Families of Freedom Scholarship Fund®

Facts About Scholarship America

• Charity Navigator, the nation's premier evaluator of non-profit organizations, has put Scholarship America in its top-ten list of "Slam-Dunk Charities," for fiscal health and responsibility to donors.

• Scholarship America has raised more than $108 million for this fund. Approximately $20 million more has been committed by major donors so that the fund has assets of $112 million.

• So far a total of 1,352 families have registered with the fund, representing 4,792 individuals.

• Scholarship America has distributed scholarships to 872 people, totaling more than $19,000,000.

• Scholarship America has kept administrative expenses for family registration, evaluation and issuing awards to 4 percent of total disbursements since 2001. Our expenses for support and fundraising since inception have been $1,589,000 for this $108 million fund, or 1.5% in an industry where administrative costs of 20% are well within the norm.

Response to Inaccuracies in 9/9/07 New York Post Article

The article about the Families of Freedom Scholarship Fund in the New York Post on September 9, 2007 contained several inaccuracies, innuendoes, and mischaracterizations of the fund, managed by Scholarship America. But the main error is in mischaracterizing the fund itself and its mission.

In the first few frantic days following the 9/11 attacks, Scholarship America—an organization founded in 1958 to help students gain access to higher education—was awarded a grant from a generous donor to set up the Families of Freedom Scholarship Fund. The goal, as stated in the fund declaration effective September 17, 2001, was and remains,

"to provide education assistance for post-secondary study to financially needy dependents of those people killed or permanently disabled as a result of the terrorist attacks on September 11, 2001, and during the rescue activities relating to those attacks."

This fund was not created to provide an education to the family of every victim of the 9/11 tragedy; rather, it was created with the foresight that the educational futures of thousands of financially needy students would be in jeopardy as a result of losing a provider to death or injury on 9/11. The fund sparked incredible generosity nationwide. The fund today stands at $112 million; it has delivered needed scholarships to 872 individuals that have totaled more than $19 million. In 2007 alone, scholarship grants have totaled more than $3.2 million.

So what does our fund declaration mean when it says "financially needy dependents"? Most student financial aid is based on the need formula used by the federal government to determine eligibility for federal financial aid. Scholarship America uses a far more liberal formula for the Families of Freedom fund. For example, unlike the federal government, the Families of Freedom fund does not consider the first $500,000 in liquid assets, or student earnings, as part of our needs assessment. In addition, Scholarship America does not consider the awards made to victims families from the 9/11 Victim's Compensation Fund. The average award from the Victim's Compensation Fund was approximately $2.1 million.

Some ask why Scholarship America considers interest income from the Victim's Compensation Fund awards that families have invested. The answer is simple if not pleasing: it's not always possible to separate this investment income from the rest of the interest income that people report on their tax returns. Furthermore, the purpose of the fund is to provide for the thousands of financially needy students who, absent this fund, may not have the financial resources needed to attend a post-secondary institution. If all investment income were excluded from the needs assessment, future generations of financially needy students would receive substantially less help from this scholarship fund.

How do we know how much we can distribute each year, and still have enough left for younger 9/11 dependents? We check our assumptions each year. We contract with an independent firm to do an actuarial study using the latest information and estimates about families' needs, student ages, educational costs, and the number of people eligible for these scholarships – currently registered as well as unregistered. Based on these studies, we continue to expect the Families of Freedom scholarships to be completely in the hands of financially needy students by 2030.

Scholarship America conducts this study to ensure that the entire fund will be used by the end of 2030 for financially needy dependents of those who were killed or disabled during the attacks of 9/11 and the rescue activities that followed. It is in part for that reason that the fund was permitted by its donors to distribute $1,000 per year honorariums to eligible students not deemed financially needy by the needs assessment.

Scholarship America has been helping students reach their potential through higher education for nearly 50 years. We are committed to responsible management and complete transparency in that mission. If you have any questions about how this fund is managed, please call 800-279-2083 or e-mail to jfugate@scholarshipamerica.org. And we will continue to update this site to ensure that any questions are addressed as quickly and openly as possible.

Scholarship America is a 501(c)(3) charitable organization. Visit us on the Web at scholarshipamerica.org.