Federal Update Jeff Baker David Bergeron Dan Madzelan

Agenda American Recovery and Reinvestment Act (ARRA) Reporting Default Rates Legislative Status Loan Programs Update Simplification – IRS Data Retrieval Regulatory Update Experimental Sites VA Benefits Two Pells in an Award Year 2

The American Recovery and Reinvestment Act (ARRA) 3

ARRA $200 million for 2009-10 Federal Work- Study ARRA added to regular appropriation Total included in school authorizations posted in March Some schools did not see an increase Special FWS reporting is required if $25,000 or more – 1,796 schools. $17.1 billion No school reporting 4

ARRA September 24 Electronic Announcement Must register Reporting deadlines Reporting guidance coming October 2 Electronic Announcement Specific Reporting Guidance October 16 Electronic Announcement Revisions and Clarification E-mails to 1,796 schools 5

FFEL/Direct Loan Cohort Default Rates 6

National Student Loan Cohort Default Rates

Cohort Default Rates

Legislative Status

President Barack Obama February 24, 2009 It is our responsibility as lawmakers and educators to make this system work.  But it is the responsibility of every citizen to participate in it.  And so tonight, I ask every American to commit to at least one year or more of higher education or career training.  This can be community college or a four-year school; vocational training or an apprenticeship.  But whatever the training may be, every American will need to get more than a high school diploma.  That is why we will provide the support necessary for you to complete college and meet a new goal:  By 2020, America will once again have the highest proportion of college graduates in the world.     President Barack Obama February 24, 2009 To reach this goal, an unprecedented number of Americans will have to enroll in—and complete—college. We are going to have to increase college access, constrain costs and tuition prices, and do a much better job of ensuring college completion—and we have to do all of it at the same time.

Legislative Status Student Aid and Fiscal Responsibility Act of 2009 (HR 3221) Passed the House on September 16 Senate drafting – similar provisions Expect committee mark-up in next few weeks Floor action to follow

HR 3221 Pell Grants More reliable funding Increased aid for children of deceased members of the armed forces EFC change moved to needs analysis New Iraq and Afghanistan Service Grants

HR 3221 Needs Analysis (EFC) Effective 2011-12 Award Year Elimination of assets Asset threshold -- no subsidized aid Elimination of most untaxed income Elimination of income exclusions

HR 3221 Drug Conviction and Student Eligibility Only if conviction was for sale of a controlled substance.

HR 3221 American Graduation Initiative Invests $3 billion to bolster college access and completion support programs for students Creates a new competitive grant program for community colleges to: improve instruction, work with local employers, improve their student support services, and implement other innovative reforms that will lead to a recognized credential to help fulfill local workforce needs It will increase funding for the College Access Challenge Grant program, and will also fund innovative programs at states and institutions that focus on increasing financial literacy and helping retain and graduate studentsIncludes all loan types

HR 3221 American Graduation Initiative Expands access to education by supporting free, high-quality, online training, high school and college courses Ensures that community college students can learn in modern, updated, state-of- the-art facilities by renovating campuses in need of repair It will increase funding for the College Access Challenge Grant program, and will also fund innovative programs at states and institutions that focus on increasing financial literacy and helping retain and graduate studentsIncludes all loan types

New Direct Perkins Loan $6 billion available for new loans, up from $1.5 billion Broad Availability to Schools Likely School Contribution Direct Loans Interest rate remains at 5% Unsubsidized Same terms and conditions as Direct Loans Originated by schools using COD Serviced by ED 17

New Direct Perkins Loan “Lending Authority” Established for Each School Hold Harmless for Current Participating Perkins Schools “Fair Share” Calculation with Incentives Success in Enrolling and Graduating Low-Income Students Affordable Tuition Charges Credit for Non-Federal Need Based Grants Awarded/Received 18

New Direct Perkins Loan Recall Federal share of cash in school’s Revolving Fund as of June 30, 2010 Schools collect on existing loans Remit to ED federal share; keep institutional share; administrative fee paid by ED ED collect on loans assigned by schools ED remits institutional share of collections to schools 19

100 Percent Direct Loans Effective July 1, 2010 all Federal student loans to be made under the Direct Loan program Includes all loan types Subsidized, Unsubsidized, PLUS, & Consolidation Foreign Schools eligible $500 Billion in outstanding FFEL loans held by FFEL lenders, guaranty agencies, and ED unaffected

