This is the accessible text file for GAO report number GAO-05-408R entitled 'Department of Education's Update of the State and Other Tax Allowance for Student Aid Award Year 2005-2006' which was released on March 22, 2005. This text file was formatted by the U.S. Government Accountability Office (GAO) to be accessible to users with visual impairments, as part of a longer term project to improve GAO products' accessibility. Every attempt has been made to maintain the structural and data integrity of the original printed product. Accessibility features, such as text descriptions of tables, consecutively numbered footnotes placed at the end of the file, and the text of agency comment letters, are provided but may not exactly duplicate the presentation or format of the printed version. The portable document format (PDF) file is an exact electronic replica of the printed version. We welcome your feedback. Please E-mail your comments regarding the contents or accessibility features of this document to Webmaster@gao.gov. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. Because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately. March 22, 2005: The Honorable David R. Obey: Ranking Minority Member: Committee on Appropriations: House of Representatives: Subject: Department of Education's Update of the State and Other Tax Allowance for Student Aid Award Year 2005-2006: Dear Mr. Obey: This letter responds to your request concerning our January 21, 2005, report Student Financial Aid: Need Determination Could Be Enhanced through Improvements in Education's Estimate of Applicants' State Tax Payments (GAO-05-105). As you know, in 2003, the Department of Education (Education) proposed an update to the state and other tax allowance, a part of the federal need analysis for student financial aid. Most federal aid, including Pell Grants and student loans, and some state and institutional aid are awarded based on a student's cost of attendance less the student's and/or family's ability to pay these costs--known as the expected family contribution (EFC). The allowance, which accounts for the amount of state and other nonfederal taxes paid by students and families, effectively reduces the EFC. Education proposed to update the allowance on the basis of information compiled by the Internal Revenue Service's Statistics of Income (SOI) Division, specifically state and other taxes paid by taxpayers and reported on their federal income tax returns for tax year 2000. Our January 2005 report discussed (1) the factors that had affected the updating of the tax data on which the allowance is based, (2) the effects Education's proposed 2003 update would have had on financial assistance for student aid applicants for the 2004-2005 award year, (3) the limitations associated with the method used to derive the allowance, and (4) various strategies available to address the limitations. Although the proposed 2003 update to the state and other tax allowance did not take effect, shortly before we issued our report--on December 23, 2004-- Education updated the state and other tax allowance for award year 2005- 2006 on the basis of information compiled by SOI for tax year 2002, which was collected in the same manner as the tax year 2000 data. For this update, Education used the same methodology that was used for the proposed 2003 update. As of January 2005, Education has begun processing student aid applications for the 2005-2006 award year using the updated allowance. In light of Education's 2004 update of the state and other tax allowance for award year 2005-2006, you asked us to update certain analyses included in our January 2005 report, which focused on Education's prior proposal. In particular, you asked us to determine how Education's update will affect, with respect to the 2005-2006 award year, (1) the state and other tax allowance, by state and dependency status; (2) the average EFC, by state; (3) eligibility for Pell Grants, by state, household income, and dependency status; (4) the amount of the average Pell Grant award, by state, household income, and dependency status; and (5) aggregate Pell Grant expenditures and overall student eligibility for Pell Grants. You also asked us to include the effects if Education had adopted one of the strategies discussed in our report for addressing the limitations associated with calculating the allowance. Education's 2004 update decreases the state and other tax allowance for most states for the 2005-2006 award year and will, thereby, increase the expected family contribution (EFC) for a majority of student aid applicants; the increase in expected family contribution will, in turn, affect the allocation of federal aid. Specifically, we estimate that the 2004 update to the state and other tax allowance will increase EFCs by about $440 on average for those with an increase, with EFC changes being larger for students from states with larger changes in their allowance. With respect to Pell Grants, our national analysis shows that the 2004 update will likely result in a decrease in Pell Grants for about 35 percent of students, and an additional 81,000 applicants (1.5 percent) will no longer be eligible for the grant; taken together, the average reduction amongst those with a decrease in their amount will be about $130. Collectively, this will decrease overall Pell Grant expenditures by about $250 million. Because these EFC changes will affect Pell and other grant aid, Stafford and PLUS loan award amounts will be affected as well. Our analysis shows that, as EFCs increase, those with income above $25,000 are most likely to have their subsidized Stafford loan awards affected. The overall impacts on EFC, Pell Grants, and loans will be slightly less when compared to what would have occurred under the proposed update of 2003. In our January 2005 report, we identified four strategies to address some of the limitations associated with the tax allowance. Using an updated sample of aid applicants and tax data, these options would have ranged in their impact on federal expenditures for the Pell Grant and other federal programs. For example, depending on the option chosen, the effect would have ranged from a $200 million decrease in Pell Grant expenditures to a $200 million increase in the 2005-2006 award year. We are providing this information more specifically in nine enclosures. In providing updated information for this letter, we replicated the methodology we used for our January 2005 report. For that report, we used Education's aid applicant sample file from the 2002-2003 award year to estimate changes to the expected family contribution and Pell Grant awards nationally that would have resulted from Education's 2003 update. In providing information for this letter, however, we used Education's aid applicant sample file from the 2003-2004 award year to provide updated information. We also analyzed Education's Cost Estimation and Analysis Division's Statistical Abstract (CEAD STAB) data to estimate the proportion of financial aid applicants who could experience a change in their federal loans as a result of the update. We also reviewed and analyzed state and other tax data from the Internal Revenue Service (Statistics of Income Division), Bureau of the Census (Census), Bureau of Economic Analysis (BEA), and the Institute on Taxation and Economic Policy (ITEP). We conducted reliability assessments on the datasets used from Census, BEA, and ITEP, and they are disclosed in the appropriate enclosures. We conducted our work in February 2005 in accordance with generally accepted government auditing standards. We provided Education with a copy of our draft letter for review and comment. Education provided a technical comment, which we incorporated. As agreed with your office, unless you publicly announce its content earlier, we plan no further distribution of this letter until 30 days after its date. At that time, we will send copies of this letter to the Secretary of Education and other interested parties. The letter will also be available on GAO's home page at [Hyperlink, http://www.gao.gov]. If you have any questions about this letter, please contact me at (202) 512-8403 or Jeff Appel, Assistant Director, at (202) 512-9915. You may also reach us by e-mail at [Hyperlink, AshbyC@gao.gov] or [Hyperlink, AppelC@gao.gov]. Tranchau Nguyen and Jeff Weinstein were also key contributors to this letter. Sincerely yours, Signed by: Cornelia M. Ashby: Director, Education, Workforce, and Income Security Issues: [End of Section] Enclosures: Enclosure I: Comparison of Prior State and Other Tax Allowance, Published in 1993, with That Proposed in 2003 and That Published in 2004, by Income Level, for Parents and Independents with Children. Enclosure II: Comparison of Prior State and Other Tax Allowance, Published in 1993, with That Proposed in 2003 and That Published in 2004, for Dependents and Independents without Children. Enclosure III: Difference between Prior Allowance, Published in 1993, and Education's 2004 Updated Allowance and Estimated EFC Impact, by State. Enclosure IV: Percentage of Recipients That Will Experience a Decrease in Pell Grant Awards As a Result of Education's 2004 Updated