27762 Federal Register / Vol. 61, No. 106 / Friday, May 31, 1996 / Notices

DEPARTMENT OF EDUCATION

Federal Pell Grant, Federal Perkins

Loan, Federal Work-Study, Federal

Supplemental Educational Opportunity

Grant, Federal Family Education Loan,

and William D. Ford Federal Direct

Loan Programs; Updates to Tables

Used in the Need Analysis

Methodology for the 1997–98 Award

Year

AGENCY: Department of Education.

ACTION: Notice.

SUMMARY: The Secretary of Education

announces the annual updates to the

tables included in the need analysis

methodology that will be used to

calculate expected family contributions

for the 1997–98 award year under the

Federal Pell Grant, campus-based

(Federal Perkins Loan, Federal WorkStudy, and Federal Supplemental

Educational Opportunity Grant), Federal

Family Education Loan and William D.

Ford Federal Direct Loan programs.

These programs are known collectively

as the Title IV, HEA programs. The

Secretary takes this action under the

authority of sections 477 and 478 of the

Higher Education Act of 1965, as

amended (HEA).

FOR FURTHER INFORMATION CONTACT: Ms.

Edith Bell, Program Specialist, General

Provisions Branch, Policy Development

Division, U.S. Department of Education,

600 Independence Avenue, S.W. (Room

3053, ROB–3), Washington, D.C. 20202–

5444, telephone (202) 708–7888. Deaf

and hearing impaired individuals may

call the Federal Information Relay

Service at 1–800–877–8339 between 8

a.m. and 8 p.m., Eastern time, Monday

through Friday.

SUPPLEMENTARY INFORMATION: The need

analysis methodology, referred to as the

‘‘Federal Needs Analysis Methodology,’’

is set forth in Subpart F of Title IV of

the HEA. It is used to determine a

student’s eligibility for assistance under

the Title IV, HEA programs.

Federal Needs Analysis Methodology

Part F of Title IV of the HEA specifies

the criteria, data elements, calculations,

and tables used in the computation of

expected family contributions for the

Title IV, HEA programs. Section 478 of

Part F requires the Secretary to adjust

annually for inflation four of the tables

included in Part F: the Income

Protection Allowance, the Adjusted Net

Worth of a Business or Farm, the

Education Savings and Asset Protection

Allowance, and the Assessment

Schedules and Rates. The inflation

changes are based, in general, upon the

reported annual inflation increase set

forth in the Consumer Price Index for

All Urban Consumers that is issued by

the United States Department of Labor.

For award year 1997–98, the Secretary

is charged with updating the tables for

income protection allowances, adjusted

net worth of a business or farm, and the

assessment schedules and rates to

account for inflation that took place in

calendar year 1996. However, the

Secretary must publish these updated

tables by June 1, 1996. Therefore, the

Secretary must update the tables based

upon an estimate of the increase in the

Consumer Price Index for All Urban

Consumers for that period.

The Secretary estimates that the

Consumer Price Index for All Urban

Consumers will rise 3.3 percent during

calendar year 1996. In making this

estimate, the Secretary assumed that the

rate of increase for calendar year 1996

will be the same as that reported for

calendar year 1995.

The table in section 1 reflects the

changes in the income protection

allowances. This change reflects a

consumer price increase of 3.3 percent

rounded to the nearest $10.

The table in section 2 reflects the

changes in the adjusted net worth of a

farm or business. This change reflects a

consumer price increase of 3.3 percent

rounded to the nearest $5,000.

The table in section 3 reflects the

changes in the education savings and

asset protection allowance. This change

reflects a consumer price increase of 3.3

percent rounded to the nearest $100.

The table in section 4 reflects the

changes in the assessment schedules

and rates. This change reflects a

consumer price increase of 3.3 percent

rounded to the nearest $100.

Section 477(b)(5) of the HEA requires

the Secretary to increase the amount

specified for the Employment Expense

Allowance to account for inflation based

upon increases in the Bureau of Labor

Statistics budget of the marginal costs

for a two-earner compared to a oneearner family for meals away from

home, apparel and upkeep,

transportation, and housekeeping

services. Therefore, the table in section

5 reflects that change.

