Summary: Use of State scholarships and grants as the non-Federal share of Federal Supplemental Educational Opportunity Grant awards.
SUBJECT: Use of State scholarships and grants as the non-Federal share of Federal Supplemental Educational Opportunity Grant awards.
REFERENCE: This letter supplements Chapter 8, Section 3 of the Federal Student Financial Aid Handbook.
The Higher Education Act of 1965, as amended, provides that the Federal share of awards under the Federal Supplemental Educational Opportunity Grant (FSEOG) Program may not exceed 75 percent of such awards. The non-Federal share of FSEOG awards shall be made from an institution's own resources, including institutional scholarships and grants, tuition or fee waivers, State scholarships and grants, and foundation or other charitable organization funds. In response to inquiries concerning the use of State scholarships for this purpose, the Department has determined that all State scholarships and grants, except for State Student Incentive Grants (SSIGs), are eligible funds that may be used to meet the non-Federal share requirement. SSIG awards, for this purpose, are defined as the Federal SSIG allocation plus the minimum required State matching amount. The remaining State grant amounts are considered non-SSIGs and therefore can be used to meet the non-Federal share requirement.
On the basis of information furnished by the respective States concerning expected expenditures for State scholarships and grants for the 1998-99 award year and using the 1998-99 SSIG allocation data and required matching information, the Department has computed the percentages of State scholarships and grants that may be used by institutions to provide the non-Federal share of total FSEOG awards for the 1998-99 award year. A chart showing these percentages is enclosed. Each institution can apply the appropriate State percentage to the State scholarships and grants its students receive to determine the total amount of State scholarships and grants that may be used to meet the FSEOG non-Federal share requirement. For example, a student receives a grant of $ 650 from the State of Massachusetts. The Massachusetts percentage of 96.14 multiplied by the grant equals $ 625, which is the portion of the grant that may be used to meet the non-Federal share requirement for a $ 2,500 FSEOG award ($ 1,875 is the Federal share of the FSEOG award).
As a variance from use of the indicated percentages, if an institution has specific knowledge that a State scholarship or grant - irrespective of its name - is considered to be the required State matching portion of an SSIG, that scholarship or grant may not be used to meet the FSEOG non-Federal share. Also, if an institution has documented knowledge that a State scholarship or grant is not comprised of SSIG monies (Federal or State), 100 percent of the scholarship or grant may be used as the FSEOG non-Federal share.
For additional information or if you have questions, please contact Nancy Adams in our Policy Development Division on (202) 708-8242. We trust that this information will be useful in your administration of the FSEOG Program.
Diane E. Rogers
Acting Deputy Assistant Secretary
Student Financial Assistance Programs