Financial Aid for NCAA Student-Athletes: Update on NCAA Bylaw 15

1. Financial Aid for NCAA Student-Athletes:Update on NCAA Bylaw 15 Kris Richardson NCAA Academic and Membership Affairs

2. Overview • Impact of NCAA Division I ProposalNo. 2011-97. • Period of award. • Aid to former student-athletes. • New legislation. • Miscellaneous expense allowance. • Proposal No. 2011-96. • Models under consideration. • Opportunities for involvement.

3. Impact of NCAA ProposalNo. 2011-97

4. Period of Award • Minimum - one academic year. • Maximum - student-athlete’s period of eligibility.

5. One-Year Awards • Aid must be disbursed in equal amounts. • Increase at any time for any reason. • No change to reduction/cancellation legislation.

6. One-Year Awards • Student may release institution from obligation to provide athletics aid. • Must be awarded institutional aid unrelated to athletics of equal or greater value than the signed award of athletically related aid.

7. Multiyear Awards • Cannot exceed period of eligibility. • Increase at any time for any reason. • During the period, no change to reduction/cancellation legislation. • Student cannot release institution from obligation to provide athletics aid.

8. Multiyear Awards - Renewals • Reduction occurs when: • Renewal period is for fewer years than the original agreement. • Unless the renewal includes the remaining years of the student-athlete's eligibility in all sports (e.g., five-year period of eligibility).

9. Multiyear Awards - Renewals • Reduction occurs when: • Average amount of aid provided per year in the renewal is less than the average amount of aid provided per year in the original agreement. • Includes any increases during the period of the original award.

10. Case Study • Caitlin signs a three-year agreement with State University for tuition and books. • Valued at $6,000 per year. • Full grant-in-aid is valued at $10,000. • Agreement represents 0.60 equivalency.

11. Case Study • Coach comes to see you about Caitlin’s renewal. • Plans to renew her for two years at 0.65 equivalency. • Is this a reduction?

12. Case Study • Reduction occurs if: • Renewal period is for fewer years than the original agreement, unless it is for the remainder of the eligibility period. • Original agreement was for three years. • Renewal is for two years. • But, renewal is for the remainder of her eligibility period.

13. Case Study • Reduction occurs if: • Average amount of aid provided per year in the renewal is less than the average amount of aid provided per year in the original agreement. • Original agreement represented 0.60 equivalency. • Renewal represents 0.65 equivalency.

14. Case Study • But, must include any increases during the period of the original award. • Renewal represents 0.65 equivalency. • Average amount of aid provided per year. • (.60 + .70 + .80) / 3 = 0.70 equivalency. • This is a reduction and Caitlin must be notified of the opportunity for a hearing.

15. Aid to FormerStudent-Athletes

16. Eligibility of Student-Athletes for Institutional Financial Aid • Proposal No. 2011-97. • May award institutional financial aid during any term in which a student-athlete was enrolled initially in a minimum full-time program of studies during the term if: • Undergraduate with eligibility remaining underfive-year rule. or • Graduate student eligible underpostbaccalaureate /graduate student legislation.

17. Aid to Former Student-Athletes • Proposal No. 2011-97. • Eliminated the “five in six years” limit on receipt of unearned athletics aid. • Permits former student-athletes to receive unearned aid for any term in which they are enrolled. • Full time or part time.

18. Newly Adopted Legislation

19. Proposal Nos. M-2011-7 andM-2012-2 Books • If student enrolls for less than a full academic year and receives any portion of a book allowance, it is represented proportionately in the numerator. • $400 for semester schools. • $534 or $267 for quarter schools. • Remains $800 in the denominator.

20. Newly Adopted Legislation • Proposal No. 2011-43. • Football Bowl Subdivision only. • Reduces limit of signees from 28 to 25. • Limit applies from December 1 through May 31. • Student who becomes a counter for the academic year during which signing occurs is not included in limit. • Effective August 1, 2012.

