Financial Aid Changes on the Horizon That May Affect MasTec Employees

The U.S. Department of Education has designated February as Financial Aid Awareness Month, and this year there's a lot to talk about. On December 21, 2020, Congress passed the Consolidated Appropriations Act, 2021, another relief package in response to the pandemic. Included in the bill were several provisions related to education, including many changes to financial aid. Here are some key highlights.

Money for Education
In total, the bill provides $82 billion for education, including $22.7 billion for colleges and universities. Colleges must use some of those funds to provide emergency financial help to students who have been affected by the pandemic. This is likely left to the discretion of each school's financial aid office.

Despite the cash infusion to colleges, the amount is far short of the $120 billion that college advocates said they needed to deal with the dual headwinds of rising expenses and falling revenue. Ted Mitchell, president of the American Council on Education, stated: '[T]he situation currently facing America's colleges and universities is a crisis of almost unimaginable magnitude....The money provided in this bill will provide some limited relief, which is welcome news to struggling students and institutions. But it is not going to be nearly enough in the long run or even the medium term.'

Simplified FAFSA for 2023-2024 School Year
The relief package included a smaller bill called the FAFSA Simplification Act, which accomplishes the long-held bipartisan objective of simplifying the Free Application for Federal Student Aid, or FAFSA. These changes will take effect starting on July 1, 2023 for the 2023-2024 school year. Here are some of the more significant changes.

Fewer questions . The bill significantly reduces the overall number of questions on the FAFSA, including eliminating questions about drug convictions and Selective Service status.
Changes to cost of attendance . The bill makes several changes to the definition of 'cost of attendance' in an attempt to standardize the term among colleges and make it more favorable for MasTec employees. For example, the allowance for room and board will be split into separate allowances for housing and meals, with the allowance for meals based on three meals a day and the housing allowance for students living in college housing based on the average or median housing charge (not the lowest charge), whichever is greater. Colleges can no longer set the housing allowance to zero for dependent students who live at home with their parents, and colleges must include an allowance for loan fees for federal student and parent loans. Colleges will be required to disclose all the elements of the cost of attendance on their website.
Expanded income protection allowance . The 'income protection allowance,' which shelters a portion of income from the FAFSA, will generally be more favorable for parents and students. Also, the income protection allowance will no longer be reduced based on the number of children in college.
Changes to untaxed income and benefits . For purposes of the FAFSA formula, the definition of 'untaxed income and benefits' has been streamlined and several types of untaxed income and benefits have been omitted, including child support (this will be considered an 'asset' instead), workers' compensation, veterans' benefits, and any money paid on the student's behalf. In addition, income from a federal work-study job, the American Opportunity tax credit, and the Lifetime Learning credit will not be counted as 'income.'
Multiple children in college at the same time loses preferential treatment . Having multiple children in college at the same time was formerly a benefit for MasTec employees because the EFC is typically cut in half (or divided by three or four, depending on how many children in the family are in college). However, starting in the 2023-2024 school year, the number of children in a family attending college at the same time on at least a half-time basis will no longer be a relevant data point. The FAFSA will still collect this information, but it will no longer divide a parent's assessment by the number of children in college. As an employee at MasTec, this change has the potential to significantly reduce the amount of financial aid offered to your children if you have multiple children in college at the same time.
Expanded Simplified Needs Test . The Simplified Needs Test, an alternate formula within the FAFSA that exempts certain families from having to report their assets (i.e., only income is counted to determine aid eligibility), has been renamed Applicants Exempt from Asset Reporting. In addition, there will be multiple ways to qualify for MasTec employees, including a higher income threshold that will be raised from $50,000 to $60,000.
Expanded Pell Grant . The bill widens the net of students eligible for a Pell Grant, and allows them to use basic information, like adjusted gross income and family size, to see if they qualify.