Allowance, Average Pell Grant Received Based on Prior Allowance, and Average Decrease as a Result of Updated Allowance, Including Those No Longer Eligible for an Award, by State. Enclosure V: Percentage of Recipients with a Decrease in Pell Award Based on a Change from the Prior Allowance, Published in 1993, to Education's 2004 Updated Allowance, by Household Income and Dependency Status. Enclosure VI: Median Percentage Change in Amount of Pell Award for Those with a Decrease Based on Change from the Prior Allowance, Published in 1993, to Education's 2004 Updated Allowance, by Household Income and Dependency Status. Enclosure VII: Percentage of Students Likely to Have a Change in Subsidized Stafford Loans Based on Change from the Prior Allowance, Published in 1993, to Education's 2004 Updated Allowance, by Household Income and Dependency Status. Enclosure VIII: Framework for Evaluating Options Identified to Change the State and Other Tax Allowance relative to the Prior Allowance. Enclosure IX: Simulation of Tax Allowances under Various Options, by State--Families with Adjusted Gross Income of $15,000 or More. [End of Section] Enclosure I: Table 1: Comparison of Prior State and Other Tax Allowance, Published in 1993, with That Proposed in 2003 and That Published in 2004, by Income Level, for Parents and Independents with Children: State of Residence: Alabama; Allowance Percentage: Income less than $15,000: 1993: 5; Allowance Percentage: Income less than $15,000: 2003: 3; Allowance Percentage: Income less than $15,000: 2004; 3; Allowance Percentage: Income $15,000 or more: 1993: 4; Allowance Percentage: Income $15,000 or more: 2003: 2; Allowance Percentage: Income $15,000 or more: 2004: 2. State of Residence: Alaska; Allowance Percentage: Income less than $15,000: 1993:3; Allowance Percentage: Income less than $15,000: 2003: 2; Allowance Percentage: Income less than $15,000: 2004: 2; Allowance Percentage: Income $15,000 or more: 1993: 2; Allowance Percentage: Income $15,000 or more: 2003: 1; Allowance Percentage: Income $15,000 or more: 2004: 1. State of Residence: Arizona; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 21004: 4; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: Arkansas; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 3; Allowance Percentage: Income less than $15,000: 2004: 3; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 2; Allowance Percentage: Income $15,000 or more: 2004: 2. State of Residence: California; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 6; Allowance Percentage: Income less than $15,000: 2004: 7; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 5; Allowance Percentage: Income $15,000 or more: 2004: 6. State of Residence: Colorado; Allowance Percentage: Income less than $15,000: 1993: 7; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 6; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: Connecticut; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 6; Allowance Percentage: Income less than $15,000: 2004: 7; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 5; Allowance Percentage: Income $15,000 or more: 2004: 6. State of Residence: Delaware; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: District of Columbia; Allowance Percentage: Income less than $15,000: 1993: 10; Allowance Percentage: Income less than $15,000: 2003: 7; Allowance Percentage: Income less than $15,000: 2004: 7; Allowance Percentage: Income $15,000 or more: 1993: 9; Allowance Percentage: Income $15,000 or more: 2003: 6; Allowance Percentage: Income $15,000 or more: 2004: 6. State of Residence: Florida; Allowance Percentage: Income less than $15,000: 1993: 4; Allowance Percentage: Income less than $15,000: 2003: 2; Allowance Percentage: Income less than $15,000: 2004: 2; Allowance Percentage: Income $15,000 or more: 1993: 3; Allowance Percentage: Income $15,000 or more: 2003: 1; Allowance Percentage: Income $15,000 or more: 2004: 1. State of Residence: Georgia; Allowance Percentage: Income less than $15,000: 1993: 7; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 6; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Hawaii; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: Idaho; Allowance Percentage: Income less than $15,000: 1993: 7; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 6; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Illinois; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Indiana; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: Iowa; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Kansas; Allowance Percentage: Income less than $15,000: 1993: 7; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 6; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Kentucky; Allowance Percentage: Income less than $15,000: 1993: 7; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 6; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Louisiana; Allowance Percentage: Income less than $15,000: 1993: 4; Allowance Percentage: Income less than $15,000: 2003: 2; Allowance Percentage: Income less than $15,000: 2004: 2; Allowance Percentage: Income $15,000 or more: 1993: 3; Allowance Percentage: Income $15,000 or more: 2003: 1; Allowance Percentage: Income $15,000 or more: 2004: 1. State of Residence: Maine; Allowance Percentage: Income less than $15,000: 1993: 9; Allowance Percentage: Income less than $15,000: 2003: 6; Allowance Percentage: Income less than $15,000: 2004: 6; Allowance Percentage: Income $15,000 or more: 1993: 8; Allowance Percentage: Income $15,000 or more: 2003: 5; Allowance Percentage: Income $15,000 or more: 2004: 5. State of Residence: Maryland; Allowance Percentage: Income less than $15,000: 1993: 9; Allowance Percentage: Income less than $15,000: 2003: 7; Allowance Percentage: Income less than $15,000: 2004: 7; Allowance Percentage: Income $15,000 or more: 1993: 8; Allowance Percentage: Income $15,000 or more: 2003: 6; Allowance Percentage: Income $15,000 or more: 2004: 6. State of Residence: Massachusetts; Allowance Percentage: Income less than $15,000: 1993: 9; Allowance Percentage: Income less than $15,000: 2003: 6; Allowance Percentage: Income less than $15,000: 2004: 6; Allowance Percentage: Income $15,000 or more: 1993: 8; Allowance Percentage: Income $15,000 or more: 2003: 5; Allowance Percentage: Income $15,000 or more: 2004: 5. State of Residence: Michigan; Allowance Percentage: Income less than $15,000: 1993: 9; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 8; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Minnesota; Allowance Percentage: Income less than $15,000: 1993: 9; Allowance Percentage: Income less than $15,000: 2003: 6; Allowance Percentage: Income less than $15,000: 2004: 6; Allowance Percentage: Income $15,000 or more: 1993: 8; Allowance Percentage: Income $15,000 or more: 2003: 5; Allowance Percentage: Income $15,000 or more: 2004: 5. State of Residence: Mississippi; Allowance Percentage: Income less than $15,000: 1993: 5; Allowance Percentage: Income less than $15,000: 2003: 3; Allowance Percentage: Income less than $15,000: 2004: 3; Allowance Percentage: Income $15,000 or more: 1993: 4; Allowance Percentage: Income $15,000 or more: 2003: 2; Allowance Percentage: Income $15,000 or more: 2004: 2. State of Residence: Missouri; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: Montana; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Nebraska; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Nevada; Allowance Percentage: Income less than $15,000: 1993: 3; Allowance Percentage: Income less than $15,000: 2003: 2; Allowance Percentage: Income less than $15,000: 2004: 2; Allowance Percentage: Income $15,000 or more: 1993: 2; Allowance Percentage: Income $15,000 or more: 2003: 1; Allowance Percentage: Income $15,000 or more: 2004: 1. State of Residence: New Hampshire; Allowance Percentage: Income less than $15,000: 1993: 7; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 6; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: New Jersey; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 7; Allowance Percentage: Income less than $15,000: 2004: 8; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 6; Allowance Percentage: Income $15,000 or more: 2004: 7. State of Residence: New Mexico; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 3; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 2; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: New York; Allowance Percentage: Income less than $15,000: 1993: 11; Allowance Percentage: Income less than $15,000: 2003: 8; Allowance Percentage: Income less than $15,000: 2004: 8; Allowance Percentage: Income $15,000 or more: 1993: 10; Allowance Percentage: Income $15,000 or more: 2003: 7; Allowance Percentage: Income $15,000 or more: 2004: 7. State of Residence: North Carolina; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 6; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 5. State of Residence: North Dakota; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 2; Allowance Percentage: Income less than $15,000: 2004: 2; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 1; Allowance Percentage: Income $15,000 or more: 2004: 1. State of Residence: