Finding 966699 (2023-101)

Cluster name: Student Financial Assistance Cluster Assistance Listings numbers and names: 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study Program 84.038 Federal Perkins Loan Program—Federal Capital Contributions 84.063 Federal Pell Grant Program 84.268 Federal Direct Student Loans Award year: July 1, 2022 through June 30, 2023 Federal agency: U.S. Department of Education Compliance requirements: Special tests and provisions Questioned costs: Unknown Condition—Contrary to federal regulations and District policies and procedures, the District’s Student Financial Assistance Offices (Offices) at 7 of its 10 colleges did not accurately and/or timely report enrollment status changes to the National Student Loan Data System (NSLDS) for 20 of 40 students we tested District-wide participating in the Federal Pell Grant (Pell) or Federal Direct Student Loans (Direct Loans) programs. Specifically, the Offices did not report: • Timely student enrollment status changes for 10 students, as the Offices reported the changes between 3 to 56 days later than the required 60 days. • Accurate student enrollment status changes for 15 students, as the Offices reported incorrect changes for these students, 5 of which were reported late, as described above. Effect—The District’s students may not be asked to repay student financial assistance grants and loans if or when required if the NSLDS does not accurately reflect students’ enrollment status. Cause—The District did not monitor its Student Financial Assistance Offices’ adherence to District-wide policies and procedures to ensure their compliance with Pell and Direct Loans requirements. Specifically, although the District had communicated District-wide policies to the SFA offices at each of its 10 colleges that are responsible for administering the federal programs, adhering to federal regulations, and following District-wide policies and procedures, it did not monitor the colleges’ adherence to them to ensure student data is reported accurately and timely. Thus, when the SFA offices at 7 of the 10 colleges did not follow the District-wide policies and procedures requiring them to review, verify, and correct, as necessary, the student data compiled from the District’s student information system before submitting reports to NSLDS, the District did not identify the errors and did not report student enrollment status changes timely. Criteria—Federal regulations and District policies and procedures require reporting to the NSLDS all applicable students’ enrollment statuses and any enrollment-status changes for the Pell and Direct Loans programs within 60 days of the students’ change. Student enrollment status changes include reductions or increases in attendance levels, withdrawals, graduations, or approved leaves of absence (34 Code of Federal Regulations [CFR] §§685.309[b][2] and 690.83[b][2]). Also, 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 District should: 1. Require its Student Financial Assistance Offices to follow District-wide policies and procedures to: a. Report accurate student enrollment statuses and changes to the NSLDS within 60 days of the students’ change for all students receiving Pell and Direct Loans. b. Review, verify, and correct as necessary the student-enrollment status data they compiled prior to submitting it to NSLDS. 2. Monitor its Student Financial Assistance Offices to ensure their compliance with District policies and procedures for the Pell and Direct Loans programs. 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 audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy. This finding is similar to prior-year finding 2022-101 and was initially reported in fiscal year 2015.