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(GEN-97-11) (GEN-97-11) This letter provides guidance regarding the Notice published in the Federal Register on September 19, 1997, that informs institutions of the deadline dates for institutions to use designated electronic processes to meet administrative capabil

DCLPublicationDate: 10/1/97
DCLID: GEN-97-11
AwardYear: 1998-99
Summary: This letter provides guidance regarding the Notice published in the Federal Register on September 19, 1997, that informs institutions of the deadline dates for institutions to use designated electronic processes to meet administrative capability requirements for participation in the Title IV Federal Student Financial Assistance Programs.


Action Letter #2
October 1997


GEN-97-11


SUMMARY: This letter provides guidance regarding the Notice published in the
Federal Register on September 19, 1997, that informs institutions of the deadline
dates for institutions to use designated electronic processes to meet administrative
capability requirements for participation in the Title IV Federal Student Financial
Assistance Programs.

Dear Colleague:

Enclosed with this letter is a reprint of the Notice published in the Federal Register on September 19, 1997, that informs institutions of the deadline dates for institutions to use designated electronic processes in order to meet the administrative capability requirement for participation in the Title IV Student Financial Assistance Programs in accordance with the provisions of 34 CFR 668.16(o).
We also have enclosed a document that provides you with a comprehensive discussion of each of the required electronic processes and their respective participation deadlines as shown on Table A of the Notice. It also provides additional information
regarding the technical specifications contained in Table B of the Notice. Finally, we have enclosed a copy of a letter that will be sent to your institution's President or Chief Executive Officer concerning the new electronic requirement.

I would also like to especially remind you to note the requirement that by January 1, 1999 your school must be "Year 2000 Compliant" with regard to the processing of financial aid data (this requirement is discussed more fully on page 8 of the enclosure). Year 2000 Compliant means that all of your data processing systems,
procedures, and protocols are designed to handle the upcoming change in the century.

We wish to thank you in advance for your cooperation and partnership with us in our continuing efforts to take advantage of existing technology in the delivery of Title IV student assistance. We believe that our programs will better serve students and families when we more fully utilize technology to provide more efficient, accurate, and timely service.


Sincerely,


Elizabeth M. Hicks
Deputy Assistant Secretary,
Student Financial Assistance Programs

Enclosures


REQUIRED ELECTRONIC PROCESSES
FALL 1997



Background:

On September 23, 1996, a Notice of Proposed Rulemaking (NPRM) was published in the Federal Register that proposed, among other things, that the standards of administrative capability for an institution to participate in the Title IV student assistance programs include the requirement that the institution participate in certain electronic services. This proposed rule was finalized (with the phrase "electronic services" changed to "electronic processes") in a Final Rule published in the Federal Register on November 29, 1996. To comply with this requirement, an institution will be able to use software provided by the Secretary or software developed by the institution, or its vendor, in accordance with specifications provided by the Secretary. Alternatively, an institution may meet this requirement by the use of a third party servicer.

The regulation provided that the specific electronic processes that schools must participate in would be those that are identified in a series of notices published by the Secretary in the Federal Register. Although the first of these notices has just been published, the Department of Education (the Department) has previously informed the postsecondary education community of the new requirement and what specific electronic processes were likely to be included.

On February 13, 1997, in one of our series of Student Financial Assistance Program (SFAP) video conferences, we discussed the new administrative capability requirements and provided a listing of those electronic processes that would most likely be in the first Federal Register Notice. The 1997 SFAP training workshops that were presented at more than 60 sites throughout the country during the Winter and Spring of 1997 included a discussion of these electronic requirements. Department staff, during presentations to financial aid professional groups, have consistently provided the community with information on the new requirements. Additionally, at the 1997 National Association of Student Financial Aid Administrators (NASFAA) Annual Conference, the Department provided a general session that covered the specific requirements that would be included in the first Federal Register Notice.


Upcoming Training and Support:


In order to assist institutions with the implementation of these designated processes, the Department will be offering a series of informational and hands-on training activities.

Video-Conference: "SFAP Update: The 1998-99 FAFSA and More"

On October 16, 1997, we broadcast another in our series of video-conferences. This video-conference entitled, "SFAP Update: The 1998-99 FAFSA and More," focused on changes to the Federal student aid delivery system for the 1998-99 award year as well as the electronic requirements contained in the attached Electronic Processes Notice.


