ERIC ED475535: Federal Student Aid Handbook, 2002-2003. Volume 2: Institutional Eligibility and Participation.

355 Pages·2002·5.8 MB·English

by  ERIC

DOCUMENT RESUME
ED 475 535
HE 035 776
Federal Student Aid Handbook, 2002-2003. Volume 2:
TITLE
Institutional Eligibility and Participation.
Office of Federal Student Aid (ED), Washington, DC.
INSTITUTION
2002-00-00
PUB DATE
354p.; Developed by Research & Publications Group. For the
NOTE
2001-2002 volume 2, see ED 454 764. For the 9 volumes of the
Student Financial Aid Handbook for 2002-2003, see HE 035 775-
782
ED Pubs, P.O. Box 1398, Jessup, MD 20794-1398. Tel: 877 -433-
AVAILABLE FROM
7827 (Toll Free); Web site: http://www.fsa4schools.ed.gov.
Guides Non-Classroom (055)
PUB TYPE
EDRS Price MF01/PC15 Plus Postage.
EDRS PRICE
*Colleges; *Eligibility; Federal Aid; *Financial Aid
DESCRIPTORS
Applicants; Grants; Higher Education; *Institutional
Characteristics; Need Analysis (Student Financial Aid);
*Participation; Paying for College; Student Financial Aid;
Student Loan Programs; Work Study Programs
ABSTRACT
The purpose of this volume is to describe how schools become
eligible to participate in the Federal Student Aid (FSA) programs and to
explain the administrative and fiscal requirements of FSA program
participation. In addition, the publication discusses other issues relevant
to the general administration of the FSA programs. Major changes from the
preceding year are summarized by chapter. The majority of the changes are
related to the return of Title IV funds by an institution. The chapters are:
"Institutional and Program Eligibility"; "General Participation
(2)
(1)
"Financial
Requirements"; (3) "Administrative Capability";
(4)
"Return of Title IV Funds";
Responsibility";
"Cash Management";
(6)
(7)
(5)
"Consumer Information"; "Recordkeeping and Disclosure";
"Written
(9)
(8)
(10) "Applying for and Maintaining Participation
Agreements between Schools";
(11) "Program Integrity"; and (12) "Distance
in the FSA Programs";
Education.". (SLD)
Reproductions supplied by EDRS are the best that can be made
from the original document.
110
I
_21
U S DEPARTMENT OF EDUCATION
Office of Educational Research and Improvement
EDUCATIONAL RESOURCES INFORMATION
CENTER (ERIC)
gerriis document has been
reproduced as
received from the person or organization
originating it
Minor changes have been made to
improve reproduction quality
Points of view or opinions stated in this
document do not necessarily represent
official OERI position or policy
Volume 2.of
9
Application and Verification Guide
.Student Loan Guide
Volume 1; Student Eligibility
.Volume 2: Institutional Eligibility' and Participation
VoluMe 3: Federal Pell Grant Prografn
Volume 4: Campus
Based Common Provisions
-
Volume 5: Perkins Loans
Volume.: Federal Work-Study
Volume?: FSEOG
Volume 8: Direct Loan and FFEL Programs
Velum
State Grant Programs
:
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As A.
