Financial aid ‘experiments’ aim to increase efficiency for universities, students

UC Berkeley officials have until Dec. 12 to decide if the campus wants to be considered for participation in one or more financial aid “experiments” that will alter requirements and distribution for federal financial aid.

The U.S. Department of Education invited postsecondary institutions Thursday to participate in experiments designed to test whether alternatives to current requirements can improve the administration of student financial assistance programs.

The goal of the Experimental Sites Initiative is to reduce the administrative burden and improve aid delivery services or otherwise benefit students while avoiding creating additional costs to taxpayers.

Eight new experiments described in a notice published in the Federal Register — a supplement to the seven experiments currently running — altered the Federal Pell Grant program, the Direct Loan program, PLUS Loan Program and a student eligibility program.

The two experiments that could have the greatest impact on large public universities allow for unequal disbursements of direct loans and limit unsubsidized loan amounts, according to Haley Chitty, director of communications at the National Association of Student Financial Aid Administrators.

“Students at low-costing institutions take out more loans than are necessary without realizing the consequences of that,” Chitty said. “(The initiative) would allow institutions to limit unsubsidized loans on a broader basis.”

To participate, a school must submit a letter of application to the initiative and agree to collect data during the implementation of the program, according to the notice.

“Each (UC) campus has the flexibility to decide whether or not they want to participate,” said UC spokesperson Ricardo Vazquez.

Though UC Berkeley does not participate in any of the current experiments, UCLA, UC Riverside and UC Santa Cruz have conducted experiments as part of the program.

“We haven’t discussed taking on any new experiments at this time, but this doesn’t mean we won’t,” said Audren Morris-Sandoval, manager of compliance and processing at the UCLA Financial Aid Office. “We plan to continue with our existing experiments.”

UC Berkeley’s financial aid office has not reviewed any of the new experiments yet, according to an email from campus spokesperson Janet Gilmore.

The specific goals of the new experiments are to gather concrete results that can be instituted and actually change legislative practices to improve the financial aid institution, Chitty said.

Previously implemented experiments have failed to incite change to legislation because the designs do not provide sufficient data to support definitive conclusions, according to the data produced by the Experimental Sites Initiative.