Tuesday, September 13, 2011
County-by-County Data Shows Aroostook, Cumberland, Hancock, Kennebec, Lincoln, Penobscot, Sagadahoc and York Counties Performing Above the State Median Grant Enrollment Rate
PORTLAND, Maine ¾ August 30, 2011 ¾ Since 2008, the Finance Authority of Maine (FAME) and the Alfond Scholarship Foundation (ASF) have worked together to enroll over 10,000 Maine babies in the Harold Alfond College Challenge (HACC). ASF has contributed more than $5 million to Maine resident babies’ college investing accounts. The program’s goal is to award every eligible Maine baby a $500 grant to start investing early for higher education in the NextGen College Investing Plan (NextGen). NextGen is Maine’s Section 529 Plan. The grant funds may be used to pay for qualified higher-education expenses at any accredited post-secondary school, including four-year and two-year public and private colleges, certificate programs, trade schools, and even graduate schools. Families just need to enroll their child in the program by the baby’s first birthday.
FAME and ASF recently evaluated enrollment rates on a county-by-county basis and conducted a statewide parent survey to better understand awareness levels and why families choose to enroll or not. There are no income requirements and families never need to add their own money (although they are encouraged to invest in their own child’s future). Since the statewide launch in 2009, 36.5 percent of all eligible babies born from January 1, 2009, to July 31, 2010 were enrolled before their first birthday deadline.
This year’s county-by county enrollment report revealed that, as anticipated, the urban, more densely populated areas in Cumberland, Kennebec, Penobscot and York Counties have stronger enrollment rates. U.S. Census Bureau data shows these areas typically have higher income rates and greater numbers of individuals who have attended college (source: http://quickfacts.census.gov/qfd/states/23000.html). But communities don’t need higher income levels and education attainment levels to succeed; community dedication and family aspirations can increase the rate at which babies are enrolled.
“We were pleased to see Aroostook County with the fifth-highest enrollment rate,” said Elizabeth Vanderweide, program manager for the Harold Alfond College Challenge. “Aroostook County is extremely rural with average household income averaging the second-lowest in the state according to U.S. Census Bureau data. That same data also shows that fewer than 16 percent of all adults in Aroostook County have a bachelor’s degree, the third-lowest ranked county in the state. These statistics demonstrate that community efforts are working well in Northern Maine and across the state. We’ve found that parents, no matter their socio-economic status, want to do right by their children by giving them the opportunity to attend college.”
Westbrook parent Trish Nkruman, a hairstylist, has enrolled both of her children — Andrew and Abigail - to receive the $500 grant. She had this to say about the $500 grant opportunity:
“It’s important to me that my kids receive a good education. I want them to have a bright future and higher education opportunities. I just want my kids to go and do whatever they want to do, and not have any trouble when it comes to their futures. Anything like this is a great help. I don’t want my kids to struggle, so I’ll struggle for them now and when they get there it might be easier.
“I mention this program to a lot of my customers and they are often confused and think it is too good to be true and believe they have to put their own money in. I tell them no, I don’t have to put my own money in, it’s not required.”
Efforts to Raise Awareness and Enroll Every Eligible Maine Baby Continue with Local Hospitals and Events Playing a Key Role
FAME and ASF wanted to learn more about what motivates parents to enroll and why some parents who are aware of the program choose not to enroll. A statewide survey of parents was conducted and received 648 responses. The results show that awareness among parents who have never inquired about the program has grown to 75 percent. The research also demonstrates that 80 percent of all families believe that children born now will need at least a bachelor’s degree to be “successful” in their future careers.
The Maine medical community, particularly hospitals, has played a significant role in helping to raise awareness for the grant program. All Maine hospitals with birthing centers have championed the HACC and make the grant program part of the education process with new parents. FAME tracks hospitals’ progress on informing families about the program by counting parent inquiries and enrollments of eligible babies per hospitals’ births, and shares this data with the hospitals. According to parents surveyed, 54 percent learned about the program through their hospital, 29 percent through their doctor’s office, and 27 percent through friends and family.
In Portland, both Mercy Hospital and Maine Medical Center have created best practices to help increase program awareness. Mercy Hospital currently has the highest enrollment rate in the state. Linda Higgins, childbirth education coordinator, and champion of the program at Mercy, believes the hospital’s success is due in large part to the education model it has developed to help parents understand the value of the Harold Alfond College Challenge grant.
