know, in its budget requests for fiscal 1974 and 1975, President Nixon has asked for the termination of supplemental grants and new direct loans and has placed the work-study programs under a State funding situation.

His attempt on two programs clearly violates the letter and intent of the 1972 law. Last year the Congress refused to go along with this Presidential suggestion. Mr. Chairman, I believe you put the congressional response best when you reportedly told your colleagues, "Let us obey the law the way we wrote the law, and let us turn down the request of the administration that it be granted amnesty from observing a law which it finds uncomfortable to live with."

I hope you and your colleagues will stand firm again this year, and when it comes time to draft new authorizing legislation, the programs high on his enemy list will be higher on the congressional retention list.

Such programs as supplemental grants, work-study, and direct loans. should be retained because they provide the flexibility the institutions require in meeting the financial needs of students, the support students receive from such direct aid programs as basic grants and insured loans.

I would also like to speak briefly on the basic educational opportunity grant program which has had a difficult time on our campus. I have a few suggestions for the improvement of the program.

First, the subcommittee must insure that one workable application form and one workable confidential financial statement be established as part of the regular procedures for basic grants.

Students, parents, and financial aid officers will appreciate the simplification of the needlessly complex procedures which currently must be followed in preparing the basic grants.

Although a task force of the Office of Education has made this a high priority, I feel it is the subcommittee's duty to see that the appropriate officials act and make sure this problem is solved.

Second, a suggestion already made by the chairman of the subcommittee for the inclusion of a section on the application form for basic grants so that a student can judge his eligibility for the program and estimate the size of his grant before he sends his application to the national processor.

This self-computation section would help students, parents and financial aid officers tremendously.

Third, a procedure should be adopted by which students, parents and financial aid officers may calculate reductions in individual basic grants if the Congress does not approve the appropriation for the program at a full-funding level.

If the program is funded, say, at 60 percent of what are considered full-funding levels, what will be the impact on the individual students' estimated grant? The interested members of the public, as mentioned above, or, at the very least, national processing services should be able to determine the impact of appropriations at less than full funding so that students and institutions can be informed promptly of the size of the grants.

Thank you very much, and, as I say, I will file additional material for the record.

Mr. RODRIGUEZ. Mr. Chairman and members of the committee, I would like to thank you for the opportunity of testifying here today.

I appear here today on behalf of the Student Assembly of the State University of New York, an organization representing 72 campuses and 382,000 students of the State University of New York to identify some of the current problems of the administration of student financial aid programs.

The greatest problem in the administration of the basic opportunity grants program in its first year is the extremely late date at which funds for the program were appropriated. I commend the committee's efforts to create a unified program of Federal student financial aid, but such a goal is unrealistic unless BOG is funded well before the beginning of the academic year for which the awards are to be made. Presently, the BOG program discriminates against low-tuition institutions, a feature which creates pressure for increasing college tuition. Instead of developing a separate cost schedule for students attending low- and high-tuition institutions, the BOG regulations consider students in the same sliding schedule and then add on restrictions that penalize the student attending a low-cost institution.

No grant can be awarded that exceeds 50 percent of the cost of the institution, and under the present level of funding, no grant can exceed 50 percent of the need which is defined as the difference between the cost and expected family contribution.

Because of these and other restrictions, it is unlikely even at full funding that the program would provide significant aid to middleincome students attending low-cost institutions. To alleviate this problem, we recommend a modified formula for low-tuition institutions as a supplement to the student aid programs.

The BOG definition of the cost of attendance is unrealistic. Table I in my testimony will illustrate the State University of New York, and define the cost to be about $3,000 yearly, but the BOG regulations can provide only $2,400, and even this amount is exaggerated because of the regulation cited above that the BEOG grant cannot exceed 50 percent of the cost.

The most important factor here is that the BEOG regulations only allow $350 a year for books, supplies, travel and personal and other incidental expenses. Another unrealistic regulation is that which allows only $950 a year for room and board costs for those students who live off campus, but not with their parents; many of whom have moved out of the dormitories because room and board charges have become too expensive.

