Pell Grant Basics

1. Pell Grant Basics PASFAA Annual Conference Harrisburg, PA October 2012

2. Pell Grant Definitions • Scheduled Award • Maximum Pell Grant a student with a given EFC and COA may receive if enrolled full-time for a full academic year

3. Pell Grant Definitions • Annual Award • For term-based, credit hour programs, based on the student’s true enrollment status (full, ¾, ½ or less than ½) • Award taken from the corresponding Annual Award chart • If the student is full-time, Scheduled Award = Annual Award • For all clock-hour and nonterm credit hour programs, the award is always taken from the full-time Scheduled Award chart

4. Initial Calculation of a Pell Grant • First calculation of a student’s Pell Grant award, based on a current, documented enrollment status • May be projected • Earliest date for calculation is date of receipt of an ED- product EFC • SAR or ISIR • If no date is documented, date of initial calculation is the later of • Processed date of initial ISIR and the student’s enrollment status as of that date, or • Date student enrolls

5. Required Recalculations • Must have procedures in place to know whether a student has begun all classes • Must recalculate if • Student’s EFC changes due to verification, corrections, updating or PJ • Student’s enrollment status and or COA changes from one term to another • Student never begins attendance in one or more classes • To reflect true enrollment status

6. Transfer Student Pell Calculation • Must have current info. from NSLDS or COD for payments received YTD • Calculation based on % of Scheduled Award used at the first school(s) • % already used is subtracted from 100% • Remaining % of Scheduled Award based on COA and EFC at your school is maximum a student may receive

7. Percentage Used Calculation Amount disbursed at prior school Total Scheduled Award at prior school Percent of Scheduled Award Used

8. Concurrent Enrollment • Student may not receive a Pell Grant at two or more schools concurrently • When COD receives actual disbursement records with enrollment dates that are within 30 days of one another: • COD notifies schools of possibility of concurrent enrollment • Warning Edit code 069 on disbursement record • MRR is sent to all involved schools if edit s not resolved in 30 days of receipt • Not the same as a Potential Overaward Process (POP)

9. Potential Overaward Process (POP) • Exists when COD receives actual disbursement records that exceed 100% of Scheduled Award during an award year • COD notifies school • Including Warning Edit 068 on disbursement records • If POP not resolved within 30 days of notification, COD generates negative disbursements for all schools involved

10. Origination Record • Electronic record sent to COD to report Pell awards made by schools to ED/FSA • Contains the required data to report amount of money a student is eligible to receive for a period of time • Designated by program (DL or Pell Grant), program and award year

11. Disbursement Record • Electronic file sent COD to report Pell disbursements made by schools to ED/FSA • Contains the required data to report amount of money a student actually received, will receive and for what payment period • Designated by program (e.g., Direct Loan or Pell Grant), by institution and by award year

12. Lifetime Limits for Pell Eligibility • Limits Pell eligibility to 12 semesters or its equivalent • Equivalent is 6 Scheduled Awards (%600) • Students enrolled less than full-time assessed at the fractional enrollment status • COD tracks student %used

13. Formula 1 Summary Process – Pell,Term Based Standard term, credit hour programs 30 weeks of instructional time Full-time status is at least 12 credit hours Academic calendar includes 2 semesters/trimesters or 3 quarters No overlapping terms

14. Step 1: Determine Enrollment Status Process – Pell,Term Based Full-time at least 12 credits 3/4 time at least 9 credits 1/2 time at least 6 credits < 1/2 time fewer than 6 credits

15. Step 2: Calculate Pell Grant COA Process – Pell,Term Based • General rule • Use full-time, full-year costs • Exception to general rule • When student is attending less than 1/2 time, use full-time, full-year costs for each allowable component • Some components not allowed for less than 1/2 time enrollment • No miscellaneous and personal expenses • Limited allowance for room and board

16. Step 3: Determine Annual Award Process – Pell,Term Based Use student’s cost of attendance and EFC to find annual award on Payment Schedules

17. Step 4: Determine Payment Periods Process – Pell,Term Based • Standard term programs use the term as the payment period • Semesters, trimesters, quarters

18. Step 5: Payment Per Payment Period Process – Pell,Term Based Annual Award # of payment periods inacademic year

19. Crossover Periods and Pell • A payment period that overlaps two award years • School must assign the payment period to one award year • Must have a valid EFC for that award year

20. Formula 3 Highlights Process – Pell,Term Based Enrollment status is different for nonstandard terms. Cost of attendance proration may apply. Pell payment per payment period is determined using number of weeks in the nonstandard term.

21. Five Calculation Steps Process – Pell,Term Based 1. Determine enrollment status 2. Calculate Pell COA 3. Determine annual award 4. Determine payment periods 5. Calculate payment for each payment period

22. Step 1: Determine Enrollment Status weeks of instructional time in nonstandard term Credit hours in the academic year X weeks of instructional time in program’s definition of academic year Process – Pell,Term Based If a school’s academic calendar contains nonstandard terms, full-time enrollment status for each term must be determined using a regulatory formula:

23. Step 2: Calculate Pell Grant COA Process – Pell,Term Based Prorating Cost of Attendance When cost is for a period longer or shorter than the statutory academic year, prorate the cost down or up to reflect one academic year’s cost.