Loan Programs Update

DIRECT LOAN – FFEL PROGRAM STATISTICS Number of Loans 2007-08 2008-09

DIRECT LOAN – FFEL PROGRAM STATISTICS 2007-2008 2008-2009 2009-2010* DL FFEL Schools 1,224 4,621 1,735 4,424 2,017 4,003 Loans 3,317,000 13,388,034 5,412,766 15,229,602 6,065,168 9,239,148 Dollars $13.1 B $55.5 B $20.9 B $61.1 B $29.5 B 49.6 B *2009-2010 Partial Year and Delayed Reporting Especially for FFEL

DIRECT LOAN – FFEL PROGRAM STATISTICS TOTAL FFEL LOANS MADE FFEL LOANS SOLD TO ED PERCENT SOLD TO ED Loans 15,229,602 11,591,588 76.1 % Dollars $61,160,183,858 $46,252,966,517 75.6 % *Does not include Consolidation Loans

DIRECT LOAN – FFEL PROGRAM STATISTICS ALL LOANS MADE DIRECT LOAN FFEL PURCHASED BY ED TOTAL LOANS OWNED BY ED % OWNED BY ED Loans 20,642,368 5,412,766 11,591,588 17,004,354 82.4 % Dollars $82.1 Billion $20. 9 Billion $46. 3 Billion $67.2 Billion 81.8 %

Loan Origination Similar to FFEL Similar to Grants Confirm eligibility Determine award/loan amount MPN needed – eMPN available Create and send certification/origination to lender Similar to Grants School transmits loan origination data to COD via Common Record and same transmission as Pell Grant data For non-Grant processing schools, same as FFELP certification Direct Loan origination must carry actual/anticipated disbursement data equal to loan amount Direct Loan award data can ride to COD alongside Grant data going to COD on same CR…no need to create separate record for additional lender or lenders. Very efficient and beneficial to school in that it’s time and labor saving process 26

FSA Preparations COD System capacity enhancements for 100% FFELP volume in progress, on time and on target FSA Customer Service Centers Increased and trained staff Monitor incoming volume COD has dedicated “OnBoarding Team” to assist setup completion requests and “starts” FSA has embarked on a program to enhance the COD system to be able to handle 100% of the current FFELP volume FSA Customer Service Centers are staffing up and readying themselves for the incoming schools

FSA Preparations FSA Direct Loan Transition Team Focused “OnBoarding” Point of Contact Team Focused School Assist Team Graduate and Professional schools Career Colleges Small schools Foreign schools FSA has assembled a group of experienced staff to act as Points of Contact to incoming schools Their job is to shepherd FFELP schools migrating to Direct Loans as they transition from one program to the other FSA has also assembled a group of experienced staff and Managers to address the issues and concerns faced by unique groups of schools Bottom line…FSA is proactively working to be 100% ready and reliable to service ALL schools coming to, and participating in, the Direct Loan Program with no disruption or delay

How to Get Started Email to COD Direct Loan Website CODSupport@acs-inc.com Direct Loan Website http://www.direct.ed.gov/participating.html For more information Email to DLEnrollment_FSA@ed.gov Email to wood.mason@ed.gov Even though FSA has setup most eligible schools, we need to know your intent to complete setup for Direct Loan participation or just as a backup Email will initiate your school being contacted by an FSA Point of Contact person to shepherd you through the migration process Email must include information about the school and the intended starting Award Year All needed information is available at the Direct Loan website…URL above Still have questions? Send an email to DLEnrollment_FSA@ed.gov and the Direct Loan OnBoarding Team will respond within 24 hours Contact Wood Mason as above

Training Suite of Direct Loan webinar training this fall Began in October COD Systems Primer Direct Loan program Primer COD & Direct Loan Program Reconciliation Will repeat spring 2010 Training is vitally important to incoming schools. Some have experience with COD and processing Pell Grants…some don’t. FSA is in the process of developing necessary training for all aspects of Direct Loan participation We are also developing training for focused groups of users, including Grad and Professional schools who have little COD experience if any. 30

