of the Higher Education Act of 1965, as amended (HEA). 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 for
purposes of determining financial aid eligibility. The Title IV
programs include the Federal Pell Grant, Federal Perkins Loan, Federal
Work-Study, Federal Supplemental Educational Opportunity Grant, William
D. Ford Federal Direct Loan, and the Teach Grant Programs (Title IV,
HEA Programs).

FOR FURTHER INFORMATION CONTACT: Ms. Marya Dennis, Management and Program Analyst, 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), call the
Federal Relay Service (FRS), toll free, at 1-800-877-8339.
    Individuals with disabilities can obtain this document in an
accessible format (e.g., braille, large print, audiotape, or computer
diskette) on request to the contact person listed under FOR FURTHER
INFORMATION CONTACT.

SUPPLEMENTARY INFORMATION: Part F of title IV of the HEA specifies the criteria, data elements, calculations, and tables used in the Federal
Need Analysis Methodology EFC calculations.
    Section 478 of part F of title IV of the HEA 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 for general price inflation. The changes are based, in
general, upon increases in the Consumer Price Index.
    For award year 2011-2012, the Secretary is charged with updating
the income protection allowance for parents of dependent students,
adjusted net worth of a business or farm, and the assessment schedules
and rates to account for inflation that took place between December
2009 and December 2010. However, because the Secretary must publish
these tables before December 2010, 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 (CPI-U) for 2010. The
Secretary must also account for any misestimation of inflation for the
prior year. In developing the table values for the 2010-2011 award
year, the Secretary assumed a 4.1 percent increase in the CPI-U for the
period December 2008 through December 2009. Actual inflation for this
time period was 2.7 percent. The Secretary estimates that the increase
in the CPI-U for the period December 2009 through December 2010 will be
1.2 percent. Last year's overestimate of inflation for 2009 (4.1
percent minus 2.7 percent) exceeds this year's estimate of inflation
for 2010. However, the Secretary lacks statutory authority to reduce
the table values in the need analysis formula. Thus, the income
protection allowance for parents of dependent students, the adjusted
net worth of a business or farm, and the assessment schedules and rates
are unchanged from 2010-2011. 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 by updating the procedures for
determining the income protection allowance for dependent students as
well as the income protection allowance tables for both independent
students with dependents other than a spouse and

[[Page 29745]]

independent students without dependents other than a spouse. As amended
by the CCRAA, the HEA established new 2011-2012 award year values for
these income protection allowances. The updated tables are in sections
1, 2, and 4 of this notice.
    The Secretary must also revise, for each award year, the education
savings and asset protection allowances as provided for in section
478(d) of the HEA. The Education Savings and Asset Protection Allowance
table for award year 2011-2012 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 upon increases in the
Bureau of Labor Statistics budget of the marginal costs for a two-
worker family compared to a one-worker family for food away from home,
apparel, transportation, and household furnishings and operations. The
Employment Expense Allowance table for award year 2011-2012 has been
updated in section 5 of this notice.
    The HEA provides for 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. It varies by
family size. The IPA for the dependent student is $5,250. The IPAs for
parents of dependent students for award year 2011-2012 are:

*NOTE: SEE PDF FOR CHART - Parents of Dependent Students

* NOTE: SEE PDF FOR CHART - Independent Students With Dependents Other Than a Spouse

*NOTE: SEE PDF CHART - Dependent Students

*NOTE: SEE PDF CHART -  Independent Students Without Dependents Other Than a Spouse

*NOTE: SEE PDF CHART - Independent Students With Dependents Other Than a Spouse

Electronic Access to This Document: 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) on the
Internet at the following site: http://www.ed.gov/news/fedregister. To
use PDF you must have Adobe Acrobat Reader, which is available free at
this site.

    Note:  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 on GPO Access at: http://www.gpoaccess.gov/
nara/index.html
.

(Catalog of Federal Domestic Assistance Numbers: 84.063 Federal Pell
Grant Program; 84.038 Federal Perkins Loan Program; 84.033 Federal
Work-Study Programs; 84.007 Federal Supplemental Educational
Opportunity Grant Program; 84.268 William D. Ford Federal Direct
Loan Program; 84.379 TEACH Grant Program)

    Program Authority:  20 U.S.C. 1087rr.

    Dated: May 24, 2010.
William J. Taggart,
Chief Operating Officer, Federal Student Aid.
[FR Doc. 2010-12799 Filed 5-26-10; 8:45 am]
BILLING CODE 4000-01-P

Attachments/Enclosures:

This Federal Register is in PDF Format

   

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