Ohio; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 6; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 5. State of Residence: Oklahoma; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 4; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 3. State of Residence: Oregon; Allowance Percentage: Income less than $15,000: 1993: 10; Allowance Percentage: Income less than $15,000: 2003: 7; Allowance Percentage: Income less than $15,000: 2004: 7; Allowance Percentage: Income $15,000 or more: 1993: 9; Allowance Percentage: Income $15,000 or more: 2003: 6; Allowance Percentage: Income $15,000 or more: 2004: 6. State of Residence: Other areas; Allowance Percentage: Income less than $15,000: 1993: 4; Allowance Percentage: Income less than $15,000: 2003: 3; Allowance Percentage: Income less than $15,000: 2004: 3; Allowance Percentage: Income $15,000 or more: 1993: 3; Allowance Percentage: Income $15,000 or more: 2003: 2; Allowance Percentage: Income $15,000 or more: 2004: 2. State of Residence: Pennsylvania; Allowance Percentage: Income less than $15,000: 1993: 7; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 6; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Rhode Island; Allowance Percentage: Income less than $15,000: 1993: 9; Allowance Percentage: Income less than $15,000: 2003: 6; Allowance Percentage: Income less than $15,000: 2004: 7; Allowance Percentage: Income $15,000 or more: 1993: 8; Allowance Percentage: Income $15,000 or more: 2003: 5; Allowance Percentage: Income $15,000 or more: 2004: 6. State of Residence: South Carolina; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 4; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 3; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: South Dakota; Allowance Percentage: Income less than $15,000: 1993: 4; Allowance Percentage: Income less than $15,000: 2003: 1; Allowance Percentage: Income less than $15,000: 2004: 1; Allowance Percentage: Income $15,000 or more: 1993: 3; Allowance Percentage: Income $15,000 or more: 2003: 0; Allowance Percentage: Income $15,000 or more: 2004: 0. State of Residence: Tennessee; Allowance Percentage: Income less than $15,000: 1993: 3; Allowance Percentage: Income less than $15,000: 2003: 1; Allowance Percentage: Income less than $15,000: 2004: 1; Allowance Percentage: Income $15,000 or more: 1993: 2; Allowance Percentage: Income $15,000 or more: 2003: 0; Allowance Percentage: Income $15,000 or more: 2004: 0. State of Residence: Texas; Allowance Percentage: Income less than $15,000: 1993: 3; Allowance Percentage: Income less than $15,000: 2003: 2; Allowance Percentage: Income less than $15,000: 2004: 2; Allowance Percentage: Income $15,000 or more: 1993: 2; Allowance Percentage: Income $15,000 or more: 2003: 1; Allowance Percentage: Income $15,000 or more: 2004: 1. State of Residence: Utah; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Vermont; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 6; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 5. State of Residence: Virginia; Allowance Percentage: Income less than $15,000: 1993: 8; Allowance Percentage: Income less than $15,000: 2003: 5; Allowance Percentage: Income less than $15,000: 2004: 5; Allowance Percentage: Income $15,000 or more: 1993: 7; Allowance Percentage: Income $15,000 or more: 2003: 4; Allowance Percentage: Income $15,000 or more: 2004: 4. State of Residence: Washington; Allowance Percentage: Income less than $15,000: 1993: 4; Allowance Percentage: Income less than $15,000: 2003: 2; Allowance Percentage: Income less than $15,000: 2004: 2; Allowance Percentage: Income $15,000 or more: 1993: 3; Allowance Percentage: Income $15,000 or more: 2003: 1; Allowance Percentage: Income $15,000 or more: 2004: 1. State of Residence: West Virginia; Allowance Percentage: Income less than $15,000: 1993: 6; Allowance Percentage: Income less than $15,000: 2003: 3; Allowance Percentage: Income less than $15,000: 2004: 3; Allowance Percentage: Income $15,000 or more: 1993: 5; Allowance Percentage: Income $15,000 or more: 2003: 2; Allowance Percentage: Income $15,000 or more: 2004: 2. State of Residence: Wisconsin; Allowance Percentage: Income less than $15,000: 1993: 10; Allowance Percentage: Income less than $15,000: 2003: 6; Allowance Percentage: Income less than $15,000: 2004: 7; Allowance Percentage: Income $15,000 or more: 1993: 9; Allowance Percentage: Income $15,000 or more: 2003: 5; Allowance Percentage: Income $15,000 or more: 2004: 6. State of Residence: Wyoming; Allowance Percentage: Income less than $15,000: 1993: 3; Allowance Percentage: Income less than $15,000: 2003: 1; Allowance Percentage: Income less than $15,000: 2004: 1; Allowance Percentage: Income $15,000 or more: 1993: 2; Allowance Percentage: Income $15,000 or more: 2003: 0; Allowance Percentage: Income $15,000 or more: 2004: 0. Source: 1993, 2003, and 2004 Federal Registers. Note: This enclosure corresponds to table 1, found on page 12 of our January 2005 report. [End of table] [End of Section] Enclosure II: Table 2: Comparison of Prior State and Other Tax Allowance, Published in 1993, with That Proposed in 2003 and That Published in 2004, for Dependents and Independents without Children: State of Residence; Alabama; Allowance Percentage: 1993: 3; Allowance Percentage: 2003: 2; Allowance Percentage: 2004: 2. Alaska; Allowance Percentage: 1993: 0; Allowance Percentage: 2003: 0; Allowance Percentage: 2004: 0. Arizona; Allowance Percentage: 1993: 3; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 2. Arkansas; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. California; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 5; Allowance Percentage: 2004: 5. Colorado; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Connecticut; Allowance Percentage: 1993: 2; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Delaware; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. District of Columbia; Allowance Percentage: 1993: 7; Allowance Percentage: 2003: 6; Allowance Percentage: 2004: 6. Florida; Allowance Percentage: 1993: 1; Allowance Percentage: 2003: 0; Allowance Percentage: 2004: 0. Georgia; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Hawaii; Allowance Percentage: 1993: 6; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Idaho; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 3. Illinois; Allowance Percentage: 1993: 2; Allowance Percentage: 2003: 2; Allowance Percentage: 2004: 2. Indiana; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Iowa; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Kansas; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Kentucky; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Louisiana; Allowance Percentage: 1993: 2; Allowance Percentage: 2003: 1; Allowance Percentage: 2004: 2. Maine; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Maryland; Allowance Percentage: 1993: 6; Allowance Percentage: 2003: 5; Allowance Percentage: 2004: 5. Massachusetts; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Michigan; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Minnesota; Allowance Percentage: 1993: 6; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Mississippi; Allowance Percentage: 1993: 3; Allowance Percentage: 2003: 2; Allowance Percentage: 2004: 2. Missouri; Allowance Percentage: 1993: 3; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Montana; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Nebraska; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Nevada; Allowance Percentage: 1993: 0; Allowance Percentage: 2003: 1; Allowance Percentage: 2004: 1. New Hampshire; Allowance Percentage: 1993: 1; Allowance Percentage: 2003: 1; Allowance Percentage: 2004: 1. New Jersey; Allowance Percentage: 1993: 3; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. New Mexico; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. New York; Allowance Percentage: 1993: 7; Allowance Percentage: 2003: 5; Allowance Percentage: 2004: 5. North Carolina; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. North Dakota; Allowance Percentage: 1993: 2; Allowance Percentage: 2003: 1; Allowance Percentage: 2004: 1. Ohio; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Oklahoma; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Oregon; Allowance Percentage: 1993: 6; Allowance Percentage: 2003: 5; Allowance Percentage: 2004: 5. Other areas; Allowance Percentage: 1993: 2; Allowance Percentage: 2003: 2; Allowance Percentage: 2004: 2. Pennsylvania; Allowance Percentage: 1993: 3; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Rhode Island; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. South Carolina; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. South Dakota; Allowance Percentage: 1993: 0; Allowance Percentage: 2003: 0; Allowance Percentage: 2004: 0. Tennessee; Allowance Percentage: 1993: 0; Allowance Percentage: 2003: 0; Allowance Percentage: 2004: 0. Texas; Allowance Percentage: 1993: 0; Allowance Percentage: 2003: 0; Allowance Percentage: 2004: 0. Utah; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Vermont; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Virginia; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 3; Allowance Percentage: 2004: 3. Washington; Allowance