Summer is usually the time for vacations, but for those in higher education, it's a time to mix business with pleasure at annual conference sites around the country. July saw two major events: the annual NASFAA conference in Seattle, and the joint NACUBO, SCUP, APPA "Campus of the Future" conference in Honolulu.
The National Association of Student Financial Aid Administrators held its annual conference July 5 through 8 in Seattle. The meeting came on the heels of several federal decisions impacting financial aid.
Of course, exhibitors and financial aid executives had just ended a hectic period answering requests and fielding loan applications for those who wanted to apply before July 1, the date when higher-interest rates on student loans went into effect.
Interest rates for the government-based Stafford Loan, for example, rose from 4.7 percent to 6.54 percent for those still in school, or those holding loans in deferment. The rate for loans in repayment went from 5.3 percent to 7.14 percent. The interest rates were also hiked on July 1 for consolidation loans.
But the attendees discussed more than interest rates. Many pursued news about changes to the single-holder rule for consolidation loans. On June 15, legislators repealed the single-holder rule with the Emergency Appropriations Act. Prior to this, borrowers were limited in their choice of lenders for consolidation loans, having to rely on the lender who originated their loans. The change gives those consolidating more flexibility in searching for better rates. "An eligible borrower may consolidate loans with any eligible consolidation lender in the FFEL (Federal Family Education Loan Program), even if the borrower's loans are held by only one FFEL holder," NASFAA reported.
Close to 100 exhibitors reviewed their consolidation loan programs and other financial aid products with approximately 3,100 attendees. Established lenders such as Sallie Mae-holder of nearly $123 billion in student loans for nine million borrowers-exhibited, as did Chase, Citibank, and Bank of America, which is launching a concerted effort to boost awareness of its student loan division.
No exhibitor generated more heat, though, than MyRichUncle, whose executives openly challenged the financial aid process. Raza Kahn, president and co-founder, not only criticized the practice of aid administrators naming certain institutions as "preferred lenders" to their students, but undercut other lenders by offering federal student loans for 2 points lower that the standard base rate. The company, which was actually launched around the time of 9/11 but which has done some retrenching a in recent years, also promises borrowers lower rates on private loans. While not a bank, MyRichUncle administers financial services directly to students.
Their pitch drew heated criticism on the exhibit floor, as financial aid administrators took offense at the insinuation that naming a "preferred lender" should somehow be a suspicious act.
Only eight days after NASFAA had ended, MyRichUncle purchased full-page ads in The New York Times and USA Today, charging that financial aid officers "in reality steer you towards lenders that benefit them. Not you." On August 4, 2006 NASFAA president Dallas Martin wrote a letter to MyRichUncle, expressing "strong objections to [the company's] recent advertising and marketing materials. The focus of your marketing campaign implies that financial aid administrators are unethical, uncaring about how they serve students, and engaged in activities detrimental to students seeking federal or private loans," Martin wrote.
The palm trees and beaches of Honolulu may have been the big draw for some, but there was serious work to be done at The Campus of the Future: A Meeting of the Minds conference. The first-ever joint conference by the National Association of College and University Business Officers (NACUBO), the Society for College and University Planning (SCUP), and the Association of Higher Education Facilities Officers (APPA) brought together some 4,000 business officers, facilities directors, and more over three days.
A "Futures Panel" began the program with an overview of the trends driving social and educational issues. The panel (Melinda Davis, CEO of The Next Group think tank; Richard Katz, vice president of EDUCAUSE; Michael H. Strauss, COO of Commonfund; James Zull, director emeritus of the University Center for Innovation in Teaching and Education at Case Western Reserve University (Ohio), and moderator James Dator, director of the Hawaii Research Center for Futures Studies at the University of Hawaii-Manoa) painted a sometimes discouraging picture of the current state of education and offered their takes on its future. Attendees were told they'd have the task of working in groups to define what the campus of the future would look like, through a series of scenario building activities. (The group reports will appear in the publications of the three sponsoring associations in the fall.)
Davis told the audience that there is a "very fundamental change in the human condition." Even as we look to the future, a revolution has been going on invisibly and nearly imperceptibly within the population. With advances in technology over the years, she said, we've moved from being an industrial society to an information society. Now we are becoming an "imagination" society that will dictate education in this century.
Strauss said that since 2004 there has been a decline in foreign students seeking a U.S. education. This is partly due to 9/11 and partly because of an increase in foreign education opportunities. India and China, for example, have an increased focus on higher education, encouraging their students to study at home rather than in the U.S. As a result, institutions at home are being hard hit for revenue, and endowments are being used to support more of the operational budget than ever.
Katz offered a video interpretation of a future world, wherein technology has eliminated the problems of accessibility, and "virtual" education has become the norm. Technology advances are inevitable, he noted, but the key is in how to incorporate them in the most responsible way. In his scenario, Google has become the hands-down leader in online education and information, while other firms such as Apple and Disney partner to create virtual universities, complete with virtual classmates to replicate the normal class interactions.
Katz noted that all the elements of his future world exist in one form or another already, and left unchecked could result in his techno-centric world. Missing from the picture, of course, was the human element of education. That, the video predicted, would live on in the form of forward-thinking educators working in secret behind the ivy-covered walls of one of the "old" universities.