KASRO Conference May 13, 2010 Presented by Denise Deal, Associate Director Student Financial Aid Office, U of L Switching from FFELP to Direct Loans

Agenda About UofL Planning Considerations/Resources UofL Implementation Timeline UofL Post-Live Comments/Issues Direct Loan: Things to Consider

About UofL 4-year public institution 21,000 enrollment 5 careers –Undergraduate –Graduate –Medical –Dental –Law Software vendor –PeopleSoft/Oracle since 2000

About UofL Federal Loan Participation –Long term history as FFELP participant (Federal Family Education Loan Program) –Switched to Direct Lending (DL) for FFELP loan borrower volume –$112,081,147 disbursed –19,313 awards for 9,493 students DL loan borrower volume to date –$115,316,835 disbursed ($120,311,768 offered) –20,310 awards for 9,934 students

Planning Considerations/ Resources

HCERA of 2010 Health Care and Reconciliation Act On March 30, 2010, President Obama signed the Health Care and Education Reconciliation Act (HCERA) of 2010, which included Title IV provisions from the Student Aid and Fiscal Responsibility Act. Specifically, the passage of HCERA converts all new federal student lending to the Department's Direct Loan Program beginning July 1, DL Source, April 2010 Edition:

USED Direct Loans Direct Loans Web Site – Important: Monitor this site regularly for updates!

USED Direct Loans (Images Only)

COD Common Origination and Disbursement COD School Relations Center (800)

COD (Image Only)

IFAP Information for Financial Aid Professionals FSA Announcements Alerts Contact Info DL School Guide New DL Loan Schools On-Line Training Links

IFAP (Image Only)

NASFAA NASFAA - –Education Department Urges Institutions to Prepare to Make Direct Loans, –Direct Loan Conversion Resource Center Resources-Checklist, Mentors Sample Communications Setting Up for DL COD Web Site Access G5 Bank Account Info DL Report Setup

NASFAA (Image Only)

NDSLC National Direct Student Loan Coalition –Alliance of Financial Aid professionals with experience with the Direct Loan program – DOE Setup Systems Platform Setup Communications Training Mentors

NDSLC (Image Only)

Training Initiatives Attend free DL training initiatives – there are many! –Direct Loan Webinar Series –COD Computer Based Training –“EDExpress 101” Web based training module via IFAP All impacted parties should participate –Financial Aid Office –Business Office Attend Fall 2010 FSA Conference –Orlando, Nov. 30 – Dec

Financial Aid Office Check Eligibility and Certification Approval Report (ECAR) to verify approval to participate in Direct Lending –Most already set up and no action is necessary –If not set up, then need to submit revised E- App (Electronic Application for Program Participation)

Financial Aid Office Multiple Campus Locations –Approved locations are listed on your institution’s PPA (Program Participation Agreement) –Decision: If multiple campuses, decide if each location will be treated as a separate entity for DL –At UofL, we process centrally for all locations

Business Office Review banking information with G5 (formerly GAPS-Grants Administration and Payment system for Department of Education fund management) –Decision: Use same bank account as for other Title IV programs or use a separate account for Direct Loan –At UofL, our Controller’s Office made the decision to use the same account

Communication/Marketing Work with Communications and Marketing Office to develop plan –Identify target audiences (students, parents, faculty and staff, general public) –Establish talking points for staff –Explore and use all options (web, printing/publications, blasts, news outlets, student newspaper, SGA, etc)

Software Vendor Assess software needs/vendor support –3 rd Party Vendor: Is functionality delivered? –COD on-line functionality? –EDExpress? Plan a site visit to another institution with the same or similar software COD testing not necessary if software vendor has completed it

U of L Implementation Timeline

December 2008 Conversations with UoL leadership –Pros and cons –Proposal to switch developed –Drafted implementation timeline Reviewed delivered software functionality –Initiated conversations with other PeopleSoft schools

January 2009 Presentation to Board of Trustees about proposed plan –Waited for approval to announce Initiated conversations with other UofL parties –Controller’s Office –Bursar’s Office –IT Department

February 2009 Worked with Communications and Marketing –Developed communication plan with public –Identified web sites to be updated –Identified publications to be updated

March 2009 Received approval to announce decision 3/4/09 Notified guarantor - KHEAA Notified key lenders Press release to public, to UofL faculty/staff, students and parents communication to student borrowers Conducted interviews with TV and newspapers Requested new program with Budget Office

