Finding Text
Cluster name: Student Financial Assistance Cluster
Assistance Listings numbers and names: 84.007 Federal Supplemental Educational Opportunity Grants
84.033 Federal Work-Study Program
84.063 Federal Pell Grant Program
84.268 Federal Direct Student Loans
Award numbers and year: P007A230133, P033A230133, P063P230512, P063Q230512, and P268K230512
July 1, 2023 through June 30, 2024
Federal agency: U.S. Department of Education
Compliance requirement: Special tests and provisions - return of Title IV funds
Questioned costs: $943
Condition—Contrary to federal regulation and the District’s policies and procedures, the District’s Financial Aid and Scholarships Department (Department) did not return $943 of Student Financial Assistance’s (SFA) Title IV funds for 1 student who received grants and loans and withdrew during a payment period or period of enrollment in which the student began attendance.1 Specifically, for 1 of 25 students tested, the District did not complete the required calculation and return the $943 unearned portion of a student’s $3,698 original Pell grant award to the U.S. Department of Education (ED) after the student withdrew from the District.
Effect—The District’s not returning $943 of Title IV funds to ED resulted in Title IV funds not being spent as intended by program requirements. Further, there is an increased risk that the District may need to return additional Title IV funds to ED. For example, the Department’s Management reported that it identified an additional 81 students, or $153,318 in Title IV funds, for whom it did not perform required calculations during the period November 2023 through June 30, 2024. This includes $143,509 in Pell Grants, $5,718 in Direct Loans, $3,716 in Federal Work Study, and $375 in Federal Supplemental Educational Opportunity Grants that may not have been spent as intended by program requirements.
Cause—The District’s student information system’s automated controls did not flag students who withdrew and required a return to Title IV calculation. In November 2023, the District made changes to its student information system without performing tests to ensure the automated controls were properly identifying and flagging students who withdrew.
Criteria—Federal regulation and District policies and procedures require the return of Title IV funds when a recipient of Title IV grant or loan assistance withdraws from the District during a payment period or period of enrollment in which the recipient began attendance. Specifically, the District must determine the amount of Title IV aid earned by the student as of the student’s withdrawal date. If the total amount of Title IV assistance earned by the student is less than the amount that was disbursed to the student or on his or her behalf as of the date of the institution’s determination that the student withdrew, the difference must be returned to the Title IV programs (34 Code of Federal Regulations [CFR] §668.22[a][1-5]).2 Further, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303).
Recommendations—The Department should:
1. Perform calculations for all students who received Title IV funds and withdrew during the period November 2023 through June 2024 and immediately return all unearned aid to ED.
2. Review and update the student information system’s automated controls to properly identify and flag all students who receive Title IV funds and withdraw from the District.
3. Test any changes made to the student information system and verify controls are operating as designed to comply with the SFA cluster’s requirements.
The District’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials. We are not required to and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.
1 The Title IV programs as part of the Student Financial Assistance cluster are administered by the Department of Education (those with Assistance Listings beginning with 84) and authorized by Title IV of the Higher Education Act of 1965, as amended (HEA), and collectively are referred to as the “Title IV programs.”
2 Pima County Community College District. (2023). Pima County Community College District Policy and Procedures 2023-2024 V2. Page 253 of 272.