New Financial Aid Regulations Announced

The Obama administration released an executive order at 12:01am, April 1, 2016 to enact the following changes to the Department of Education’s financial aid rules.  The new, promulgated regulations affect how eligibility for aid is determined, among other things.

According to new Secretary of Education Dr. John B. King, the 2,072 page order includes several key changes, “The Estimated Family Contribution, previously the key determinant of eligibility in the financial aid formulas, has been eliminated in its entirety because it was too complicated and unfair for families to figure out,” King said.  “So we tweaked things.”

The changes to eligibility include:

  • Families that earn between $0 and $99,999 annual, adjusted gross income will attend college for free and receive iPads and four-year subscriptions to Netflix
  • Families that earn between $100,000 and $249,999 annual, adjusted gross income will not be eligible for any aid but will receive a formal rejection letter on Department of Education stationery, signed by secretary King,  that praises their efforts for applying and wishes them luck on their student loan applications
  • Families that earn more than $250,000 annual, adjusted gross income will pay an amount equal to 110% of the cost of attendance of the most expensive domestic college in that particular academic year.  King stated that the extra 10% would go toward a Department of Education “general slush fund to ensure that the ultra rich pay their fair share.”

Other changes include incentives for colleges to adjust their grading scale to achieve federal targets.  “Given today’s challenging economic climate, which in no way is the fault of the current administration, we must do whatever we can to help our college graduates succeed,” King said. “Under the new rules,  95% of students will receive a grade of A minus or better, which will make them more attractive to employers and help them get better jobs.”

Reaction among presidential candidates was mixed. The Clinton campaign praised the initiative, “This is exactly what Secretary Clinton proposed seven years ago.”  A spokesperson for Bernie Sanders stated “These rules don’t go far enough.  We’d make it 150%. If you are a responsible family who has paid your utility or cell phone bills for the past six consecutive months, that proves that you can afford college – for you and your neighbor who might be less fortunate.”

Donald Trump, on a self-imposed 37 minute media sabbatical, could not be reached for comment, but tweeted, “What is this ‘financial aid’?”