In many ways, the electronic financial aid reporting process that will be presented to the Division III membership as 2004 Convention Proposal No. 56 best represents the objectives of the Future of Division III "reform" package.

The proposal seeks to establish a process by which member institutions can check practices against Division III philosophy. It strives to do so in a manner that is within the means of all institutions. And it addresses a core value of Division III that all member institutions -- in all their diversity of size, funding and mission -- can unite around and support.

"The commitment to treating athletes and nonathletes the same for financial aid purposes is the most highly regarded value of Division III," said Kevin LaGree, president of Simpson College and chair of the Division III Financial Aid Review Task Force, which has worked for the past two years to develop the reporting process that would be enacted by the membership with the adoption of Proposal No. 56.

"I think this report will create a self-assessment tool for institutions, to see how we are in practice complying with that core value of Division III -- and where we might not be, to give us a chance to address it and come into compliance.

"My sense is that every Division III institution thinks it's in compliance with this core value, because we all treat it so highly," LaGree added. "But there has been no way to test that. This will provide that way to test it, primarily for the benefit of the institution."

Proposal No. 56 would establish a reporting process in which each institution annually would compare financial aid packaging for freshman and incoming transfer student-athletes with the financial aid packages awarded to nonathlete freshmen and transfer students.

Under the proposal, institutions would be called upon to organize relevant data from their records into a report that then would be submitted electronically -- probably during October -- to the NCAA. The report would compile data from the previous academic year.

Division III institutions clearly are interested in establishing such a process. A survey last spring of Division III institutional chief executive officers to measure support for various Future of Division III concepts attracted "strong support" or "support" for a financial aid reporting process from 64 percent of respondents, and another 15 percent indicated they "somewhat" support the idea.

But it also is clear that support is contingent upon answering as many questions as possible about how the reporting program will work, what kinds of data will be requested, and how burdensome and expensive the process will be for institutions. Answering those questions has been the primary focus of the task force since the Division III Presidents Council agreed in August to sponsor Proposal No. 56.

Pilot success

The task force, with assistance from the NCAA research staff, recently conducted "pre-pilot" testing of the reporting process at selected Division III institutions, in anticipation of pilot testing by the entire membership during 2004-05. The membership-wide pilot is a component in the proposed legislation, which calls for actual implementation of the reporting process in 2005-06.

The membership's interest in financial aid reporting was indicated further by reaction to the task force's solicitation in October of volunteers to participate in the pre-pilot testing. About one-fourth of the Division III membership -- 107 institutions -- responded by offering to participate. Only 26 were selected, due to the nature of the testing.

Institutions represented on the task force and the Division III Financial Aid and Awards Committee were selected first, due to the familiarity of administrators at those schools with the project. Priority then was given to schools that represented a cross section of the membership, using the criteria of institutional affiliation, undergraduate enrollment, sports sponsorship, location and conference affiliation.

The task force and the Financial Aid and Awards Committee met jointly December 9 in Chicago to review results from the pre-pilot testing, which was conducted during a three-week period in November. The groups analyzed results from 19 institutions that actually were able to complete testing during that period.

Those results provide a number of answers, LaGree said.

"It's possible to do this electronically, with a minimum amount of burden -- at least after the first year," he said, listing some of those answers. "We're able to preserve anonymity of student-athletes and nonstudent-athletes, so we're able to preserve the confidentiality of the data. We're able to create a report that will be extremely helpful to each institution, as a means of self-assessment of our individual compliance with Bylaw 15.

"We have significantly reduced the cost of doing this report," he added. In 2001, the Division III Presidents Council proposed using outside auditors to compare financial aid for athletes and nonathletes, but ultimately withdrew a proposal for the 2002 Convention that would have established an audit-based process, citing cost among other reasons. That proposal's withdrawal resulted in formation of the task force to explore methods for comparing financial aid packages, and now has resulted in Proposal No. 56.

"The current option, which appears to be relatively unobtrusive and inexpensive, will produce the data we need -- and that each individual college and university needs -- with minimal cost," LaGree said.

Results from the pre-pilot indicated that the participating schools completed the compilation and reporting of data in an average of two days, with actual time ranging from a half-day to a week. Much of that time was devoted to learning where and how to gather the data and establishing campus systems for compilation and reporting. Task force members believe that those systems, once established, will enable completion of reporting in a shorter time period in subsequent years.

"It's not going to be as burdensome as we originally thought," said task force member Ellen Shilkret, who oversaw pre-pilot testing at Vassar College, where she is associate director of financial aid. "The first year is going to be the hardest, because you're setting up those pieces of information that you need.

"Those schools that have the large software company (packages), it's easy because it's in your system; it only took my IT (information technology) person a couple of hours to pull this together, because we have the information in there."

"Those schools whose systems are homegrown, and who may not have all their information readily available through computer sources -- and I can't imagine there are a lot out there, but you never know because there are 420 schools and I don't want to speak on behalf of all of them -- that could be difficult, and that's why the NCAA offered to step in and help."

Shilkret is referring to a decision to set aside funds in the 2004-05 Division III budget to assist institutions with the cost of establishing the reporting process on campuses.

"Once that initial report is set up, then every year it's just a matter of gathering the same information," she said.