Percentage: 1993: 0; Allowance Percentage: 2003: 0; Allowance Percentage: 2004: 0. West Virginia; Allowance Percentage: 1993: 4; Allowance Percentage: 2003: 2; Allowance Percentage: 2004: 2. Wisconsin; Allowance Percentage: 1993: 5; Allowance Percentage: 2003: 4; Allowance Percentage: 2004: 4. Wyoming; Allowance Percentage: 1993: 0; Allowance Percentage: 2003: 0; Allowance Percentage: 2004: 0. Source: 1993, 2003, and 2004 Federal Registers. Note: This enclosure corresponds to table 2, found on page 13 of our January 2005 report. [End of table] [End of Section] Enclosure III: Table 3: Difference between Prior Allowance, Published in 1993, and Education's 2004 Updated Allowance and Estimated EFC Impact, by State: State: Alabama; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 61; Average EFC, in dollars, under the prior allowance for those with an increase[D]: $ 7,602; Estimated average EFC dollar increase for those with an increase[E]: $ 319. State: Alaska; Percentage point change in the state and other tax allowance: Families[A]: -1; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 62; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 16,350; Estimated average EFC dollar increase for those with an increase[E]: 274. State: Arizona; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 67; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,014; Estimated average EFC dollar increase for those with an increase[E]: 328. State: Arkansas; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 63; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 6,898; Estimated average EFC dollar increase for those with an increase[E]: 430. State: California; Percentage point change in the state and other tax allowance: Families[A]: -1; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 46; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,180; Estimated average EFC dollar increase for those with an increase[E]: 209. State: Colorado; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 75; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 11,408; Estimated average EFC dollar increase for those with an increase[E]: 578. State: Connecticut; Percentage point change in the state and other tax allowance: Families[A]: +1; Percentage point change in the state and other tax allowance: Individuals[B]: +2; Estimated percentage of students with an increase in their EFC[C]: 0; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,230; Estimated average EFC dollar increase for those with an increase[E]: 70. State: Delaware; Percentage point change in the state and other tax allowance: Families[A]: -4; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 77; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,583; Estimated average EFC dollar increase for those with an increase[E]: 858. State: District of Columbia; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 61; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 8,938; Estimated average EFC dollar increase for those with an increase[E]: 484. State: Florida; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 66; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 8,311; Estimated average EFC dollar increase for those with an increase[E]: 310. State: Georgia; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 68; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,994; Estimated average EFC dollar increase for those with an increase[E]: 388. State: Hawaii; Percentage point change in the state and other tax allowance: Families[A]: -4; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 70; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,118; Estimated average EFC dollar increase for those with an increase[E]: 763. State: Idaho; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 69; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 7,902; Estimated average EFC dollar increase for those with an increase[E]: 351. State: Illinois; Percentage point change in the state and other tax allowance: Families[A]: -1; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 59; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 11,915; Estimated average EFC dollar increase for those with an increase[E]: 238. State: Indiana; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 74; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,299; Estimated average EFC dollar increase for those with an increase[E]: 415. State: Iowa; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 78; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,751; Estimated average EFC dollar increase for those with an increase[E]: 632. State: Kansas; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 76; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,951; Estimated average EFC dollar increase for those with an increase[E]: 397. State: Kentucky; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 66; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 8,206; Estimated average EFC dollar increase for those with an increase[E]: 340. State: Louisiana; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 52; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 13,032; Estimated average EFC dollar increase for those with an increase[E]: 463. State: Maine; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 79; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,276; Estimated average EFC dollar increase for those with an increase[E]: 630. State: Maryland; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 76; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 11,637; Estimated average EFC dollar increase for those with an increase[E]: 473. State: Massachusetts; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 80; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 12,357; Estimated average EFC dollar increase for those with an increase[E]: 724. State: Michigan; Percentage point change in the state and other tax allowance: Families[A]: -4; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 74; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,873; Estimated average EFC dollar increase for those with an increase[E]: 765. State: Minnesota; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 81; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 11,419; Estimated average EFC dollar increase for those with an increase[E]: 706. State: Mississippi; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 55; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 6,913; Estimated average EFC dollar increase for those with an increase[E]: 301. State: Missouri; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 60; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,842; Estimated average EFC dollar increase for those with an increase[E]: 445. State: Montana; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 71; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 8,156; Estimated average EFC dollar increase for those with an increase[E]: 531. State: Nebraska; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 78; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,658; Estimated average EFC dollar increase for those with an increase[E]: 580. State: Nevada; Percentage point change in the state and other tax allowance: Families[A]: -1; Percentage point change in the state and other tax allowance: Individuals[B]: +1; Estimated percentage of students with an increase in their EFC[C]: 49; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,837; Estimated average EFC dollar increase for those with an increase[E]: 195. State: New Hampshire; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 73; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 13,701; Estimated average EFC dollar increase for those with an increase[E]: 828. State: New Jersey; Percentage point change in the state and other tax allowance: Families[A]: 0; Percentage point change in the state and other tax allowance: Individuals[B]: +1; Estimated percentage of students with an increase in their EFC[C]: 1; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 16,076; Estimated average EFC dollar increase for those with an increase[E]: 70. State: New Mexico; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 64; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 7,514; Estimated average EFC dollar increase for those with an increase[E]: 304. State: New York; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 69; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,068; Estimated average EFC dollar increase for those with an increase[E]: 653. State: North Carolina; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 69; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 8,160; Estimated average EFC dollar increase for those with an increase[E]: 344. State: North Dakota; Percentage point change in the state and other tax allowance: Families[A]: -4; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 79; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,155; Estimated average EFC dollar increase for those with an increase[E]: 758. State: Ohio; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 73; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,286; Estimated