Further, no consideration is given to the differences in the cost of living expenses as they vary from region to region. The difference between the cost of living in New York City and the upper areas of New York State should be taken into account when determining the award to which the student is entitled.

I wish to point out some other areas of importance with regard to this program. The amount of parental contribution demanded under present BOG regulations are far too strict. Most financial aid officers believe that the needs analysis standards used by the College Scholarship Service, CSS, and the American College Testing Service, ACTS, are also too strict. When compared to the BOG regulations promulgated by the U.S. Office of Education, they would almost appear

generous.

Perhaps the committee should consider using an alternate filing system for the BOG. By allowing the already existing agencies of CSS and ACT to compute the BOG awards, the program would be one step closer to coordinating the student financial aid package.

Let me commend the committee and the chairman, especially Chairman O'Hara, in his efforts to deal with all of these problems that I have mentioned. The introduction of his bill will allow students from families with annual incomes of up to $20,000 to qualify for fully subsidized guaranteed student loans of up to $2,000 shows imagination and insight into the problems that middle-income students face in financing their post-secondary education.

Students are often compelled to submit records of parental income even though they receive no moneys from their parents toward the cost of their education. Determining whether or not a student is financially emancipated from his or her parents is difficult.

Thus far, the BEOG definition of financial emancipation is fair, but very strict. We propose two amendments to the Federal regulations governing the definition of financial emancipation.

First, the regulations should apply the three criteria for independence to the calendar year in which aid is requested, rather than to the calendar year prior to the full academic year for which aid is requested.

This proposal would still permit documentation of the student's claims by submission of the Federal income tax return. We therefore see no reason to include the additional semester.

The committee might also want to undertake a thorough study of the college work study program. Financial aid officers in New York State have often complained of the irrational fund juggling that goes on in this program.

The money available to a college for the work study program often do not match the needs of the students at that college as well as the realistic employment opportunities in that college's community.

Many institutions are left with excess or insufficient funds for the student needs. There has been very little effort to study this problem, and little information as to why the mechanics of CWS funding would vary widely from institution to institution, but would appear to be an area where funds are wasted through misdirection.

A new method of determining the institutional appropriation might closely resemble the one presently used for BEOG.

In conclusion, I would like to thank you on behalf of the students. of the State University of New York for your tireless efforts on our behalf. I hope you will find our comments and recommendations helpful in your deliberations.

Mr. O'HARA. Thank you, Mr. Rodriguez.

I am going to yield very briefly to Mr. Dellenback.

Mr. DELLENBACK. I apologize that I won't be able to participate in the normal questioning. I am, unfortunately, due somewhere else already. I have already read what the next witness has to say in her statement, and I will also make it a point to read the record and talk to counsel as well.

I appreciate your input very much, and I have made some notes on it. My thanks and my apologies.

Ms. MACIEJEWSKI. Mr. Chairman, I would like to thank you for this opportunity to present the views of approximately 200.000 of Wisconsin's students on one of the Federal Government's most pervasive

student financial assistance programs, the guaranteed student loan program.

Specifically, I would like to address my remarks to two facets of the guaranteed student loan program; one, the relationship between that program and the new 18-year-old age-of-majority, and two, the critical problems faced by students in regard to the repayment of student loans. Approximately 40 States have now enacted legislation whereby 18-year-olds have all the responsibilities and almost all the prerogatives or other adults. One prerogative which students who are 18 years or older presently do not have is the ability to be viewed as adults for the purposes of obtaining student financial assistance.

Although there may be valid arguments to support the continuation. of the present policy to view students as children for the purpose of awarding aid under the various Federal grant programs, these arguments lose a great deal of their validity when one speaks about loan programs.

It is the student and not the parent who has the primary responsibility to repay the loan which has been borrowed for educational purposes. Given this fact, it seems incongruous to have the amount of that loan based on parental resources.