March 2009 (cont) Sent to COD School Relations Received Direct Loan code Setup/updated COD website security officer, contact information, users eMPN options, credit checks, program relations, campus, etc. Setup Direct Loan Servicing report options entrance/exit counseling, delinquency reports, etc. Controller’s Office contacted G5

March 2009 (cont) Started receiving MPN and Entrance Counseling data files in SAIG mailbox Worked with staff on file management of new message classes Started working with IT on program to load entrance interviews Visited another institution with same software and mirrored their system setup in test database Attended DL workshop at software user group conference

April 2009 Completed production system setup to support Direct Loan processing –In PS, account # setup begins with the Bursar’s Office Updated website with new processing procedures and instructions Started processing freshman awards Continued communicating with students about eMPN and entrance counseling Reassigned staff duties to support both FFELP and Direct Loan – did not need new staff

May 2009 Started conducting staff training on DL Started processing awards for all other student populations continuing undergraduates, graduates, professionals Continued communicating with students about eMPN and entrance counseling!

June 2009 Transmitted first COD loan origination file Received first COD receipt and response files UofL transmits and receives files daily Began working with errors and problem resolution Software provides numerous canned reports Continued communicating with students about eMPN and entrance counseling! Worked with Controller’s Office on monthly reconciliation procedures

July 2009 Transmitted first COD disbursement file Controller’s Office completed first G5 drawdown All institutions are approved for advanced funding Must monitor 3 day cash management rule UofL opted to do frequent draw downs on actual funds already disbursed UofL completes draw downs when disbursements are $250,000 or greater and always on the last day of the month Continued communicating with students about MPN and entrance counseling!

August Present Completed first monthly reconciliation and continue to complete monthly COD sends monthly reconciliation school account statement Must develop internal reconciliation procedures Continue daily (M-Th) transmittal of COD DL origination and disbursement data files Made decision to reserve Fridays for problem resolution Continue communicating with students about MPN and entrance counseling!

U of L Post-Live Comments and Issues

Positive Staff Feedback Ease of COD system –Viewing loan information, by student or by batch, cash activity Software vendor processes already established and tested Less complicated to create origination and disbursement data files eMPN and batch results are near real-time Quick turnaround time - usually in same day Most problem solving on front-end, not back-end First big disbursement a huge success: –For for undergraduate, graduate, and law students was $10,000,000 more than first disbursement for

Staff Adjustments Shift from local to national customer service –Miss contact with our KHEAA friends –Establishing new DL customer service relationships Change in culture –No cents –No loan EFT/check release –Works like Pell Adjusting to new terminology –“Accepted”, “Linked” Problem solving learning curve –Cannot always fix it the way we did with FFELP –Biographical mismatch issues (name, SSN, DOB)

Staff Adjustments Staffing –No new staff, but some shift in job duties –Monthly reconciliation; file transfer; EdConnect Issues we did anticipate (new programming): –Override on loan period dates for special groups –Loading entrance interviews –Loan period vs. academic year Issues we did not anticipate –2 nd disbursement disbursing before 1st –Co-mingled records at COD

Student Feedback/Issues Overall, an easier process Completing the new eMPN process –Transitioning from FFELP to DL For PLUS and GradPLUS –No upfront credit check; have to wait for loan to be originated with COD (U of L decision) –Denial process for PLUS and GradPLUS; more loans are approved –New functionality with StudentLoans.gov Some customer service communication issues Direct Loan on-line servicing options a positive –

StudentLoans.gov Implemented May 1, 2010 Webinar June 9, 2010 –

StudentLoans.gov (Image Only)

Tips from DL: Things to Consider (permission to borrow from Wood Mason, DOE)

Commonality with Pell Same person Same origination process Same disbursement process Same transmission vehicle

Resources/Staff Commonality of awards Same system (COD) Same institution solution Maybe some additional programming for minor differences between FFELP and DL

Reconciliation Monthly reconciliation leads to successful program year closeout School Account Statement School Summary Financial Information Other cash activity screens on COD

COD Staff Resources COD Customer Service Representatives COD Issue Resolution Specialists COD Reconciliation Specialists

DL Setup Contacts to COD Direct Loan Website – For more information – to – to

Questions/Contact Info Denise Deal, Associate Director Student Financial Aid Office University of Louisville Louisville, KY desk fax