average EFC dollar increase for those with an increase[E]: 421. State: Oklahoma; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 65; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 7,132; Estimated average EFC dollar increase for those with an increase[E]: 300. State: Oregon; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 69; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,530; Estimated average EFC dollar increase for those with an increase[E]: 536. State: Pennsylvania; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 67; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 12,073; Estimated average EFC dollar increase for those with an increase[E]: 502. State: Rhode Island; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 63; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 11,723; Estimated average EFC dollar increase for those with an increase[E]: 490. State: South Carolina; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 69; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,341; Estimated average EFC dollar increase for those with an increase[E]: 581. State: South Dakota; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 64; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,716; Estimated average EFC dollar increase for those with an increase[E]: 595. State: Tennessee; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 53; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,195; Estimated average EFC dollar increase for those with an increase[E]: 381. State: Texas; Percentage point change in the state and other tax allowance: Families[A]: -1; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 52; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 9,341; Estimated average EFC dollar increase for those with an increase[E]: 192. State: Utah; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 73; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 6,185; Estimated average EFC dollar increase for those with an increase[E]: 366. State: Vermont; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 79; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,815; Estimated average EFC dollar increase for those with an increase[E]: 449. State: Virginia; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 74; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,703; Estimated average EFC dollar increase for those with an increase[E]: 627. State: Washington; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 54; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 11,440; Estimated average EFC dollar increase for those with an increase[E]: 437. State: West Virginia; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -2; Estimated percentage of students with an increase in their EFC[C]: 68; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 8,827; Estimated average EFC dollar increase for those with an increase[E]: 564. State: Wisconsin; Percentage point change in the state and other tax allowance: Families[A]: -3; Percentage point change in the state and other tax allowance: Individuals[B]: -1; Estimated percentage of students with an increase in their EFC[C]: 81; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 10,830; Estimated average EFC dollar increase for those with an increase[E]: 640. State: Wyoming; Percentage point change in the state and other tax allowance: Families[A]: -2; Percentage point change in the state and other tax allowance: Individuals[B]: 0; Estimated percentage of students with an increase in their EFC[C]: 60; Average EFC, in dollars, under the prior allowance for those with an increase[D]: 12,275; Estimated average EFC dollar increase for those with an increase[E]: 436. State: Total USA[F]; Percentage point change in the state and other tax allowance: Families[A]: N/A; Percentage point change in the state and other tax allowance: Individuals[B]: N/A; Estimated percentage of students with an increase in their EFC[C]: 61; Average EFC, in dollars, under the prior allowance for those with an increase[D]: $ 9,964; Estimated average EFC dollar increase for those with an increase[E]: $ 443. Source: GAO analysis of the 2003-2004 Free Application for Federal Financial Aid (FAFSA) applicant file. Notes: This enclosure generally corresponds to table 3, found on pages 17-18 of our January 2005 report. N/A indicates "not applicable." We assessed the reliability of the FAFSA applicant file by conducting electronic testing of key variables for obvious problems in accuracy and completeness, interviewing appropriate Education officials, and reviewing related documentation, and we determined that the data were sufficiently reliable for our purposes. [A] Families are defined to include parents of dependent students and independent students with children. [B] Individuals are defined to include independent students without children and dependent students. Dependent students whose state of residence is different from that of their parents were counted as being from their parents' state. Since the EFC for a family is based upon both the parents' and the student's income, the EFC changes reported above for each state may reflect not only the change in the allowance for that state but also the change for the state of residence for students attending school in another state. For example, Connecticut, which has an increased allowance, may have families with an EFC increase because the children of those families may be attending school and residing in another state with a decreased allowance. [C] The sampling errors for the percentage of students with an increase in their EFC are at or below 5 percentage points for all states. [D] The sampling errors for the average EFC--under the current allowance--for those with an increase are at or below 5 percent for all states. [E] The sampling errors for the average EFC increase for Connecticut, the District of Columbia, and New Jersey are above 10 percent. The sampling errors for Alaska, Delaware, Hawaii, Maine, Montana, Nevada, North Dakota, Rhode Island, South Dakota, Vermont, West Virginia, and Wyoming are above 5 percent but no more than 10 percent. All other state figures have a sampling error at or below 5 percent. [F] The total row includes the 50 U.S. states, the District of Columbia, American Samoa, the Federal States of Micronesia, Guam, the Marshall Islands, Northern Marianas, Palau, Puerto Rico, the Virgin Islands, and other U.S. territories. [End of table] [End of Section] Enclosure IV: Table 4: Percentage of Recipients That Will Experience a Decrease in Pell Grant Awards As a Result of Education's 2004 Updated Allowance, Average Pell Grant Received Based on Prior Allowance, and Average Decrease as a Result of Updated Allowance, Including Those No Longer Eligible for an Award, by State: State: Alabama; Estimated percentage of recipients with a decrease in Pell Grant[A]: 37; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: $ 1,937; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -$ 109. State: Alaska; Estimated percentage of recipients with a decrease in Pell Grant[A]: 24; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,401; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -65. State: Arizona; Estimated percentage of recipients with a decrease in Pell Grant[A]: 41; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,791; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -111. State: Arkansas; Estimated percentage of recipients with a decrease in Pell Grant[A]: 44; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,933; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -145. State: California; Estimated percentage of recipients with a decrease in Pell Grant[A]: 21; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,794; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -86. State: Colorado; Estimated percentage of recipients with a decrease in Pell Grant[A]: 44; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,743; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -156. State: Connecticut[D]; Estimated percentage of recipients with a decrease in Pell Grant[A]: 0; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: N/A; Estimated average Pell Grant dollar decrease for those with a decrease[C]: N/A. State: Delaware; Estimated percentage of recipients with a decrease in Pell Grant[A]: 54; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,611; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -193. State: District of Columbia; Estimated percentage of recipients with a decrease in Pell Grant[A]: 41; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,874; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -154. State: Florida; Estimated percentage of recipients with a decrease in Pell Grant[A]: 42; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,816; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -108. State: Georgia; Estimated percentage of recipients with a decrease in Pell Grant[A]: 43; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,634; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -105. State: Hawaii; Estimated percentage of recipients with a decrease in Pell Grant[A]: 46; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,893; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -210. State: Idaho; Estimated percentage of recipients with a decrease in Pell Grant[A]: 47; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,879; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -126. State: Illinois; Estimated percentage of recipients with a decrease in Pell Grant[A]: 26; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,690; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -86. State: Indiana; Estimated percentage of recipients with a decrease in Pell Grant[A]: 45; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,728; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -119. State: Iowa; Estimated percentage of recipients with a decrease in Pell Grant[A]: 55; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,715; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -184. State: Kansas; Estimated percentage of recipients with a decrease in Pell Grant[A]: 48; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,766; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -124. State: Kentucky; Estimated percentage of recipients with a decrease in Pell Grant[A]: 40; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,743; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -116. State: Louisiana; Estimated percentage of recipients with a decrease in Pell Grant[A]: 33; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,972; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -113. State: Maine; Estimated percentage of recipients with a decrease in Pell Grant[A]: 51; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,806; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -173. State: Maryland; Estimated percentage of recipients with a decrease in Pell Grant[A]: 47; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,746; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -112. State: Massachusetts; Estimated percentage of recipients with a decrease in Pell Grant[A]: 49; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,738; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -178. State: Michigan; Estimated percentage of recipients with a decrease in Pell Grant[A]: 47; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,707; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -197. State: Minnesota; Estimated percentage of recipients with a decrease in Pell Grant[A]: 55; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,700; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -180. State: Mississippi; Estimated percentage of recipients with a decrease in Pell Grant[A]: 36; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,951; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -115. State: Missouri; Estimated percentage of recipients with a decrease in Pell Grant[A]: 38; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,770; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -119. State: Montana; Estimated percentage of recipients with a decrease in Pell Grant[A]: 48; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,911; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -172. State: Nebraska; Estimated percentage of recipients with a decrease in Pell Grant[A]: 50; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,731; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -166. State: Nevada; Estimated percentage of recipients with a decrease in Pell Grant[A]: 22; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,573; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -76. State: New Hampshire; Estimated percentage of recipients with a decrease in Pell Grant[A]: 52; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,682; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -182. State: New Jersey[E]; Estimated percentage of recipients with a decrease in Pell Grant[A]: 0; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,530; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -93. State: New Mexico; Estimated percentage of recipients with a decrease in Pell Grant[A]: 39; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,767; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -110. State: New York; Estimated percentage of recipients with a decrease in Pell Grant[A]: 46; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,978; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -171. State: North Carolina; Estimated percentage of recipients with a decrease in Pell Grant[A]: 45; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,898; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -118. State: North Dakota; Estimated percentage of recipients with a decrease in Pell Grant[A]: 48; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,858; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -224. State: Ohio; Estimated percentage of recipients with a decrease in Pell Grant[A]: 43; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,692; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -116. State: Oklahoma; Estimated percentage of recipients with a decrease in Pell Grant[A]: 42; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,834; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -113. State: Oregon; Estimated percentage of recipients with a decrease in Pell Grant[A]: 41; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,824; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -156. State: Pennsylvania; Estimated percentage of recipients with a decrease in Pell Grant[A]: 42; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,743; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -127. State: Rhode Island; Estimated percentage of recipients with a decrease in Pell Grant[A]: 43; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,829; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -114. State: South Carolina; Estimated percentage of recipients with a decrease in Pell Grant[A]: 48; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,870; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -159. State: South Dakota; Estimated percentage of recipients with a decrease in Pell Grant[A]: 45; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,785; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -165. State: Tennessee; Estimated percentage of recipients with a decrease in Pell Grant[A]: 36; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,895; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -108. State: Texas; Estimated percentage of recipients with a decrease in Pell Grant[A]: 24; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,758; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -82. State: Utah; Estimated percentage of recipients with a decrease in Pell Grant[A]: 46; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,854; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -144. State: Vermont; Estimated percentage of recipients with a decrease in Pell Grant[A]: 48; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,687; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -130. State: Virginia; Estimated percentage of recipients with a decrease in Pell Grant[A]: 49; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,806; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -163. State: Washington; Estimated percentage of recipients with a decrease in Pell Grant[A]: 34; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,804; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -115. State: West Virginia; Estimated percentage of recipients with a decrease in Pell Grant[A]: 46; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,938; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -168. State: Wisconsin; Estimated percentage of recipients with a decrease in Pell Grant[A]: 52; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,706; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -173. State: Wyoming; Estimated percentage of recipients with a decrease in Pell Grant[A]: 36; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: 1,877; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -117. State: Total USA[F]; Estimated percentage of recipients with a decrease in Pell Grant[A]: 36; Average dollar Pell Grant under the prior allowance for those with a decrease[B]: $ 1,806; Estimated average Pell Grant dollar decrease for those with a decrease[C]: -$ 131. Source: GAO analysis of the 2003-2004 FAFSA applicant file. Notes:This enclosure generally corresponds to Table 4, found on pages 19-20 of our January 2005 report. N/A indicates "not applicable." [A] The sampling errors for the percentage of students with a decrease in their Pell Grant for the District of Columbia and Vermont are just over 5 percentage points. All other state figures have a sampling error at or below 5 percentage points. [B] The sampling errors for the average Pell Grant--under the current allowance--for those with a decrease for Alaska and New Jersey are over 10 percent. The sampling errors for Delaware, the District of Columbia, Hawaii, Maine, Montana, Nevada, New Hampshire, North Dakota, Rhode Island, South Dakota, Vermont, and Wyoming are above 5 percent but no higher than 10 percent. All other state figures have