A former participant in the federal GEAR UP program administered by Vermont Student Assistance Corporation (VSAC), the young Montpelier man is one of only 30 individuals nationwide chosen for the first GEAR UP Alumni Leadership Academy.

During a June retreat in Washington, D.C., Paiva will receive training in leadership skills, grassroots and social media advocacy, and storytelling. Back in Vermont, he will spend the next year educating policymakers and the public about the benefit of programs like GEAR UP.

GEAR UP — which stands for Gaining Early Awareness and Readiness for Undergraduate Programs —was established in the 1990s, the brainchild of former U.S. Senator Jim Jeffords of Vermont.

It provides low-income and first-generation college-bound students with the support they need to prepare for and succeed in college. Either directly or via partnerships, VSAC serves nearly 8,000 students annually through the program.

Paiva — a graduate of Blue Mountain Union High School (BMU) in Wells River, and, this month, the University of Vermont (UVM) — traveled a winding road to his degree.

“I grew up in so many places,” Paiva recalled. “My family lived in New York, New Hampshire, Ohio, Minnesota, and Wisconsin before settling in Vermont. Even then, we moved more than 12 times between second grade and the year I entered BMU as a sophomore.”

When his parents decided to move again, Paiva feared it would derail his education and career plans. So he secured their permission to become an emancipated minor, enabling him to live with another family while completing his studies at BMU.

His decision was wise: In his junior year, he placed top of his class, which entitled him to attend UVM tuition-free through a coveted Green & Gold Scholarship. His success at UVM, in turn, has motivated him to pursue one or more graduate degrees in a few years.

Dianne Griggs, formerly a counselor with VSAC’s GEAR UP program and now its manager, said that when she started working with Paiva at BMU, he had a lot of ground to cover to become college-ready. But he threw himself into the task, and set the UVM scholarship as his goal.

“I knew immediately that he was an exceptional young man,” said Griggs. “Through a combination of faculty support and independent study, he overcame all that he was lacking. He even skipped study hall so he could take extra courses.

“Once he got to UVM, he quickly settled in and challenged himself at every turn: academically, in part-time work, and through his involvement in student affairs. Cody has proven time and again that he has what it takes to reach his goals.”

Paiva will graduate with a major in microbiology and a minor in molecular genetics. He already has a job lined up doing cancer research at Dartmouth-Hitchcock Medical Center, and looks forward to pursuing a career in medicine, molecular biology, and/or public health.

“I’m currently leaning toward medical school with the goal of opening a general practice somewhere in Vermont,” he said. “I’ve also considered the wild idea of going for an MD/PhD or an MD/MPH. I really am interested in providing access to basic health care in rural areas.”

Paiva said he hopes to use his time at Dartmouth to clarify his goals: “I’m open to many possibilities, and my academic advisor has told me that I could do whatever I want. I’m going to use the next two years to get a little more experience in both research and medicine so that I can make a solid decision.”

In most respects, his unusual family odyssey is now behind him. But as he begins his role as a GEAR UP alumni leader, he will be able to share his own story and encourage public support for students coping with the same kinds of challenges he encountered.

The GEAR UP Alumni Leadership Academy is sponsored by the National Council for Community and Education Partnerships, which provides the federal GEAR UP program with training and technical assistance. The alumni academy is funded by a generous grant from the Kresge Foundation.

“Our objective was to find a visionary, entrepreneurial leader capable of building on VSAC’s unique strengths and tackling the challenges ahead,” said Dorothy Mitchell, chair of the VSAC Board of Directors.

“Scott is committed to Vermont and VSAC’s values. Under his leadership, we believe VSAC will become an even stronger catalyst and support system than it is today for Vermonters seeking education and training beyond high school.”

The board began the process of seeking a successor to Vickers more than a year ago, and made its decision following a nationwide search. The board involved staff at all levels of the organization in defining desired characteristics of the new CEO and in interviewing finalists.

In his current role as a vice president, Giles oversees VSAC’s operational areas — including outreach, financial aid delivery, customer relations, and information technology — as well as its 529 college savings plan, social marketing, strategic planning, research, and public and federal affairs.

Giles was instrumental in VSAC’s efforts to adapt to changes in federal law in 2010 that eliminated the agency’s authority to finance and make federal education loans — a key source of revenue for the organization.

Giles worked with Vermont’s congressional delegation to have the law amended so that state-based nonprofits like VSAC could compete for federal education loan servicing contracts. As a result, VSAC began servicing new federal loans in the fall of 2012.

Giles also led VSAC’s efforts to retain four federal grants that pay for a portion of its outreach to low-income Vermonters, and teamed up with other VSAC executives to reduce costs and increase efficiencies.

