Where should financial aid report? Organizing for enrollments? Think carefully about optimum linkages before you set structure

University Business, June, 2004 by Kathy Kurz, Jim Scannell

There's no doubt that the reporting relationship of Financial Aid offices has shifted, but just when did that change begin to take place? We say: Around the same time that the rote of financial aid began to change from a mechanism used to promote equity, access, and choice, to one that is a significant factor in determining an institution's competitive position and financial well being. It was then that the concept of enrollment management (LM) was just being introduced. At its core, EM created formal connections between administrative units that-up to then--were most often untethered. Certainly the Linkage between Financial Aid and Admissions under an EM umbrella was an obvious connect point.

THE DOWNWARD SLIDE

Still, this was a moment in the history of financing higher education when lots of other changes were occurring, as well. The traditional partnership of government, institution, and family working together to make college affordable was beginning to break down. The federal government's view was transitioning from one that saw higher education as a societal good to one that pronounced it more of an individual good. Thus came the major shift in federal aid policy from grants to loans. The inability of state governments to generate tax revenues, and the increasing mandatory expenditures in Medicaid, prisons, and K-12, forced the states' role in financing higher education to take a downward slide. HOPE-type scholarship programs at the federal and state Levels, as well as tuition tax credits, have created more trenches in the playing field, and moved it away from low income families and toward the middle-income crowd.

All of these factors have placed increasing pressure on institutions and families to find workable solutions for financing a college education. Among institutions there has been a rapid increase in the use of merit dollars to attract students who otherwise would not ever apply, never mind enroll. In addition, there has been a great deal of public debate about the pluses and minuses of tuition discounting: Is it fair? Does it even work?

CHANGE AND REPORTING

So, where does all of this change leave the Financial Aid office? And where should the office reside organizationally, if it is to serve its multiple masters and their interests: students and families (affordability); institutions (net tuition revenue, student quality, diversity); donors (stewardship); and government (regulatory compliance).

The answer is, it depends. That is, it depends on:

* the institution's vision

* the institution's history

* the institution's current goals and challenges

* the student body the institution is trying to serve

* the people and systems employed at the institution, and their strengths and weaknesses

In other words, what is right for a particular moment in the institution's history may not always be right. Staff turnover, changes in external/internal forces, and evolving consumer needs could require a different organizational structure.

LEADERSHIP AND LINKAGE

Our premise is that there is no one "right" organizational model; no one-size-fits-all solution. There is, however, a given condition:

Regardless of where it reports, the Financial Aid office has to have healthy, strong, productive linkages to other key student service offices: Admissions, Registrar, Student Accounts, and the Budget office (to name the most important), if it is to be successful This, of course, is in large part a junction of leadership. The Financial Aid office cannot simply "tie" to where it reports.

In fact, we've observed successful Financial Aid offices that report to the vice president for Finance, the vice president for Student Life, the academic vice president, and of course the vice president of Enrollment. The success was a function of the leadership and the linkages, not the reporting line. Conversely, we've seen unsuccessful and even dysfunctional Financial Aid offices in all the above reporting scenarios where the leadership and linkages were poor or non-existent.

To illustrate, let's take a look at various institutions with differing Financial Aid office reporting lines--all appropriate for what the institution is trying to accomplish, and all unanimous in their need for strong linkages.

WHERE DOES FINANCIAL AID REPORT?

At the University of Connecticut, Financial Aid--along with Admissions, Registrar, and Orientation--reports to Dolan Evanovich, vice provost for Enrollment Management. Before the creation of the Enrollment Management division, Financial Aid reported to the finance side of the house.

White Dolan acknowledges the need for basic organizational structures to maintain workflow, he notes, "At a higher level, we need to devote ourselves to breaking down the silos of reporting structures. We need to begin to think holistically, focusing on institutional rather than unit-based goat setting and problem-solving, and the development of strategic partnerships to achieve shared objectives."

At Mercy College (NY), President Lucie Lapovsky responds in kind, stating that "Financial Aid could report anywhere, as the expectation is that staff will work collaboratively and cooperatively. With almost all of our students receiving substantial amounts of financial aid from federal state, and institutional sources, it makes sense to merge Admissions and Financial Aid into an enrollment unit so that more attention can be placed on the front end, explaining to first generation students both the benefits of college, as well as how they will be able to afford it. In Mercy's environment, admissions and financial aid officers need to be cross-trained in order to do their jobs effectively."