UNITED STATES DEPARTMENT OF EDUCATION
WASHINGTON, D.C. 20202
In the Matter
COMMUNITY Student Financial
COLLEGE, Assistance Proceeding
Appearances: Lisa C. Bureau, Esq., Dow, Lohnes & Albertson,
Washington, D.C., for Mount Wachusett Community College.
Denise Morelli, Esq., Office of the
General Counsel, United States Department of
Education, Washington, D.C., for Student Financial Assistance Programs.
Before: Judge Richard F. O'Hair
MWCC began its prison programs in 1987, following a request of
the Commonwealth of
Massachusetts to provide incarcerated students with educational opportunities. Through its
prison programs, MWCC offers a limited number of courses to incarcerated students. (Exh. R-3-
13). These courses are designed to develop skills which enable the students to re-enter the
workforce upon release from prison and include programs in Business Management, Heating
Ventilation and Air-Conditioning, Refrigeration, Graphic Arts, Printing, Desktop Technology,
Auto Body Repair, Carpentry, and Culinary Arts. (Exh. ED-14-2). MWCC currently offers a
selection of these programs in seventeen correctional institutions in the Commonwealth of
Massachusetts. The institution is not operating under a contract with the Commonwealth to
provide this instruction and it receives no reimbursement from the Commonwealth for its
other than that which may be received by any other college in the Commonwealth. The
are administered through MWCC's main campus, but instruction is provided at the prison sites.
Although program degrees can be awarded to these incarcerated students, the programs cannot
completed entirely at the prison sites without the assistance of consortium arrangements, transfer
of credits from other colleges, or the granting of a waiver of selected course requirements. (See
MWCC appeals four FPRD conclusions before this tribunal: (1)
each prison site was and
is currently ineligible to participate in any Title IV Program; (2) MWCC improperly inflated the
Federal Pell Grant COA for the incarcerated students; (3) MWCC used an inappropriate method
to construct an average Federal Pell Grant COA for Day and "S" students; (4) MWCC
improperly included incarcerated students on the eligible aid applicant grid of the Fiscal
Operations Report and Application to Participate (FISAP).
Off-Campus Site Eligibility/Eligibility Letter
the term " complete educational program."
A complete educational program is a legally authorized postsecondary program of organized instruction or study which leads to an academic or professional degree, vocational certificate, or other recognized educational credential. Under the current regulations and procedures, an institution does not need approval for additional locations which do not offer complete programs, such as the examples contained in your letter.
This definition has been codified in 34 C.F.R. §
600.2. According to this definition, if a
school does not provide all of the necessary courses at a particular location for a student to
a degree or certification, the school does not provide a complete educational program.
The Code of Federal Regulations specifically addresses the
situation where a school does
not provide a full program at a particular location, and completion of that program can occur
when an institution accepts transfer credits from another institution. In the definition of an
"educational program", the Code states that:
the Secretary does not consider that
an institution provides an
educational program if the institution does not provide instruction
itself. . . but merely gives credit for one or more of the following:
instruction provided by other institutions or schools, examinations
provided by agencies or organizations, or other accomplishments
such as "life experience."
(34 C.F.R. § 600.2)
Although MWCC's prison programs do not directly match the
examples addressed in the
1991 letter, it is clear these programs do not offer all of the classes necessary to obtain a
certification or degree. In order for an incarcerated student to receive a degree or certification
from MWCC, the school must either waive certain requirements or accept transfer credits from
another institution. When accepting transfer credits, MWCC is not providing the instruction
itself, but is merely giving credit for instruction provided by another institution. Applying the
interpretation of the definition given by the director and the codification of that definition in 34
C.F.R. § 600.2, MWCC's DCE prison programs do not offer a complete educational
and, therefore, need not apply for separate eligibility to participate in Title IV programs for each
of the programs offered at its prison sites.
Accordingly, MWCC is relieved of any liability under this
Inflated Federal Pell Grant Cost of Attendance for Incarcerated Students.