The table in section 6, statutory

allowances for State and other taxes, has

not been revised, but is included for

informational purposes.

The following sections set forth the

above described tables.

1. Income Protection Allowance

This statutory allowance represents

the amount of reasonable living

expenses that would be associated with

the maintenance of an individual or

family. The allowance is offset against

the family’s income and varies by family

size and family members in college. The

income protection allowances for

parents of dependent students and

independent students with dependents

other than a spouse for the award year

1997–98 are:

Family size (including student)

Number in college

1 2 3 4 5

2 .............................................................................................................................................. $11,750 $9,740

3 .............................................................................................................................................. 14,630 12,630 $10,620

4 .............................................................................................................................................. 18,070 16,060 14,060 $12,050

5 .............................................................................................................................................. 21,320 19,310 17,310 15,300 $13,300

6 .............................................................................................................................................. 24,940 22,930 20,930 18,920 16,920

For each additional family member add $2,810.

For each additional college student subtract $2,000.

2. Adjusted Net Worth (NW) of a

Business or Farm

A portion of the full net value of a

farm or business is excluded from the

calculation of an expected contribution

since: (1) the income produced from

such assets is already assessed in

another part of the formula; and (2) the

formula protects a portion of the value

of the assets. The portion of these assets

included in the contribution calculation

is computed according to the following

schedule. This statutory schedule is

used for parents of dependent students,

independent students without

dependents other than a spouse, and

independent students with dependents

other than a spouse.
Federal Register / Vol. 61, No. 106 / Friday, May 31, 1996 / Notices 27763

If the net worth of a

business or farm is—

Then the adjusted net

worth is:

Less than $1 ............. $0.

$1 to $85,000 ............ $0 + 40% of NW.

$85,001 to $250,000 $34,000 + 50% of

NW over $85,000.

$250,001 to $420,000 $116,500 + 60% of

NW over $250,000.

$420,001 or more ...... $218,500 + 100% of

NW over $420,000.

3. Education Savings and Asset

Protection Allowance

This statutory allowance protects a

portion of net worth (assets less debts)

from being considered available for

postsecondary educational expenses.

There are three asset protection

allowance tables—one for parents of

dependent students, one for

independent students without

dependents other than a spouse, and

one for independent students with

dependents other than a spouse.

DEPENDENT STUDENTS

If the age of the

older parent is

And there are

Two parents One parent

then the education savings

and asset protection allowance is—

25 or less .......... .................... ....................

26 ...................... 2,400 1,700

27 ...................... 4,700 3,300

28 ...................... 7,100 5,000

29 ...................... 9,500 6,600

30 ...................... 11,800 8,300

31 ...................... 14,200 10,000

32 ...................... 16,600 11,600

33 ...................... 18,900 13,300

34 ...................... 21,300 14,900

35 ...................... 23,700 16,600

36 ...................... 26,000 18,300

37 ...................... 28,400 19,900

38 ...................... 30,800 21,600

39 ...................... 33,100 23,200

40 ...................... 35,500 24,900

41 ...................... 36,400 25,400

42 ...................... 37,300 26,000

43 ...................... 38,300 26,500

44 ...................... 39,300 27,100

45 ...................... 40,300 27,800

46 ...................... 41,300 28,300

47 ...................... 42,400 29,000

48 ...................... 43,400 29,700

49 ...................... 44,500 30,400

50 ...................... 45,900 31,200

51 ...................... 47,100 31,900

52 ...................... 48,300 32,700

53 ...................... 49,800 33,500

54 ...................... 51,300 34,300

55 ...................... 52,600 35,100

56 ...................... 54,200 36,100

57 ...................... 55,900 36,900

58 ...................... 57,600 38,000

59 ...................... 59,600 39,100

60 ...................... 61,400 40,000

61 ...................... 63,200 41,100

62 ...................... 65,400 42,300

DEPENDENT STUDENTS—Continued

If the age of the

older parent is

And there are

Two parents One parent

63 ...................... 67,700 43,500

64 ...................... 70,000 44,900

65 and over ....... 72,400 46,100

INDEPENDENT STUDENTS WITHOUT

DEPENDENTS OTHER THAN A SPOUSE

If the age of the

student is

And the student is

Married Single

then the education savings

and asset protection allowance is—

25 or less .......... .................... ....................

