Verification and Satisfactory Academic Progress

1. Verification and Satisfactory Academic Progress Jamie MaloneMarty GuthrieU.S. Department of Education

2. Today’s Agenda • Resources • Verification Regulations • Federal Register Notice • Satisfactory Academic Progress • Dear Colleague Letter • Questions?

3. Resources For information, consult: • Notice of Proposed Rulemaking (NPRM), published 6/18/10 • Describes all changes to current reg • Final Rule, published 10/29/10 • Responds to comments and describes changes to NPRM • Not a comprehensive review of all reg changes

4. Verification Regulations

5. Verification • Effective date delayed until July 1, 2012 • 2012-13 award year • Institutions may need time to make changes to their institutional processing systems

6. Verification: General Changes • Emphasizes updating requirements through change to subpart heading • Removes references to individual programs • Defines “subsidized student financial assistance programs” and “unsubsidized student financial assistance programs”

7. Verification: General Changes • Subsidized— • Eligibility uses EFC • Verification applies • Pell Grant, FSEOG, FWS, Perkins, Direct Subsidized Loan • Unsubsidized— • Eligibility does not use EFC • Verification does not apply • TEACH Grant, Iraq & Afghanistan Service Grant, Direct Unsubsidized Loan, Direct PLUS Loan

8. Verification: General Changes • Uses “FAFSA information” instead of “application” • Defines “specified year” as base year or year prior to base year • Allows for option of using income data from a different year • No plans to exercise this option at this time

9. Verification: General Changes • Must complete verification prior to exercising professional judgment • Codifies long-standing policy in regulations

10. Verification: Selection • Eliminates 30% limit • Department targeting error-prone items to select applications to verify • Institutions must verify all applicants we select

11. Verification: Selection • Institutions must continue to resolve conflicting information they believe is inaccurate • Institutions keep flexibility to select additional information or applications for verification

12. Verification: Exclusions • Removes certain exclusions • Clarifies provisions applicable to— • Applicants • Parents of dependent applicants • Spouses of independent applicants • Lists specific situations when parent’s or spouse’s information is not subject to verification

13. Verification: Updating • Applicant required to update all changes in dependency status throughout the award year, except changes resulting from a change in the applicant’s marital status • Applicant’s responsibility, not institution’s

14. Verification: Updating • FAA may require applicant to update marital status to address inequity or to reflect more accurately the applicant’s ability to pay • Documentation not required if the information has not changed during subsequent verification of household size and number in college

15. Verification: Items to Verify • Annual FederalRegister notice • Items to verify • Documentation • Initially, will include the current five data elements

16. Verification: Documentation • Specified as acceptable in annual FederalRegister notice • Retained current documentation requirements with technical changes • Added option to retrieve electronic data from IRS

17. Verification: Documentation • For applicants with tax filing extension • May require completed tax return when filed • Must re-verify AGI and taxes paid, when/if the tax return is submitted

18. Verification: Documentation • Tax return not signed by the tax filer • Must be signed, typed, printed, or stamped by the tax preparer and • Contain the preparer’s SSN, EIN or PTIN

19. Verification: Interim Disbursements • Technical and conforming changes • May make a disbursement after completing verification but prior to receiving a corrected valid SAR or valid ISIR if the changes would not change the amount of aid

20. Verification: Interim Disbursements • To avoid liability, must ensure necessary corrections are submitted to ED • Valid SAR or valid ISIR required before disbursement can be made for all Title IV programs

21. Verification: Deadlines • Require institutions to follow cash management procedures for Direct Loans • Removed the requirement to pay Pell Grant on the higher EFC

22. Verification: Fund Recovery • Requires institutions to reimburse program account if disbursement made without receiving corrected valid SAR or ISIR • Requires recovery of overpayments that occur from interim disbursements for students employed under the FWS Program

23. Verifications: Corrections • Removed $400 tolerance • Require all corrections over $25 to be submitted • Require all corrections of nondollar items

24. Federal Register Notice

25. Federal Register Notice • Published Spring/Summer 2011 • Describes 2012-2013 verification items • Outlines acceptable documentation • Lists other verification resources

26. Satisfactory Academic ProgressRegulations

27. Satisfactory Academic Progress • Previously, SAP requirements and references were included in 3 regulatory sections • Administrative capability §668.16(e) • Student eligibility §668.32(f) • Satisfactory progress §668.34 • Now all requirements are in §668.34 with cross references in §§668.16(e) and 668.32(f)

