Cost Allowances Crucial to Financial Aid Officers, Survey Finds

August 9, 2011

A majority of college and university officials responding to a National Association of Student Financial Aid Administrators survey said their campuses would be "moderately" or "greatly" affected if administrative cost allowances for federal financial aid were eliminated. The allowances, $5 per student receiving Pell Grants, are used to offset the expenses of administering campus-based financial aid programs, and are used primarily for salaries, office supplies, and training and travel.

The money is considered a possible target for deficit reduction, NASFAA wrote in a summary of the survey's findings. More than 500 institutions responded to the survey, and 31 percent said they would be "greatly affected" if the allowances were eliminated, including more than half of all responding public four-year universities. More than half of the public four-year universities said their financial aid office heavily depends on the funds. "Elimination of the ACA would have a detrimental impact on the financial aid offices that serve our nation’s postsecondary students," the group wrote. "We urge lawmakers to consider its importance and necessity as they make difficult budgetary choices."

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