Last month we discussed the pitfalls of insufficient communication between the financial aid office and the academic side of the house in terms of how individual students may be impacted. Another time administrators from both worlds need to be on the same page is when new programs are introduced. The financial aid administrator can wind up on the hot seat if the students were told they could receive federal loans or other financial aid when the program is not eligible. So, here’s a check list of information needed to determine eligibility and, if appropriate, process financial aid for new programs.
- Is the program covered under your Program Participation Agreement (PPA)? If it’s not, you may be able to self-certify the program’s eligibility once approved by the accrediting agency and state, and in that case, you can immediately award federal aid and include that program when you next re-certify. But there are some conditions where the Department of Education will need to approve the program before you can award aid. You can see the list in the Federal Student Aid Handbook, Volume 2, Chapter 5, page 2-144.
- Does it need to have a different academic year than other programs? When different programs operate on different calendars, you can use separate academic years as the basis for setting payment periods and disbursement dates. Consider the following:
- Start and end date of classes in one school year and the number weeks of instructional time contained therein. (For a detailed definition of ‘instructional time’ see the Federal Student Aid Handbook, Volume 3, Chapter 1, page 3-8.)
- Is it organized into semesters, trimesters, modules, etc.?
- How are you defining the terms? See the Federal Student Aid Handbook, Volume 3, Chapter 1, page 3-12 for options and definitions.
- Is the program offered in credit hours, clock hours or something else? (See the Federal Student Aid Handbook Volume 2, Chapter 2, page 2-35 if your program isn’t offered in either credit or clock hours.)
- If it is a new undergraduate program, full-time standing is defined as 24 semester or trimester credit hours, 36 quarter credit hours or 900 clock hours; however, if it is a graduate program, full-time standing needs to be defined by the institution – do you know what that definition is?
Once you’ve been able to answer these questions, you’ll be ready to define the payment periods and disbursement dates. The payment period is not only important for determining when to disburse funds, but it is also the timeframe for evaluating satisfactory academic progress. In many cases, the payment period is the same as the term, but that is not true for all term types or even for all types of aid. You can find more information about payment periods for all term types in the Federal Student Aid Handbook, Volume 3, Chapter 1, page 3-18.
Now it’s time to determine your disbursement dates. In general, disbursements must be made during the payment period for which the award is intended, but there are sometimes exceptions for early disbursements, late disbursements and special rules for certain types of terms. Review the Federal Student Aid Handbook, Volume 3, Chapter 1, page 3-22 before determining disbursement dates for the new program.
Clearly your institution’s work is not done when a new program is accredited and approved by the state. The sooner the Financial Aid Office is made aware of new programs, the easier it will be for the new students enrolling in the program.
The expert consultants at the Higher Education Assistance Group are available to help in a number of ways so you and your staff can feel confident in assessing new program eligibility. Contact us at firstname.lastname@example.org for more information.