Title: Basis of Presentation
Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.
De Minimis Rate Used: N
Rate Explanation: The Authority has elected not to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance
The accompanying schedule of expenditures of federal awards (Schedule) includes the federal award activity of North Texas Higher Education Authority, Inc. (Authority) under programs of the federal government for the year ended August 31, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Authority, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Authority.
Title: Federal Financial Assistance
Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.
De Minimis Rate Used: N
Rate Explanation: The Authority has elected not to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance
The Authority receives interest subsidies on behalf of eligible students during qualified periods and special allowance on eligible qualifying loans disbursed before April 1, 2006. The Special Allowance Payment formula, or SAP rate, is determined by the DOE, based upon an average of all of the applicable floating rates (91-day Treasury bill, commercial paper, and SOFR) in a calendar quarter, plus a spread between 1.74% and 3.50%, depending on the underlying loan status and origination date. These rates are then applied to the quarterly average daily balance for loans eligible to receive SAP.
For loans first disbursed prior to April 1, 2006, the Authority earns interest at the higher of the borrower’s rate or the SAP rate. If the SAP rate exceeds the borrower’s rate, the DOE makes a payment directly to the Authority. For loans first disbursed after April 1, 2006, the Authority earns interest at the SAP rate. If the SAP rate is less than the borrower’s rate, the Authority “rebate” the difference between the borrower’s rate and the lower SAP rate to the DOE. If the SAP rate is greater than the borrower’s rate, the DOE makes SAP payments to the Authority for the difference between the two rates.
Title: Student Loan Servicing
Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.
De Minimis Rate Used: N
Rate Explanation: The Authority has elected not to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance
The Authority outsources the servicing of its loans to Nelnet Diversified Solutions LLC, Navient Corporation, Iowa Student Loan Liquidity Corporation, and Higher Education Servicing Corporation (the Servicers). The Authority receives service auditor’s reports and compliance examination reports from these Servicers to obtain assurances about controls in place and compliance with federal requirements under Chapter 3 of the 2020 edition of the U. S. Department of Education’s Guide for Financial Statement Audits and Compliance Attestation Engagements of Lender Servicers Administering Federal Family Education Loan Program Loans (Lender Servicer Audit Guide) for the Servicers.
Title: Accrued Federal Interest and Subsidies Receivable
Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.
De Minimis Rate Used: N
Rate Explanation: The Authority has elected not to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance
The following represents the accrued federal interest and subsidies receivable for the year ended August 31, 2024:
Title: Outstanding Student Loan Balances
Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.
De Minimis Rate Used: N
Rate Explanation: The Authority has elected not to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance
The federal loan programs listed subsequently are administered directly by the Authority, and balances and transactions relating to these programs are included in the Authority’s basic financial statements. Loans outstanding at the beginning of the year, loans made during the year, if any, interest subsidies and special allowance subsidies (payments) are included in the federal expenditures presented in the Schedule. The balance of loans outstanding at August 31, 2024, consists of: