Agency Will Not Notify Students of Cuts in Aid

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A deliberate decision by the Social Security Administration not to warn the children of widows, widowers, retirees, and disabled persons that they probably will not be eligible for education benefits after this spring could substantially upset the college plans of as many as 300,000 high-school seniors.

Benefits Phased Out

In its frantic and unprecedented budget-slashing last summer, Congress voted to phase out the agency's $2.4-billion program of educational benefits for postsecondary students beginning May 1, 1982. Students not enrolled full-time in a postsecondary institution by that day would become ineligible for benefits that now average about $2,700 per year.

Until recently, the decision to end the program had gone largely unnoticed by the general public and the media. (See Education Week, Dec. 21.)

Consequently, according to higher-education officials and school guidance counselors, many high-school seniors now eligible for college aid are unaware that they will become ineligible for the benefits on May 1.

There is also much uncertainty about the Social Security agency's estimates of the number of high-school seniors who would be affected by the program cuts. Some agency officials set figures that ranged as high as 150,000, while others said the number could be as low as 40,000.

Another agency official, who asked not to be identified, said the number is closer to 300,000.

Erroneous Assumptions

Many of these students, the officials say, will probably assume they are still eligible and will erroneously report the expected Social Security assistance as part of their projected income when filing financial-aid forms with colleges.

By the time the error is discovered, it may be too late for such students to obtain financial aid from other sources.

Not only has the Social Security Administration decided not to warn students of their potential loss, but the agency, according to official spokesmen, it is continuing to send an outdated notification form to all eligible students five months before their 18th birthdays. The form, which contains no mention of the program revisions, simply informs students that they could be eligible for the aid and advises them, if interested, to contact a

branch office of the agency for more information.

This will only compound the problems, some observers contend, because such an announcement implies that the benefits are available--and the students may not discover otherwise until they apply for the aid at local Social Security offices.

Students whose 18th birthday falls after July 1982 will not receive the Social Security letter until next month or later--by which time many of them will have accepted admission to a college and filed their financial-aid forms.

Asked why a separate announcement or the notice sent to current Social Security recipients before their 18th birthdays could not inform them of the phase-out of the benefits program, Social Security officials said costs, logistical problems, and bureaucratic delays made it impractical.

One Social Security official who asked not to be identified added that the confusing nature of the federal budget-reconciliation process last summer prevented the agency from preparing for the cuts in advance. "There were several versions of the bill being offered at once with a lot of jockeying around and last-minute revisions in the committees," the official said. "We didn't know what we'd be getting up until August."

The agency does, however, plan to inform student beneficiaries already enrolled in college of the program changes. According to agency officials, the notice will be attached to the student's end-of-year report--a standard form that participating students receive twice yearly--and will be mailed in late February.

John B. Trollinger, a spokesman for the Social Security agency, suggests that the decision not to inform high-school students of their potential loss of benefits was based less on logistics than on an effort to avoid pointing out a "legal loophole" in the new law: the possibility that students might somehow qualify for the benefits by enrolling in a postsecondary institution before May 1.

And that is apparently happening to some degree. Hauppauge High School in Suffolk County, N.Y., is arranging early graduation for students affected by the phase-out of the program, and some colleges are establishing dual-enrollment programs for such students.

Mr. Trollinger said the agency did not want to take any action that would have alerted students to the possibility of retaining the benefits by graduating early and enrolling in college before the May deadline.

"It is not the intent of the [Social Security] administration to notify students of methods on how to circumvent Congress's action," he explained. "The administration accepted the Congressional mandate to remove those students from Social Security rolls, and it was the clear intent of Congress for us to go through with those changes immediately."

In interviews, however, Congres-sional aides offered very different opinions on the actual intent of program revisions, particularly on the reasons for setting May 1 as the cutoff date for eligibility.

"Congress never said that current high-school seniors were to be excluded from the program," according to a Senate Finance Committee aide.

"All that the bill said was that all students enrolled in college before May 1982 were covered. The bill was never meant to preclude them from using the option of early graduation" in order to qualify for the benefits.