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-
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BEST COPY AVAILABLE
Table of Con2,zents
INTRODUCTION
Major Changes by Chapter
2-1
CHAPTER 1 -INSTITUTIONAL AND PROGRAM ELIGIBILITY
2-1
The Three Definitions of Eligible Institutions
2-1
Institutional Control
2-2
Eligible Institution
2-3
Legal Authorization by a State
2-3
Accreditation
2-4
Alternatives to accreditation
2-4
Changes in accreditation
2-4
Change in primary institution-wide accreditation
2-4
Accreditation by more than one institution-wide accrediting agency
2-5
Primary accreditor
2-5
Dual accreditation
2-5
Admissions Standards
2-5
High School Diploma
2-6
Recognized Equivalent Of A High School Diploma
2-6
Home Schooled
2-7
"Two-Year" Rule
2-7
Additional Institutional Eligibility Factors
2-8
Demonstrations of compliance
2-9
The 90/10 Rule
The cash basis of accounting, Exclusions from fraction. FSA program funds for
institutional charges, Revenues, Time period covered
2-12
Correspondence course limitation
2-12
Correspondence student limitation
2-12
Incarcerated student limitation
2-13
Ability-to-benefit limitation
2-13
Bankruptcy
2-13
Crimes involving FSA program funds
2-13
Program Eligibility Requirements
2-14
Determination of program eligibility
2-14
Types of eligible programs at an institution of higher education
2-15
Types of eligible programs at a proprietary or postsecondary vocational institution
2-17
Exceptions to eligible program definition
2-17
Weeks Of Instruction And The 12-hour Rule
2-18
Additional Eligibility Requirements
2-19
ESL Programs
Study abroad programs
2-19
Flight schools
2-19
Clock Hour/Credit Hour Conversions
2-20
Foreign Schools Eligible for FFEL Programs
2-23
Foreign Medical Schools
2-23
Criteria for determining whether a foreign veterinary school is eligible to apply to partici-
pate in the FFEL programs
2-24
Reporting Information on Foreign Sources
2-24
CHAPTER 2
GENERAL PARTICIPATION REQUIREMENTS
2-27
The Program Participation Agreement
2-27
Purpose and scope of the PPA
2-27
PPA Requirements
2-28
Voter Registration Required
2-31
GED preparatory program required
2-32
Civil rights and privacy requirements
2-32
Academic Calendars
2-32
Definition of a Payment Period
2-33
Payment period for term-based credit hour programs
2-34
Payment period for nonterm credit hour programs and clock hour programs
2-34
Payment period for programs of an academic year or less
2-35
Payment period for programs of multiples of an academic year
2-36
Programs longer than an academic year with a remainder
2-37
Definition of coursework
2-38
More than two payment periods per academic year
2-38
Payment periods and the return of Title IV funds
2-39
Academic Year Requirements
2-39
Thirty-week minimum of instructional time
2-39
Determining academic year length
2-39
Definition of a week of instructional time
2-39
12-hour rule and definition of an academic year
2-40
Reductions in academic year length
2-40
Contracts with Third-Party Servicers
2-41
Anti-Drug Abuse Requirements
2-43
Anti-Lobbying Certification and Disclosure
2-45
CHAPTER 3
ADMINISTRATIVE CAPABILITY
2-47
Required Electronic Processes
2-47
"IFAP
Information for Financial Aid Professionals" Web site
2-47
Submission of the Application to Participate (Recertification) through the Internet
2-49
Administrative Requirements for the Financial Aid Office
2-49
2-49
Coordinating official
2-49
Consistency of information
2-50
OIG Referrals
2-50
Counseling
2-50
Adequate staffing
2-51
System of checks and balances
2-51
Satisfactory Academic Progress
2-52
Financial Aid History
2-52
Default Rates
2-53
Withdrawal Rates
2-54
Debarment And Suspension Certification
2-57
FINANCIAL RESPONSIBILITY
CHAPTER 4
2-58
General Standards
2-58
Proprietary or private nonprofit institution
Audit opinions and past performance, Composite score, Refund reserve standards,
Current in debt payments
2-63
Public schools
2-64
Alternatives to the General Standards
2-64
Letter of credit alternative for new school
2-64
Letter of credit alternative for participating school
2-64
Zone alternative
2-65
Provisional certification for school not meeting standards
2-66
Provisional certification for school where persons or entities owe liabilities