Training IFAP Announcement: Publication Date: September 28, 2009 DCL ID:  ANN-09-30 Subject: Live Internet Webinars - Direct Loan Webinar Training Suite Attachments contain session descriptions and schedule Training is vitally important to incoming schools. Some have experience with COD and processing Pell Grants…some don’t. FSA is in the process of developing necessary training for all aspects of Direct Loan participation We are also developing training for focused groups of users, including Grad and Professional schools who have little COD experience if any. 31

Training EDExpress “101” COD Computer Based Training Web based training module via IFAP COD Computer Based Training Download via IFAP Updated version this Fall FSA Fall Conference Nashville, Tennessee December 1-4, 2009 Training is vitally important to incoming schools. Some have experience with COD and processing Pell Grants…some don’t. FSA is in the process of developing necessary training for all aspects of Direct Loan participation We are also developing training for focused groups of users, including Grad and Professional schools who have little COD experience if any. 32

COD Call Center for Schools COD School Relations Center www.cod.ed.gov (800) 848-0978 And of course, the COD School Relations Center in Niagara Falls, NY, is fully staffed to answer questions you may have… 33

FAFSA Simplification

Technology Facilitated by a technology upgrade. 2010-11 design facilitated by technology upgrade Updated navigation reduces the number of pages and length of the application Display of help text and instructions will be enhanced by: use of field instructions flyover text modal boxes Redesign of the 2010-2011 FAFSA on the Web site Facilitated by a technology upgrade. Updated navigation reduces the number of pages and length of the application. Display of help text and instructions will be enhanced to include the use of field instructions, flyover text for glossary terms and the use of modal boxes for specific help topics.

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Results Reporting Retention, graduation and transfer rates within FAFSA on the Web When students use the school code lookup within FOTW to lists colleges on the form, they will be presented with each college’s reported retention, graduation and transfer rates. This information will also display on the FAFSA on the Web confirmation page. Beginning August 9, 2009, when applicants use the school code lookup within FAFSA on the Web to lists colleges on the form, they will be presented with each college’s reported retention, graduation and transfer rates. This information will also display on the FAFSA on the Web confirmation page . 38

IRS Data Retrieval

IRS-FSA Concept Federal Student Aid (FSA) and the Internal Revenue Service (IRS) are developing a collaborative solution to simplifies FAFSA completion. Tax filer Retrieves Their Own Data No Consent Voluntary Will allow some applicants that use FAFSA on the Web to retrieve their income tax data from the IRS. IRS data can be automatically transferred to FOTW. The IRS Data Share Project takes a different approach to doing a match, and it’s this approach that has enabled us to make the significant progress we have made over the past few months. Through collaboration between ED and the IRS – at the highest levels – we’ve been able to develop an IRS solution that will make completing the most difficult part of the FAFSA – which is providing income information – much simpler for many students and parents. The new process will allow students using FOTW (and their parents if they’re dependent) to request and receive their income tax data directly from the IRS while they’re in their FOTW session. Once tax data have been received by the taxpayer from the IRS, he or she will be given the option to have that IRS data automatically transferred into his or her FOTW application. So, the big difference between the process we’re working on now and past projects is that taxpayer data will be presented to the taxpayer directly, not to ED, and the taxpayer can choose what to do with that data – in other words, the taxpayer gets to decide whether to share the information with ED by transferring it into FOTW -- or not. Past solutions have relied on a more mandatory approach, and I think it’s for that reason that we’ve run into obstacles in the past. So, putting the taxpayer in the driver’s seat – so to speak – has really helped to get us beyond some of the stickier policy and legal issues, and opened the door for making some real progress here. Now, the data share process we’ll talk about today is still a work in progress. We’ve accomplished an enormous amount of work in a very short amount of time, but there are some details that still need to be worked out. But these details are relatively small at this point, so what you see today should be very close to the final process we’ll be implementing. And, as you’ll see, the process only involves two IRS screens and should be quite simple for applicants and their parents to get through.

