1 / 72

U.S. Department of Education Federal Update

U.S. Department of Education Federal Update. Jeff Baker Federal Student Aid November 9, 2010. 1. Appropriations and Budget Legislative Update Cohort Default Rates Direct Loan Transition IRS Data Retrieval Two Pells In One Award Year Regulatory Update. Today’s Topics. 2.

valterra
Download Presentation

U.S. Department of Education Federal Update

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. U.S. Department of EducationFederal Update Jeff Baker Federal Student Aid November 9, 2010 1

  2. Appropriations and Budget Legislative Update Cohort Default Rates Direct Loan Transition IRS Data Retrieval Two Pells In One Award Year Regulatory Update Today’s Topics 2

  3. Appropriations andProgram Budget 3

  4. Title IV Aid Available 4

  5. Legislative Update 5

  6. Legislative Update 6

  7. FFEL/Direct LoanCohort Default Rates 7

  8. National Student Loan Default Rates 9

  9. Missouri Default Rates(FY 2006 - FY 2008) 2006 2007 2008 Rate 4.3% 6.0% 5.8% Borrowers in Repayment 75,925 77,164 Borrowers in Default 4,617 4,539 10

  10. What is the CDR Calculation? Currently, a school’s cohort default rate is: The percentage of the number of the school’s FFEL and Direct Loan borrowers who enter repayment in one Federal Fiscal Year who default in that Federal Fiscal Year or by the end of the next Federal Fiscal Year. Beginning with the 2009 cohort will be: Borrowers who default in that Federal Fiscal Year or by the end of the next two Federal Fiscal Years.

  11. HEOA Changes • Increases CDR monitoring period from two to three years • Increases sanction threshold default rate from 25 percent to 30 percent • Establishes transition period to implement sanctions

  12. FY-09 FY-10 125 230 5,000 FY-09 FY-10 FY-11 125 230 250 5,000 2-Year Versus 3-Year Calculation The Numerator is the number of borrowers from the denominator who default within a cohort period The Denominator is the number of borrowers who enter repayment within a cohort period 3555000 .071 or 7.1% 6055000 .121 or 12.1%

  13. Transition Period

  14. Direct Loan Transition 14

  15. Direct Loan Transition • Contracted with 4 additional servicers • ACS (current servicer) • Nelnet • Sallie Mae • Great Lakes Education Loan Services • AES/PHEAA • Will “service” borrowers only…no origination responsibility 15

  16. Direct Loan Transition Can a school select the servicer with whom they wish to work? • No, loans will be disbursed to all servicers systemically as they book How will a school know which servicer has a particular loan? • By looking at NSLDS 16

  17. IRS Data Retrieval 17

  18. IRS-FSA Concept Federal Student Aid (FSA) and the Internal Revenue Service (IRS) developed a non-consent solution to simplify FAFSA completion. Tax filer retrieves own data No Consent Voluntary Will allow some applicants to retrieve their income tax data from the IRS. IRS data can be automatically transferred to FOTW. 19

  19. Option to Access IRS Information 19

  20. Get My Federal Income Tax Information 20

  21. Federal Income Tax Information Provided 21

  22. 22

  23. ISIR Codes and Flags • CPS will set flags and comment codes to indicate that student and/or parent transferred IRS data into FOTW • Comment codes will appear in – • FAA Information section of the ISIR • Student Inquiry section of FAA Access • Flags and codes set based on certain conditions. 23

  24. IRS Request Flag Values 24

  25. IRS Data and Verification • An institution may consider as acceptable documentation IRS retrieved information if the Secretary has identified those items as having come from the IRS and not been changed – IRS Request Flag = 02. 25

  26. Implementation Schedule • 2009-10 IRS process began in January 2010. • Pilot to test proof of concept. • 2010-11 IRS data share began in September of 2010. • 2011-12 IRS data share expected to begin with start-up in January 2011. • Within a couple of weeks electronic tax filing. • Within several weeks of paper tax filing. 26

  27. Enhancements • Beginning with the 2011-12 processing year, the IRS data retrieval process can be accessed by the applicant using Corrections on the Web. 27

  28. Two Pells in an Award Year 28

  29. Two Pells In An Award Year • Authorized by the Higher Education Opportunity Act (HEOA). • If eligible, student able to receive all or a portion of a second Scheduled Award within an Award Year. • Objective is to help needy students accelerate their academic progress. • Effective for the 2009-2010 Award Year. 4

  30. Two Pells In An Award Year Regulations • Team V-General and Nonloan Programmatic Issues in 2009 • Notice of Proposed Rulemaking: August 21, 2009 • Final regulations: October 29, 2009 • Effective with the 2010-2011 Award Year

  31. Unchanged Pell Rules • Scheduled Award • Amount that full-time student would receive for a full academic year based on the student’s EFC and COA. • Prorated by payment period based on hours and weeks of instructional time attended – Pell Formulas. • Payment periods • Payment for a payment period calculations

  32. Changed Pell Rules • Scheduled Award – • Old: Student may receive only one Scheduled Award in an award year. • New: Student may receive more than one Scheduled Award in an award year.

  33. Changed Pell Rules • Enrollment Status - • Old: Less than half-time enrollment eligible at all times. • New: Must be at least half-time for second scheduled award.

  34. Changed Pell Rules • Cross-Over Payment Periods • Old: Institution may assign a crossover payment period to either award year as a general policy or on a case-by-case basis. • New: Must assign to award year that will produce higher payment amount.

  35. Award Amount • No change in calculation of award for payment period • Awarding formulas have not changed • Award by payment period based on Scheduled Award • School continues to pay until reaching 200% of Scheduled Award • Payment period may include awards from both first Scheduled Award and second Scheduled Award.