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Goodbye EFC terminology . The Student Aid Report generated by the FAFSA will no longer refer to the end calculation as the Expected Family Contribution, or EFC. Instead, this figure will be called the Student Aid Index, or SAI. The purpose of the name change is to more accurately reflect what this number represents — a yardstick for aid eligibility rather than a guarantee of what families will pay, because families often pay more than their EFC amount.

The 2023-2024 FAFSA that will include these changes will be available to file beginning October 1, 2022. This will give the U.S. Department of Education time to implement the changes. The 2022-2023 FAFSA, which will be available to file on October 1, 2021, will follow the current definitions and rules.

Employer help with student loan repayment starting in 2021
The bill extends a provision allowing MasTec employees to pay up to $5,250 of employees' student loans per year on a tax-free basis for another five years. This provision, included in the Consolidated Aid, Relief, and Economic Security (CARES) Act, would have expired at the end of 2020.

Expanded Lifetime Learning credit starting in 2021
Beyond financial aid, the relief bill increases the income limits necessary to qualify for the Lifetime Learning credit, an education tax credit worth up to $2,000 per year for courses taken throughout one's lifetime to acquire or improve job skills.

Starting in 2021, a full credit will be available to single-filer MasTec employees with a modified adjusted gross income (MAGI) below $80,000 and joint filers with a MAGI below $160,000 (the credit phases out for single filers with incomes between $80,000 and $90,000 and joint filers with incomes between $160,000 and $180,000). These are the same income limits used for the American Opportunity credit. To accommodate an expanded Lifetime Learning credit, Congress repealed the deduction for qualified college tuition and fees for 2021 and beyond.

For more information
The Consolidated Appropriations Act, 2021, contains other provisions that affect the FAFSA, making Financial Aid Awareness Month even more important this year. For more information on the FAFSA for MasTec employees, along with news and updates, visit the official FAFSA website.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Name of Plan: MasTec, Inc. Pension Plan Years of Service and Age Qualification: Employees are generally eligible for the pension plan after completing 5 years of service and reaching the age of 65. For early retirement, employees can start receiving benefits at age 55 with 10 years of service. Pension Formula: The pension benefit is calculated based on a formula that considers the number of years of service and average salary over a specified period, usually the highest-paid years. Name of Plan: MasTec, Inc. 401(k) Plan Eligibility: Employees are eligible to participate in the 401(k) plan upon completion of 30 days of service. Company Contributions: MasTec offers a matching contribution up to a certain percentage of the employee’s contribution.

Restructuring and Layoffs: MasTec announced a restructuring plan in early 2024 aimed at streamlining operations and reducing overhead costs. This plan included a reduction of around 8% of their workforce, particularly targeting roles that overlap in their newly consolidated departments. The company cited the need to adapt to changing market conditions and improve efficiency as primary reasons for this move. It is crucial to monitor these developments due to the current economic climate, which affects labor markets and corporate stability. Restructuring can impact not just the employees but also investors and the broader economy. Benefit Changes: Alongside the layoffs, MasTec has revised its employee benefits structure. The company has introduced a more flexible benefits package, including adjustments to health insurance premiums and modifications to retirement plan contributions. These changes are in response to evolving market demands and cost-management strategies. Staying informed about these adjustments is essential given the broader economic and political context, as such changes can influence employee satisfaction and retention, and reflect broader trends in corporate benefit management.

MasTec provides stock options and RSUs to employees as part of their compensation package. Stock options are often granted to executives and key employees, while RSUs are typically awarded based on performance and tenure. In 2022, MasTec's stock options and RSUs aimed to align employee interests with company performance.

Employee Benefits Overview: MasTec provides a comprehensive benefits package which typically includes medical, dental, and vision coverage, among other options. Healthcare Plans: They offer multiple health plan options including PPO (Preferred Provider Organization) and HDHP (High Deductible Health Plan) with HSA (Health Savings Account) compatibility. Wellness Programs: MasTec includes wellness programs and resources to support employees' physical and mental health.