Paring down information requests

The task force further reduced the potential burden during its recent joint meeting with the Financial Aid and Awards Committee. The most important agreement from that meeting was a decision to request only information that is needed to establish compliance with Bylaw 15 -- thus excluding several pieces of data that were requested from institutions participating in the pre-pilot testing.

The excluded information includes academic data such as high-school grade-point averages, SAT or ACT scores, or class ranking, as well as various types of demographic data -- particularly gender and race/ethnicity data -- although such information could be used as a justification to explain why the average financial need of student-athletes at an institution is greater than the average need of other students.

"If we had inserted a lot of demographics, that's where a lot of the complaints would have come from, because we don't keep a lot of that information," Shilkret said about campus financial aid record-keeping.

Such data may be requested at some time in the future, she added, but for now, the task force recommends keeping data collection as stripped down as possible, focusing on what Shilkret calls "gift aid" -- including scholarships and grants awarded employing either federal or institutional methodology for determining need, as well as work-study aid.

Now that the task force has addressed the potential burden and cost of data collection, as well as types of data that will or will not be collected, it will turn over to the Financial Aid and Awards Committee the task of overseeing the actual reporting process -- and also responsibility for determining answers to remaining questions.

"I think we're headed in the right direction," said Terry Rupert, director of athletics at Wilmington College (Ohio) and chair of the Financial Aid and Awards Committee. "It'll be very interesting to see what happens when we apply it to over 400 schools (during the 2004-05 pilot).

"The financial aid committee's concern will be to see what results come out of that, where there will be disparity, and what the variances will be, because that will trigger what the committee will do. If there's a lot of variances, then we've got some relatively large issues."

Addressing the variances

Task force members acknowledge that the question of variances (the degree of difference between financial aid packaging for athletes and nonathletes) -- and how such variances will be addressed -- probably generates more anxiety throughout the membership than other aspects of the process.

Once implemented, the reporting process will seek compliance with Bylaw 15.4.1-(d) by ensuring that the total dollar value of institutionally administered grants is "closely equivalent" to the percentage of student-athletes in an institution's student body (see accompanying description of Bylaw 15.4.1).

The 2004-05 membership pilot is expected to produce data for use in beginning to establish variance limits. Variances that are greater than the established level could result in review of an institutional program by the financial aid committee. Depending on circumstances, a large variance that cannot be justified could result in referral of the case to the NCAA enforcement process.

Task force members understand that much of the membership's anxiety arises from the inability to define those limits before adoption of the legislation.

"We could set a variance now, but the risk of it being too rigid and too linear is, in my mind, too great," LaGree said. "We need more data, and we need to be able to subject that data to sophisticated analysis, simply to be able to get a more equitable and workable variance standard established."

And that anxiety perhaps is a distraction from what LaGree and other task force members believe is the real purpose of the reporting process.

"The big issue remaining, in my mind, is what is an appropriate variance," LaGree said. "But I want to place that in context, because I think there is real concern in the membership that this is primarily an enforcement device, when in fact, I think it's primarily a self-assessment device.

"If you think about this as a tool of self-assessment, the variances are points at which it's certainly in the institution's interest to take a look at what's going on. A variance itself would not necessarily indicate a problem, but would indicate a discrepancy that needs further investigation and study."

In fact, task force and financial aid committee members hope institutions actively will review their own reports, address any questions that may arise and use those reports as a self-assessment tool, rather than only minimally complying with the legislation and transmitting data to the NCAA national office without campus review.

"Our focus is looking at the individual institution's information, not comparing institutions," Shilkret said.

LaGree anticipates that as the reporting process supports compliance on campuses, it also ultimately will prompt constructive conversations among institutions as the membership gains a better understanding of the types of aid granted throughout Division III, and why.

"The real critical issue here is not so much getting the cheaters, as involving everyone in a process in which each member participates in self-assessment of compliance," LaGree said.

"The construct always has been, in my mind, to get us to a point where we can talk in a coherent way -- with definitions and terms and policies that we've all agreed upon, like this is what an institutional grant is. If we can sit down and talk about these things, then my guess is that most of the rumors will evaporate, and the ones that don't evaporate, we can work on."

That discussion begins in earnest in January at the Convention, where representatives of the task force will present information about the reporting process and answer questions during the Division III Legislative Forum scheduled at 8:30 a.m. January 11 in Nashville.

Information sought

The financial aid reporting proposal presented in 2004 Convention Proposal No. 56 specifically would seek information regarding amounts awarded of the following types of grants and scholarships:

Pell Grants

Federal Supplemental Educational Opportunity Grant (FSEOG)

State grants and scholarships

Institutional grants and scholarships

Private grants and scholarships

It also will seek information about grants from "other resources," as well as work-study aid.

Division III financial aid packaging

NCAA Bylaw 15.4.1 requires that the composition of a financial aid package that is offered to a student-athlete at a Division III institution be "consistent with the established policy of the institution's financial aid office for all students." It also requires that the package meet the following criteria:

A member institution shall not consider athletics ability as a criterion in the formulation of the financial aid package.

The financial aid procedures used for a student-athlete are the same as the existing official financial aid policies of the institution.

The package for a particular student-athlete cannot be clearly distinguishable from the general pattern of all financial aid for all recipients at the institution.

The percentage of the total dollar value of institutionally administered grants awarded to student-athletes shall be "closely equivalent" to the percentage of student-athletes within the student body.