26 ...................... 2,400 1,700

27 ...................... 4,700 3,300

28 ...................... 7,100 5,000

29 ...................... 9,500 6,600

30 ...................... 11,800 8,300

31 ...................... 14,200 10,000

32 ...................... 16,600 11,600

33 ...................... 18,900 13,300

34 ...................... 21,300 14,900

35 ...................... 23,700 16,600

36 ...................... 26,000 18,300

37 ...................... 28,400 19,900

38 ...................... 30,800 21,600

39 ...................... 33,100 23,200

40 ...................... 35,500 24,900

41 ...................... 36,400 25,400

42 ...................... 37,300 26,000

43 ...................... 38,300 26,500

44 ...................... 39,300 27,100

45 ...................... 40,300 27,800

46 ...................... 41,300 28,300

47 ...................... 42,400 29,000

48 ...................... 43,400 29,700

49 ...................... 44,500 30,400

50 ...................... 45,900 31,200

51 ...................... 47,100 31,900

52 ...................... 48,300 32,700

53 ...................... 49,800 33,500

54 ...................... 51,300 34,300

55 ...................... 52,600 35,100

56 ...................... 54,200 36,100

57 ...................... 55,900 36,900

58 ...................... 57,600 38,000

59 ...................... 59,600 39,100

60 ...................... 61,400 40,000

61 ...................... 63,200 41,100

62 ...................... 65,400 42,300

63 ...................... 67,700 43,500

64 ...................... 70,000 44,900

65 and over ....... 72,400 46,100

INDEPENDENT STUDENTS WITH

DEPENDENTS OTHER THAN A SPOUSE

If the age of the

student is

And the student is

Married Single

then the education savings

and asset protection allowance is—

25 or less .......... .................... ....................

INDEPENDENT STUDENTS WITH DEPENDENTS OTHER THAN A

SPOUSE—Continued

If the age of the

student is

And the student is

Married Single

26 ...................... 2,400 1,700

27 ...................... 4,700 3,300

28 ...................... 7,100 5,000

29 ...................... 9,500 6,600

30 ...................... 11,800 8,300

31 ...................... 14,200 10,000

32 ...................... 16,600 11,600

33 ...................... 18,900 13,300

34 ...................... 21,300 14,900

35 ...................... 23,700 16,600

36 ...................... 26,000 18,300

37 ...................... 28,400 19,900

38 ...................... 30,800 21,600

39 ...................... 33,100 23,200

40 ...................... 35,500 24,900

41 ...................... 36,400 25,400

42 ...................... 37,300 26,000

43 ...................... 38,300 26,500

44 ...................... 39,300 27,100

45 ...................... 40,300 27,800

46 ...................... 41,300 28,300

47 ...................... 42,400 29,000

48 ...................... 43,400 29,700

49 ...................... 44,500 30,400

50 ...................... 45,900 31,200

51 ...................... 47,100 31,900

52 ...................... 48,300 32,700

53 ...................... 49,800 33,500

54 ...................... 51,300 34,300

55 ...................... 52,600 35,100

56 ...................... 54,200 36,100

57 ...................... 55,900 36,900

58 ...................... 57,600 38,000

59 ...................... 59,600 39,100

60 ...................... 61,400 40,000

61 ...................... 63,200 41,100

62 ...................... 65,400 42,300

63 ...................... 67,700 43,500

64 ...................... 70,000 44,900

65 and over ....... 72,400 46,100

4. Assessment Schedules and Rates

Two separate assessment schedules—

one for dependent students, and one for

independent students with dependents

other than a spouse—are used in

determining the expected family

contribution toward educational

expenses from family financial

resources.