I, as others speaking before me, support the abolition of the needs test for the GSL program. However, I would replace that needs test not with a return to the status quo ante, but with a highly simplified needs test based only on the student's individual resources.

This would serve the purpose of not only placing GSL loans in the hands of the needy lower and middle class students, but would also serve to recognize that the overwhelming majority of today's students are indeed adults.

This change alone, however, is not sufficient to solve all the problems involved in student borrowing. Statistics indicate that student default in the GSL program as well as in the other programs is increasing.

Although there are undoubtedly many reasons for this increase, it is safe to assume that one reason relates to the well-known facts that student costs are rising and that the normal undergraduate degree does not provide the same degree of economic security as it once did. When these facts are coupled with the inflexible repayment provisions of the GSL program, default is inevitable. Expanded collection efforts and loan counseling is not the answer.

What is needed is a repayment system based on the student's ability pay, that is, some form of income contingency. Such a system is not only highly equitable because it embodies the principle of progressivity, but it would also serve to encourage and enable students to remain within the repayment system.

Taken together, the recognition of age-of-majority and the adoption of an income contingent repayment feature serve to provide greater access to all students, for no longer will students need to depend on parental contribution which may not be forthcoming or which may not be desirable and no longer will students need fear that the amounts borrowed under the GSL program will not be able to be repaid. Thank you, Mr. Chairman.

Mr. O'HARA. Thank you.

Mr ALTSCHULER. Mr. Chairman, good morning. My name is Lee Altschuler and I am speaking today as student body copresident of the

University of California at Berkeley and chairman of the University of California student body presidents' council.

I would like to divide my remarks into three parts, dealing with basic opportunity grants, the traditional programs and general remarks dealing with all facets of financial aid administration.

We are pleased with the entitlement approach to the BOG program because we realize it may increase access to low- and middle-income students. We have encountered with UC the administrative difficulties which we feel might spill over into other systems and which this committee might correct.

One of these problems is the three different overlapping deadlines that students must meet to apply for financial aid. In California, for example, the State Scholarship and Loan Commission, which requires the parents confidential statement must be filed by November 20.

In addition, institutional aid, such as college work study, NDSL and SEOG, must be filed by January 15 in the year preceding enrollment, again with the parent's confidential statement. On top of that there is the BOG program.

Our solution is that if Congress and the Office of Education could agree early enough in the year on what BOG information requirements are, it would be possible for the CSS parent's confidential statement and the ACT financial statement to request the same information.

Another difficulty is the family contribution schedule which we feel creates particular hardship on lower-middle-income and middleincome students. While we realize a deliberate decision was made setting up this schedule to husband scarce resources, the galloping inflation rate and unreasonableness of the PCS, CSS and BOG schedules are forcing students with need to shoulder huge loans or request their families to suffer in their life styles.

For example, at the University of California there are 80,000 undergraduate students. Last year there were 25,000 students with a proven financial need. Of those 25,000, 7,000 were freshmen. Of those 7,000, only 577 requested and received BOG grants.

To solve this problem we would request that the amount of parental assets excluded from the family contribution schedule be increased to $15,000, if not $20,000. In California particularly, with the style of single dwelling, we feel that individuals who own homes are discriminated against because they follow the common life style. In the area of categorical aid, when speaking of college work study, SEOG and NDSL, several thoughts come to mind regarding the efficiency of shrinking dollars and how they are distributed to a rising number of schools.

The allotment formulas of 1972, coupled with the freeze on increasing dollars mean that some States, like California, bear the brunt of fiscal dissemination. In particular, while approximately $770 million was available for the three programs, California received $77 million, or 10 percent.

At the same time, however, we enrolled over 15 percent of the nationwide student body in higher education. To us this is clearly discriminatory. We would therefore suggest that State allotment formulas be changed so they are strictly tied to the State proportion of national postsecondary enrollment.