a sampling error at or below 5 percent. [C] The average reflects the reduction for those with a decrease, including both those who would have retained and those who would have lost eligibility. The sampling errors for the average Pell Grant decrease for Alaska, the District of Columbia, New Jersey, and Vermont are above 10 percent. The sampling errors for Delaware, Hawaii, Idaho, Maine, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Rhode Island, South Dakota, and Wyoming are above 5 percent but no higher than 10 percent. All other state figures have a sampling error at or below 5 percent. [D] No one in the sample from Connecticut exhibits a decrease in his or her Pell Grant. [E] The actual figure for New Jersey is 0.1 percent, which rounds to 0 percent for the purposes of this table. [F] The total row includes the 50 U.S. states, the District of Columbia, American Samoa, the Federal States of Micronesia, Guam, the Marshall Islands, Northern Marianas, Palau, Puerto Rico, the Virgin Islands, and other U.S. territories. [End of table] [End of Section] Enclosure V: Figure 1: Percentage of Recipients with a Decrease in Pell Award Based on a Change from the Prior Allowance, Published in 1993, to Education's 2004 Updated Allowance, by Household Income and Dependency Status: [See PDF for image] Source: GAO analysis of the 2003-2004 FAFSA applicant file. Notes:This enclosure corresponds to figure 3, found on page 21 of our January 2005 report. The sampling errors are all 5 percentage points or less. [End of figure] [End of Section] Enclosure VI: Figure 2: Median Percentage Change in Amount of Pell Award for Those with a Decrease Based on Change from the Prior Allowance, Published in 1993, to Education's 2004 Updated Allowance, by Household Income and Dependency Status: [See PDF for image] Source: GAO analysis of the 2003-2004 FAFSA applicant file. Notes:This enclosure corresponds to figure 4, found on page 22 of our January 2005 report. The sampling errors are all 5 percentage points or less. [End of figure] [End of Section] Enclosure VII: Figure 3: Percentage of Students Likely to Have a Change in Subsidized Stafford Loans Based on Change from the Prior Allowance, Published in 1993, to Education's 2004 Updated Allowance, by Household Income and Dependency Status: [See PDF for image] Source: GAO analysis of 2004 CEAD STAB data. Notes:This enclosure corresponds to figure 5, found on page 24 of our January 2005 report. The sampling error for independents with household income of $100,001 or more is just over 5 percentage points. All other figures have sampling errors of 5 percentage points or less. We assessed the reliability of the CEAD STAB file by conducting electronic testing of key variables for obvious problems in accuracy and completeness, interviewing appropriate Education officials, and reviewing related documentation, and we determined that the data were sufficiently reliable for our purposes. [End of figure] [End of Section] Enclosure VIII: Table 5: Framework for Evaluating Options Identified to Change the State and Other Tax Allowance relative to the Prior Allowance: Change in federal Pell Grant expenditure[F]; Updated: Updated 2005-2006 tables: -$0.3 billion; Strategy I: SOI with revised methodology[A]: -$0.1 billion; Strategy II: BEA/Census[B]: -$0.05 billion; Strategy II: CPS (ASEC)[C]: -$0.2 billion; Strategy II: ITEP[D]: + $0.2 billion; Strategy III: Standard: allowance (4%)[E]: -$0.2 billion. Percentage of students facing a reduction in Pell Grant award; Updated: Updated 2005-2006 tables: 36.0; Strategy I: SOI with revised methodology[A]: 23.9; Strategy II: BEA/Census[B]: 18.6; Strategy II: CPS (ASEC)[C]: 33.8; Strategy II: ITEP[D]: 2.3; Strategy III: Standard: allowance (4%)[E]: 28.5. Percentage retaining eligibility; Updated: Updated 2005-2006 tables: 34.5; Strategy I: SOI with revised methodology[A]: 23.0; Strategy II: BEA/Census[B]: 17.8; Strategy II: CPS (ASEC)[C]: 32.5; Strategy II: ITEP[D]: 2.2; Strategy III: Standard: allowance (4%)[E]: 26.9. Percentage not retaining eligibility (number of students affected)[G]; Updated: Updated 2005-2006 tables: 1.5; (81,000); Strategy I: SOI with revised methodology[A]: 0.9; (46,000); Strategy II: BEA/Census[B]: 0.8; (45,000); Strategy II: CPS (ASEC)[C]: 1.3; (72,000); Strategy II: ITEP[D]: 0.1; (4,000); Strategy III: Standard: allowance (4%)[E]: 1.6; (88,000). Average dollar change in Pell Grant award for those with a decrease[H]; Updated: Updated 2005-2006 tables: -$131; Strategy I: SOI with revised methodology[A]: -$108; Strategy II: BEA/Census[B]: -$142; Strategy II: CPS (ASEC)[C]: -$123; Strategy II: ITEP[D]: -$94; Strategy III: Standard: allowance (4%)[E]: -$175. Change in expected family contribution[I]; Updated: Updated 2005-2006 tables: + $3.2 billion; Strategy I: SOI with revised methodology[A]: + $1.7 billion; Strategy II: BEA/Census[B]: + $1.0 billion; Strategy II: CPS (ASEC)[C]: + $2.8 billion; Strategy II: ITEP[D]: -$2.8 billion; Strategy III: Standard: allowance (4%)[E]: + $3.0 billion. Percentage of students facing an increase in EFC; Updated: Updated 2005-2006 tables: 60.8; Strategy I: SOI with revised methodology[A]: 46.8; Strategy II: BEA/Census[B]: 35.4; Strategy II: CPS (ASEC)[C]: 60.2; Strategy II: ITEP[D]: 4.7; Strategy III: Standard: allowance (4%)[E]: 48.4. Average dollar change in EFC for those with an increase[J]; Updated: Updated 2005-2006 tables: + $443; Strategy I: SOI with revised methodology[A]: + $308; Strategy II: BEA/Census[B]: + $477; Strategy II: CPS (ASEC)[C]: + $391; Strategy II: ITEP[D]: + $261; Strategy III: Standard: allowance (4%)[E]: + $633. Source: GAO analysis. Notes:This enclosure corresponds to table 9, found on page 37 of our January 2005 report. All alternatives are based on information that would have been available to Education as of June of 2004 for publication in the December 2004 Federal Register. We assessed the reliability of the BEA, Census, CPS, and ITEP data by reviewing information available online from the associated websites, interviewing relevant officials, and reviewing related documentation, and we determined that the BEA data were sufficiently reliable for our purposes in this analysis. However, we were unable to determine if the Census, CPS, and ITEP data were reliable for our purposes. [A] The SOI with Revised Methodology figures are based on the Internal Revenue Service's (IRS) 2002 Statistics of Income (SOI) data and were calculated for each income band by dividing the aggregate total taxes paid deduction by the aggregate adjusted gross income for families and by dividing the aggregate state and local income taxes by the aggregate adjusted gross income for individuals. [B] The BEA/Census figures are based on 2003 Bureau of Economic Analysis and U.S. Census data and were calculated by dividing the sum of property taxes, general sales and gross receipts taxes, and individual income taxes from the U.S. Census by personal income from the BEA for families and by dividing the sum of general sales and gross receipts and individual income taxes from the U.S. Census by personal income from the BEA for individuals. Note that BEA and U.S. Census data are not provided separately by income band. [C] The CPS figures are based on the Current Population Survey's (CPS) Annual Social and Economic Supplement (ASEC) and were generated based on a 3-year average of the median effective tax rate, by state, across 2001, 2002, and 2003 CPS (ASEC) data, as prescribed by CPS documentation for the study of state-based information in the CPS. The median effective tax rate reflects the median across households of the sum of state income taxes paid and household property taxes divided by total personal income for families and of state income taxes paid divided by total personal income for individuals. [D] The ITEP figures are based on the Institute on Taxation and Economic Policy's (ITEP) analysis of tax data, which presents tax rates that already take personal income into account. ITEP figures were calculated for each income band by summing general sales tax rates, other sales and excise tax rates, property tax rates, and personal income tax rates for families and by summing general sales tax rates, other sales and excise tax rates, and personal income tax rates for individuals. As explained in the GAO report Student Financial Aid: Need Determination Could Be Enhanced through Improvements in Education's Estimate of Applicants' State Tax Payments, GAO-05-105, Washington, DC, January 21, 2005, we were unable to determine the reliability of the ITEP data. [E] The standard allowance of 4 percent is based on an estimate of the median household across states using CPS data. [F] The estimated expenditure of the Pell Program in award year 2005- 2006 is about $13 billion under the current allowance. [G] The sampling error of those not retaining eligibility for ITEP is above 10 percent. All others have a sampling error of 5 percent or less. Figures for the number of students not retaining eligibility are rounded to the nearest $1,000. [H] The estimated average Pell award for award year 2005-2006 is about $2,430 under the current allowance, which was published in the 1993 Federal Register. [I] The