For dependent students, the expected

parental contribution is derived from an

assessment of the parents’ adjusted

available income (AAI). For

independent students with dependents

other than a spouse, the expected

contribution is derived from an

assessment of the family’s AAI. The AAI

represents a measure of financial

strength which considers both income

and assets. The statutory assessment

schedules are as follows:
27764 Federal Register / Vol. 61, No. 106 / Friday, May 31, 1996 / Notices

DEPENDENT STUDENTS

If AAI is— Then the contribution

is—

Less than ¥$3,409 ... ¥$750.

¥$3,409 to $10,500 22% of AAI.

$10,501 to $13,200 ... $2,310 + 25% of AAI

over $10,500.

$13,201 to $15,900 ... $2,985 + 29% of AAI

over $13,200.

$15,901 to $18,500 ... $3,768 + 34% of AAI

over $15,900.

$18,501 to $21,200 ... $4,652 + 40% of AAI

over $18,500.

$21,201 or more ........ $5,732 + 47% of AAI

over $21,200.

INDEPENDENT STUDENTS WITH

DEPENDENTS OTHER THAN A SPOUSE

If AAI is— Then the contribution

is—

Less than ¥$3,409 ... ¥$750.

¥$3,409 to $10,500 22% of AAI.

$10,501 to $13,200 ... $2,310 + 25% of AAI

over $10,500.

INDEPENDENT STUDENTS WITH DEPENDENTS OTHER THAN A

SPOUSE—Continued

If AAI is— Then the contribution

is—

$13,201 to $15,900 ... $2,985 + 29% of AAI

over $13,200.

$15,901 to $18,500 ... $3,768 + 34% of AAI

over $15,900.

$18,501 to $21,200 ... $4,652 + 40% of AAI

over $18,500.

$21,201 or more ........ $5,732 + 47% of AAI

over $21,200.

5. Employment Expense Allowance

This allowance for employmentrelated expenses, which is used for the

parents of dependent students and for

married independent students with

dependents, recognizes additional

expenses incurred by working spouses

and single-parent households. The

allowance is based upon the marginal

differences in costs for a two-earner

family compared to a one-earner family

for meals away from home, apparel and

upkeep, transportation, and

housekeeping services.

The employment expense allowance

for parents of dependent students,

married independent students without

dependents other than a spouse, and

independent students with dependents

other than a spouse is the lesser of

$2,700 or 35 percent of earned income.

6. Allowance for State and Other Taxes

The statutory allowance for state and

other taxes protects a portion of the

parents’ and student’s income from

being considered available for

postsecondary education expenses.

There are four tables for state and other

taxes, one each for parents of dependent

students, dependent students,

independent students without

dependents other than a spouse, and

independent students with dependents

other than a spouse.

PARENTS OF DEPENDENT STUDENTS

If parents’ state or territory of residence is

And parents’ total income

is—

Less than

$15,000 or

$15,000 or

more

then the percentage is—

Wyoming, Tennessee, Nevada, Alaska, Texas ............................................................................................................... 3 2

Louisiana, Florida, Washington, South Dakota ............................................................................................................... 4 3

Alabama, Mississippi ........................................................................................................................................................ 5 4

North Dakota, Illinois, Connecticut, New Mexico, Missouri, West Virginia, Arizona, Indiana, Oklahoma, Arkansas ..... 6 5

New Hampshire, Pennsylvania, Colorado, Georgia, Kansas, Kentucky, Idaho .............................................................. 7 6

North Carolina, Virginia, Delaware, South Carolina, Ohio, Utah, Nebraska, Montana, California, New Jersey, Iowa,

Vermont, Hawaii ........................................................................................................................................................... 8 7

Massachusetts, Rhode Island, Michigan, Minnesota, Maine, Maryland ......................................................................... 9 8

District of Columbia, Wisconsin, Oregon ......................................................................................................................... 10 9

New York .......................................................................................................................................................................... 11 10

Other ................................................................................................................................................................................ 4 3

INDEPENDENT STUDENTS WITH DEPENDENTS OTHER THAN A SPOUSE

If student’s state or territory of residence is

And student’s total income is—

Less than

$15,000 or

$15,000 or

more

then the percentage is—

Wyoming, Tennessee, Nevada, Alaska, Texas ............................................................................................................... 3 2