24. COA Proration Process – Pell,Term Based Multiply COA by lesser of these two fractions: hours in academic year definition hours for which costs apply weeks in academic year definition weeks for which costs apply

25. COA Proration Take the lesser of the two fractions: 32 24 24 21 OR $17,100 X 24 / 21 = $19,543 Process – Pell,Term Based

26. Step 3: Determine Annual Award Process – Pell, Term Based Use the student’s cost of attendance and EFC to find annual award on Payment Schedules

27. Step 4: Determine Payment Periods Process – Pell,Term Based Nonstandard term programs use the term as the payment period

28. Step 5: Payment Per Payment Period weeks of instructional time in payment period annual award × Process – Pell, Term Based weeks of instructional time in program’s definition of an academic year

29. Final Step: COD Process – Pell, Term Based • Send Origination records electronically to COD • Send an Actual Disbursement records electronically to COD • No funds in G5 for until COD accepts the records • Disbursement date must reflect actual date of disbursement • Resolve all rejects!! (see COD Technical Reference, Volume II, Section 4: Edits)

30. Calculating Pell Grant Awards Non-term Credit Hour andAll Clock-Hour Programs

31. Five Calculation Steps Process – Pell, Non-Term 1. Determine enrollment status 2. Calculate Pell COA 3. Determine annual award 4. Determine payment periods 5. Calculate payment for each payment period

32. Step 1: Determine Enrollment Status Process – Pell, Non-Term • Clock hour programs • for Pell calculation purposes, students in clock hour programs are always considered to be full-time • 34 CFR 668.2 defines full-time as at least 24 clock hours per week

33. Step 2: Calculate Pell COA Process – Pell, Non-Term Prorating COA If program is longer than or shorter than statutory academic year, prorate down or up to reflect one academic year.

34. Step 2: Prorating COA Take the lesser of the two fractions: 26 40 900 1400 OR Process – Pell, Non-Term $20,000 x ____ ÷ ____= $______

35. Step 3: Determine Annual Award Process – Pell, Non-Term Use the cost of attendance and EFC to find annual award on Payment Schedule

36. Step 4: Determine Payment Periods • Process – Pell, Non-Term • Program less than an academic year in length • Divide into two equal payment periods using ½ the hours and weeks • Program longer than an academic year with remainder less than or equal to ½ an acad. Yr. • Divide 1st academic year into two equal payment periods • Use remaining portion as a single payment period • Program longer than an academic year but less than two academic years – remaining portion greater than ½ an academic year • Divide 1st academic year into two equal payment periods • Divide remaining portion into two equal payment periods

37. Step 5: Payment Per Payment Period Scheduled Award times the lesser of: credit or clock hours in the payment period credit or clock hours in program’s academic year OR weeks of instructional time in the payment period weeks of instructional time in program’s academic year Process – Pell, Non-Term

38. Final Step: COD Process – Pell, Non-Term • Send origination records electronically to COD • Send actual disbursement records electronically to COD • No funds in G5 until COD accepts the records • Disbursement date must reflect actual date of disbursement • Resolve all rejects!! (see COD Technical Reference, Volume II, Section 4: Edits)

39. AdjustmentsandRecalculations

40. Reasons for Adjustments and Recalculations Process – Adjustments & Recalculations • Changes in student information • Expected family contribution (EFC) • Corrections • Updates • Professional Judgment • Enrollment status • Cost of attendance • All changes must be submitted to COD

41. EFC Change Adjustments Process – Adjustments & Recalculations • For Pell Grants & IASG, if EFC changes any time during the award year, school must recalculate the amount of Pell grant award for entire award year (34 CFR 690.80) • Adjust for changes due to • Clerical error • Mathematical error • Correction from Verification • If possible, adjust overpayment or underpayment within same award year • If not possible, • Adjustment made in next year or • Student repays excess grant

42. EFC Change Adjustments Process – Adjustments & Recalculations For Campus-Based Aid, Direct Loans, and TEACH Grants • If adjustments change EFC, must submit corrections to CPS for reprocessing • Repackaging may be necessary • If adjustments do not change EFC, may award based on original data

43. Enrollment Status Adjustments Process – Adjustments & Recalculations • For term-based, credit-hour programs • Pell Grants, IASG, TEACH Grants: • Changes between payment periods • School must recalculate • Changes within payment period • School must recalculate if student does not attend at least one class in all courses used to determine enrollment status • Recalculations not required for changes in enrollment status after student has begun attendance in all classes • School may establish recalculation policy

44. Enrollment Status Considerations Process – Adjustments & Recalculations • School must have • Procedure in place to know that a student has begun attendance in each class • If school cannot document attendance, student is considered not to have begun attendance • Policy on recalculation dates • Policy on attendance in compressed coursework (i.e. modules, mini-terms, intersessions, etc)

45. COA Adjustments Process – Adjustments & Recalculations • Pell Grants, IASG, TEACH Grants: • Schools are not required to recalculate for changes during the award year • If a school recalculates for change in enrollment status, must take into account any changes in COA

46. Questions? Greg Martin gregory.martin@ed.gov 215-656-6452 Comments about this presentation or my performance Should be directed to Jo Ann Borel Joann.borel@ed.gov 202-5954385