estimated sum of EFCs across all FAFSA applicants in award year 2005-2006 is about $82 billion under the current allowance, which was published in the 1993 Federal Register. [J] The estimated average EFC in award year 2005-2006 is about $6,850 under the current allowance, which was published in the 1993 Federal Register. [End of table] [End of Section] Enclosure IX: Table 17: Simulation of Tax Allowances under Various Options, by State- -Families with Adjusted Gross Income of $15,000 or More: State: Alabama; Prior: Tables published in 1993: 4; Updated 2005-2006 tables: 2; Strategy I: SOI with revised methodology: 3; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 3; Strategy II: ITEP: 7. State: Alaska; Prior: Tables published in 1993: 2; Updated 2005-2006 tables: 1; Strategy I: SOI with revised methodology: 2; Strategy II: BEA/Census: 1; Strategy II: CPS/(ASEC)[A]: 1; Strategy II: ITEP: 2. State: Arizona; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 4; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 7. State: Arkansas; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 2; Strategy I: SOI with revised methodology: 4; Strategy II: BEA/Census: 7; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: California; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 6; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: Colorado; Prior: Tables published in 1993: 6; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 7. State: Connecticut; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 6; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 8. State: Delaware; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 4; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 5. State: District of Columbia; Prior: Tables published in 1993: 9; Updated 2005-2006 tables: 6; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 9; Strategy II: CPS/(ASEC)[A]: 8; Strategy II: ITEP: 8. State: Florida; Prior: Tables published in 1993: 3; Updated 2005-2006 tables: 1; Strategy I: SOI with revised methodology: 2; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 1; Strategy II: ITEP: 5. State: Georgia; Prior: Tables published in 1993: 6; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: Hawaii; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 9; Strategy II: CPS/(ASEC)[A]: 13; Strategy II: ITEP: 8. State: Idaho; Prior: Tables published in 1993: 6; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: Illinois; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 8. State: Indiana; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 4; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 8. State: Iowa; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 8. State: Kansas; Prior: Tables published in 1993: 6; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 9. State: Kentucky; Prior: Tables published in 1993: 6; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 7; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: Louisiana; Prior: Tables published in 1993: 3; Updated 2005-2006 tables: 1; Strategy I: SOI with revised methodology: 2; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 2; Strategy II: ITEP: 7. State: Maine; Prior: Tables published in 1993: 8; Updated 2005-2006 tables: 5; Strategy I: SOI with revised methodology: 6; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 9. State: Maryland; Prior: Tables published in 1993: 8; Updated 2005-2006 tables: 6; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 8. State: Massachusetts; Prior: Tables published in 1993: 8; Updated 2005-2006 tables: 5; Strategy I: SOI with revised methodology: 6; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 8. State: Michigan; Prior: Tables published in 1993: 8; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: Minnesota; Prior: Tables published in 1993: 8; Updated 2005-2006 tables: 5; Strategy I: SOI with revised methodology: 6; Strategy II: BEA/Census: 7; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 9. State: Mississippi; Prior: Tables published in 1993: 4; Updated 2005-2006 tables: 2; Strategy I: SOI with revised methodology: 3; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 3; Strategy II: ITEP: 7. State: Missouri; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 8. State: Montana; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 6. State: Nebraska; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: Nevada; Prior: Tables published in 1993: 2; Updated 2005-2006 tables: 1; Strategy I: SOI with revised methodology: 2; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 1; Strategy II: ITEP: 4. State: New Hampshire; Prior: Tables published in 1993: 6; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 4; Strategy II: BEA/Census: 3; Strategy II: CPS/(ASEC)[A]: 2; Strategy II: ITEP: 4. State: New Jersey; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 7; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 9. State: New Mexico; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 4; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 3; Strategy II: ITEP: 8. State: New York; Prior: Tables published in 1993: 10; Updated 2005-2006 tables: 7; Strategy I: SOI with revised methodology: 8; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 7; Strategy II: ITEP: 9. State: North Carolina; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 5; Strategy I: SOI with revised methodology: 6; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: North Dakota; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 1; Strategy I: SOI with revised methodology: 3; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 2; Strategy II: ITEP: 6. State: Ohio; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 5; Strategy I: SOI with revised methodology: 6; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 9. State: Oklahoma; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 3; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 9. State: Oregon; Prior: Tables published in 1993: 9; Updated 2005-2006 tables: 6; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 8; Strategy II: ITEP: 9. State: Other areas[B]; Prior: Tables published in 1993: 3; Updated 2005-2006 tables: 2; Strategy I: SOI with revised methodology: 3; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 3; Strategy II: ITEP: 6. State: Pennsylvania; Prior: Tables published in 1993: 6; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 7. State: Rhode Island; Prior: Tables published in 1993: 8; Updated 2005-2006 tables: 6; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 9. State: South Carolina; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: South Dakota; Prior: Tables published in 1993: 3; Updated 2005-2006 tables: 0; Strategy I: SOI with revised methodology: 1; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 2; Strategy II: ITEP: 5. State: Tennessee; Prior: Tables published in 1993: 2; Updated 2005-2006 tables: 0; Strategy I: SOI with revised methodology: 1; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 1; Strategy II: ITEP: 5. State: Texas; Prior: Tables published in 1993: 2; Updated 2005-2006 tables: 1; Strategy I: SOI with revised methodology: 2; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 1; Strategy II: ITEP: 5. State: Utah; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 5; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 6; Strategy II: ITEP: 8. State: Vermont; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 5; Strategy I: SOI with revised methodology: 6; Strategy II: BEA/Census: 7; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 8. State: Virginia; Prior: Tables published in 1993: 7; Updated 2005-2006 tables: 4; Strategy I: SOI with revised methodology: 6; Strategy II: BEA/Census: 5; Strategy II: CPS/(ASEC)[A]: 5; Strategy II: ITEP: 7. State: Washington; Prior: Tables published in 1993: 3; Updated 2005-2006 tables: 1; Strategy I: SOI with revised methodology: 2; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 1; Strategy II: ITEP: 6. State: West Virginia; Prior: Tables published in 1993: 5; Updated 2005-2006 tables: 2; Strategy I: SOI with revised methodology: 3; Strategy II: BEA/Census: 7; Strategy II: CPS/(ASEC)[A]: 4; Strategy II: ITEP: 8. State: Wisconsin; Prior: Tables published in 1993: 9; Updated 2005-2006 tables: 6; Strategy I: SOI with revised methodology: 7; Strategy II: BEA/Census: 6; Strategy II: CPS/(ASEC)[A]: 8; Strategy II: ITEP: 10. State: Wyoming; Prior: Tables published in 1993: 2; Updated 2005-2006 tables: 0; Strategy I: SOI with revised methodology: 1; Strategy II: BEA/Census: 4; Strategy II: CPS/(ASEC)[A]: 0; Strategy II: ITEP: 4. Source: GAO analysis. Notes:This enclosure corresponds to appendix IV, found on pages 55-56 of our January 2005 report. Under strategy III, the standard allowance would be 4 percent for every state, based on the median family in the CPS. [A] The CPS (ASEC) tax rates were generated based on a 3-year average of 2001, 2002, and 2003 CPS (ASEC) data. [B] Other areas includes American Samoa, the Federal States of Micronesia, Guam, the Marshall Islands, Northern Marianas, Palau, Puerto Rico, the Virgin Islands, and other U.S. territories. [End of table] (130459):