Louisiana, Florida, Washington, South Dakota ............................................................................................................... 4 3

Alabama, Mississippi ........................................................................................................................................................ 5 4

North Dakota, Illinois, Connecticut, New Mexico, Missouri, West Virginia, Arizona, Indiana, Oklahoma, Arkansas ..... 6 5

New Hampshire, Pennsylvania, Colorado, Georgia, Kansas, Kentucky, Idaho .............................................................. 7 6

North Carolina, Virginia, Delaware, South Carolina, Ohio, Utah, Nebraska, Montana, California, New Jersey, Iowa,

Vermont, Hawaii ........................................................................................................................................................... 8 7

Massachusetts, Rhode Island, Michigan, Minnesota, Maine, Maryland ......................................................................... 9 8

District of Columbia, Wisconsin, Oregon ......................................................................................................................... 10 9

New York .......................................................................................................................................................................... 11 10

Other ................................................................................................................................................................................ 4 3
Federal Register / Vol. 61, No. 106 / Friday, May 31, 1996 / Notices 27765

DEPENDENT STUDENTS

If student’s state or territory of residence is

The percentage

is—

Alaska, Texas, South Dakota, Wyoming, Washington, Tennessee, Nevada ......................................................................................... 0

Florida, New Hampshire .......................................................................................................................................................................... 1

Connecticut, Louisiana, Illinois, North Dakota ......................................................................................................................................... 2

Mississippi, Arizona, Alabama, Pennsylvania, New Jersey, Missouri ..................................................................................................... 3

Nebraska, Indiana, Colorado, New Mexico, Oklahoma, Kansas, West Virginia, Rhode Island, Virginia, Georgia, Arkansas, Vermont, Michigan ..................................................................................................................................................................................... 4

Montana, Idaho, Utah, Kentucky, Massachusetts, California, North Carolina, South Carolina, Ohio, Iowa, Delaware, Maine, Wisconsin ................................................................................................................................................................................................... 5

Oregon, Maryland, Minnesota, Hawaii .................................................................................................................................................... 6

District of Columbia, New York ................................................................................................................................................................ 7

Other ........................................................................................................................................................................................................ 2

2

INDEPENDENT STUDENTS WITHOUT DEPENDENTS OTHER THAN A SPOUSE

If student’s state or territory of residence is

The percentage

is—

Alaska, Texas, South Dakota, Wyoming, Washington, Tennessee, Nevada ......................................................................................... 0

Florida, New Hampshire .......................................................................................................................................................................... 1

Connecticut, Louisiana, Illinois, North Dakota ......................................................................................................................................... 2

Mississippi, Arizona, Alabama, Pennsylvania, New Jersey, Missouri ..................................................................................................... 3

Nebraska, Indiana, Colorado, New Mexico, Oklahoma, Kansas, West Virginia, Rhode Island, Virginia, Georgia, Arkansas, Vermont, Michigan ..................................................................................................................................................................................... 4

Montana, Idaho, Utah, Kentucky, Massachusetts, California, North Carolina, South Carolina, Ohio, Iowa, Delaware, Maine, Wisconsin ................................................................................................................................................................................................... 5

Oregon, Maryland, Minnesota, Hawaii .................................................................................................................................................... 6

District of Columbia, New York ................................................................................................................................................................ 7

Other ........................................................................................................................................................................................................ 2

Dated: May 29, 1996.

David A. Longanecker,

Assistant Secretary for Postsecondary

Education.

(Catalog of Federal Domestic Assistance

Numbers: 84.007 Federal Supplemental

Educational Opportunity Grant; 84.032

Federal Family Education Loan Program;

84.033 Federal Work-Study Program; 84.038

Federal Perkins Loan Program; 84.063

Federal Pell Grant Program; 84.268 William

D. Ford Federal Direct Loan Program)

[FR Doc. 96–13799 Filed 5–30–96; 8:45 am]

BILLING CODE 4000–01–P