UNITED STATES DEPARTMENT OF EDUCATION
WASHINGTON, D.C. 20202
In the Matter of Docket No. 97-65-SP
CINCINNATI STATE TECHNICAL AND Student Financial
COMMUNITY COLLEGE, Assistance Proceeding
Cincinnati State Technical and Community College (College) participates in the various student financial assistance programs authorized under Title IV of the Higher Education Act of 1965, as amended (HEA). 20 U.S.C. § 1070 et seq. and 42 U.S.C. § 2751 et seq. These programs are administered by the office of Student Financial Assistance Programs (SFAP), U.S. Department of Education (ED or Department). On March 26, 1997, SFAP issued a Final Program Review Determination (FPRD) in which it sought the return of $743,470 in federal funds from the College. The FPRD is based upon the program review of the 1990-91, 1991-92, and 1992-93 award years. The College filed a request for review and both parties filed submissions to this tribunal.
SFAP contends that the College overpaid $406,435 of Pell Grant funds to co-operative education (co-op ed) students because it incorrectly determined their enrollment status. SFAP further contends that the College overpaid $337,035 of Pell Grant funds to its students because it was unable to document whether all recipients commenced attendance in classes for which they were registered and for which they received Pell Grant payments. The College responds that SFAP misapplies the applicable regulations, that there is no regulatory basis for these findings of the FPRD, and that the College's awards to its students were valid. The College has the burden of persuasion in this proceeding under 34 C.F.R. § 668.116(d).See footnote 11
FPRD Finding 1A
Statutes governing the Pell Grant program base a student's Pell Grant award on full-time
enrollment status and require that the awards of students who attend on less than a full-time basis
be reduced proportionately. 20 U.S.C. § 1070a(b)(2)(B) (1990). The implementing regulations
are found at 34 C.F.R. §§ 690.63 and 690.75 (1990). These regulations provide that institutions
that use academic terms of instruction, such as the College does, must disburse Pell Grant awards
based on a student's "enrollment status" in each term. § 690.63(a). "Enrollment status" is
defined as "full-time," "three-quarter-time," or "half-time." § 690.2. The institution is also
required to maintain records documenting the student's admission to, and enrollment status at, the
institution. § 668.23(f)(1)(i).
SFAP contends that the College overpaid $406,435 of Pell Grant funds to co-op ed
students because it incorrectly calculated their enrollment status. The FPRD based its finding upon the reviewer's conclusion that "the students only earned and were granted two or three hours of credit toward graduation upon completion of the class." It continued, stating that "[d]epending on the number of credits earned during the term, the student would be classified as full-time, three-quarter time, or half-time according to the definitions of full-time in the respective regulations." Therefore, it determined that the award of only two or three credits to these students was insufficient to classify them as full-time students and thus they were not entitled to the maximum Pell Grant awards. The College responds that all students enrolled for cooperative education credit were full-time students, regardless of the number of credit hours being taken or assigned to the students' programs.
According to the College's Handbook for 1990-91, full-time students were those students
completing academic courses totaling twelve or more credit hours per academic term. Students
completing less than twelve credit hours per academic term were considered to be part-time
students. Ex. ED-1 at 23. The College's Handbook also states that "[a]ny student registered for
cooperative education credit will be considered a full-time student during that term, regardless of
the total number of credit hours being taken." Ex. ED-1 at 21. The Handbook further explains
that students who are enrolled in the cooperative education program can meet their requirements
in one of three ways:
As SFAP notes, according to the College's own guidelines, a student who worked part-
time and did not take any classes would not satisfy these co-op ed program requirements and thus
would not qualify as a full-time student. The Handbook's later reference that any student
registered for co-op ed credit will be considered a full-time student during the term regardless of
the total number of credit hours taken can be read to be harmonious with these guidelines to the
extent that under alternative (1) above, a student who was working full-time would not be
attending any classes that term but would still be considered a full-time student. This cannot be
read to imply that a student working part-time and attending no classes would also be considered
a full-time student, as this would violate the College's own requirements under alternative (2)
above. Moreover, this would not satisfy the requirement of § 690.2(6) that the amount of work
performed by a full-time student in the co-op ed program be equivalent to the academic workload
of a full-time student. Therefore, based upon the College's own guidelines, a student enrolled in
a co-op ed course would not be a full-time student just by taking that course if the student elected
not to work full-time and did not take other academic courses such that the total workload was
equivalent to that of a full-time student.
