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Utah Higher Education Assistance AuthorityDavid A. Feitz, Executive Director60 South 400 WestSalt Lake City, UT [email protected]
PAYING FOR COLLEGE
March 20, 2014
Utah Higher EducationAssistance Authority
• Student loan andfinancial aid organizationof the Utah State Boardof Regents
• Established by statestatute in 1977
Utah FoundationAnnual MeetingMarch 20, 2014
2
Utah Higher EducationAssistance Authority
• Major provider of highereducation financing andservices for Utah Student loans Grants Loan servicing
• Leading role in how-to-pay-for college communityoutreach services
Utah FoundationAnnual MeetingMarch 20, 2014
3
UHEAA: Success Story for State of Utah
• UHEAA’s 37-yearhistory
• $6.6 billion instudent loans to 1.8million students
Utah FoundationAnnual MeetingMarch 20, 2014
4
UHEAA’s low student loan default rates
Utah FoundationAnnual MeetingMarch 20, 2014
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4.6 5.26.7 7.0
8.8 9.110.0
4.32.8 2.1 1.9 2.3 2.2 2.6
0
2
4
6
8
10
12
2007 2008 2009 2010 2011 2012 2013
Perc
ent
UHEAA’s Low Default RatesNational Average UHEAA
How do students pay for college?
Utah FoundationAnnual MeetingMarch 20, 2014
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Savings
Work
SuccessStipend
Loans
ScholarshipsFamily
Support
PellGrants
How the typical family pays for college
Utah FoundationAnnual MeetingMarch 20, 2014
7
5%
9%
11%
18%
27%
30%
Relatives & Friends
Parent Borrowing
Student Income & Savings
Student Borrowing
Parent Income & Savings
Grants & Scholarships
Source: SLM Corp. Ipsos, How America Pays for College, 2013
UHEAA Community Outreach Services toSchools and Students
Utah FoundationAnnual MeetingMarch 20, 2014
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8
How to Pay for CollegeFree, statewide workshops
Last 24 months of activity:• 275 “Prepare for college” events• Over 26,000 in attendance
students parents guidance counselors
UHEAA’s consistent message to families –
1. Save for college2. Apply for:
• Grants• Scholarships• Work Study
3. Consider loans last
Utah FoundationAnnual MeetingMarch 20, 2014
9
Pell Grants – Largest Federal student aidgrant program
• Utah students – significant users of Pell Grant• Pell Grants based on financial need for
undergraduate study• Maximum award: $5,730• 12 semesters• Total Utah Pell for 2012-13:
119,800 students$421 million
• Up to 30 credit hours forremedial coursework
Utah FoundationAnnual MeetingMarch 20, 2014
10
Pell Grant recipients in Utah
Utah FoundationAnnual MeetingMarch 20, 2014
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-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Award Years 2000-2013
57,400
119,800
Increase from2008 – 2013
109%
Source: US Department of Education
Pell Grant dollars in Utah
Utah FoundationAnnual MeetingMarch 20, 2014
12
$-
$50
$100
$150
$200
$250
$300
$350
$400
$450
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Mill
ions
Award Years 2000-2012
$142.2 M
$421.4 M
196%Increase from2008 to 2013
Source: US Department of Education
Highest Pell volume schools in Utah
Utah FoundationAnnual MeetingMarch 20, 2014
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2012-2013 Pell Grant Volume at Utah Schools
School Recipients Disbursements
UTAH VALLEY UNIVERSITY 14,900 $52.4 M
BRIGHAM YOUNG UNIVERSITY 12,300 $49.8 M
SALT LAKE COMMUNITY COLLEGE 14,200 $41.5 M
UTAH STATE UNIVERSITY 10,200 $37.6 M
UNIVERSITY OF UTAH 8,900 $32.8 M
WEBER STATE UNIVERSITY 9,100 $30.9 M
Source: US Department of Education
Pell & Loan use in Utah: Twice as muchloan volume compared to Pell
Utah FoundationAnnual MeetingMarch 20, 2014
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$920 M(186,700)
$421 M(119,800)
Loans Pell Grants
2012-13 Volume
Federal student loan volume in Utah
Utah FoundationAnnual MeetingMarch 20, 2014
15
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
Mill
ions
Award Years 2000 to 2013$919.6 M
Increase from2008 to 2013
111%
Source: US Department of Education
$436.7 M
Student loan volume at Utah schools
School Dollar Amount
UNIVERSITY OF UTAH $ 135.4 M
UTAH VALLEY UNIVERSITY $ 83.1 M
UTAH STATE UNIVERSITY $ 59.9 M
STEVENS HENAGER COLLEGE $ 59.2 M
BRIGHAM YOUNG UNIVERSITY $ 56.0 M
Utah FoundationAnnual MeetingMarch 20, 2014
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2012-13 Award Year
Student loan and Pell Grant dollarvolume at Utah schools
Utah FoundationAnnual MeetingMarch 20, 2014
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20%39% 39% 32%
47% 55% 36%
80% 61%
61%68%
53%45% 64%
$-
$20
$40
$60
$80
$100
$120
$140
$160
$180
U of U UVU USU StevensHenager
BYU SLCC WSU
Mill
ions
Pell & Loan Dollar Volume 2012-13
LoansPell Grant
Post-recession reality: Decreased parentalsupport for paying college expenses
• Student loan debt is the only kindof household debt that continuedto rise during the recession.
• Parents’ average out-of-pocketspending for college expenses hasdecreased by 35% since 2010.
$8,752 to $5,727
Utah FoundationAnnual MeetingMarch 20, 2014
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Source: SLM Corp. Ipsos, How America Pays for College, 2013
50% of Utah graduates have loans
Utah average student loan debt of college seniorsranks 44th in nation at $21,520.
National average is $29,400.
Utah FoundationAnnual MeetingMarch 20, 2014
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Source: Project on Student Debt, Class of 2012
Example monthly payment amount
• $21,520 balance• 6% interest rate• 10-year repayment period
Monthly payment = $239
Annual income of $36,000 neededto service this debt level.
Utah FoundationAnnual MeetingMarch 20, 2014
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Reality of borrowing patterns
Press stories of extremely high debt levels are the exception.
Utah FoundationAnnual MeetingMarch 20, 2014
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39.9%
29.8%
17.7%
9.0%
2.2% 0.9% 0.6%$1-$10,000
$10,000-$25,000
$25,000-$50,000
$50,000-$100,000
$100,000-$150,000
$150,000-$200,000
$200,000+
Source: FRBNY Consumer Credit Panel / Equifax
40% ofborrowers havebalances lessthan $10,000
3.7% ofborrowers havebalances greaterthan $100,000
Utah National Avg.
Need-based, state grant aid
Utah ranks 48th in stateneed-based grant dollarsper undergraduate FTE.¹
“Low-income and minoritystudents who receive grantsgenerally are more likely to persistthan those who receive loans.”²
Utah FoundationAnnual MeetingMarch 20, 2014
23
¹Source: National Association of State Student Grant and AidPrograms 43rd Annual Survey Report
²Source: Educational Policy Institute, StudentRetention.org
$16.03
$481.63
Additional state investment needed forUtah to move up in ranking from #48
3 Spots to #45 5 Spots to #43 To Midpoint #26
$2.4 million $9.7 million $43.9 million
Utah FoundationAnnual MeetingMarch 20, 2014
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Annual State Grant Dollars Needed
Utah Higher Education Assistance AuthorityDavid A. Feitz, Executive Director60 South 400 WestSalt Lake City, UT [email protected]
PAYING FOR COLLEGE
March 20, 2014