So, let’s look at how students and parents will access the IRS Web site. For security reasons, when a student or parent clicks on the IRS link, before they will be permitted access to the IRS site, they’ll first need to go through FSA’s PIN authentication process. The left side of this slide (if you can see it) shows what the PIN authentication screen will look like. To make the PIN authentication process as simple as possible, we’ll automatically pre-fill all identifying information for the individual (Name, SSN, DOB) that they’ve already entered on the FAFSA. That way the only additional item they’ll need to provide is their PIN. Once the PIN is entered, we’ll match those 4 identifiers against our PIN database and if they all match up then the individual is considered to have been authenticated by FSA. And, it’s at this point that the student or parent will automatically be sent over to the IRS Web site. Technically, what will happen is that a second Web session will open up and lay on top of the FOTW session. The example you see on the right side of this slide shows the screen that our sample student, Joe Smith, will see when he gets to the IRS site. We’re calling this screen the “IRS Request Screen,” because it’s the screen that Joe will use to ask the IRS to show him his tax information. Some information about Joe will be automatically be pre-filled on this screen with data he already entered on the FAFSA, so he doesn’t have to re-enter that information once he gets to the IRS site. As you can see, Joe’s first and last names are pre-filled, as are -- The last four digits of his SSN, and His Date of Birth. You probably can’t see this, but the tax year he’s requesting data for is also automatically pre-filled based on the year required by the FAFSA – in this example, Joe is completing a 2009-10 FAFSA, so the tax year he needs information for is 2008. Again, for security reasons, Joe will go through an IRS authentication process before the IRS will display his tax information. For IRS authentication, Joe will need to provide – His mailing address -- as it appears on his tax return for the year he is requesting tax information, and His tax filing status for that year (single; married filing jointly; married filing separately; etc.). In addition, he’ll need to confirm that his name and DOB from his FOTW application matches his 2008 tax return, and if not, he can change those fields on this screen. Joe’s SSN, on the other hand, can not be updated – it needs to come over correctly from the FAFSA. Once Joe confirms (or, if necessary, changes) his name or DOB, confirms his SSN, enters his address as it appears on his 2008 return, and selects his tax filing status for 2008 from a dropdown box, he needs to click on the Submit button.

By clicking on the Submit button, the IRS will authenticate Joe’s data against its records, in real-time – so this will happen very quickly -- within seconds. If all of the data on the Request Screen matches what the IRS has in its database for Joe for that tax year, the IRS will go ahead and present Joe with the screen you see on this slide -- we’re calling this the IRS “Review Screen.” This screen shows IRS data for Joe for the 2008 tax year. In the left hand column, Joe will see the names of the IRS items being displayed. In the middle column he’ll see the value of that field in the IRS’s records. And, in the right column, Joe will see the 2009-10 FAFSA question number that this IRS data element corresponds to. Now, IF, Joe wants to have this data transferred automatically to his online FAFSA, he can click on the “Transfer Now” button that you see at the bottom of this screen. When he does that, the IRS session and window will automatically close, Joe will be taken back to his FOTW session, and all of these data fields will be pre-populated for him into the appropriate FAFSA fields. If Joe opts not to have his data transferred to the FAFSA application, he can print a copy of this screen if he wants to. And then click on the Logout button, which will close the IRS session and automatically take Joe back to his FOTW session, where he can enter the IRS data himself (or it may be that this information is not the information that he needs to report on his FAFSA, perhaps because of a marital status change or what have you) – so he’ll have to use other records to complete the income portion of his FAFSA. Either way, Joe can then complete the rest of FAFSA and submit it to the CPS for processing. This may sound like a lot, but the process only requires two IRS screens – the Request Screen and the Review Screen, and very little data entry on Joe’s part. So it really should be a simple process and much easier than trying to figure out from a tax return what data needs to be reported on the FAFSA, and where.