21. Newly Adopted Legislation • Proposal No. 2011-74. • Summer athletics aid not required to be in proportion to academic year aid if: • Student-athlete has exhausted eligibility; and • Is enrolled in degree courses. • Not required to graduate at end of summer term. • Not required to be enrolled in all degree courses offered. • Effective Immediately.

22. Newly Adopted Legislation • Proposal No. 2011-75. • In football, prospective student-athlete who receives athletically related financial aid during a summer term is an initial and overall counter for the next academic year. • Applies even if prospective student-athlete is a nonqualifier or does not enroll. • Effective Immediately.

23. Newly Adopted Legislation • Proposal No. 2011-77. • Exception to baseball’s minimum equivalency requirement. • Final year of eligibility; and • Never received athletically related aid in baseball. • Effective August 1, 2012.

24. Miscellaneous Expense Allowance

25. Miscellaneous Expense Allowance • Proposal No. 2011-96. • October 27, 2011: Legislation adopted. • November 9-16, 2011: National Letter of Intent early signing period. • December 19, 2011: Legislation suspended. • Received more than 125 override requests. • December 21, 2011: Start of National Letter of Intent signing period for football midyear two-year college transfers. • January 14: Legislation defeated.

26. Miscellaneous Expense Allowance • Financial aid agreements issued before December 20, 2011, could include a miscellaneous expense allowance. • No miscellaneous expense allowances for summer terms.

27. Miscellaneous Expense Allowance • Eligibility for miscellaneous expense allowance. • Specified in written financial aid agreement. and • Awarded athletically related and/or nonathletically related financial aid equal to the value of a full grant-in-aid.

28. Miscellaneous Expense Allowance • Miscellaneous expense allowance may include: • Additional athletically related institutional financial aid. or • Combination of athletically related and nonathletically related financial aid up to lesser of cost of attendance or $2,000.

29. Miscellaneous Expense Allowance • Three models currently under consideration. • Miscellaneous expense allowance. • Unmet need grant. • Supplement NCAA Student Assistance Fund. • All would permit up to $2,000.

30. Miscellaneous Expense Allowance • No vote on this initiative before August 2 meeting of NCAA Division I Board of Directors. • Legislation would not be effective before 2013-14 academic year.

31. Miscellaneous Expense Allowance • Opportunity for working group to: • Obtain information from spring /summer meetings. • Conduct focus group meetings. • Evaluate practical and administrative burdens. • Ensure gender-equity issues are fully addressed.

32. Miscellaneous Expense AllowanceModel 1: Miscellaneous Expense Allowance • Maintain current definition of a full grant-in-aid. • Maintain current regulations and exemptions concerning individual financial aid limits regarding cost of attendance.

33. Miscellaneous Expense AllowanceModel 1: Miscellaneous Expense Allowance • Permit up to $2,000 of “exempt aid,” not to exceed cost of attendance, when all sources of aid countable toward individual limits are included for any student-athlete who receives a full or equivalency grant-in-aid. • May be provided to full and equivalency grant recipients. • Demonstrated financial need not required to qualify.

34. Miscellaneous Expense AllowanceModel 1: Miscellaneous Expense Allowance • Alternative 1. • Limit miscellaneous expense allowance for an equivalency grant based on proportionality. • Example: • 0.33 or less = $500 0.34 - 0.66 = $1,000 • 0.67 - .99 = $1,500 1.0 = $2,000.

35. Miscellaneous Expense AllowanceModel 1: Miscellaneous Expense Allowance • Alternative 2. • Exempt Pell Grant from counting toward individual limit. • Would permit more Pell Grant recipients to receive the full $2,000.

36. Miscellaneous Expense AllowanceModel 2: Unmet Need Grant • Maintain existing definition of a full grant-in-aid. • Maintain current regulations and exemptions concerning individual financial aid limits regarding cost of attendance.

37. Miscellaneous Expense AllowanceModel 2: Unmet Need Grant • Permit up to $2,000 based on “unmet need,” not to exceed cost of attendance, when all sources of grant and gift aid countable toward individual limits are included for any student-athlete who receives a full or equivalency grant-in-aid.