MWCC disagrees and claims that all of its incarcerated students are
charged tuition and
fees.See footnote 1
Tuition bills, however, are sent only to incarcerated students who have other financial
resources and, thus, do not receive student financial assistance. (Exh. R-5-14-21). Bills are not
sent to those students receiving financial aid, even though the amount of the financial assistance
less than the tuition fee, because the institution has implemented a program whereby it can grant
waiver of all fees in excess of the financial assistance. MWCC further explains that, for those
students who are not receiving financial assistance, if that student fails to pay the billed amount,
the student is "locked out" by the school and thus prevented from registering or attending classes
until the bill is satisfied. Since there is evidence that the students who receive Federal aid
technically owe MWCC for the balance of their tuition and fee bill, even though they are
granted a waiver of this balance, I conclude that incarcerated students actually incur the cost of
tuition and fees. Accordingly, the cost of tuition and fees is appropriately included in the COA
incarcerated students enrolled through MWCC.
With respect to the room, board, and miscellaneous expenses of the incarcerated students, the statutory provisions in effect at the time of the review did not require schools who had several categories of students, such as day students and incarcerated students, to compute a separate living allowance component in the COA calculation for each category of student, but rather the
institution could compute an average COA and apply it to all categories of students. (Dear
Colleague Letter, GEN-88-7 (January 1988)). Further support for this position is found in the
Question and Answer section of a subsequent Dear Colleague Letter (GEN-89-49 (September
1989)) which highlights the elimination of the previous regulatory requirement that "required
different treatment for calculating the cost of attendance for certain special categories of
including incarcerated students." The 'Answer' continues by explaining that "an institution may
establish a category within the allowance for room, board, books, supplies, and miscellaneous
expenses to reflect costs incurred by an incarcerated student." [Emphasis in original]. MWCC
interpreted this guidance as giving it the discretion to develop only one living allowance
component and apply it to all categories of its students, including its incarcerated students.
MWCC further relies on the 1990-91 Federal Student Financial Aid Handbook, at 4-18, which
permitted schools to "establish allowances based on the typical costs for its students," to say that
the computation of one living allowance component for inclusion in the COA calculation for all
students was appropriate.
The key phrase in these various forms of ED guidance for the
schools is that the costs of
attendance which ultimately serve as a guide for Federal student aid must be costs which are
actually incurred by the students. With regard to MWCC's incarcerated students, as well as
those addressed in Microcomputer and Chenier, the students had no obligation to
pay for their room and board because the state provided their housing, food, and clothing.
Likewise, the only
personal financial obligations of MWCC's incarcerated students were for miscellaneous and
expenses. While the theme of the guidance ED provided the institutions was that it was no
necessary to develop a separate COA figure for each category of student, it is unrealistic to argue
that the living expense component for one category of student which incurs housing, food, and
clothing expenses should be applied to another group of students which incurs none of those
expenses. I cannot accept MWCC's argument that room, board, and clothing expenses are
"typical" costs incurred by incarcerated students which would justify including such a figure in
that group's COA calculation. I make this finding despite the fact that the incarcerated students
comprise only 15% of the total student population at MWCC. This student group is large
and dissimilar enough from the other 85% of the student body to warrant a separate calculation
the living allowance component of its COA that does not include an assigned cost for room,
board, and clothing.
Consequently, MWCC must recompute the cost of attendance of its
for Pell Grant purposes, and may include only costs of tuition and fees, books and miscellaneous
Undocumented Cost of Attendance
with the higher tuition costs for DCE "S" studentsSee
when determining the Day student COA which the school reported to ED for the Spring,
1991 semester. Relying on guidance found in the
1990-91 Federal Student Financial Aid Handbook (page 4-14), SFAP concludes that MWCC
not permitted to use average costs for its Day and DCE "S" students while at the same time the
institution reported the actual costs incurred by the remainder of the student population. There is
no statutory guidance on this issue other than that found in the Higher Education Act of 1965
which defines "cost of attendance" as:
(A) the tuition and uniform
compulsory fees normally charged a
full-time student at the institution at which the student is in
attendance for any award year, ....