Implementation Schedule So, when will applicants start seeing this new data share process between the IRS, the taxpayer, and the Department of Education? Our plan at the moment is to implement a pilot – or what we’re more formally calling a “proof of concept” –starting in January 2010 for remainder of the 2009-10 application processing year. The reason for this particular timeframe is pretty straight forward – it’s the earliest that the IRS and FSA can have a fully coded and tested process to implement. The new process will be made available to a subset of our 2009-10 FOTW applicants and their parents. We’re still working on who this subset will include. This data share process is voluntary for students and parents – and will continue to be as long as we’re using this approach. As I mentioned earlier, the voluntary nature of this process is what has allowed us to make progress toward implementing a data share with the IRS. Data from the 09-10 proof of concept will be carefully analyzed and used to inform what we do in 10-11. Chances are the process will be very similar, but if we find usability issues, or unanticipated problems with any part of the process, we’ll use that information to refine what we do in 2010-11. In addition, based on what we learn in the proof of concept phase, we’ll decide who are the best candidates to use this new process. We believe that most students will be able to benefit from it – the exceptions are really just parents and students who’ve had a recent marital status change, but our data shows that there aren’t very many of these situations. For 2010-11, then, our plan is to implement the IRS Data Share process in the Summer of 2010. The reason for that timeframe is because base year income, which is 2009 for the 2010-11 application year, isn’t available at the IRS until the summer timeframe. If we ever move to PPY, instead of PY income on the FAFSA, we could offer this process to applicants starting on Jan. 1, instead of just to applicants who apply later in the year. VERIFICATION: For the 2010-11 year, we’re looking at sending information to you in the student’s ISIR that tells you when data on the FAFSA is coming directly from the IRS. This may make it possible for us to look at our verification rules differently to allow you to consider data from the IRS to already be “verified,” and then all you may have to do is verify the remaining items that did not come directly from the IRS, such as HHS and Number in College. Any questions? 2009-10 IRS data retrieval process will be implemented in January 2010 Pilot to test proof of concept Participation is voluntary 2010-11 IRS data share will be implemented in the Summer of 2010 Full implementation Possible use by applicants using the Corrections on the Web (COTW) Process

Verification So, when will applicants start seeing this new data share process between the IRS, the taxpayer, and the Department of Education? Our plan at the moment is to implement a pilot – or what we’re more formally calling a “proof of concept” –starting in January 2010 for remainder of the 2009-10 application processing year. The reason for this particular timeframe is pretty straight forward – it’s the earliest that the IRS and FSA can have a fully coded and tested process to implement. The new process will be made available to a subset of our 2009-10 FOTW applicants and their parents. We’re still working on who this subset will include. This data share process is voluntary for students and parents – and will continue to be as long as we’re using this approach. As I mentioned earlier, the voluntary nature of this process is what has allowed us to make progress toward implementing a data share with the IRS. Data from the 09-10 proof of concept will be carefully analyzed and used to inform what we do in 10-11. Chances are the process will be very similar, but if we find usability issues, or unanticipated problems with any part of the process, we’ll use that information to refine what we do in 2010-11. In addition, based on what we learn in the proof of concept phase, we’ll decide who are the best candidates to use this new process. We believe that most students will be able to benefit from it – the exceptions are really just parents and students who’ve had a recent marital status change, but our data shows that there aren’t very many of these situations. For 2010-11, then, our plan is to implement the IRS Data Share process in the Summer of 2010. The reason for that timeframe is because base year income, which is 2009 for the 2010-11 application year, isn’t available at the IRS until the summer timeframe. If we ever move to PPY, instead of PY income on the FAFSA, we could offer this process to applicants starting on Jan. 1, instead of just to applicants who apply later in the year. VERIFICATION: For the 2010-11 year, we’re looking at sending information to you in the student’s ISIR that tells you when data on the FAFSA is coming directly from the IRS. This may make it possible for us to look at our verification rules differently to allow you to consider data from the IRS to already be “verified,” and then all you may have to do is verify the remaining items that did not come directly from the IRS, such as HHS and Number in College. Any questions? Flags on ISIR to identify when income data is from IRS versus self-reported Need to evaluate the 2009-10 pilot Verification On Neg Reg Process Agenda

Negotiated Rulemaking

Completed Regulatory Process School-Based Loan Issues NPRM published July 28, 2009 Final published October 28, 2009 Effective July 1, 2010 General and Lender/Guaranty Agency Loan Issues NPRM published July 23, 2009 Final published October 29, 2009

Completed Regulatory Process Grants and Other Issues NPRM published August 21, 2009 Final published October 29, 2009 Effective July 1, 2010 Accreditation NPRM published August 6, 2009 Final published October 27, 2009 ACG/SMART Final Rule – November 2009

Current Regulatory Process Two negotiating committees: Program Integrity Negotiations begin November 2, 2009 Negotiations expected to conclude by January 29, 2010 Foreign Schools Negotiations begin November 16, 2009 Negotiations expected to conclude by February 26, 2010 48

