PROFESSIONAL
JUDGMENT
Bridgette Ingram and Mary Teel
• Agenda
–Define professional judgment
–Scenarios
–TAMU Process Flow
Professional Judgment is
• A mechanism for a financial aid
administrator to exercise discretionary
action for unusual circumstances that
affect a student’s and/or parent’s ability
to pay for educational expenses.
• Financial aid professionals are all given
authority by the Secretary of Education to
exercise professional judgment.
• An aid administrator may use professional
judgment on a case-by-case basis only to
alter the data used to calculate the EFC.
• Act as if every professional judgment will
be reviewed in an audit.
• PJ’s can only occur with supplemental
information.
 You must be able to distinguish between
changes in a family’s circumstances that
are a function of choice, and those that are
a function of necessity.
 Using this will help you distinguish
expenses that you should or should not
consider.
• Remember you are given the authority !
• Every financial transaction has a receipt…..
 Documentation is a MUST
• When in doubt use your life lines
– Poll the audience (your peers, your
supervisor)
– Phone a friend (someone at another
college)
– Eliminate options (tell the student what you
can do)
What to do?
• Take emotion out of the equation
• Ask for documentation (documentation will
tell the story)
• What meets the measure of an exception?
Is the circumstance individual, meaning it
is not something that has happened to a
class of students.
• “Decision making, is it informed,
repeatable, unemotional, not personal and
documentable?” (NASFAA presentation)
What are some unusual
circumstances ?
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Loss of employment
Loss of benefits
Medical expenses
Separation or divorce
Death (parent, spouse)
Expecting the birth of a child or addition to
the household
• Nursing home expenses, not covered by
insurance.
Documentation
What do I ask for?
• It is unlimited.
• You ask for what you believe will assist
you in evaluating the particular review
that you are doing.
• What items are best:
– Third party letters
– Memos
– Tax documents
– Financial statements
– Receipts
Did you know?
• Bottom Line Adjustments to an
Estimated Family Contribution (EFC) is
PROHIBITED!
• You should understand the Federal
Methodology and how each data
element is treated.
Did you know?
• These circumstances do not warrant
dependency overrides:
– Parents refusal to contribute to educational
costs.
– Parents unwilling to provide information on
FAFSA or TASFAA or for verification of the
file.
– Parents do not claim the student as a
dependent.
– Student demonstrates total self-suffiency.
NO PJ Allowed!
• Cannot use PJ to make a an otherwise
ineligible student eligible for aid.
• Cannot use to circumvent law or
regulations
– Under no circumstance can an FAA grant a
Stafford loan for a student who is less than
half time.
– May not grant PJ for post enrollment
activities, professional licensing exams
In today’s economic times….
• Recent information - 2/3 of institutions
saw a 10% increase in request for PJ’s.
• The Dept. of Ed has encouraged making
adjustments for those who need them.
• Could there be different scenarios from
what we have seen in the past (beyond
unemployment)?
– Salary cuts
– Hardship withdrawals from retirement to cover
medical bills.
Types:
• Unsubsidized loan for dependent
students when parent refuses to fill out
the FAFSA
• Adjustment to FAFSA data for
extenuating circumstances
• Dependency Override
• Cost of Attendance increase
From the handbook (application
and verification guide chap 2)
You must get documentation (1) that his
parents refuse to provide information for his
FAFSA and (2) that they do not and will not
provide any financial support to him. Include the
date support ended. If the parents refuse to sign
and date a statement to this effect, you must
get documentation from a third party (the
student himself is not sufficient), such as a
teacher, counselor, cleric, or court.
Scenarios
Unsubsidized loan for
dependent
• Kristen wanted to come to Texas A&M
University and her parents were
adamantly against it. They wanted her
to go to a local college. The parents
wrote a letter stating they would not
support her financially and would not fill
out their information on the Free
Application for Federal Student Aid
(FAFSA). What would you do?
Adjustment to FAFSA
• Kitty’s mother had income earned from
work of $25,000 in 2011 but is no longer
employed for 2012. After receiving
documentation confirming this, What
would you do?
Adjustment to FAFSA
• In 2011 Alan had $2,850 in medical
expenses that were out-of-pocket costs.
He is married, has two children, and is
the only member of his household in
college, so his IPA is $33,300. What
would you do?
Adjustment to FAFSA
• John (the parent) converted his regular
IRA into a Roth IRA by transferring funds.
The amount converted has to be reported
as taxable income on the tax return. So
the income reported on the FAFSA will be
higher than without the Roth conversion,
even though the family doesn’t actually
have additional income or assets
available. What would you do?
Dependency Override
• Ryan has had no contact with his Mom
since he was 3 years old. He has lived
with his Dad who is an alcoholic and
verbally abusive. He lived with his Dad
all but a few months at the end of high
school and checks on him every now
and then. Documentation has been
received from his high school teacher.
What would you do?
Dependency Override
• Alyshia submitted documentation
explaining that her parents would not
support her through college because of
the boy she was dating. What would
you do?
Dependency Overrides!
• What circumstances have you used?
• What documentation have you requested
to do this?
- What if a parent does not like a students
boyfriend or girlfriend?
- What if a parent does not want to release
tax data?
- What if the student has lived with
neighbors or a teacher due to abuse at
home?
Cost of Attendance
• Henry is a graduate student who moved
from Oklahoma. He is asking for an
increase for moving expenses, U-haul
rental, gas for U-haul, in addition to the
deposits he had to pay for an apartment
and electricity. He feels these cost fall
under educational expenses to attend
TAMU. What would you do?
Cost of Attendance
• Freddie submitted a request that he
needs to pay his rent ($400 month), pay
electricity ($125 month) and has short
term loans to pay off. His parents
bought him a car so he needs to pay the
difference and have insurance. He eats
out a lot because he is very busy. What
would you do?
Cost of Attendance
• Heather states that she broke her arm
and has had to pay over $1000 in out of
pocket medical expenses she had not
planned for during this semester. She
is now short funds to pay her November
and December rent. What would you
do?
TAMU Process Flow
About Us
• Approximately 800 professional
judgments processed to date for 20122013.
• Average processing time 5 to 7
business days.
Professional Judgment Flow
Student submits CRF w/documents
Documents scanned into our Imaging System and sent to Workflow
If student file has not been verified, we verify original data on FAFSA
Assistant Director assigns CRF to Advisors for review/processing
Contact student for additional documents or clarification if needed
If approve-update Banner and/or FAA Access (D.O.) and notify student
If Denied—notify student and enter notes on Banner
Submit Professional Judgment Worksheet to Imaging and documentation for
approval or denial
Clear from workflow
Banner Schools Tidbit
• Use RNINAIQ to determine components of
federal methodology.
Resources
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NASFAA website
NASFAA Monograph 26
HEA Sec 479A(a)
Federal Student Aid Handbook
Dear Colleague Letters GEN-09-04 and GEN
09-05 and 2010-05-21, 2010-05-05
Final Thoughts
• Advocate for students and parents
• Respect others professional judgment
• Don’t forget to
DOCUMENT