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Home > State > Executive > Oregon Student Access Commission > Agency History

Oregon Student Access Commission: Agency History

OSAC home

 

Note
The commission was renamed the Oregon Student Access Commission in 2012.

 

Written 2003

 

Introduction
The Oregon Student Assistance Commission (OSAC) is the state's student financial aid. Formerly named Oregon State Scholarship Commission, OSAC administers a variety of federal, state, and privately funded financial aid programs for the benefit of Oregon students attending post-secondary educational institutions. Federal programs include the Ford Direct Loan and Federal Family Education Loan Programs. State programs include the Opportunity Grant, Oregon Nursing Loan and Rural Health Services, and JOBS Plus. There are approximately 200 private scholarship programs.

 

The agency's mission is to "…provide financing and information to assist Oregonians in attaining a post secondary education and enhance the value, integrity, and diversity of Oregon's college programs."

The original Scholarship Commission was created in 1959. The powers and duties of the Commission are outlined in ORS 348 and have been altered and expanded over the years. Major divisions of the agency are Administration, Office of Degree Authorization, Claims and Collections, Grants and Scholarships, Guarantee Services and Default Protection, and Information Technology.

 

History
The first attempt to provide a comprehensive program of financial assistance to Oregon students occurred during the 1955 Legislative Session. State Senator Mark Hatfield authored a bill for a state scholarship program that students attending public and private colleges in Oregon would be eligible for and that a citizens board would administer. The bill failed.

 

In 1958, a citizen discovered a dormant "student aid program" in Oregon law. An 1885 statute allowed state legislators and judges to award free tuition at the Oregon Agricultural College (now OSU) to one student per year. The Attorney General ruled that the law must be honored. There was no standard application process and no consensus on selection criteria, but applicants presented themselves and legislators made what came to be called, "District and County Awards." OSU resented being forced to admit beneficiaries of political patronage. Presidents of other institutions objected to a state program for the students of a single institution. Disappointed parents assailed legislators because their children were not chosen. The public appeared to want a student aid program, but no one liked the ad hoc process used to make the initial awards.

 

The 1959 legislative session passed a bill making it possible for awardees to attend any accredited four-year college in Oregon, public or private. The bill also created the State Scholarship Commission to administer the program. The Commission was also to take over existing tuition remission programs at state-run, four-year institutions. The bill passed without appropriations for awards to independent college students or for agency administrative expenses. An amendment permitted the Commission to solicit and administer privately funded scholarships for the benefit of students at both public and private institutions. As the Commission began operation, its programs were tuition and fee remissions for state institutions, funded by the institutions themselves. Commissioners were members of the public that were appointed by the Governor. The Chancellor of the Oregon State System of Higher Education (now Oregon University System) provided part-time staff.

 

In 1961, an appropriations bill passed. A separate scholastic grant program was created for students at independent colleges. Awardees were to be recent high school graduates chosen based on academic excellence and financial need. The State of Oregon, rather than the institutions, would subsidize these students. The program was called Oregon Cash Award. The Commission was made separate from the Chancellor's Office though it continued to be housed on the University of Oregon Campus.

 

In 1965, the federal Higher Education Act created the Guaranteed Student Loan Program (GSL). Initially, the State Board of Higher Education was responsible for this program in Oregon. The Board contracted with United Student Aid Funds of Indianapolis, Indiana to operate the Oregon GSL Program.

 

During the 1967 legislative session, the Commission was authorized to take over Oregon GSL administration from the State Board of Higher Education. Through the GSL program, the Commission guaranteed loans from Oregon lenders for resident students attending accredited post secondary institutions. The U.S. Department of Education reinsured these loans.

 

In the 1969 session, the Legislative Assembly created the Non-public College Grant Program to encourage independent colleges in Oregon to enroll Oregon resident undergraduates. The Commission was designated as the administrating agency.

 

In 1971, the Commission's programs were restructured. The centerpiece was the Oregon Need Grant. Awards were based entirely on financial need and students could use awards at Oregon community colleges as well as four-year public and private institutions. Funding was increased and structural changes were made to the Non-public College Grant. In addition, the Need Grant, Community College Grant, and the revised non-public college grant -- Purchase of Educational Services from Independent Colleges (PESIC) all passed and received appropriations but the District and County program ended. In 1973, Community College students were incorporated into the Need Grant and the Community College Grant was discontinued.