2-67
Past performance and Affiliation Standards
2-67
Past performance of a school
2-68
Past performance of persons affiliated with a school
2-68
Financial Statements
2-69
Foreign Schools
2-71
CASH MANAGEMENT
CHAPTER 5
2-71
Purpose of Cash Management Regulations
2-72
Requesting Funds
2-72
The advance payment method
2-72
The reimbursement method
Requesting loan funds from an FFEL lender, Limitations on use of FFEL funds
2-74
The cash monitoring payment method
2-75
The just-in-time payment method
2-76
GAPS
2-77
Maintaining and Accounting for Funds
2-77
Bank account notification requirements
Interest-bearing or investment account
2-77
Exceptions
2-78
Federal Perkins Loan Program participants
2-78
Accounting and financial requirements
2-78
Disbursing Funds
2-79
Definition of disbursed
2-79
Exceptions
2-79
Disbursement by crediting a student's account
2-80
Time Frames To Disburse Loan Funds Or Return Them
2-80
Time frames for disbursing FFEL funds received from lender
2-81
Verification extension
2-81
Time frame for returning undisbursed FFEL loan funds
2-81
Proration of loan fees for returned FFEL funds
2-82
Disbursing FSA funds directly
2-82
Disbursement by Payment Period
2-83
Excused Absences
2-83
Early Disbursements
2-84
Late Disbursements
2-85
FSA Credit Balances
2-86
Holding credit balances
2-88
Prior-year Charges
2-88
Required School Notifications
2-89
Opportunity for loan cancellation
2-89
Required Student Authorizations
2-91
Using Electronic Processes for Authorizations and Notifications
2-93
The Electronic Signatures in Global and National Commerce Act
2-93
Excess Cash
2-94
Allowable excess cash tolerances
2-94
CHAPTER 6
RETURN OF TITLE IV FUNDS
2-97
Withdrawals
2 -97
Worksheets and software
2-98
General requirements
2-98
Definition of a Title IV recipient
2-98
Verification
2-99
Consumer information
2-99
Foreign schools
2-100
Rounding
2-101
Date of the institution's determination that the student withdrew
2-101
Use of payment period or period of enrollment
2-102
Payment period, Period of enrollment, Applicability
2-103
2-104
Step 1: Student's Title IV Aid Information
Funds to include in the calculation, FSEOG program funds, LEAP program funds
2-104, Title IV aid disbursed, Title IV aid that could have been disbursed
Second or subsequent FFELJDL disbursements, Effects of the 30-day delayed
disbursement requirement, Late arriving aid
2-108
Step 2: Percentage of Title IV Aid Earned
2-108
Withdrawal date
Withdrawal date for a student who withdraws from a school that is required to
take attendance, Attendance requirements of outside entities, Documentation,
Determining a student's withdrawal date at a school that is not required to take
attendance, Official notification, School's withdrawal process, Otherwise provides
official notification, When a student triggers both dates, Official notification not
provided by the student, Time frame for the determination of a withdrawal date for
without student notification due to,
an unofficial withdrawal, Withdrawal
circumstances beyond the student's control, All other withdrawals without student
notification
2-115
When students fail to earn a passing grade in any of their classes
2-115
Last date of attendance at an academically-related activity
2-116
Withdrawals after rescission of official notification
Withdrawals from standard term-based programs
2-117
using modules
2-118
Leaves of absence
Approved leaves of absence, Number of leaves of absence in a 12-month period,
Formal policy, Reasonable expectation of return, No additional charges, Does not
exceed 180 days in any 12-month period, Completion of coursework upon return,
Explanation of consequences of withdrawal to loan recipients, Unapproved leaves
of absence
2-123
Death of a student
2-125
Percentage of payment period or period of enrollment completed
Credit-hour programs, Scheduled breaks, Clock-hour programs, Use of scheduled
hours, Excused absences
2-128
Step 3: Amount of Title IV Aid Earned by the Student
2-128
Effects of a post-withdrawal reduction in charges
2-129
Step 4: Total Title IV Aid to be Disbursed or Returned
2-129
Post-withdrawal disbursements
2-129
Crediting a student's account
2-131
