A r c h i v e d I n f o r m a t i o n

   FOR RELEASE              Contact:  Stephanie Babyak (202)401-2311    October 5, 1994                       Jane Glickman (202)401-1307

FEWER HEADACHES, LESS PAPERWORK FOR STUDENTS, SCHOOLS

U.S. Secretary of Education Richard W. Riley today announced a series of measures to simplify management and reduce paperwork for colleges and students.

Riley said the Education Department will also hold a series of regional meetings to discuss further regulatory and administrative changes to improve student financial aid programs.

"These changes are part of a continuing effort to better serve our clients -- students and schools -- by being more responsive and efficient," Riley said. "We've made concrete reforms based on school suggestions to relieve some long-standing frustrations, and we plan to continue this productive dialogue."

Key changes:

eliminate paper record-keeping and allow electronic processing for more than 4 million Federal Pell Grant recipients;
replace the paper-intensive financial aid transcript process with a national electronic database;
ease administrative burden during the transition to the national database. Schools will not have to report Federal Supplemental Education Opportunity Grant (FSEOG) data to the national electronic database;
reduce requirements for multiple forms and duplicate signatures on federal student aid applications to validate and update information, thereby reducing time and effort for parents and students.

"These changes support Clinton administration initiatives to reinvent government by simplifying regulations and making services user-friendly," added Madeleine Kunin, deputy secretary.

The Department of Education is holding four regional meetings to solicit additional ideas from college, university and proprietary school administrators and students on ways to improve the student financial aid system:

        Oct. 5    Seattle;          Oct. 13   Kansas City, Mo.;          Oct. 28   Boston;          Nov. 2    Atlanta

"Our objective is to strike the right balance between our obligation to protect the taxpayers' investment in student aid and our responsibility to minimize costs and burdens for students, families and schools," said David A. Longanecker, assistant secretary for postsecondary education. "We look forward to working with schools and students to meet this shared goal."

STUDENT FINANCIAL AID PROGRAM REGULATORY AND ADMINISTRATIVE CHANGES

The need for nearly 4 million Federal Pell Grant recipients to submit, and 6,000 postsecondary institutions to process, Student Aid Reports (SAR) will be eliminated. The new rules, to be published in the Federal Register this month, will be effective for the 1995-96 school year. Beginning in January, schools will be able to process applicant information using computer records sent by ED's application processing contractor. They will no longer be required to receive, process and store millions of five-page SARs. In addition to reducing the paperwork burden for schools, the changes will make the application process -- and distribution of grant money for needy students -- faster and easier.
The paper-intensive financial aid transcript process will be replaced with a national electronic database. Currently, colleges and universities exchange paper forms for hundreds of thousands of students who transfer every year. Starting this fall, financial aid data will be loaded into the National Student Loan Data System (NSLDS). By Summer 1995, schools may begin retrieving transfer student information directly from NSLDS using software provided by ED -- eliminating requests for paper financial aid transcripts from each school the student attended. The entire system of paper financial aid transcripts will be completely eliminated by January 1996, a boon for students and schools.
More than 3,500 institutions that participate in the Federal Supplemental Education Opportunity Grant program will not need to load data on this program into the NSLDS.
Requirements for multiple forms and duplicate signatures on federal student aid applications to validate and update information will be reduced. This step will save time and effort for schools, students and parents. Institutions will still have the option to gather additional data if warranted.