38. Miscellaneous Expense AllowanceModel 2: Unmet Need Grant • Determining Unmet Need. • Student-athlete shall file a FAFSA. • If not eligible to file, shall follow institution’s uniform or institutional methodology to establish expected family contribution. • Unmet Need. • Equals cost of attendance – expected family contribution – grant-in-aid – other gift or grant aid. • Outside gift aid and exempt institutional aid that does not count toward cost of attendance is included when determining unmet need.

39. Miscellaneous Expense AllowanceModel 2: Unmet Need Grant • Examples. • Cost of Attendance = $25,000 and Full Grant-in-Aid = $19,000. • Student-Athlete 1. Expected FamilyContribution = $0. • Athletics Grant-in-Aid = $19,000; • Pell Grant = $5,500; • Other Grants = $0. • Unmet Need is $500. • Unmet Need Grant of up to $500 may be provided.

40. Miscellaneous Expense AllowanceModel 2: Unmet Need Grant • Cost of Attendance = $25,000 and Full Grant-in-Aid = $19,000 • Student-Athlete 2. Expected FamilyContribution = $10,000 • Athletics Grant-in-Aid = $2,000 • Pell Grant = $0 • Other Grants = $3,000 • Unmet Need is $10,000. • Unmet Need Grant of up to $2,000 may be provided.

41. Miscellaneous Expense AllowanceModel 2: Unmet Need Grant • Cost of Attendance = $25,000 and Full Grant-in-Aid = $19,000 • Student-Athlete 3. Expected Family Contribution = $20,000 • Athletics Grant-in-Aid = $19,000 • Pell Grant = $0 • Other Grants = $0 • Unmet Need is $0. • Unmet Need Grant not permissible.

42. Miscellaneous Expense AllowanceModel 3: Institutional Supplement to NCAA Student-Athlete Opportunity Fund • Permit institutions to supplement NCAA Student-Athlete Opportunity Fund by up to the total of $2,000 multiplied by total number of grant-in-aid awarded. • Example: • Head count awards = 130 • Equivalency awards = 80 • Permitted Student-Athlete Opportunity Fund supplement • (130+80)*$2,000 = $420,000.

43. Miscellaneous Expense AllowanceModel 3: Institutional Supplement to Student-Athlete Opportunity Fund • Continue to prohibit use of Student-Athlete Opportunity Fund toward “countable” athletics aid, except summer school. • Continue to permit institutions to use Student-Athlete Opportunity Fund funds for direct benefits to student-athletes.

44. Miscellaneous Expense AllowanceModel 3: Institutional Supplement to Student-Athlete Opportunity Fund • Permit use for up to a $2,000 “Miscellaneous Expense Allowance,” not to exceed cost of attendance, when combined with other sources of financial aid that count toward individual limits. • At discretion of institution and its conference. • May be provided any student-athlete.

45. Miscellaneous Expense AllowanceModel 3: Institutional Supplement to Student-Athlete Opportunity Fund • New allocation of funds not restricted to miscellaneous expenses allowances. • May be used for other direct benefits to student-athletes as currently permitted.

46. Opportunities for Involvement

47. Opportunities for Involvement • Review of miscellaneous expense allowance models is underway. • Participate in the discussion. • Talk with president or chancellor. • Talk with faculty athletics representative. • Talk with athletics. • Provide feedback via ncaa.org.

48. Opportunities for Involvement • Review of Bylaw 15 begins this year. • Plan will be presented to cabinet in June. • Areas for review. • Phase I • Equivalency computation method; • Team maximum financial aid limitations (head count and equivalency, as well as number of grants-in-aid); and • Terms and conditions of awarding institutional financial aid.

49. Opportunities for Involvement • Areas for review. • Phase II • Role of recruited status on financial aid; • Period of award; • Summer financial aid; and • Retroactive financial aid.

50. Opportunities for Involvement • Surveys will be distributed. • Need feedback from financial aid officials. • Focus group and subgroup participation opportunities. • Information available on NCAA Working Group on Collegiate Model – Rules page at ncaa.org.