Other Congressional aides explained that under the Reagan Administration's proposal to eliminate the program, only those students who were enrolled in colleges by Sept. 1, 1981, would have been "grandfathered" into the program.

This, they said, would have disqualified students who graduated from high school last June but did not register full time before Sept. 1.

"There was a feeling among some members of Congress that those first-term college freshmen shouldn't be cut from the program," said another staff member of the Senate Finance Committee.

"The June graduates had already made plans in advance, such as filling out financial-aid forms. Their colleges had already calculated their financial aid using that data. If we had cut the benefits in September as the Administration had requested, we would have left a lot of people high and dry."

The May cutoff date was chosen, the staff member said, in order to give the June graduates ample time to enroll in colleges so they could qualify for the benefits. "We never really considered the May date a loophole for current high-school seniors who wanted to graduate early,'' he said. "The issue never came up, as far as I can tell. If Congress wanted to prevent them from qualifying, it could have placed language to that effect in the bill. I guess they just didn't think about it."

Several Congressmen, however, apparently did think of the potentially disastrous effect the cuts could have on unsuspecting high-school and college students. According to John P. Mallan, a vice president of the American Association of State Colleges and Universities and chief education lobbyist on the issue last summer, they promised "to light a fire under Social Security" to warn the students of the revisions.

Assistants to the legislators who made those claims, however, said the warning effort was never organized, partly because the program cuts "were lost in the crunch and crush of the reconciliation process."

"It was a funny deal in that we expected much more hue-and-cry about getting notices out," said a staff member of the Social Security subcommittee of the House Ways and Means Committee. "But there really was quite a bit of support for the President's budget-cutting proposals at the time, at least a lot more than we expected. I guess that no one wanted to be the harbinger of bad news, even if it was their actions that caused it."

Another senatorial aide said that shortly after the budget cuts were passed last summer a Social Security official assured her both current and potential beneficiaries would be notified of the change.

"This was very early in the game and was done in a very casual manner, so we didn't press the matter any further," the assistant said. "I had no idea that they had made a decision against sending the notices to high-school students. That's very upsetting."

According to a brochure, titled Social Security Checks for Students 18 to 22, which officials say is available in local Social Security offices, students who were receiving Social Security benefits of any sort prior to September 1981 will continue to receive monthly payments until they finish school, reach age 22, or through April 1985--whichever comes first--provided that they are in full-time attendance in college or other postsecondary institutions before May 1982.

New regulations, however, make the following changes:

Eligible students will no longer receive checks for May, June, July, or August beginning this year even if they attend school then.

They will no longer be eligible for for any future general benefit increases, as will other beneficiaries.

The amount of their future payments will be gradually reduced. Students will receive: 25 percent less beginning with the September 1982 check (which is due on Oct. 1); 50 percent less effective September 1983; 75 percent less effective September 1984; and no more checks after April 1985.

Students who first qualified for any sort of Social Security aid in September 1981 or after and who are currently attending college or another postsecondary institution will receive checks only through July 1982, according to the brochure. No checks will be paid for any month after that.

Students who received their first Social Security check in September 1981 and who are still in high school will also continue to receive benefits through July 1982. Beginning in August 1982, however, they will stop receiving checks upon reaching age 19 except that:

A student can continue to receive payments until the end of the term in which he or she turns 19.

If the student's school does not operate on a semester or quarter basis, the checks may continue until the student completes the course or for two months after the month he or she turns 19, whichever comes first.

The 16-year-old education-benefits program has grown tremendously since it began in 1965. That year $165 million was disbursed to 206,000 students, who received monthly benefits that averaged $66.73, according to Social Security officials. Last month, the officials said, more than 760,000 shared about $196 million in benefits, which now average $258 per month.

There is some confusion about the accuracy of these figures, however. Last month, for example, one Social Security official said the total number of students receiving benefits in April 1981 was 904,000.

Another agency official reported that in December 1980 a total of 733,758 students received the benefits. By December 1981, he said, that figure had only risen to 760,508. The second agency official also reported figures that indicate that participation in the program peaked in December 1977, when some 856,000 received student-benefit checks.

Vol. 01, Issue 16

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