Risk Sharing

What Would the PROSPER Act Risk-Sharing Scheme Cost Your College?

House legislation to reauthorize the Higher Education Act (PROSPER Act, H.R. 4508) would hold colleges financially accountable for student completion – i.e., impose risk sharing – by changing the rules for how much Title IV aid a college must return to the Department of Education for students who withdraw during an enrollment period. By answering the questions below, you can estimate how much this will cost your college and provide valuable information for AACC’s advocacy efforts.

What percentage of Title IV-aided students withdrew in each of the last two periods of enrollments at your college?

Of your Title IV-aided students who did not complete a term during the last academic year (2 periods of enrollment), what percentage officially withdrew, and for what percentage did a last day of attendance have to be determined retrospectively?

To the maximum extent possible, using the formula below, please provide an estimate of the total amount of Title IV funds not “earned” by students in those two periods of enrollment under the PROSPER Act. (Withdrawal date unknown = 50% of term completed.)

Percentage of term completed / Aid earned
0 – 24% / 0%
25 – 49% / 25%
50 – 74% / 50%
75 – 99% / 75%

What percentage of the total Title IV funds disbursed in those periods of enrollment does this represent?

Finally, in order for AACC to assess the full impact of the pending proposal, it would be helpful to know the total amount of funds your college had to return to the federal government under current rules for the same periods that we are asking you to perform calculations under the pending House legislation.

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