28. SAP: New Regulations New regulations provide— • Continued flexibility for institutions to establish their SAP policies • Additional flexibility for institutions that monitor SAP more often than annually • Definitions for “warning” and “probation” • In general, a student who is not making SAP is no longer eligible for Title IV aid

29. SAP: Policy Requirements Specified in §668.34 and include— • Measurement of student’s progress at each evaluation— • Can take place each payment period, annually, or less often than each payment period • Must occur at the end of a payment period

30. SAP: Policy Requirements • GPA that a student must achieve at each evaluation (qualitative standard) • Pace of progression at each evaluation (quantitative standard)

31. SAP: Details on Standards • Qualitative standard: required GPA • For programs more than 2 academic years: at the end of 2 years, at least a 2.0 or academic standing consistent with requirements for graduation • Quantitative standard: pace at which a student must progress to complete within the maximum timeframe • Calculate by dividing cumulative successfully completed hours by cumulative hours attempted

32. SAP: Policy Requirements • How student’s GPA and pace are affected by incompletes, withdrawals, repetitions, or transfers of credits • Must count transfer hours accepted toward completion of the student’s program as both hours attempted and hours completed

33. SAP: Defined Terms • Must incorporate the terminology used in these regulations • Must explain terms and use consistently with these regulations • Must make sure conditions of each term are clear to students

34. SAP: Defined Terms Defined Term: Financial Aid Warning • Status assigned to a student who fails to make SAP at an institution that evaluates SAP at the end of each payment period • Student may continue to receive Title IV aid for one payment period • No appeal necessary

35. SAP: Defined Terms Defined Term: Financial Aid Probation • Status assigned by an institution to a student who fails to make SAP, who has appealed, and has had eligibility for Title IV aid reinstated • May impose conditions for student’s continued eligibility to receive Title IV aid

36. SAP: Defined Terms Defined Term: Maximum timeframe • For an undergraduate program—basically 150% of the published length of the program • For a graduate program—a period defined by the institution that is based on the length of the educational program

37. SAP: Defined Terms Defined Term: Appeal • Process by which a student who is not meeting an institution’s SAP policy petitions the institution for reconsideration of the student’s eligibility for Title IV aid

38. SAP: Defined Terms Defined Term: Appeal (more) • Must specify the conditions under which a student may appeal including— • Why the student failed to make SAP; and • What has changed that will allow the student to make SAP at the next evaluation

39. SAP: Frequency of Review • Regulations are organized by frequency of SAP evaluation— • At the end of each payment period, or • Less frequently

40. SAP: Payment Period Review Evaluating at each payment period: If student fails to make SAP, student— • Loses eligibility for Title IV aid • May be placed on Financial Aid Warning for one payment period • Must make SAP or may be placed on Financial Aid Probation after a successful appeal

41. SAP: Payment Period Review Evaluating SAP each payment period (more) • After Financial Aid Probation, student— • Must be making SAP, or • Must be successfully following an academic plan

42. SAP: Academic Plans About academic plans— • Not regulated • General or specific • Flexibility to address student situation • Appeal needed to implement or change

43. SAP: Annual Review Evaluating less frequently: If student fails to make SAP, student— • Loses eligibility for Title IV aid • May be placed on Financial Aid Probation after an appeal • After Financial Aid Probation, must be making SAP or successfully following an academic plan

44. SAP: Notifications Notifications • Results of SAP review that impact the student’s eligibility for Title IV aid • Specific elements required to appeal SAP, if appeal process is used • Process for reestablishing eligibility for Title IV aid, if no appeal process is used

45. SAP: Questions People asked about… • Using different rates of assessment for different classes of students • Evaluating one factor at end of each payment period and another annually • Implementing SAP for the 2011 summer crossover payment period

46. SAP Dear Colleague Letter • Expected in summer 2011 • Will include questions and answers clarifying the SAP provisions in the 10/29/10 regulations

47. Contact Information • We welcome your feedback. You may contact us at: • Phone: 312-730-1528 • Email: Jamie.Malone@ed.gov • Fax: 312-730-1520 • Phone: 202-219-7031 • Email: Marty.Guthrie@ed.gov • Fax: 202-502-7874