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R2T4 – Return of Title IV Funds
VASFAA – May 2014Laurie Owens, Director of Financial Aid
AgendaPurposeProcess overviewImportant deadlinesModulesBest practicesCommon audit findingsPerforming hand calculationsQuestions?
Purpose
• Title IV funds are awarded based on the assumption that the student will attend school for the entire period.
• When a student withdraws or stops attending, the student may no longer be eligible for the full amount of Title IV funds originally awarded.
• The amount of Title IV grant and/or loan assistance earned by the student must be determined.
VCCS Impact
• 23 colleges• Traditional and various dynamically
dated sessions• # of R2T4s range from 4000-5000
per term for fall and spring; 1000-2000 per summer term
• Modular regulations did not impact volume as expected
Process Overview
1. Identify the involved students
2. Complete the R2T4 WorksheetEnrollment/payment periodWithdrawal date or LDATypes of Title IV aid awarded/disbursedInstitutional chargesBreaks of 5 or more consecutive days
3. Return unearned aid or offer post withdrawal disbursement (PWD)
Identifying Students
• Report or query in SIS• Last enrollment action is withdrawal as
opposed to completion• 100% of aid earned if attend past 60% date• Return calculation still required to
determine eligibility for PWD • Written confirmation of intent to return• Next course must start within 45 days of
withdrawn course ending date• Custom page for intent to return
Determining the Withdrawal Date• If required to take attendance...
Last date of academic attendance (LDA) as determined by attendance records
Must demonstrate participation in online courses (not just logging in)
• If not required to take attendance or failure to earn any passing grades...LDA if known or midpoint for enrollment or
payment period
• If withdrawn during break...Last day of classes before break
Types of Title IV Aid• Unsubsidized Direct Loan• Subsidized Direct Loan• Federal Perkins Loan• Direct PLUS Loan• Federal Pell Grant • FSEOG• TEACH Grant • Iraq and Afghanistan Service Grant
* Separate calc for VSFAP & GEARUP
Important DeadlinesRequirement Deadline
Date of determination(unofficial withdrawal)
Within 14 days if take attendanceWithin 30 days of end of period if not
Perform R2T4 calculation Within 30 days of determination
Return of unearned funds already disbursed for allowable charges
ASAP but no later than 45 daysafter withdrawal determination
Request for acceptance of PWD for loan funds from student or parent
Within 30 days of withdrawal determination (school supplies deadline for response: i.e.,14 days)
PWD to student’s account for outstanding allowable charges
ASAP but no later than 180 days after withdrawal determination
PWD to student’s account in excess of charges
Loans: ASAP but no later than 180 days after withdrawal determinationGrants: ASAP but no later than 45 days after withdrawal determination
Important DeadlinesRequirement Deadline
Notification to student of grant overpayment
Within 30 days of withdrawal determination
Return of grant funds by student Within 45 days of notification
Referral of student to Debt Resolution Services
Not specified but ASAP
Reporting student to NSLDS No later than 45 days after notification sent to student
Loan repayment In accordance with MPN
Modules
• Completion of at least one class previously exempted students from R2T4
• Regulation changed effective 7/1/11• Students now subject to R2T4 if cease
attendance at any point prior to completing the enrollment/payment period
• Program is offered in modules if all courses do not span entire length of the enrollment/payment period
• Summer impact
The 3 Questions1. After beginning attendance in the payment period or period of
enrollment, did the student cease to attend or fail to begin attendance in a course he or she was scheduled to attend?
If no, student is not a withdrawal.
If yes, go to question 2.
2. When ceased to attend or failed to begin attendance in a scheduled course, was the student still attending other courses?
If yes, student is not a withdrawal.
If no, go to question 3.
3. Did the student confirm attendance in a later module in the enrollment period (starting within 45 days)?
If yes, student is not a withdrawal as long as they return.
If no, student is a withdrawal and R2T4 may apply.
Modules
• Seek intent to return to later course starting within 45 days before processing R2T4
• Must recalculate aid for dropped or never attended courses prior to R2T4
• R2T4 required if last enrollment action is withdrawal not completion
• Timing is key and results in inequities• Problem ED was attempting to resolve can
still occur
Example 1Enrollment Period LDA
Class 1 08/22/13 - 12/19/13 09/28/13
Class 2 08/22/13 - 12/19/13 09/28/13
Class 3 08/22/13 - 12/19/13 09/28/13
Class 4 08/22/13 - 10/18/13 10/18/13
R2T4 Not Required: Student still attending modular course when withdrawn from traditional courses. Modular course subsequently completed. Last enrollment action is completion on 10/18/13.