 

During the 1979 legislative session, in response to sharp tuition increases at public institutions, additional funds were appropriated for the Need Grant. The funds were to insulate needy resident undergraduates at public institutions from the increased costs. This Tuition Offset Grant (TOG) supplemented Need Grants from 1979 to 1983.

 

In the 1980's, many major federal financial aid programs were renamed after members of Congress. The Basic Educational Opportunity Grant became the Pell Grant, the National Direct Student Loan became the Perkins Loan, and Guaranteed Student Loans became Stafford Loans. In addition, two new loan programs were added to those programs already administered by the Commission -- PLUS Loans for parents of dependent students and SLS Loans for self-supporting students.

 

Before the 1982 Special Session, five religiously oriented independent colleges withdrew from PESIC in order to end an ACLU lawsuit.

 

In 1987, legislation was passed authorizing the Rural Health Services loan repayment program. This was an incentive program to encourage physicians and nurses to locate in rural areas in Oregon. The program did not receive funding until 1991 when the Legislative Assembly created and funded the Oregon Nursing Loan Program.

 

The federal education legislation in 1992 created a pilot project for an alternative way to operate federal student loan programs. Rather than insuring loans made by private lenders, the federal government would raise capital through bonds, send funds directly to participating schools, and assume all collection responsibilities. The name of the program was the Ford Direct Loan. Loans to students and parents were called Stafford Loan and PLUS Loan, mirroring the names of the existing programs. A new umbrella name was created for all the existing programs -- Federal Family Education Loan Program (FFELP). The Commission continued to administer FFELP Stafford and PLUS Loans. SLS Loans ceased. In 1993, the federal government scrapped the "pilot" concept, and endeavored to replace FFELP with Direct Loan throughout the nation. In Oregon, the majority of public institutions chose Direct Loan and Commission FFELP volume dropped by more than half.

 

During the 1993 legislative session, legislators were faced with the need to reduce General Fund expenditures, and the Commission requested that all available General Funds go to maintaining the Need Grant at highest possible level -- at the expense of all funding for Cash Award and PESIC. The potential effect on independent colleges was harsh, since PESIC funds went entirely to independent colleges and a large proportion of Cash Awardees chose independent colleges. The Ways and Means Committee added $2 million to the agency's base budget, and mandated segmental distribution of enlarged Need Grants.

 

During the 1995 and 1997 legislative sessions, the Governor's Office of Educational Policy and Planning was dismantled. One branch, the Office of Degree Authorization, became part of the Commission. This office regulates degree offerings in Oregon by independent institutions and out-of-state state institutions. It also enforces state laws forbidding use of fraudulent academic degrees by individuals.

 

In 1999, the name of the agency was changed to Oregon Student Assistance Commission (OSAC). The Need Grant was changed to Oregon Opportunity Grant, effective in 2001. A merit-based program, Oregon Achievement Grant, was created to become operational in 2001. A 22-member special commission was created to study student financial aid issues in Oregon and make recommendations to the 2001 Legislative Assembly.

 

Current Organization
The agency is currently organized into the following major divisions: Commission, Office of Degree Authorization, Administration, Information Technology, Grants and Scholarships, Guarantee Services and Default Protection, and Claims and Collections.

 

Commission
The Commission oversees the agency that administers financial aid programs designed to assist students in obtaining post secondary education in Oregon. It also oversees the Office of Degree Authorization. The Commission develops general policy, makes strategic plans, and makes basic budget decisions. It also conducts Oregon Administrative Rule hearings and other public hearings.

 

Office of Degree Authorization
The Office of Degree Authorization authorizes schools to offer academic degree programs in Oregon. It terminates substandard or fraudulent degree activities, and reviews proposed new publicly funded post secondary programs and locations. It also validates individual claims of degree possession by individuals.