Despite those successes, Giles is quick to point out that more remains to be done to ensure the organization’s stability so that it can continue offering the many postsecondary planning and financing services on which Vermonters depend.

“We are at a watershed in VSAC’s 48-year history,” said Giles. “We will need to focus on the things we do well, explore possible expansion of our services and our contract work, partner with other agencies to increase our reach, and generate government support for key programs. We have an incredible team at VSAC, and I am confident that together we will achieve these goals while finding new and innovative ways to serve Vermont students and families.”

Prior to joining VSAC, Giles held positions in Washington, D.C., both on Capitol Hill and in the private sector. He staffed the House Committee on Science; the Senate Committee on Health, Education, Labor and Pensions during Vermont Senator Jim Jeffords’ chairmanship; and the office of Congressman Frank Horton of New York State.  He also worked as a public affairs consultant in private practice and for Cassidy & Associates.

Giles has held a variety of board positions, most notably representing the nonprofit student loan community during the U.S. Department of Education’s last three rounds of negotiated rulemaking and serving as a member and chair of the Federal Advisory Committee on Student Financial Assistance.

Giles has a bachelor’s degree from St. Lawrence University and a master’s degree from the University of Virginia (UVA), and is pursuing a doctorate from UVA. He has also attended a number of programs at Harvard’s Business School and Kennedy School in nonprofit finance, management, and strategy.

About VSAC:

VSAC was created by the Vermont Legislature in 1965 with the mission of helping Vermonters plan and pay for education or training beyond high school. VSAC provides a range of career and college information and counseling services through presentations, events, online tools, and direct service at middle schools, high schools, and agencies serving adult learners. VSAC also administers the state’s 529 college savings plan, need-based Vermont student grants, many public and private scholarships, and private student loans. It began servicing federal education loans under government contract in 2012.

WINOOSKI — High school sophomores, juniors, and parents who want to get a jump on college planning should attend Vermont Student Assistance Corporation’s 12^th annual College Pathways program, a free day of workshops on preparing for higher education.

In order to accommodate as many families as possible, VSAC hosts College Pathways in three locations on the following Saturdays:

• March 16 at Saint Michael’s College in Colchester, 9:15 a.m. to 2:45 p.m. (lunch provided)
• March 23 at Castleton State College in Castleton, 9:30 a.m. to 2:15 p.m. (lunch provided)
• April 6 at Lyndon State College in Lyndonville, 8:30 a.m. to 12:30 p.m.

New this year, VSAC is offering a remote option for families who are unable to attend a College Pathways event in person. On March 23, from 11:30 a.m. to 2:30 p.m., three of the sessions being held at Castleton will be viewable via Vermont Interactive Technologies (VIT) at three sites: North Country Union High School in Newport, Lyndon State College, and Brattleboro Union High School.

Depending on the location, College Pathways offers up to eight workshops on a variety of topics, including writing a college application essay that stands out, strategies for taking SATs and ACTs, creating a college list that fits you, and demystifying financial aid.

Families are encouraged to pre-register for both the campus-based and VIT College Pathways events, because workshops fill quickly. For more information or to register, visit www.vsac.org/CollegePathways.

The award will be conferred March 8 at a celebration in Boston attended by leaders of education, business, and government from the six New England states.

“We are so pleased that Don is receiving this award,” said VSAC Board Chair Dorothy Mitchell. “Throughout his 42 years at VSAC, Don has exhibited extraordinary leadership in improving access to higher education in Vermont and nationally. His many achievements deserve to be honored.”

Vickers’ legacy includes:

• administering state grant programs for full- and part-time students, and creating the nation’s first grant program for those pursuing non-degree courses designed to enhance employability or college readiness
• increasing resources for, and expanding the number of, scholarships available to Vermonters
• financing and making federal education loans (including offering the nation’s first program to reduce borrowers’ loan costs), becoming a federal loan servicer after VSAC’s role in federal loan administration ended in 2010, and offering competitively priced private student loans
• establishing outreach programs and career development resources for students of all ages, creating the award-winning Start Where You Are college access program, and supporting mentoring programs
• helping high school students and parents plan for postsecondary education through the day-long College Pathways program, Paying for College workshops, and assistance with financial aid forms
• promoting college savings through management of the state’s 529 college savings plan
• creating a resource center with public access computers and free library materials available statewide, as well as offering a wealth of online resources
• initiating biennial surveys of Vermont high school students to inform state higher education policies

In addition to his service at VSAC, Vickers has been active in local organizations such as the Essex Town School Board and the Stern Center for Language and Learning. He has also served on a number of state and national higher education commissions and boards, most notably the Federal Advisory Committee on Student Financial Assistance, Education Finance Council, and National Council of Higher Education Resources.