“We have one individual — Sally Heath — in our medical records department dedicated to educating new parents about the grant program. During her meetings with parents to review and complete important paperwork for the baby, she takes a few minutes to tell them about the Alfond grant opportunity for college investing. I believe it is her consistent and personal attention that makes our education effort for the program so strong, and the reason why we’ve been so successful encouraging new parents to enroll.”
Maine Medical Center also scores high in program enrollments and, as the largest hospital in the state, contributes nearly 20% of all enrollments. According to Kara Kaikini, the hospital’s OB parent education program coordinator, “We believe in the program and realize not every state has a grant offering like this. It’s something unique we can provide our patients to help them start investing for college early. Education about the grant program has been integrated into our daily routine, and we encourage new parents to participate through our medical records staff, childbirth education classes and volunteer ambassador program. Our volunteers help parents complete and mail the inquiry forms.”
Despite high awareness levels among parents, challenges in completing the application remain. In some instances, parents believe they have completed the application when they provide their information on the inquiry form at the hospital and never take the important step of filling out the NextGen account application. Some parents say they are too busy and often forget to fill out and submit the application within the one-year period. And for some, the application seems too difficult to complete on their own.
Removing Barriers to Participation
FAME and ASF are working hard together to remove these barriers so more parents enroll before their child’s first birthday and before the opportunity expires. Events called the “Future Faces of Maine Casting Calls” have been developed to raise awareness and make enrollment easier for parents. Held six times a year at various locations across the state, these events are designed to give parents an opportunity to meet with program staff that can assist them in completing the NextGen account application. Families also receive a free, professional photograph of their baby. In March of this year, the application was made available online. This gives parents the opportunity to participate in live chat with experts who can help them complete the application. The application can be accessed online through www.500forbaby.org.
Over the past two years, casting call events have attracted nearly 2,500 Maine babies and assisted with the opening of 1,800 NextGen accounts. Casting calls played an important role in enrollment growth in Aroostook County, attracting more than 12 percent of those residents who are eligible.
Today, more than 25 percent of all families enrolled have chosen to contribute their own funds to NextGen accounts to further help their children prepare for college. Additional matching grants have also been introduced by FAME to encourage families to add their own contributions.
Vanderweide concluded: “September is national College Savings Month and what better way to celebrate in Maine than to encourage a parent of a Maine child under the age of one to complete an application to receive the $500 Harold Alfond College Challenge grant?”
For the remainder of 2011, the following Casting Call events are planned:
Saturday, Sept. 17, 2011 – 10 a.m. to 2 p.m.
Wyndham Hotel Ballroom (across from Best Buy at the Maine Mall)
Saturday, Oct. 1, 2011 – 10 a.m. to 2 p.m.
University of Maine Augusta - Room 138 in the Richard J. Randall Student Technology Center
Families may request NextGen application materials be mailed to them directly, complete an application online through www.500forbaby.org or contact their financial advisor. Any questions about the Harold Alfond College Challenge Grant or the NextGen College Investing Plan should be directed to FAME 1-800-228-3734 or email@example.com.
Please remember there's always the potential of losing money when you invest in securities.
The Alfond Grant is awarded to a NextGen account. NextGen is a Section 529 plan administered by the Finance Authority of Maine (FAME). Before you invest in NextGen, request a NextGen Program Description and Participation Agreement (Program Description) from your Maine bank or financial advisor, or call FAME at 1-800-228-3734, and read it carefully. The Program Description contains more complete information, including investment objectives, charges, expenses and risks of investing in NextGen, which you should carefully consider before investing. You also should consider whether your home state or your designated beneficiary’s home state offers any state tax or other benefits that are only available for investments in such state’s 529 plan. Merrill Lynch, Pierce, Fenner & Smith Incorporated, a registered broker-dealer, Member SIPC, is the program manager and underwriter of NextGen.
“Qualified higher education expenses,” as defined in the Internal Revenue Code. Any earnings withdrawn that are not used for such expenses are subject to federal income tax and may be subject to a 10% additional federal tax as well as state and local income taxes.
ASF commissioned Pan Atlantic SMS Group of Portland to conduct the survey. Results had a statistical validity at the 95% confidence interval level with a margin of error of 3.79%