KASRO Conference May 13, 2010 Presented by Denise Deal, Associate Director

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

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

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

4. About UofL Federal Loan Participation Long term history as FFELP participant (Federal Family Education Loan Program) Switched to Direct Lending (DL) for 2009-2010 2008-2009 FFELP loan borrower volume $112,081,147 disbursed 19,313 awards for 9,493 students 2009-2010 DL loan borrower volume to date $115,316,835 disbursed ($120,311,768 offered) 20,310 awards for 9,934 students

5. PlanningConsiderations/Resources

6. 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, 2010. DL Source, April 2010 Edition: http://www.direct.ed.gov/newsletters/apr10.html

7. USED Direct Loans Direct Loans Web Site – www.direct.ed.gov Important: Monitor this site regularly for updates!

8. COD Common Origination and Disbursement http://cod.ed.gov COD School Relations Center (800) 848-0978

9. IFAP Information for Financial Aid Professionals http://www.ifap.ed.gov/ifap/processing/directLoans.jsp FSA Announcements Alerts Contact Info DL School Guide New DL Loan Schools On-Line Training Links

10. NASFAA NASFAA - www.nasfaa.org Education Department Urges Institutions to Prepare to Make Direct Loans, 10-05-09 Direct Loan Conversion Resource Center http://www.nasfaa.org/SubHomes/DL/DLhome.html Resources-Checklist, Mentors Sample Communications Setting Up for DL COD Web Site Access G5 Bank Account Info DL Report Setup

11. NDSLC National Direct Student Loan Coalition Alliance of Financial Aid professionals with experience with the Direct Loan program www.directstudentloancoalition.org DOE Setup Systems Platform Setup Communications Training Mentors

12. Training Initiatives Attend free DL training initiatives – there are many! Direct Loan Webinar Series http://ifap.ed.gov/dpcletters/ANN1012.html COD Computer Based Training http://ifap.ed.gov/codcbt/CODCBT.html “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. 3 - http://fsaconferences.ed.gov/

13. 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)

14. 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

15. 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

16. 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, email blasts, news outlets, student newspaper, SGA, etc)

17. Software Vendor Assess software needs/vendor support 3rd 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

18. U of LImplementationTimeline

19. 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

20. 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

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

22. 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 Email communication to student borrowers Conducted interviews with TV and newspapers Requested new program with Budget Office

23. March 2009 (cont) Sent email to COD School Relations CODSupport5@acs-inc.com 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

24. 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

25. 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

26. 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!

27. 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

28. 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!

29. August 2009 - 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!

30. U of L Post-LiveComments and Issues

31. 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 2009-10 for undergraduate, graduate, and law students was $10,000,000 more than first disbursement for 2008-09

32. 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)

33. 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 2nd disbursement disbursing before 1st Co-mingled records at COD

34. 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 www.dl.ed.gov

35. StudentLoans.gov Implemented May 1, 2010 Webinar June 9, 2010 http://www.ifap.ed.gov/dpcletters/ANN1014.html

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

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

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

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

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

41. DL Setup Contacts Email to COD 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

42. Questions/Contact Info Denise Deal, Associate Director Student Financial Aid Office University of Louisville Louisville, KY 40292 502-852-8343 desk 502-852-0182 fax dmkreb01@louisville.edu