20 U.S.C. § 1070a-6-(5); See also 20 U.S.C. §
SFAP explains that the Handbook authorizes institutions to
compute a COA utilizing
either an average amount or the actual amount it charges. SFAP interprets this provision as a
prohibition against an institution's use of both methods for calculating the COA for different
categories of students at that institution. By using both methods, SFAP asserts that MWCC
inflated the COA for Day students and permitted them, as a group, to receive $6894 more in
Federal Pell Grant money than they would have received had the COAs from the two groups not
I disagree with this interpretation of the Handbook and cannot
conclude, as does SFAP,
that the tuition and fees component must be computed by using either the average costs or actual
costs, to the exclusion of the other method. Without any regulatory guidance on this issue, it is
logical for MWCC to use actual costs of tuition and fees for its students who take only DCE
classes, but that an average of the fees would be appropriate for Day students who may also be
enrolled in DCE "S" classes which happen to have a higher tuition cost than straight Day
classes. I think the Handbook unnecessarily attempts to restrict an institution's ability to
a COA which is both easy to apply and generally reflects the true costs of the tuition and fee
component of MWCC's COA for its Day students.
Even if I were to agree with SFAP's interpretation of the provisions of the Handbook that an institution may use only the average or the actual costs of tuition and fees, I must agree with MWCC that, in the absence of statutory or regulatory guidance on this issue at the time of this program reviewSee footnote 3 3 , it cannot be financially penalized for its failure to comply with ED policy on this
issue. To do so would be in contravention of the requirements of the General Education
Provisions Act, 20 U.S.C. § 1232, which formalizes the Federal government's rulemaking
procedures by requiring the publication for comment of any proposed regulations, rules,
guidelines, and so forth. The 1990-91 Handbook has not been subjected to these formalized
procedures and, therefore, cannot be used as the basis for imposing a liability on MWCC in this
instance. As this tribunal held in In the Matter of Baytown Technical School, Inc., Dkt.
No. 91- 40-SP, at 26 (Init. Dec., January 13, 1993), aff'd by the Secretary, November 14,
[T]his tribunal is obliged to finding
violations of law, not violations
of statements of policy. While a statement of policy may assist the
tribunal in interpreting the law, policies and procedures, it, without
more, cannot carry the weight of law. The existence of a statutory
violation may be appraised against the backdrop of published policy
statements or published bulletins but these indicia or policy cannot
stand alone as the basis of a regulatory violation.
MWCC has met its burden of proving that its use of an
average cost of tuition and fees for the Day students and actual costs for the remainder is not
prohibited by a statute or regulation,
and has shown that this practice is not an improper expenditure of Federal student financial
MWCC, therefore, is not required to repay ED the $6,894 Federal
Pell Grant liability
pursuant to this finding.
Inaccurate Data Reported on the Fiscal Operations Report and
Application to Participate (FISAP)
The basis for this finding is that the college should not have included incarcerated students in its eligible aid application grid because MWCC does not offer campus based aid to incarcerated students, thereby making incarcerated students ineligible for campus based funds. MWCC has produced evidence to the contrary, including a report written by SFAP discussing the details of the prison work study program, which is a campus-based aid program. Since MWCC offered work study aid to its incarcerated students, the institution properly included these students in the FISAP as students who were eligible to receive financial aid. According to the instructions on the
FISAP, an institution must include all eligible aid applicants who applied for financial aid for
year. (Exh R-16-3) . The instructions also clearly state that "[y]ou must include students for
whom you had no funds to award . . ." (Exh R-16-3). I find that MWCC offered campus-based
aid to the incarcerated students and, therefore, correctly included incarcerated students on its
eligible aid application grid.
Accordingly, MWCC is relieved of any liability under this
2. MWCC improperly inflated the
COA of students enrolled in its prison programs by including a cost for room and board.
3. MWCC used a correct average
COA for its Day students.
4. MWCC correctly included
incarcerated students in its reported data on the FISAP.
Judge Richard F. O'Hair
Dated: September 1, 1995
On September 1, 1995, a copy of the attached initial decision was sent by certified mail, return
receipt requested to the following:
Lisa C. Bureau, Esq.
Dow, Lohnes & Albertson
1255 Twenty-Third Street, N.W.
Washington, D.C. 20037-1194
Denise Morelli, Esq.
Office of the General Counsel
U.S. Department of Education
600 Independence Avenue, S.W.
Washington, D.C. 20202-2110