The NEBHE award — named in memory of the first woman to serve as commissioner of higher education in Rhode Island and as NEBHE’s chair — is among several Vickers has received during his career. At the March awards ceremony, NEBHE will also honor Johnson State College’s External Degree Program with the Vermont State Merit Award.

NEBHE was established in 1955 to promote educational opportunities for New England residents through programs focused on cost savings and affordability and college access and success. VSAC was created by the state as a public nonprofit in 1965 to help Vermonters plan and pay for education or training beyond high school.

WINOOSKI — Vermont Student Assistance Corporation (VSAC) has joined other state-based nonprofits working under government contract to service federal education loans.

Servicing involves issuing loan bills, helping borrowers select a payment plan, collecting payments, and assisting borrowers at risk of defaulting on their loans. Most students and parents take 10 years or more to repay their education loans, and the relationship with the servicer is critical to ensuring a successful outcome.

VSAC has a long history of financing and servicing both federal and private education loans. In 2010, the government switched to a system in which all federal education loans are financed and disbursed directly by the government. However, the government contracts with outside organizations to provide servicing.

The contract under which VSAC will work is the result of efforts by Vermont’s three-member congressional delegation to ensure that state-based nonprofits are able to compete with private corporations for the government work.

“We are thrilled to have met the U.S. Department of Education (ED) standards for selection as a federal education loan servicer, and are looking forward to applying our years of expertise to this new group of accounts,” said Don Vickers, VSAC’s president and CEO. “We are also very grateful to the Vermont congressional delegation for its support of nonprofits like VSAC.”

The three delegation members — U.S. Senators Bernie Sanders and Pat Leahy and U.S. House member Peter Welch — applauded the news.

“I am delighted that the federal Department of Education, recognizing VSAC’s excellent history of working with students, has selected them to service federal education loans to college students,” said Sanders. “This is something that my office has supported. We understand how effective VSAC is in Vermont. I am glad the Department of Education agrees and has selected VSAC to service these loans.”

“Congratulations to VSAC on this important accomplishment,” Welch added. “VSAC has provided generations of Vermonters with access to higher education which is the gateway to America’s middle class. The dedicated VSAC staff provide critical support for students as they navigate the often Byzantine maze of student financial aid. Without their good work, too many Vermonters would miss the opportunity to pursue a college education.”

Said Leahy: “The Vermont Student Assistance Corporation has a long record of providing exceptional services and programs to Vermont students, families and colleges. As Congress worked to consolidate student lending under the Direct Loan Program, Senator Sanders, Representative Welch and I worked hard with VSAC and the Obama Administration to ensure that nonprofit servicers like VSAC could continue to provide the quality services that Vermonters and students across the country have counted on.  Servicing new loans will allow VSAC to continue to help make a college education possible through low cost loans and by providing innovative programs aimed at linking young students’ career ambitions with educational requirements and opportunities. I will continue to stand with VSAC as they compete nationally to service more loans.”

VSAC has received an initial allocation of 100,000 federal education loan accounts to manage. The agency hopes to receive additional accounts through a competitive process based on customer satisfaction, default rates, and an evaluation by the ED.

The ED is randomly assigning loan accounts to agencies like VSAC in order to be able to compare servicers’ performance. In addition to handling new accounts, VSAC continues to service 82,000 federal education loans it made prior to 2010.

VSAC has set up a Web site for customers whose accounts will be serviced under the new contract. The address is www.vsacfederalloans.org.

Vickers joined VSAC as director of state grant programs in 1971, when the organization had fewer than 10 employees. A graduate of Johnson State College, Vickers had previously worked as the school’s director of financial aid, placement, and faculty housing. He served in several capacities at VSAC prior to assuming his current position as president and CEO in 1988.

Vickers is known locally and nationally as a tireless advocate for college access and affordability, which has earned him accolades and awards from a number of organizations focused on educational or economic opportunity.

Dorothy Mitchell, chair of the VSAC Board of Directors, noted: “Don has never forgotten his own humble beginnings and makes every decision with an eye toward what will be most beneficial for the students and families VSAC serves. He believes deeply that each generation owes the next generation of students a chance at a better future.”

In his years as CEO, Vickers led efforts to expand VSAC’s career exploration and college planning and financing services, resulting in significant growth in VSAC’s workforce. The organization, based in Winooski, employs about 250 and was a major catalyst for the project that reshaped the city’s downtown and made it a more vibrant community.