In its initial brief, the College argues that SFAP is applying an unauthorized addition to
the regulations because it is requiring the College to award twelve credit hours per term to its
full-time co-op ed students. Surprisingly, SFAP retreated from this position in its initial brief by
FPRD Finding 1B
The regulations contain a provision allowing an institution to disburse Pell Grants to
registered students up to three weeks before the first day of classes of a payment period.
Nonetheless, if a student officially or unofficially withdraws, drops out, or is expelled before the
first day of classes, the entire payment is considered an overaward and the institution is required
to return to the Department all Pell Grant funds disbursed to that student for that payment period.
§§ 690.78(c) and 668.21. A student is considered to have dropped out before his or her first day
of class if the institution is unable to document the student's attendance at any class during the
payment period. § 668.21(b). Additionally, if a student's projected enrollment status changes
before the student begins attendance in all of his or her classes, the institution is required to
recalculate the student's award to reflect only those classes for which the student actually began
attendance. § 690.80(b)(2)(ii). The regulations contrast this with situations where a student's
projected enrollment status changes after the student has begun attendance in all of his or her
classes. In those situations, the institution has the option of recalculating the student's award, but
is not required to do this. § 690.80(b)(2)(i). In addition, Under § 668.23(f)(1)(i), the College
was required to maintain records regarding each Title IV recipient's enrollment status at the
The College, when challenged by SFAP to prove that its Pell Grant recipients actually began attending the classes upon which their grants were paid, was unable to comply with the request for those students who did not receive a passing grade for their enrolled courses, i.e., those who received letter grades of W, V, or F for their courses. This was due to the College's failure to require its teachers to take class attendance. However, it explained that its grading system serves as a satisfactory substitute for class attendance records, even for those students who did not receive a passing grade. These three grades are defined in its 1991-92 and 1992-93 catalogs as follows:
SFAP argues that the school can determine if a student changed his or her enrollment
status before attending classes only by first determining if the student began attending classes in
that course, and the regulations support that position. "Enrolled" is defined in § 668.2(b) as the
status of a student who has completed the registration requirements (except for the payment of
tuition and fees) at the institution he or she is attending.See footnote 22 Students have to be "enrolled" in order
to receive Pell Grant payments. §§ 690.75(a)(2) and 690.2. The removal of the attendance
requirement from the definition of enrolled is consistent with the regulations that authorize a
school to make Pell Grant payments to students up to ten days before they begin attending classes
(or by crediting their accounts up to three weeks prior to the first day of classes). § 690.78(b).
These students are "enrolled" and eligible to receive Pell Grant payments even though they have
not yet attended classes. It does not follow, however, that if these students fail to ever attend
classes in these courses, their status does not change from "enrolled" to "unenrolled."
The College's argument that SFAP's position mandates that an institution must monitor
attendance and that this amounts to an academic issue, the regulation of which by the Department
is prohibited by Section 432 of the Higher Education Act of 1965 (20 U.S.C. § 1232a), is
incorrect. The regulations do not require institutions to adopt and monitor an attendance policy,
but rather simply obligate institutions to document that students who receive federal Pell Grants
actually begin attending the classes for which they enrolled. No specific attendance policy or
requirement is placed upon the schools, and they can document the student's attendance in many
different ways, such as through test scores or class work submitted. Since the regulations
discussed above support SFAP's position, I do not find it necessary to resort to the Department's
Student Financial Aid Handbook to resolve this issue.
The College relied on the students'enrollment status when calculating Pell Grant awards,
but since the College did not require its faculty to take attendance, the only way to document that
students attended at least one class in each course that made up their projected enrollment status
is to rely on the students' grades in those courses. This is a simple task for those students who
received passing grades; however, it is another matter for those who did not. Based upon the
statements of various professors at the College, it is clear that the students could receive a grade
of "F", "V", or "W" regardless of whether they ever attended a class in the course. As a result,
the College cannot tell simply by looking at a student's grade whether that student ever began
attending classes in that course. Therefore, I find the College is unable to document that the
students who received these grades ever attended any classes in those courses and, therefore,
cannot document that the Pell Grant payments to these students were authorized. The College
must refund to the Department $337,035 in overpaid Pell Grant funds.
Judge Richard F. O'Hair
Dated: September 4, 1998
A copy of the attached document was sent to the following:
Kelli J. Jareaux, Esq.
Dow, Lohnes & Albertson
1200 New Hampshire Ave., N.W.
Washington, DC 20036-6802
Stephen M. Kraut, Esq.
Office of the General Counsel
U.S. Department of Education
600 Independence Avenue, S.W.
Washington, D.C. 20202-2110