Plans, Programs & Promises: Think There's No Way to Help Your Students out of Their College Finance Crunch? Think Again. (A University Business Special Section: Student Finance)
Lorenzetti, Jennifer Patterson, University Business
As the United States struggles out of an economic downturn, one thing is clear: Financing a college education is becoming more challenging than ever. The College Board estimates that tuition and fees at four-year private institutions jumped 5.8 percent to $18,273 between the 2001-2002 and 2002-2003 academic years, with four-year public tuition fees increasing 9.6 percent to $4,081 over the same period. According to data from the DOE, the average amount borrowed in federal student loans at private, four-year colleges jumped from $14,290 in 1995-96 to $18,000 in 1999-2000--this, before the recession officially began. Borrowing at public, four-year institutions increased from $11,950 to $16,100 over the same period. This translates to an increased load on both students and universities.
"We need to get money into the hands of students who need it," says Marty Guthrie, director of Governmental Affairs for the National Association of Student Financial Aid Administrators (www.nasfaa.org). Financing an education is not only putting greater pressure on students and families seeking better ways to manage their budgets, she says; increased demand for student aid is also creating more work for universities, who are searching for ways to streamline processes, adopt innovative pricing strategies, and use technology to provide faster services. "There's a tension between wanting to simplify things and needing to be accountable," Guthrie adds. Still, colleges are finding their own unique ways of meeting the challenge.
University of Wisconsin-Stout: Streamlining with Technology
Students receiving a refund of the overage from their financial aid award used to be participants in a cumbersome system at the University of Wisconsin-Stout--a system that may sound familiar to many campuses across the nation. Once a student's aid confirmation was received by the financial aid office, the student's account file was sent to the business office. The business office would apply the aid toward any outstanding tuition and fees; then, if the amount of the aid exceeded the amount owed the university, the office would calculate the net to be returned to the student. This would typically occur when the student's aid included money for room and board, and the student chose to live off campus, or when the aid included funds to be used for living. The refund (in the form of a paper check) was then available to the student for pick-up. Routinely, processing time was inconvenient for students who needed the money to pay rent or purchase text books, and the business office became accustomed to long lines of students at the beginning of terms, as it processed and distributed refunds for many of the 7,400 undergraduates on campus.
But much of this changed when the university instituted new services to accompany the student debit/check card, says Joe Krier, director of Budget, Technology, and Campus Card for Student Life Services. Through a partnership with Higher One (www.higherone.com), a "One Card" banking and online funds disbursement provider, most students now see their financial aid refund appear on their Stout One Card automatically, with a minimum of processing time--a matter of hours from confirmation of aid by the university, to deposit of funds to the student's card. There's simply no more standing in line for checks.
The new system of automatic deposit of refunds to the Stout One Card debuted at the university in early 2003. "We basically outsourced check writing for student funds," says Krier. Through the Web-based One Card system, students can request that refunds be posted to the Stout One Card, be transferred to any other bank account, or be sent via paper check to their address. On the back end, the Higher One system integrates with the university's existing Datatel (www.datatel.com) student information system, to provide for automatic updates (to both school and student) of the location of student funds. …