Notice to a student offering a post-withdrawal disbursement
2-134
Disburse grant before loan
2-134
Title IV aid to be returned
2-134
Step 5: Amount of Unearned Title IV Aid Due From the School
2-135
Aid disbursed to the student before institutional charges are paid
a
Institutional charges
2-135
Use of institutional charges in determining the school's responsibility for
return,
Effects of waivers on institutional charges, January 7, 1999, policy bulletin, Insti-
tutional versus noninstitutional charges, Principle 1: Most costs
are institutional
Principle 2: An institutional charge does not need to be assessed to all students,
Principle 3: Institutional charges may or may not be charged to
a student's
account, General guidelines for defining institutional charges, Demonstrating a
real and reasonable opportunity, Book vouchers and institutional charges in the
return of Title IV funds calculation, Summary
2-142
Step 6: Return of Funds by the School
2-143
Order of return of Title IV funds
2-143
Time frame for the return of Title IV funds
2-144
Step 7: Initial Amount Of Unearned Title IV Aid Due From The Student
2-144
Step 8: Return Of Funds By The Student
2-144
Grant Overpayments
2-145
When a student receives additional funds during the 45-day period of extended
eligibility, Student overpayments less than $25, Payments
on a student's behalf
Recording reductions and student payments in the Pell System, Notifying the
Department, Reporting and referring overpayments, Summary, Accepting
pay-
ments on referred overpayments
Calculating a Pell award when a student who owes an overpayment returns to
a standard
term-based educational program in the same award year
2-155
When a student loses eligibility at a former school while receiving aid at
a second school
2-156
Sample Summary of the Requirements of 34 CFR 668.22
2-158
CASE STUDIES
2-161
Worksheet for Withdrawal from a Clock Hour Program
2-205
Worksheet for Withdrawal from a Credit Hour Program
2-207
Post-Withdrawal Disbursement Tracking Sheet
2-209
Format for Referral to ED Collections
2-210
Chart of Requirements and Deadlines for Return of Title IV Funds
2-211
Chart of Notification Requirements Associated with the Return Funds
2-212
Chart of Withdrawal Dates for a School that is not Required to Take Attendance 2-211
Chart of Requirements and Deadlines for Return of Title IV Funds
2-211
CHAPTER 7
CONSUMER INFORMATION
2-215
Basic Consumer Information Requirements
2-217
Financial Aid Information
2-217
General Information About The School
2-217
Consumer Information From The Department
2-219
Student Right-to-Know Disclosures
2-219
Determining The Cohort For Completion Or Graduation And Transfer-out Rates 2-220
Standard-term schools
2-221
Nonstandard term or nonterm schools
2-221
Definitions
2-221
Waivers
2-222
Reporting on Completion /Graduation Rates for General Student Body Cohort
2-222
Reporting Information on Completion or Graduation Rates for Student Athletes 2-224
Equity in Athletics
2-228
Loan Counseling
2-232
Drug and Alcohol Abuse Prevention Information
2-233
Misrepresentation
2-234
Definition of misrepresentation, Nature of educational program, Nature of
financial charges, Employability of graduates
Campus Security
2-236
General information, Distribution of the Campus Crime Report, Definition of
campus, Timely warning, Campus security authority, Professional and pastoral
counselors excluded from reporting requirements, Daily crime log, The annual
security report, Policies and procedures for reporting crimes, Complaints against
schools
FERPA
2-245
Chart of Requirements for Institutional and Financial Assistance
Information for Students (continued)
2-248
CHAPTER 8
RECORDKEEPING AND DISCLOSURE
2-251
Required Records
2-251
Program Records a School Must Maintain
2-252
Fiscal Records
2-252
General Records
2-253
Record Retention Periods
2-255
Record Maintenance
2-256
Acceptable formats
2-256
Safeguarding electronic records
2-257
Special requirements for SARs and ISIRs
2-258
Examination of Records
2-258
Location
2-258
Cooperation with agency representatives
2-258
Timely access
2-259
Reasonable Access To Personnel
2-259
FSA Recipient Information
2-259
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