Current Regulatory Process Program Integrity Verification Satisfactory academic progress. Monitoring grade point averages. Incentive compensation Gainful employment in a recognized occupation State authorization as a component of institutional eligibility Definition of a credit hour Definition of a high school diploma 49

Current Regulatory Process Process Program Integrity Misrepresentation of information provided to students and prospective students. Ability to benefit Agreements between institutions Retaking coursework Term-based module programs Institutions required to take attendance for purposes of the Return of Title IV Funds Timeliness and method of disbursement of Title IV funds 50

Current Regulatory Process Process Foreign Schools United States Generally Accepted Accounting Principles Compliance audits Definition of a foreign school Non-profit status for foreign schools Public foreign schools and financial responsibility Consolidation of select Title IV requirements on a countrywide basis Non-degree programs 51

Current Regulatory Process Foreign Schools Issues specific to foreign medical schools: New eligibility criteria for foreign medical schools Clinical sites of foreign medical schools in other countries Basic science locations of foreign medical schools in other countries Eligibility requirements for foreign veterinary schools Eligibility requirements for foreign nursing schools Foreign medical and veterinary schools certified separately from larger school 52

Experimental Sites

Experimental Sites Phase I Phase II Notice published October 28, 2009 Proposals & suggests due by December 18 Does not need to be fully developed We will work with proposer and evaluation experts to flesh out the experiments Notice to be published early 2010 Experiment will be described in detail with appropriate design Requests to participate in the experiment will be due within 30-60 days Proposer will be given “right of first refusal” on the experiment but aren’t obligated to participate

VA Benefits

VA Educational Benefits VA Educational Benefits no longer considered “Estimated Financial Assistance” or “Resources” for all Title IV programs Effective with the 2009-10 Award Year Both VA share and institutional share of “Yellow Ribbon” awards are excluded Includes ROTC See Electronic Announcement Posted to IFAP on August 14

Two Pell Grants in an Award Year

Two Pells in an Award Year Authorized by the Higher Education Opportunity Act. Effective for the 2009-2010 Award Year. If otherwise eligible, a student must receive all or a portion of second Scheduled Award within an Award year. Objective to help accelerate student’s progress in academic program. Final Regulations Published October 29, 2009.

Two Pells: Student Eligibility First Scheduled Award Student otherwise Pell Grant Eligible. Enrolled in degree or certificate program. Enrolled at any enrollment status. Second Scheduled Award Enrolled at least Half-Time. Received 100% of first Scheduled Award. 59

Term Based Example Prior Law: One Scheduled Award per Award Year Assume student’s 2009-10 Scheduled Award is $5,350 and will be $5,550 for 2010-11 Fall 2009 $2,675 Spring 2010 $2,675 Summer 2010 $0 100% 2009-10 AY 2009-10 Award Year Summer 2010 $2,775 Fall 2010 $2,775 Spring 2011 $0 100% 2010-11 AY 2010-11 Award Year

Term Based Example New Law: Up to Two Scheduled Awards per Award Year. Assume student’s 2009-10 Scheduled Award is $5,350 and will be $5,550 for 2010-11 Fall 2009 $2,675 Spring 2010 $2,675 Summer 2010 $2,675 150% 2009-10 AY 2009-10 Award Year Fall 2010 $2,775 Spring 2011 $2,775 Summer 2011 $2,775 150% 2010-11 AY 2010-11 Award Year

Term-Based Example New Rule: Up to Two Scheduled Awards per Award Year Student’s Scheduled Award is $5,350 for the award year Summer 2009 $2,675 Fall 2009 $2,675 Spring 2010 $2,675 Summer 2010 $2,675 2009-10 Award Year 200% 2009-10 AY

Clock Hour Example Prior Law: One Scheduled Award per Award Year 1500 clock hour program; AY = 900 hours/26 weeks between July 1 and June 30. Student’s Scheduled Award is $5,350. 450 hours/13 weeks $2,675 450 hours/13 weeks $2,675 2009-10 Award Year 100% 2009-10 AY 300 hours/8 weeks $0 300 hours/8weeks $0 2009-10 Award Year

Clock Hour Example New Rule: Up to Two Scheduled Awards per Award Year 1500 clock hour program; AY = 900 hours/26 weeks Student’s Scheduled Award is $5,350 for the award year 450 hours/13 weeks $2,675 450 hours/13 weeks $2,675 2009-10 Award Year 160% 2009-10 AY 300 hours/8 weeks $1,645 300 hours/8 weeks $1,645 2009-10 Award Year

October 29 Final Regulations Effective with the 2010-11 Award Year If awarding out of second scheduled award from 2009-10 (including summer cross-over) regulations do not apply. If awarding from 2010-11 and beyond (including cross-over) new regulations do apply.

