Financial Aid Process Lacks Transparency

Changes in eligibility result in retroactive aid removal

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*A pseudonym is used to protect source’s identity. 

When Lyla James* checked her MyUCSC portal over the summer, she found a hold on her account stating she owed $3,247 from fall 2018. 

After attempting to contact the financial aid office multiple times, James received an email from a compliance officer stating she had been awarded $169 too much in fall 2018. The change in aid amount was due to a leave of absence in winter 2018 that adjusted her financial aid for the entire year. Nobody explained why the bill was $3,247 instead of $169. 

“I made it very apparent that I wanted to do what I could to correct the situation,” James said. “And they never gave me any other solutions other than having to pay it.”

The financial aid office alerted James on Sept. 23 that they made an administrative error that caused the $3,247 charge. James was reimbursed several months after the initial error.

While James’s situation is uncommon, thousands of students each year are could have their aid retroactively reduced if their enrollment status changes. 

Julian Hodge

A student’s financial aid may be revoked if their eligibility to receive that aid changes after their aid awards have already been distributed. For example, students risk losing financial aid eligibility if they expect to enroll in 15 credits one quarter, but then drop a class.

“I think that students often perceive something to be a mistake when it’s actually regulatory,” said Director of Financial Aid Patrick Register, “or when it is actually being driven by reconciliation activities that are required.”

About seven to 10 days before the add/drop/swap deadline each quarter, the financial aid office emails students who are in danger of failing to meet the enrollment requirements necessary to receive their financial aid and warns them this could occur, Register said. However, the emails don’t provide specific information about which aid awards might be affected.

In James’s case, she wasn’t aware that taking a leave of absence could alter her financial aid package, and she definitely wasn’t prepared to bear the brunt of an administrative error.

In 2018-19, the financial aid office awarded more than 75,000 awards to nearly 16,000 students. The sheer quantity of aid awards means it’s statistically likely the financial aid office will make a few mistakes. For third-year Roberto Alvarez*, one of these mistakes cost him $7,000.

In May, Alvarez saw he had received a state-funded $7,500 middle class scholarship award. He thought this was strange since he normally receives no more than $1,500 per quarter for this scholarship, so he went to speak with a student worker at the financial aid office. The student told him he shouldn’t question the award and to accept the aid, Alvarez said. So he did, and ended up purchasing a new computer with some of the money.

Two months later in July, Alvarez received an email from the financial aid office which prompted him to check his MyUCSC portal.

“I look and there’s a hold for $7,000,” Alvarez said. “And I see this charge and then I see the email, all at the same time. Obviously I tell my parents and they’re shocked and everything. But from the way it was worded in the original email, they seemed like they were going to work with us. Because they acknowledged it was their fault, it was their mistake on their side.”

Director of Financial Aid Patrick Register told Alvarez the assistant director had made a typo error by accidentally adding a “7” in front of the $500 Alvarez  was supposed to receive. Register apologized for the mistake, but said Alvarez still must pay back the $7,000 since he was ineligible to receive it. 

“It’s unfortunate if those kind of things happen, and it’s the kind of thing where you will find the institution is going to try and do what it can.” Register said. “But there are limits to what the institution can do, especially if it’s not our funding.”

The financial aid disbursement process lacks transparency for all students whose enrollment changes at some point during the year. Students often have no idea they are at risk for retroactive financial aid withdrawal.  

For students unfamiliar with the requirements for maintaining aid eligibility, it is difficult to understand when and why their financial aid may change. 

“I’m hoping that they will make the billing system a little bit more transparent for students,” James said, “because if I’m not the only one experiencing this, it’s obviously a problem.”


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