DATE: August 17, 2004
CONTACT: Gus Wales
PHONE: (225) 922-2029
FAX: (225) 922-0790
Student Aid Commission Returns $400,000 to State's Most Needy College Students
BATON ROUGE -- The Louisiana Student
Financial Assistance Commission (the Commission) today announced the award of
$400,000 in surplus operating revenues to the state’s most financially
needy college students. These revenues were generated from the Commission’s
administration of the Federal Family Education Loan Program (FFELP) in Louisiana
during fiscal year 2003-2004.
The surplus was principally derived from federal fees paid the Commission on the volume of student loans that it guarantees and from defaulted student loan debt that the Commission collected.
In January of this year, the Commission authorized the return of these surplus funds to Louisiana’s students in the form of need-based aid. To achieve this purpose, the Commission and the Board of Regents concluded an interagency agreement that provides guidelines for the allocation and use of these aid funds. In accordance with a formula developed by the Board of Regents, the funds are now being distributed to Louisiana’s colleges and universities, both public and private. Recipient schools will then disburse their share of the funds to students who have financial need as determined by a federal needs test. To be considered, students must qualify for federal Pell Grants and be enrolled at least half time. All award funds must be used by students to pay their higher education expenses.
“As we increase the volume of loans that we guarantee, the potential exists for incremental growth in the amounts that can be annually allocated to higher education institutions,” said Commission Chairman F. Travis Lavigne, Jr.
The Commission is the U.S. Department
of Education’s designated guarantor for FFELP loans in Louisiana; however,
it must compete for student loan business with out-of-state guarantee agencies.
The Commission guaranteed approximately 46% of the $746 million in FFELP loans
that were generated by Louisiana’s postsecondary institutions last year.