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Last updated on Thursday, January 10, 2013
(BLOOMINGTON) - Ivy Tech Community College students who reneged on tuition bills or do not pay back financial aid after withdrawing from classes will soon have their tax returns diverted.
Eric Weddie of the Lafayette Journal & Courier reports that, starting in 2013, the college will use the state's tax intercept program to collect on nearly $9 million in past due bills.
In the past few years, the state system has written off at least 3 percent in uncollected student fees, a combination of Title IV financial aid funds, such as Pell Grants, bounced checks or deferred tuition.
Recently administrators approved an $8.8 million write-off, or 3.4 percent, of student fees for the 2011-12 academic year. That includes $454,000 at the Lafayette region and nearly $2 million for the central region.
Chris Ruhl, Ivy Tech's senior vice president and chief financial officer, said while the school expects 1 percent to 1.5 percent of its entire general fund will be lost to uncollected bills, it's making changes to collect and limit losses.
The tax intercept program will apply to students who owe money for the 2011-12 academic year and thereafter.
Ivy Tech will provide the state's department of revenue with individuals who have past due accounts. It mirrors the process used by the state to collect back child support.
Those who file for an Indiana tax return and are on the list, will have part of all of their refund diverted to Ivy Tech.
The state keeps 15 percent of the fees recovered.
Students will be notified if their accounts are forwarded to the state, Ruhl said. Students can appeal the intercept.
Collection agencies also are used by Ivy Tech to collect outstanding account. On average $1 million is collected.
To limit write-offs, Ruhl said, Ivy Tech has decreased the money it advances students on federal loans to purchase books and supplies and locked student accounts to prevent them from enrolling in future classes.
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