Example 2Enrollment Period LDA
Class 1 08/22/13 - 12/19/13 10/20/13
Class 2 08/22/13 - 12/19/13 10/20/13
Class 3 08/22/13 - 12/19/13 10/20/13
Class 4 08/22/13 - 10/18/13 10/18/13
R2T4 Required: Student not attending other courses when withdrawn from traditional courses. Last enrollment action is withdrawal on 10/20/13. This student attends more days than the student in Example 1 and owes funds back simply due to timing of withdrawal.
Common Audit Findings
• #3 on ED’s Top 10 Program Review Findings list
• #2 and #3 on ED’s Top 10 Audit Findings list
• Findings on both listsR2T4 Returns Made LateR2T4 Calculation Errors
Common Audit Findings
• Problem: Returns not made within 45-day allowable timeframe- School’s policy and procedures not
followed- Inadequate system in place to
identify/track official and unofficial withdrawals
- No system in place to track number of days remaining to return funds
Common Audit Findings• Solution: Returns not made within 45-day
allowable timeframeReview and revise policies and procedures to
ensure funds are returned no later than 45 days after date of determination
Develop R2T4 monitoring/reporting systemProvide staff trainingPeriodically review processes, policies, and
procedures to ensure complianceEnsure timely communication between offices
and/or systemsFSA Assessments
Common Audit Findings
• Problem: R2T4 Calculation Errors Incorrect number of days used in
term/payment periodActual clock-hours used instead of scheduled
hours Incorrect aid used as “could have been
disbursed” Incorrect withdrawal dateMathematical and/or rounding errors
Common Audit Findings• Solution: R2T4 Calculation Errors
Work with academic offices to confirm when classes meet, including weekends
Exclude all class breaks of five consecutive days or more
Determine number of clock-hours student is scheduled to attend each day
Multiply the number of clock-hours scheduled each day by the number of scheduled days elapsed in the payment period or period of enrollment
Implement plan for peer review of each calculation Conduct monthly self-assessment by reviewing
random sample of student files
Things to Consider
• Establishing the correct 60% date• Impact of unscheduled breaks resulting
from inclement weather closings• Breaks between modules• Pell Recalculations
All term long Census locking
• Permissibility of less than half-time status after loan disbursement
Best PracticesProvide thorough R2T4 information on the on
College’s websiteProvide thorough R2T4 information with your
award notificationsPost notices around campus (particularly in
withdrawal locations) warning students about withdrawal implications
Educate Counseling and Student Records staff regarding withdrawal implications
Summarize withdrawal implications in your SAP policy literature
Consider having FAO sign off on withdrawals so students can be informed of impact
Best Practices - FacultyEnsure there is a policy in place for students who
never attend to be dropped or coded as suchEnsure there is a policy in place for students who
stop attending to be withdrawn or coded as suchEnsure the last date of attendance is captured if
required to take attendanceEnsure faculty do not award ‘W’ or ‘F’ grades to
students who never attendEnsure there is a policy in place to determine if
failing grades are actually unofficial withdrawalsCommunicate the necessity for accurate and
timely reporting by faculty
Hand Calculations
Programs measured in credit-hours:
# of days in attendance = % of Title IV Earned
# of days in the period
Programs measured in clock-hours:
# of scheduled clock-hours = % of Title IV Earned
# of clock-hours in the period
Rounding• Percentages
Calculated to four decimal placesRounded to three decimal places 52/116 = .4482 to .448 to 44.8% Exception: .6001 through .6004 which are not
rounded for determining if past 60% point
• Dollars and cents Rounded to nearest penny: $977.207 to $977.21Repayment amounts can be rounded to the
nearest dollar: $637.48 to $637
Hand Calculations
• See handouts
1. 2014 Calendar
2. Calculating the Length of the Period
3. R2T4 Worksheet• Traditional 16 week term measured in
credit hours• Feel free to use cell phone calculators
Hand Calculations
Start Date End Date Withdrawal Date
Pell Disbursed
Loans Disbursed (net)
College Charges
1-13-2014 5-13-2014 2-27-2014 $1411 Sub: $990 $1075
Results
Return of funds by the school?Box O: $637.48 (rounded down to $637)
To which Title IV program?Subsidized
Return of grant funds by the student? $0
Repayment of the student’s loans? $352.52 via terms of MPN $353 due to rounding
Questions
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