Electronic Conferences: "A Second Decade of Partnership Through Electronics"

During November and December 1997, the Department will present three on-site conferences where institutions can learn about the electronic processes required, as well as other electronic services available from the Department. The first of these conferences, to be called "A Second Decade of Partnership Through Electronics," will
be held in St. Paul, Minnesota from November 4 through November 6. The second will be in Seattle, Washington from November 17 until November 19. The final conference will be from December 16 through December 18 in Boston, Massachusetts. More than 40 concurrent sessions will be offered throughout each of the conferences. For additional information on these conferences, please refer to Action Letter #9, 1997-98 Application Processing System (GEN-97-7) or visit the conference website at
http://edeworkshop.walcoff.com.

NSLDS Computer Training


Beginning in January, the Department will offer training on the National Student Loan Data System (NSLDS), at each of the Department's Regional Training Facilities. This 2-day training will include hands-on exercises in the system functionality of
NSLDS. Further information will be published in a Training Announcement later this fall.
On-Site Training: "The Electronic Financial Aid Office"

Beginning in February 1998, "The Electronic Financial Aid Office" training, offered at various sites across the country, will focus on the uses of electronics in the administration of student financial aid programs. This combination of lecture and computer training will continue through the Summer of 1998, assisting schools in
implementing the requirements of this Electronic Processes Notice, and providing actual practice using various software and electronic services developed by the Department. Details of the training topics, dates, and locations will be provided in a Training Announcement.


Required Electronic Processes:

As published in the Electronic Processes Notice, Table A (reprinted on the next page of this letter) provides a summary of the electronic processes in which institutions must participate to be considered administratively capable and the required deadline date by which each requirement must be implemented by institutions. Following the table is a more comprehensive discussion of each of these requirements.


TABLE A: DESIGNATED PROCESSES AND DEADLINE DATES


Deadline Date Designated Electronic Processes

January 1, 1998 1. Participate in the Title IV Wide Area Network (TIV WAN)
2. For the 1998-99 Processing Year1 and Beyond:
a. Receipt of Institutional Student Information Records (ISIRs)2
b. Adding Your Institution to the Central Processing System Record (CPS)
c. On-line Access to the National Student Loan Data System
(NSLDS)


July 1, 1998 1. Access to the "Info for Financial Aid Professionals"
website or the Student Financial Assistance Bulletin Board
System (SFA BBS)
2. Submission of the Application for Approval to Participate
in Federal Student Aid Programs (recertification,
reinstatement and changes) through the Internet
3. Submission of the Fiscal Operations Report and Application
to Participate (FISAP) to the Title IV Wide Area Network
(TIV WAN). Diskettes will be eliminated.

July 1, 1999 1. For the 1999-2000 Award Year and Beyond:
Report Federal Pell Grant Payments Electronically or on
Magnetic Tape or Cartridge to the Title IV Wide Area
Network (TIV WAN). Diskettes will be eliminated.
2. Submit Student Status Confirmation Report (SSCR) data
Electronically or on Magnetic Tape or Cartridge to the
National Student Loan Data System (NSLDS). Diskettes will
be eliminated.
3. Submit Federal Perkins Loan Data Electronically or on
Magnetic Tape or Cartridge to the National Student Loan
Data System (NSLDS). Diskettes will be eliminated.


1 The application processing cycle lasts 18 months. For the 1998-99 award year, application processing begins in January 1998 and applications for that year will be accepted until June 30, 1999. (see The 1997-98 Counselor's Handbook for Postsecondary Schools, page 19)

2 The Secretary realizes that processing Title IV aid upon the receipt of an ISIR, rather than the paper Student Aid Report (SAR), may be new for some institutions. In order to provide institutions sufficient time to implement electronic procedures to receive ISIRs, the Secretary will not assess any penalties against an institution that is not able to comply with this requirement on January 1, 1998. However, beginning July 1, 1998, all institutions are expected to be receiving ISIRs electronically for any Title IV applicant who has listed that institution on the applicant record held in the CPS and the Department will begin assessing appropriate penalties at that time for institutions found not to be awarding Title IV assistance to eligible applicants based on the receipt of the ISIR.