Among its many services, VSAC oversees:

career and college planning services for all Vermonters

administration of need-based state education grants, many public and private scholarships, and private student loans

outreach programs assisting low-income and first-generation college-bound students

the state’s 529 college savings plan

Prior to 2010, VSAC also guaranteed, financed, and serviced federal education loans. The government’s new direct lending model ended VSAC’s role in making federal loans. The agency is planning to become a direct loan servicer under contract to the government.

The VSAC board plans to conduct a nationwide search for Vickers’ successor. It expects to begin the recruitment process later this fall and to select a new CEO next spring.

Attorneys in public service carry comparable education debt to those in private practice, but often earn much less. The Justice Department funding is designed to make it more affordable for attorneys to work as prosecutors and public defenders, and requires recipients to continue in those positions for at least three years following receipt of the aid.

“This grant will help ensure that bright Vermont students can afford to go into public service when they graduate,” said Gov. Peter Shumlin. “It will also help Vermont recruit well-trained and dedicated lawyers to serve as state prosecutors and public defenders.”

This is the third year VSAC has received the funding, although federal cuts resulted in a grant amount this year that is half that awarded each of the prior two years. VSAC administers the program at no charge so that all of the funding can go to eligible recipients. By law, half the dollars must go to prosecutors and half to public defenders.

VSAC works with the state’s Office of the Defender General, its Department of State’s Attorneys, and the Federal Public Defender for the District of Vermont to identify eligible applicants and award funding. The three offices report that the aid is critical to both recruitment and retention of talented attorneys.

VSAC appreciates the efforts of Vermont’s congressional delegation in helping to secure continued funding for the program.

A month ago, I joined other Vermonters in calling for more reasonable interest rates on federal education loans so that we don’t price students and their families out of higher education.

Today, I issue a word of caution — namely, that we not allow our very legitimate concerns about student and parent debt loads to cloud our judgment about the very real value of higher education.

In all the talk about student borrowing, college costs, and graduates’ job prospects, we run the risk of dissuading students — particularly the least advantaged — from getting the education or training that can change their lives.

Low-income students, and those whose families have little or no college experience, tend to have fewer college aspirations. If they do think about college, they are likely to underestimate their eligibility for financial aid and to overestimate their out-of-pocket costs.

If we want to reduce poverty, and ensure educational opportunity for all, we need to tread carefully in framing the choices facing today’s students.

Why is higher education still important?

Recent pieces in the Atlantic and The New York Times acknowledge that many college graduates are indeed struggling, but these articles also note that the situation facing high school graduates is often worse.

It’s still true that, over time, a person with a postsecondary credential will earn more than someone without it. People who continue their education also tend to have fewer periods of unemployment, better health outcomes, and increased civic engagement. They are less likely to be incarcerated or require public assistance.

This is not to say that every student needs a four-year degree, a point that VSAC has consistently emphasized when working with Vermonters. But every student does need the opportunity to acquire the skills essential for today’s job market.

But what about student debt?

College Board analysts Sandy Baum and Michael McPherson, writing in The Chronicle of Higher Education, note that the nationwide increase in student loan debt is partly due to higher individual borrowing, but is also the result of more students pursuing education beyond high school.

They found wide swings in student borrowing, depending on the institution and program attended. In general, students enrolled in for-profit colleges tended to borrow the most, while many who attended community colleges were able to graduate debt-free.

When VSAC examines its own loan portfolio, we see patterns as well. A significant number of our high-balance borrowers have pursued graduate and professional degrees — which don’t guarantee, but can often lead to, higher earnings.

Unfortunately, other borrowers have accumulated high debt because they attended expensive institutions without having enough non-loan aid or family resources; struggled at several institutions, changing majors and degrees while losing credits through transfer; or were unable to complete their degrees on time.  

So how can we help students make informed decisions about education?

First, we must engage more students in career exploration — work that VSAC is committed to through our Start Where You Are and other programs. Of course, job preparation shouldn’t be the only goal of education or training. But wise career decisions can make the difference in attaining a decent standard of living while avoiding unmanageable debt.

Second, it’s clear that our society must do a better job of helping families identify programs that meet the student’s education needs without straining the household budget. Part of that process is being able to access financial aid, compare colleges’ aid offers, decide how much debt is reasonable, and have a realistic plan for repaying loans.

Finally, when it comes to college or program selection, we must continue to emphasize that “one size doesn’t fit all.” There are many types of programs, ranging from one-year training courses to professional degrees, to suit the interests and aptitudes of different kinds of students. And there are many sectors — the trades, technology, and health care, among them — that need skilled workers.

The bottom line is that there are a variety of avenues to a degree or certificate, and we need to encourage students to take them.

