Finding Text
Federal Agency: U.S. Department of Education
Program: Student Financial Assistance Cluster – Federal Direct Loan Program: ALN 84.268, Federal Pell Grant Program: ALN: 84.063, Federal Work-Study Program: ALN 84.033, Federal Supplemental Educational Opportunity Grants: ALN 84.007, Federal Perkins Loan Program: ALN 84.038
Criteria: As described in 34 CFR 668.171, the U.S. Department of Education (ED) requires institutions of higher education to report the occurrence of specific events, known as triggering events, to them within twenty-one days of the event.
Condition: During the year ended June 30 2024, the College failed the debt service coverage ratio covenant included in its agreement with its lender, which is a triggering event that should have been reported to the ED within twenty-one days of occurrence of the event.
Context: ED requirements for reporting triggering events. The triggering event occurred on June 30, 2024 and the College failed to communicate the event to the ED.
Cause: Lack of procedures in place to identify triggering events that require reporting to the ED.
Effect: Failure to report triggering events could result in the College being required to obtain a letter of credit or other surety or financial protection or result in the loss of the College’s eligibility to participate in Title IV funding.
Recommendation: We recommend that the College implement procedures to ensure triggering events are identified and reported to the ED in a timely manner.
Views of responsible officials and planned corrective actions: Management agrees with the finding, and corrective measures are being made.