  36. Final Regulations – October 29, 2009 • Effective with the 2010-11 Award Year • Cross-Over Payment Period • If cross-over payment period, school must award from the award year with the highest award amount for the payment period for the student. • Academic Year Progression • At least one credit or clock hour in the payment period must be attributable to the student’s next academic year. 36

  37. If Law Had Not Changed - Semester Example Student may only receive up to ONE Scheduled Award within an Award Year. Assume student’s 2009-2010 Scheduled Award is $5,350 and will be $5,550 for 2010-2011. Fall 2010$2,775 Spring 2011$2,775 Summer 2011$0 100% 2010-11 AY 2010-11 Award Year Summer 2011$2,855 Fall 2011$2,855 Spring 2012$0 100% 2011-12 AY 2011-12 Award Year 37

  38. New Law - Semester Example Student may receive up to TWO Scheduled Awards within an Award Year. Assume student’s 2009-2010 Scheduled Award is $5,350 and will be $5,550 for 2010-2011. Fall 2010$2,775 Spring 2011$2,775 Summer 2011$2,775 150% 2010-11 AY 2010-11 Award Year Fall 2011$2,855 Spring 2012$2,855 Summer 2012$2,855 150% 2011-12 AY 2011-12 Award Year 38

  39. New Law - Semester Example Student may receive up to TWO Scheduled Awards. Student’s Scheduled Award is $5,350 for the Award Year. Summer 2010$2,775 Fall 2010$2,775 Spring 2011$2,775 Summer 2011$2,775 2010-11 Award Year 200% 2010-11 AY 39

  40. New Regs for Cross-Over Term • Effective with the 2010-2011 Award Year • Must assign to award year in which student receives greater payment for the term - based upon information available at initial calculation. • Assume other year is higher if – • No SAR/ISIR. • Rejected ISIR with no EFC. • ISIR selected for verification but verification not completed.

  41. Cross-Over Payment Period EXAMPLE • A program has a semester calendar with two summer sessions (6/1 – 7/14 and 7/20 – 8/28). • If combined in one term, the combined term is a crossover payment period regardless of what classes students attend or when a disbursement is made. • If the two sessions are considered separate terms, only the 6/1 – 7/14 term is a crossover payment period. 41

  42. Cross-Over Payment Period • For Pell, use EFC for the award year from which the student will be paid • May use either EFC, COA, and need for all other Title IV programs except Pell • Treat Pell as estimated financial assistance (EFA) for other Title IV, regardless of which award year it is from. 42

  43. New Regs for Cross-Over Term Changes – • Until date published in Federal Register (2010-11 - September 10, 2010) - • Must reassign payment period if information received showing greater payment from other Award Year. • Must compare again if re-calculating for any reason. • May monitor and adjust after Federal Register date up to February 1, 2011.

  44. New Law – Assign Cross-Over To Higher Payment Semester Example Student may receive up to TWO Scheduled Awards. Assume student’s 2010-11 Scheduled Award is $5,550 and $5,710 for 2011- 2012 and student eligible for either. Fall 2010$2,775 Spring 2011$2,775 Summer 2011$0 100% 2010-11 AY 2010-11 Award Year Summer 2011$2,855 Fall 2011$2,855 Spring 2012$2,855 150% 2011-12 AY 2011-12 Award Year

  45. Academic Year Progression 45 45 • At least one credit or clock hour (or partial hour if school uses partial hours) in the payment period when award will be from a second Scheduled Award must be attributable to the student’s next academic year. • Gives meaning to statutory use of term “accelerate” • Not “grade progression”. • Must be applied for any required recalculation.

  46. Academic Year Minimums Statutory Definition of an Academic Year Academic Progress Minimum Completion Minimum Instructional ** Measured By: Requirement* Time Requirement Semester hours 24 semester hours 30 weeks Trimester hours 24 trimester hours 30 weeks Quarter hours 36 quarter hours 30 weeks Clock hours 900 clock hours 26 weeks *Number of hours that a student enrolled full time is expected to complete in a full academic year . **A week is a seven day period in which there is at least one day of instruction or exams. 46 46

  47. Semester Academic Year Progression Assumes academic year defined as 24 hours Fall 2009 50% Paid 12 Hours Earned Spring 201050% Paid 12 Hours Earned Summer 2010Enrolled in 6 Hours ELIGIBLE Second Scheduled Award First Scheduled Award No Hours to Prior Academic Year Six Hours for New Academic Year Pay 25% of Second Scheduled Award 47

  48. Semester Academic Year Progression Assumes academic year defined as 24 hours Fall 2009 50% Paid 12 Hours Earned Spring 201050% Paid 9 Hours Earned Summer 2010Enrolled in 6 Hours ELIGIBLE Second Scheduled Award First Scheduled Award Three Hours to Prior Academic Year Three Hours for New Academic Year Pay 25% of Second Scheduled Award 48

  49. Semester Academic Year Progression Assumes Academic Year defined as 24 hours Fall 2009 50% Paid 9 Hours Earned Spring 201050% Paid 9 Hours Earned Summer 2010Enrolled in 6 Hours NOT ELIGIBLE First Scheduled Award Second Scheduled Award Six Hours to Prior Academic Year No Hours for New Academic Year Cannot pay second Scheduled Award May pay from upcoming Award Year 49

  50. 50 Transfer Student • Final regulations: Two options • Assumption method • Based on disbursements received • Do not consider hours earned at other institutions to be conflicting information • Hours-earned method • Based on actual hours earned in award year • Method at option of institution: apply on a student-by-student basis or to all students

More Related