FOR IMMEDIATE RELEASE

Contact: Irene Racz, director of public affairs, 802-542-2240

WINOOSKI — Vermont Student Assistance Corporation (VSAC) is again offering a fixed-rate private education loan for students who need to supplement their federal borrowing.

The Vermont Advantage loan for 2012–13 offers a choice of three competitively priced interest rates, depending on the repayment option the student chooses while attending school:

·       6.6 percent if the student begins making immediate monthly payments of both principal and interest

·       7 percent if the student makes interest-only payments

·       7.9 percent if the student defers repayment until after graduation.

The loan requires a cosigner and assesses a one-time origination fee, ranging from zero to 5 percent, depending on the cosigner’s credit rating.

Students eligible to borrow from VSAC are Vermont residents attending college in or out of state and nonresidents borrowing for attendance at a Vermont school. VSAC recommends that students submit their loan applications about eight weeks prior to the start of classes, although applications are accepted at any time.

VSAC urges students to consider all their federal education loan options prior to taking a private student loan such as the Vermont Advantage. If a private loan is needed, it’s important to compare lenders in order to ensure you get the best possible rate and terms for your situation. Rates in the marketplace can be fixed or variable; sometimes, lenders advertise low variable rates that are available only to a small number of borrowers or that have a high risk of rising if certain conditions are not met.

More details about the Vermont Advantage loan, including an online application, are available at vsac.org/vermontadvantageloan.

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By Don Vickers

Recently, I joined U.S. Rep. Peter Welch of Vermont in urging Congress to halt a planned hike in the interest rate on subsidized Stafford loans (federal education loans that go to students with the greatest financial need). Unless Congress acts, the rate will rise from 3.4 to 6.8 percent on July 1.

Congress’ decision will have huge implications for students throughout the country. If the rate is allowed to increase, a college education is going to become even more out of reach for students who need our help the most.

Take the case of a student who borrows $23,000 for college, the maximum available to undergrads using subsidized loans, and repays the loans during the customary 10 years:

• At 3.4 percent, the borrower would repay the principal plus $4,149 in interest, for a total of $27,149.
• At 6.8 percent, the borrower would repay the principal plus $8,746 in interest, more than twice the amount accruing at 3.4 percent, for a total of $31,746.

If the student extends his or her repayment period — for example, because of unemployment or underemployment — the interest mounts. Under a 20-year repayment plan, a 3.4 percent rate translates to $8,650 in interest and a 6.8 percent rate costs $19,021 in interest — almost as much as the original amount borrowed.

Apart from the subsidized loan discussion, but no less important, are interest rate challenges facing other federal loan customers:

• Undergrads with unsubsidized Stafford loans already pay 6.8 percent in interest. These “unsub” loans, in which interest accrues from the day the loan is made, are used by undergrads who do not qualify for a subsidy while attending school or who need more than they can receive in the subsidized program.
• Grad students with Stafford loans also pay 6.8 percent.
• Parents and grad students with PLUS loans, another type of federal loan available to supplement Stafford borrowing, pay from 7.9 to 8.5 percent in interest.

At his news conference, Rep. Welch was joined by several student and parent borrowers who, like VSAC, share his view that reasonable interest rates are vital to keeping higher education affordable. The same week, VSAC talked by phone with a father who was struggling to manage the federal PLUS loans he and his wife had taken out to help pay for two sons’ college educations.

It wasn’t so much the face value of the loans that had him concerned, but the interest rate. Given the high PLUS rate, the loans were costing the family $1,400 a month. Because no rate relief is in sight for this type of federal loan, the parent chose to pay off his PLUS loans by refinancing his home at about 3 percent interest. It frustrated him that he had to do this, but now the debt will cost him about a third of what he had been spending.

Ironically, the federal education loan programs were developed to provide students with access to low-cost financing and to enable parents to pay for their children’s education without putting their own homes and livelihoods at risk. The original goal was to provide rates and benefits that the private sector couldn’t match due to higher borrowing costs and underwriting restrictions.

So it is with sadness that we at VSAC hear from borrowers who feel forced to give up their federal loans for riskier forms of debt, or, in the worst case, to forego education altogether. Despite recent questions about the value of higher education, the depressed job market, the proper role for government in funding education, and whether students are borrowing responsibly, two things remain true.

Education beyond high school — not always a four-year degree, but some type of education or training — is still the best ticket out of poverty and toward a life of greater opportunity. And financial aid, whether in the form of grants, scholarships, or loans, will still be needed to help families make this important investment in the future. While we continue to debate the value of education and what more we can do to foster responsible borrowing, the federal government should not saddle students with unreasonable and unfair finance charges.