Crossover Payment Period Long Standing Policy – Payment period that includes both June 30 and July 1. Must be assigned to one award year. Must have valid SAR/ISIR for assigned year. May assign both the first and the last crossover payment period to the same award year.

Crossover Payment Period New Requirement Must assign to the award year with the highest award amount for each student. May be different award year for Pell than for other Title IV aid. 67

Term Based Example New Law: Up to Two Scheduled Awards per Award Year. Assume student’s 2009-10 Scheduled Award is $5,350 and $5,550 for 2010-11 Fall 2009 $2,675 Spring 2010 $2,675 Summer 2010 $0 100% 2009-10 AY 2009-10 Award Year Summer 2010 $2,775 Fall 2010 $2,775 Spring 2011 $2,775 150% 2010-11 AY 2010-11 Award Year

Term Based Example New Law: Up to Two Scheduled Awards per Award Year Student’s Scheduled Award is $5,350 for the award year Summer 2009 $2,675 Fall 2009 $2,675 Spring 2010 $2,675 Summer 2010 $2,775 2009-10 Award Year 2010-11

Second Scheduled Award – Student Eligibility Second Scheduled Award – At least one credit or clock hour in the payment period must be attributable to the student’s next academic year. Gives meaning to statutory use of term “accelerate” 70

Assumes Academic Year Defined as 24 hours Fall 2009 50% Paid 12 Hours Completed Spring 2010 50% Paid 12 Hours Completed Summer 2010 Enrolled in 6 Hours ELIGIBLE Second Scheduled Award First Scheduled Award No Hours to Prior Academic Year Six Hours for New Academic Year

Assumes Academic Year Defined as 24 hours Fall 2009 50% Paid 15 Hours Completed Spring 2010 50% Paid 9 Hours Completed Summer 2010 Enrolled in 6 Hours ELIGIBLE First Scheduled Award Second Scheduled Award No Hours to Prior Academic Year Six Hours for New Academic Year

Assumes Academic Year Defined as 24 hours Fall 2009 50% Paid 12 Hours Completed Spring 2010 50% Paid 9 Hours Completed Summer 2010 Enrolled in 6 Hours ELIGIBLE First Scheduled Award Second Scheduled Award Three Hours to Prior Academic Year Three Hours for New Academic Year

Assumes Academic Year Defined as 24 hours Fall 2009 50% Paid 9 Hours Completed Spring 2010 50% Paid 9 Hours Completed Summer 2010 Enrolled in 6 Hours NOT ELIGIBLE First Scheduled Award Second Scheduled Award Six Hours to Prior Academic Year No Hours for New Academic Year

Assumes Academic Year Defined as 24 hours Fall 2009 50% Paid 7 Hours Completed Spring 2010 50% Paid 6 Hours Completed Summer 2010 Enrolled in 12 Hours ELIGIBLE First Scheduled Award Second Scheduled Award Eleven Hours to Prior Academic Year One Hour for New Academic Year

Assumes Academic Year Defined as 24 hours Fall 2009 50% Paid 6 Hours Completed Spring 2010 50% Paid 6 Hours Completed Summer 2010 Enrolled in 12 Hours NOT ELIGIBLE First Scheduled Award Second Scheduled Award Twelve Hours to Prior Academic Year No Hours for New Academic Year

Special Circumstances Credit hour completion requirement can be waived if – FAA determines that student was unable to complete the hours of the first academic year due to ‘circumstances beyond the student’s control’. Determination must be documented and made on a student by student basis. 77

Special Circumstances Special Circumstances beyond a student’s control - May include, but are not limited to – Student withdrawing from classes due to illness Student being unable to register for classes necessary to complete his or her eligible program because those classes were not offered. 78

Special Circumstances Special Circumstances beyond a student’s control does not include- Withdrawing to avoid a particular grade or failing to register for a necessary class that was offered during the period to avoid a particular instructor. 79

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