Guidance for Colleges and Universities Impacted by COVID-19

The entire nation’s life has been turned around over the course of weeks. Higher education institutions went from business as usual, to spring break, to extended spring break, and now most are delivering their content and education virtually. The industry, however, has been adapting to delivering education virtually over the past decade, and the jump to all online was easier to overcome than in most industries. There are some issues in relation to student financial aid (SFA) since many regulations have not caught up to the digital age. Some guidance has been distributed by the Department of Education described below, but additional guidance is likely to come. In addition to financial aid, refer to best practices as detailed below with respect to distance education and federal work study programs.

Title IV Funding

There are many Title IV funding changes and updates including Expected Family Contributions (EFC), Satisfactory Academic Progress (SAP), approved leave of absences, enrollment status changes, and return of Title IV Funding. Financial Aid Administrators have the authority to use professional judgement to make any necessary changes to individual’s student’s EFC to reflect a student’s circumstances. The judgement decisions must be made on a case-by-case basis and cannot be made to all students. The justification of COVID-19 will be an acceptable change to the EFC as long as the documentation of the judgement is maintained in the student’s financial aid file. This can include, but not be limited to, parents losing income because an employer closed due to the pandemic, or the student’s family was directly affected by a positive case of COVID-19. The documentation included in the student’s file must substantiate the reason of any adjustment to the EFC. An institution’s SAP appeal policy (34 CFR § 668.34(a)(9)) must describe the basis on which a student may file an appeal: the death of a relative, an injury or illness of the student, or other special circumstances. Circumstances related to COVID-19, quarantine requirements, illness of a family member or student, or the general disruption resulting from COVID-19 may form a basis of a student’s SAP appeal even if it is not specifically identified in the institution’s SAP policy. If a student would like to take a leave of absence due to COVID-19 related concerns or limitations such as not having reliable internet connection for online learning, interruption of a travel abroad program, or just physical well-being, the Education Department will permit students to take that leave even if the student notifies the institution in writing after the approved leave of absence has begun. The institution may retain any Title IV funding to apply to the student when they continue enrollment. However, if the student does not return to complete their program within 180 days, the school is then expected to return the Title IV funds based on the date on which the leave-of-absence began. Institutions must confirm at least half-time enrollment status for direct loans as of the time of disbursement of loans. As most institutions have disbursed their direct loans as of the date of closures, a follow up enrollment status change does not need to be communicated. Any enrollment changes after an institution’s established Pell Grant recalculation (census) date also does not require recalculation.

Return of Title IV Funds

Despite the disruption caused by COVID-19, an institution is still required to return any Title IV funds when a student withdraws. In order to identify students who withdrew after the onset of the pandemic, student aid administrators should work with the enrollment and the registrar’s offices to identify students who have withdrawn but did not notify financial aid of withdrawal. This can be challenging in normal environments; however, with all students and most institution personnel working remotely this can be extremely challenging. If the institution is required to take attendance, the withdrawal date is that last date of documented attendance. If the institution does not have an attendance requirement the institution can use any applicable option under 34 CFR § 668.22(c), which includes the option of the mid-point of the payment period or period of enrollment to determine the withdrawal date. If, in the case of COVID-19, the student fails to perform any additional coursework and is deemed to have withdrawn as of the transition to online learning, the timeframe for completing the return of Title IV funds calculation and making the appropriate returns or post-withdrawal disbursements begins on the date of online instruction. The institution will then have 30 days to perform the calculation and 45 days to return the funds. While the scope of this pandemic is unprecedented in recent times, most have adapted to the changed world. Institutions are encouraged to document and maintain all decisions that have been made regarding their campus, as government regulatory agencies will want to review those to ensure that the institution was following them. We believe the Education Department will be more forgiving given the immense scope of the disruption in everyday life. As always, auditors are still awaiting the compliance supplement to determine if there are any changes to the auditing requirements for the Student Financial Aid Cluster. We will keep you abreast of any of those changes that could affect fiscal year 2020 audits.

Distance Education

Most institutions have moved all courses online and will complete their terms, and possibly summer terms completely online. In most cases, the Department of Education must approve distance instruction. However, due to the sudden nature of closures, the Department of Education is waiving the requirement for approval. Therefore, your institution will not have to obtain the approval from the Education Department for any distance education courses. The distance education waiver will apply to a program during a payment period of March 5, 2020 through June 1, 2020. In most cases, this would apply to the spring semester and summer sessions. If your Institution intends to continue to offer the distance education after these periods, you must then seek approval under the Education Department’s normal process. The Education Department is also permitting accreditors to waive their distance education review requirements to accommodate students, with the exception of clock-hour courses that lead to licensure. If your institution offers a clock hour program, you must ensure that each clock hour of instruction is supervised by qualified instructional personnel. The institution must maintain an online learning platform or another system for monitoring each student’s academic engagement to ensure that students are academically engaged in at least 50 minutes for each hour that is recorded as a clock hour attended by the student.

Here is a quick reminder of the requirements that institutions must meet in order to qualify for distance education. The Education Department’s requirements (34 CFR § 600.2) include communications to students through one of the following types of technology:

1. Internet, including email correspondence
2. One-way/two-way transmissions through open broadcast, closed circuit, cable microwave, broadband lines, fiber optics, satellites or wireless communications
3. Audio conferencing
4. Video cassettes, DVDs, and CD-ROMS, if the media are used in a course in conjunction with any of the technologies listed above

Instructors must also initiate substantive communication with students, either individually or as a group on a regular basis, which should be established by the institution. This can be on any set schedule, such as when the class would have met physically or on a weekly basis. The instructors can use email to provide instructional materials to students enrolled in their class, use chat features to communicate with students, set up conference calls to facilitate group discussions, engage in email exchanges or require students to submit work electronically that their instructor will evaluate. Instructors should document what they are doing just as they would for an in-person classroom setting.

Federal Work Study (FWS)

FWS students usually are required to work and document their hours worked in order to receive FWS funds, unless they are in a disaster affected area in which they are unable to work. Pennsylvania has obtained a federal disaster designation and therefore are able to continue to pay their FWS Students. If the institution’s state has not been declared a federal disaster area and the student is at an institution that closed its campus or the student’s employer had to close as a result of COVID-19, the institution may continue paying FWS wages. In order to continue to pay FWS wages, the closure had to occur after the beginning of the term and the institution needs to continue to pay its other employees, and the institution must meet its institutional wage share requirement. The institution should document that the COVID-19 disruption was the reason their students continued to receive FWS funds without documentation of hours worked.

See the following resources for additional information:

Department of Education COVID-19 Resources