 

Administration
Administration is responsible for overall management of the agency including policy and planning. Administration provides staff support to the Commission and performs the Administrative Rules function for the agency. It prepares and monitors the agency budget and prepares and gives testimony before the Legislative Assembly.

 

Finance provides all financial services including accounting, coordination of budget preparation and monitoring, and financial reporting. It also performs payroll and benefits functions.

 

Human Resources provides all personnel related functions including recruitment, job classification, and training coordination.

 

Outreach coordinates internal and external agency communications, media relations, and legislative relations. It also "owns and operates" the agency website.

 

Information Technology
The Information Technology Division provides computer and network services used to operate the agency's programs.

 

Policy and Research
The Policy and Research Division compiles, analyzes, and publishes statistics and related information on state and Federal financial aid disbursements at post secondary institutions in Oregon. It also conducts research projects on state financial aid, legislative, and federal issues.

 

Grants and Scholarships
The Grants and Scholarships Division administers federal and state grant and loan programs and privately funded scholarship programs. It operates the Private Award Program that acts as a clearinghouse for the administration of over 200 privately funded scholarship programs. In addition, in partnership with the Oregon Community Foundation, the Division provides staffing and training for the ASPIRE volunteer advising program.

 

Guarantee Services and Default Prevention
The Guarantee Services and Default Prevention Division provides state management for the Federal Family Education Loan Program (FFELP). The Guarantee Services and Default Prevention division works with borrowers who are in danger of defaulting on their loans. The Division also monitors school and lender compliance with federal and state regulations governing FFELP.

 

Claims and Collections
The Claims and Collections Division collects student loans that the agency has purchased from a bank or lender after those loans have fallen into default. The agency acts as a guarantor for the Federal Family Education Loan Program (FFELP).

 

Selected Chronology

1955 First attempt to establish student aid failed.

 

1958 Citizen discovered dormant "student aid program" in Oregon law. "District and County" awards started.

 

1959 State Scholarship Commission created to administer student aid program for students at public and private post secondary institutions.

 

1961 Separate scholastic grant program created for independent college students. Commission separated from Oregon State System of Higher Education.

 

1965 Congress enacted Higher Education Act of 1965 creating Guaranteed Student Loan Program (GSL).

 

1967 Commission took over Oregon GSL administration from Board of Higher Education.

 

1971 Oregon Need Grant, Community College Grant, and revised non-public college grant -- Purchase of Educational Services from Independent Colleges (PESIC) passed. "District and County" program ended.

 

1973 Community College students incorporated into Need Grant.

 

1979 Tuition Offset Grant (TOG) instituted to insulate needy resident undergraduates from increased costs at public institutions.

 

1980's Financial aid programs renamed after members of Congress.

 

1982 Five religiously oriented independent colleges withdrew from PESIC to end an ACLU lawsuit. Legislature reduced PESIC budget proportionally.

 

1987 Rural Health Services loan repayment incentive program authorized without funding.

 

1991 Rural Health Services program received initial funding. Legislature created and funded the Oregon Nursing Loan Program.

 

1992 Federal Ford Direct Loan pilot program created. All federal programs given new umbrella name -- Federal Family Education Loan Program (FFELP).

 

1993 Federal Direct Loan program replaced FFELP throughout the nation.

 

1997 Office of Degree Authorization became part of the Commission.

 

1999 State Scholarship Commission renamed Student Assistance commission. Special commission created to study financial aid issues.

 

Bibliography
A Brief History of the Oregon Student Assistance Commission, 2001.

The Oregon Blue Book, 2000-2001. Office of the Secretary of State.

Oregon Student Assistance Commission website

Oregon Laws 1955 -- 2001.

Oregon Revised Statutes Chapter 348 and 351, 2001.

 

Primary Agency Statutes and Administrative Rule Chapters
ORS 348 Student Aid; Education Endowment Fund, Planning http://www.leg.state.or.us/ors/348.html

OAR 575 Oregon Student Assistance Commission http://arcweb.sos.state.or.us/pages/rules/oars_500/oar_575/575_tofc.html

OAR 583 State Scholarship Commission, Office of Degree Authorization http://arcweb.sos.state.or.us/pages/rules/oars_500/oar_583/583_tofc.html