Electronic Requirements - January 1, 1998

TIV WAN Participation:

Beginning January 1, 1998, institutions will be required to participate in the Title IV Wide Area Network (TIV WAN) by which Title IV program financial aid data is electronically transmitted and received between the Department and institutions. Each location that physically transmits and receives financial aid data via TIV WAN is called a Destination Point. An institution can establish one or more Destination Points at its own location, at another site, or in combination. It may also designate a third-party servicer or servicers to serve as its Destination Points. An institution may have different Destination Points for its various Title IV electronic functions.

We are currently redesigning the TIV WAN registration process and form. We will roll forward current TIV WAN institutional profiles into the next processing year. Schools that need to initiate TIV WAN participation, as well as those that may need to make changes to previously submitted information, should refer to Action Letter
#4, 1997-98 Application Processing System (GEN-96-20). A new Action Letter describing the revised TIV WAN enrollment process will be published shortly.

Receipt of ISIRs:

Beginning with the 1998-99 processing year (January 1998), institutions will be required to receive Institutional Student Information Records (ISIRs) either through the Title IV Wide Area Network (TIV WAN) or on magnetic tape or cartridge. ISIRs are the electronic records that are sent to each school designated by an applicant on the Free Application for Federal Student Aid (FAFSA). The ISIR includes data provided by the applicant on the FAFSA, results of required database matches, results of the calculation of the applicant's Expected Family Contribution (EFC), and certain other information. Institutions must use ISIR data to determine student
eligibility, award and disburse program funds, and certify or originate Title IV HEA program loans. Schools may not require students to submit paper Student Aid Reports (SARs), except to expedite the corrections process. However, an institution that
receives a paper SAR from a student, and that school is not listed on the SAR, must process the SAR for awarding of Title IV aid. Schools must also make certain that they are added to the CPS record as discussed below.

Many institutions that receive ISIRs through TIV WAN use software (EDExpress) provided by the Department to download the ISIRs from their TIV WAN electronic mailbox into a database created by EDExpress. Institutions then either continue using components of EDExpress for the processing of student aid or copy the ISIR data into a locally created database for further processing using custom or vendor software. Other institutions download ISIRs from their electronic mailbox directly into their local system for further processing. Institutions that receive ISIRs on magnetic tape or cartridge generally load those records into their own systems for
further processing, although they may also be loaded into EDExpress for specialized processing (corrections, payment data reporting, etc.).


We realize that processing Title IV aid upon the receipt of an ISIR, rather than relying on a paper Student Aid Report (SAR), may be new for some institutions and may require the purchase or development of automated systems and procedures. In order to provide these institutions sufficient time to comply with this requirement, the Department will not assess any penalties against an institution that is not able to comply as of the beginning of the processing year in January 1998. However, beginning July 1, 1998, all institutions are expected to be receiving ISIRs electronically for any Title IV applicant who has listed that institution on the applicant record held in the CPS. The Department will begin assessing appropriate penalties at that time for institutions found not to be awarding Title IV assistance to eligible students based on the receipt of the ISIR.

Adding Your Institution to the CPS Record:

For the effective administration of the Title IV programs and to ensure the capability for future enhancements to the delivery system, the CPS must have a complete record of all institutions an applicant is considering attending. The most immediate need for this information is to allow the NSLDS to inform schools of potential changes to an applicant's eligibility for Title IV aid. Therefore,
beginning with the 1998-99 processing year, an institution must ensure that its Title IV school code is added to the CPS record no later than 30 days after the institution receives a SAR that does not list that institution. This updating of the CPS record can be done by the institution using EDExpress software and the Data Release Number (DRN) (formally known as the personal identification number (PIN)) printed on the applicant's SAR. Alternatively, the applicant can update the listing of schools by submitting a correction using Part 2 of the paper SAR or sending a letter to the MDE processor, or by calling the Federal Student Aid Information
Center (319) 337-5665 and providing the DRN from the SAR.

The addition of the new school should be made by using the first blank institution field in EDExpress or on the paper SAR so that a prior listed school is not deleted. In the event that all six of the institution fields have been used, the applicant must decide which of the original six schools should be replaced.

