In keeping with your request and that of Under Secretary Kanter, we are encouraging rejected applicants to participate in the appeals process put in place by the Department. We are also making every effort to contact families of students who did not attempt registration following receipt of their denied Parent PLUS loan application. We request that your office provide us with frequent reports on how many appeals are received and how many are approved.
The impact that the changes to the Parent PLUS loan program have had on students and HBCUs is unprecedented in its severity and disproportionately egregious for low-income and historically underserved and underrepresented communities. These are the very communities that, until now, have been traditionally protected by federal policy – particularly from policies that result in a disparate impact.
A recent UNCF review underscores the breadth of the challenges associated with the new implementation of considering a parent's credit history (and related factors) as one of the criteria for approval. Our data indicate that there was a 50 percent reduction in approval rates on Parent PLUS loan applications from last year. The total amount awarded to students also decreased substantially, roughly 47 percent from last year, even with four more campuses reporting data for 2012-2013 than for the previous year. And the average amount awarded to each institution fell $2.52 million, or 47 percent from the previous year. We are completing a comparable review of the impact on the public institutions.
Recent changes to the review of Parent PLUS loan applications are devastating, particularly when added to a growing list of federal policies that in the aggregate resemble death by a thousand cuts. Multiple reductions and formula reconfigurations to Title III, Part B, the Summer Pell award, reduction of the zero Expected Family Contribution (EFC) income level from $30,000 to $23,000 – and now, PPL changes – undermine intentions articulated in Executive Order 13532 and the recently signed Executive Order establishing the White House Initiative on Educational Excellence for African Americans. The changes in PPL criteria also place in jeopardy the Administration's goal of doubling college completion rates by 2020, affording all Americans, including students from ethnically and economically diverse backgrounds, access to educational opportunities, and the very viability of a category and community of diverse, mission-based institutions that have made unparalleled contributions to educating African Americans and others.