DCL – GEN-15-03: January 30, 2015 – Wind-down of the Federal Perkins Loan Program
The approaching end of an era is discussed in this DCL. The Federal Perkins Loan Program, as modified over the years, is the first modern Federal Student Aid program. Having originally been named the National Defense Student Loan (NDSL) program in the National Defense Education Act of 1958, it began in the era of the space race after the Russian Sputnik was launched in 1957. It was the first student aid program geared specifically for low income students. The program was later redesignated as the National Direct Student Loan (NDSL) program as a result of the Higher Education Amendments of 1972. Subsequently it was again renamed in the 1986 reauthorization of the Higher Education Act in honor of U.S. Representative Carl Perkins (KY) who was an early proponent of the program as well as other student aid programs.
Unless Congress intervenes before then, no Perkins Loans may be made to new borrowers after September 30, 2015. If a loan for the 2015-2016 award year has had a disbursement made prior to September 30, 2015, the school may make subsequent disbursements of that loan for the 2015-2016 award year. There are limited circumstances in which a Perkins Loan recipient in 2014-2015 may receive subsequent Perkins disbursements beyond 2015-2016 in order to finish the program they had begun. Schools that have been participating in the Perkins Loan program are encouraged to review the specific instructions for the limited “grandfathering” provisions available. More information will also be coming from ED in the next few months regarding the disposition of monies in an institution’s Perkins Loan revolving funds account.
DCL – GEN-15-05: March16, 2015 – 2015-2016 Unusual Enrollment History Flag
In this DCL, ED re-emphasizes the current requirements for resolving the Unusual Enrollment History (UEH) flags, as well as explains the new expanded scope of UEH for 2015-2016. For the 2015-2016 award year, two significant changes are made of which schools must be aware. First, the selection of applicants for the UEH flag has been expanded to include students who may have received a Federal Direct Loan (not Direct Consolidation Loans or parent PLUS Loans), whether or not they received a Federal Pell Grant previously. Also, the number of years to be reviewed has been expanded from 3 years to 4 years. So, beginning with the 2015-2016 processing year, for students who receive the UEH flag schools will need to review the 2011-2012, 2012-2013, 2013-2014, and 2014-2015 award years to determine if the student received any academic credit during those periods. Schools should carefully digest the information in this latest DCL.
EA – Posted February 11, 2015 – (Gainful Employment). Gainful Employment Electronic Announcement #52 – NSLDS Functionality Now Available for Voluntary Gainful Employment Reporting
The financial aid community is made aware of the ability to begin early voluntary reporting of gainful employment (GE) information. Schools are required to begin reporting by July 31, 2015, for data going back to 2008-2009, for most schools. (See the article, “Gainful Employment Redux,” in the January 2015 issue of the Inside Report for more details on the GE reporting requirements.) This EA simply clarifies that some schools may choose to begin voluntarily reporting some of the years’ data before the deadline date so they do not have to report all years at the same time. This posting additionally provides notice of updates to the GE Frequently Asked Questions Web page.
EA – Posted February 11, 2015 – (Gainful Employment). NSLDS Gainful Employment User Guide (February 2015)
This announcement informs of the availability of the latest NSLDS Gainful Employment User’s Guide. This tool is critical to successfully meeting the reporting requirements mentioned above.
Posted – February 11, 2015 – Gainful Employment – Frequently Asked Questions.
While this notice is not officially classified as an Electronic Announcement, ED did post on IFAP an alert to the fact that the GE Frequently Asked Questions Web page has been updated. Specifically, there are a number of questions that directly address GE reporting matters. Schools are well advised to review and become familiar with these latest Q&As.
ED notifies the financial aid community of the applicable deadlines for the submission of various applications, reports, and waiver requests, etc. Schools participating in these Campus-Based aid programs should become aware of these critical dates for submissions.
FR – Posted January 14, 2015 – Notice: Early Implementation of PLUS Loan Adverse Credit Regulation
This Notice in the Federal Register makes the public aware of ED’s decision to implement the new PLUS Loan adverse credit regulations that were published on October 24, 2014, effective March 29, 2015. It also reiterates the requirement that PLUS borrowers who had an adverse credit history but are subsequently approved for a PLUS Loan must complete ED’s PLUS Loan counseling prior to disbursement of the loan. The PLUS Loan counseling is different and separate from any other student loan entrance counseling. See the feature article later in this edition of the Inside Report for more important information on this topic.