On-Line Access to NSLDS:

No later than January 1, 1998, institutions must, as part of their Title IV WAN participation, have at least one staff member signed up for direct on-line access to the National Student Loan Data System (NSLDS). This access will enable institutions to fully utilize many of the special functions of the NSLDS. These include on-line
financial aid transcripts (FATs), borrower tracking look-ups, and on-line updating of Student Status Confirmation Report (SSCR) data. Beginning in January 1998, NSLDS overpayment reporting screens will also be available.

Even though all institutions will be required to have on-line access to the NSLDS, schools are reminded that they are still required to respond to requests for FAT information from other institutions or from students in accordance with 34 CFR 668.19.


Electronic Requirements - July 1, 1998

Access to the "Information for Financial Aid Professionals" Website or the SFA BBS:

Beginning July 1, 1998, institutions will no longer automatically receive Departmental information through the mail, including most "Dear Colleague" letters, announcements, Federal Registers, etc. Instead, institutions must have the capability to retrieve such documents through either the current Student Financial Assistance Bulletin Board System (SFA BBS) or from a special website being developed for financial aid professionals. This site, partially developed as of this writing, is called "Information for Financial Aid Professionals" and is part of the Office of Postsecondary Education (OPE) Website. The specific Internet address to the "Information for Financial Aid Professionals" website is:

http://www.ed.gov/offices/OPE/Professionals

For information on accessing the SFA BBS, institutions should contact the Customer Support Branch at (800) 433-7327.

Although the SFA BBS is currently operational, institutions should be prepared to access the website, since it is likely that the SFA BBS will be phased out during the next year.

An institution that uses a third-party servicer to meet this requirement needs to ensure that it is kept informed by its third-party servicer of all information posted by the Department on the SFA BBS or website.

In order for an institution to meet this requirement, as well as have the capability to submit recertification documents over the Internet, as discussed below, it will need to obtain Internet access through an Internet Service Provider, and to acquire a World Wide Web browser, i.e., Netscape Navigator or Microsoft Internet Explorer. To download a copy of the Netscape Navigator software, the web address is http://home.netscape.com. The web address to download the Microsoft Internet Explorer software is http://www.microsoft.com/ie/download/.

Institutions must have the capability to print Federal Registers or other complex documents provided in Portable Document Format (PDF). The software for viewing and printing PDF files can be downloaded onto an institution's PC hard drive for free from the Adobe Systems website at http://www.adobe.com/prodindex/acrobat/readstep.html.

The Department provides a link to the Adobe Systems website through the "Information for Financial Aid Professionals" website or the SFA BBS. Of course, an institution may use other software to print these documents.

Submission of the Application to Participate (Recertification) through the Internet:

Beginning July 1, 1998, applications for recertification, reinstatement, or changes in institution ownership or structure must be submitted to the Department electronically through the Internet. The Department will no longer provide diskettes to institutions for submission of the "Application for Approval to Participate in Federal Student Financial Aid Programs." A signature page will still be required and must be mailed separately along with all required supporting documentation. Institutions need to have access to the World Wide Web using a forms capable web browser such as Netscape Navigator or Microsoft Internet Explorer. The web address to access the electronic application form is:

http://www.eligcert.ed.gov

Applications for initial certification will not be submitted over the Internet during the initial phase of this process. Institutions wishing copies of the application for initial application should call (202) 260-3270.

Institutions will be able to send electronic updates to their application data through the Internet. An institution will be able to pull up its own application data from the Postsecondary Education Participants System (PEPS), change the necessary data items, and transmit it for Departmental review and acceptance. The PEPS system allows for changes in telephone numbers, fax numbers, names on the
application, etc. This updating feature should be available beginning in December 1997.

Institutions are reminded that they are responsible for monitoring the expiration dates of their participation agreements and submitting a complete Application to Participate in Federal Student Aid Programs with appropriate documentation 90 days in advance of the expiration date.

Submission of the FISAP through the TIV WAN:

Beginning with the Fiscal Operations Report for 1997-98 and Application to Participate for 1999-2000 (FISAP) due October 1, 1998, institutions will be required to submit FISAP data through the TIV WAN. Currently a FISAP can be submitted to the
Department either through an electronic submission or by sending computer diskettes or magnetic tapes. This new requirement will eliminate the diskette and magnetic tape options and will transfer the electronic submission to the TIV WAN. The software supporting the submission of the FISAP will be in Windows 3.1 or higher format. The Department will no longer support software in DOS.

