Lawmakers looking to close loophole in college aid being exploited by suburban parents

SPRINGFIELD — A pair of Illinois House committees have scheduled a joint hearing next week to explore recent news reports about wealthy parents exploiting a legal loophole in order to draw down more student financial aid for their children.

The ProPublica Illinois story identified nearly four dozen cases of parents in Lake County who had assigned guardianship of their teens to a friend or relative, thus allowing their children to declare themselves financially independent of their families so they could qualify for federal, state and college financial aid.

Of concern to Illinois lawmakers is the state-funded Monetary Award Program, or MAP grants, which are awarded on the basis of financial need.

“Particularly in the wake of former Governor (Bruce) Rauner’s budget crisis in which these students took the brunt of the pain, it is outrageous to learn that some wealthy families have decided to game the system at the expense of those who truly need help affording an education,” Rep. LaShawn K. Ford, a Chicago Democrat who chairs the House Higher Education Budget Committee, said in a news release announcing the hearings.

The ProPublica Illinois story reported that nearly all of the guardianship cases it identified were handled by two Chicago-area law firms.

The story also identified a Lincolnshire-based college consulting company, Destination College, which works closely with one of the lawyers involved.

It said the company offers “strategies to lower tuition expenses,” including one plan that involves a “College Financial Plan, Using Income and Asset Shifting Strategies to Increase Your Financial and Merit Aid and Lower Out of Pocket Tuition Expenses.”

“It pains me to see that individuals have decided to be dishonest in applying for college financial aid,” said Rep. Carol Ammons, an Urbana Democrat, who chairs the House Higher Education Committee. “As the cost of college skyrockets, we must take appropriate steps to ensure our finite resources are only going to those who truly need it, not those elites who have rigged the system again and again to their own advantage.”

In addition to the legislative inquiry, Gov. J.B. Pritzker has said he is directing his staff to investigate to determine how widespread the problem is in Illinois.

“We want it to go to the students who are most in need, not to people who are defrauding the system,” Pritzker told reporters during a news conference in Chicago on Monday, soon after the story was published. “So we need to look into it to make sure that we are identifying people who are doing this, calling it out, and making sure we are preventing it from happening in the future.”

The legislative hearing is scheduled for 10 a.m. Thursday at the Bilandic state office building in Chicago.