Electronic Requirements - January 1, 1999

Windows 95, Windows NT or Higher:

As provided on Table B as a technical requirement, institutions must be prepared to process Department data, starting with the 1999-2000 award year, using either Windows 95, Windows NT, or a newer version of the Windows operating system. Neither the Disk Operating System (DOS) nor earlier versions of Windows will be supported after December 31, 1998.

Year 2000 Compliant:

By January 1, 1999, all institutions must be Year 2000 Compliant with regard to the processing of financial aid data. Year 2000 Compliant means that all data processing systems, procedures, and protocols are designed to handle the upcoming change in the century by storing and reporting date data in ways that differentiate
between years prior to 2000 and Year 2000 and beyond. This issue is critical because many computer systems were not designed to accommodate a four-character year. That is, they were designed to store and process data about a year using just the last two digits (i.e. 1989=89). Such conventions are no longer sufficient as we move toward the new century.

Electronic Requirements - July 1, 1999

Submission of Federal Pell Grant Payment Data through TIV WAN:

Beginning July 1, 1999, institutions will be required to report payments for the Federal Pell Grant Program electronically through TIV WAN or by magnetic tape or cartridge. The Department will no longer accept diskette submissions. Although this change still maintains the magnetic tape or cartridge reporting options, we are
working on ways to replace those media with enhanced electronic submissions.

Submission of SSCR Data to the NSLDS:

Beginning July 1, 1999, institutions will be required to report Student Status Confirmation Report (SSCR) data electronically through TIV WAN or by magnetic tape or cartridge to NSLDS. The Department will no longer accept diskette submissions. As discussed above, we are working on ways to replace tape and cartridge media
with enhanced electronic submissions.

Submission of Federal Perkins Loan Data to the NSLDS:

Beginning July 1, 1999, institutions will be required to report Federal Perkins Loan Data electronically through TIV WAN or by magnetic tape or cartridge to the NSLDS. The Department will no longer accept diskette submissions of Federal Perkins Loan data. Once again, we expect to eliminate tape and cartridge submissions in the
future.

Technical Specifications

The following technical specifications (Table B), as published in the Electronic Processes Notice, provide information regarding hardware and software requirements that will enable schools to participate in these required electronic processes. Some of the specifications, while not needed to meet the current requirements designated in the Electronic Processes Notice, will be required in future years as the Title IV student aid programs delivery system is upgraded and enhanced. Therefore, institutions should regularly include in their automated data processing budgets plans for upgrades and enhancements to their systems. Institutions should particularly note that, beginning on January 1, 1999, for the 1999-2000 processing
year, the Department's electronic processes will require a Windows 95 or Windows NT operating system. Neither the Disk Operating System (DOS) or earlier versions of Windows will be supported.

The table includes two columns of specifications. The left column provides information on the current minimum configuration needed in order for an institution to maintain a basic level of electronic efficiency. The right column provides information on the configuration that will be needed to support the electronic
requirements beginning in January 1999 as designated in the Electronic Processes Notice. Although many institutions currently participate electronically using the minimum configuration, it is recommended that institutions that need to acquire resources in order to meet the requirements of the Electronic Processes Notice invest in the equipment and software that will be needed in the future. Schools that currently participate electronically should prepare to upgrade their equipment and software in time to meet the January 1999 requirements. When reviewing these specifications, institutions should be aware that capacity requirements (processor
speed, RAM, hard drive storage, etc.) are greatly affected by specific factors at each institution, including which EDExpress functions the
school uses, number of records processed, and institutional database interfaces.



TABLE B: TECHNICAL SPECIFICATIONS


Current Minimum Configuration (Depending Upon Volume and Usage)

Equipment

IBM or fully IBM-compatible PC
66 MHZ Processor 486DX2
16 MB RAM
300 MB Hard Disk Space
14,400 bps or higher baud Hayes or
comparable Modem
3.5"/1.44MB Diskette Drive
SVGA Monitor
Standard Keyboard
Printer capable of printing on standard
paper (8 1/2" x 11")
4x CD-ROM Drive with sound board*


Software

MS-DOS version 6.2 or higher;
Windows 3.1, 3.11 or 95
Internet Service Provider (ISP)**
Netscape Navigator 3.0 or 3.01
(domestic) or web browser***


Phone Line
Dedicated phone line

Diskettes
3.5" high-density double-sided diskettes





Minimum Configuration Required By January 1999

Equipment

IBM or fully IBM-compatible PC
200MHz Pentium Processor or comparable
64MB RAM
4.0 GB SCSI Hard Drive
56K Analog Modem
3.5"/1.44MB Diskette Drive
SVGA Monitor
Windows 95 Keyboard
Laser printer capable of printing on standard
paper (8 1/2" x 11")
12x CD-ROM Drive with sound board*


Software

32 bit operating system (Windows 95 or
Windows NT 4.x)
Internet Service Provider (ISP)**
Netscape Navigator 3.0 or 3.01 (domestic) or
web browser***


Phone Line
Dedicated phone line

Diskettes
3.5" high-density double-sided diskettes


* Required if institutions want to use the EDExpress Tutorial and the AWARE software.
** Will be necessary to access the "Info for Financial Aid Professionals" website or the Student Financial Assistance Bulletin Board System (SFA BBS) and for submission of the Application for Approval to Participate in Federal Student Aid Programs (recertification, reinstatement, and changes).
*** Currently must use Netscape Navigator 3.0 or 3.01 (domestic) in order to utilize FAFSA on the web. The Department is currently testing other web browsers that will be made available to the public in the near future.


Additional Information:

For further information on any of the electronic processes discussed in this letter or on technical aspects of the requirements, please contact:

1. Title IV Federal Student Aid Program Policy: Jacquelyn C. Butler, (202) 708-8242.

2. Title IV Wide Area Network (TIV WAN): Title IV WAN Customer Service, 1-800-615-1189

3. "Information for Financial Aid Professionals" website or the Student Financial Assistance Bulletin Board System (SFA BBS): Customer Support Branch, 1-800-433-7327.

4. Electronic Application for Approval to Participate in Federal Student Aid Programs: Patricia Patterson, (202) 260-5742.

5. Fiscal Operations Report and Application to Participate (FISAP): Campus-Based Programs Financial Management Specialists, (202) 708-7741.

6. Federal Pell Grant Reporting: Financial Management Specialists, 1-800-4PGRANT

7. National Student Loan Data System (NSLDS): F. Lynn Alexander, (202) 708-8125.

8. Easy Access for Students and Institutions (Project EASI): Fred Sellers, (202) 708-8242.




GEN-97-12
November 1997


Dear President:

I am writing to ask for your support as your financial aid, business office, and computing services staff ensure that your institution is in compliance with a new Federal requirement relating to electronic participation between the Department of Education (ED) and postsecondary educational institutions. The new requirement
provides that schools must participate in certain electronic processes for the administration of Federal student aid programs. Enforcement actions that may be taken against a school that is not in compliance could include termination from all participation in the Federal student aid programs

Under separate cover, we have sent your institution's financial aid administrator a letter (1998-99 Action Letter #2) that includes a comprehensive explanation of each of the required electronic processes and their implementation dates. I have enclosed with this letter a copy of the table from the Action Letter that lists the
technical specifications schools must have in order to be in compliance.

Many institutions will find that they already participate in all or most of the required processes. Some will need to expand their electronic participation, while a few will become "electronic" for the first time. An institution may meet this requirement by utilizing software provided by the Department or software developed by the institution or a vendor, in accordance with specifications provided by the Department. Alternatively, an institution may meet this requirement by the use of a third party servicer.

I would also like to especially remind you of the need for your school to be "Year 2000 Compliant" with regard to the processing of financial aid data. Year 2000 Compliant means that all of your data processing systems, procedures, and protocols are designed to handle the upcoming change in the century. We will be sending a
separate more specific letter to your financial aid officer within the next few weeks describing this issue in more detail.

Let me thank you in advance, for your cooperation and support as, together, we move toward creating an efficient and cost effective Federal student aid delivery system.



Sincerely,



Elizabeth M. Hicks
Deputy Assistant Secretary,
Student Financial Assistance Programs

Enclosure

Last Modified: 09/30/1997