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(CB-03-05) Use of State Scholarships and Grants as the Non-Federal Share of Federal Supplemental Educational Opportunity Grant Awards.

Publication Date: April 2003

DCL ID: CB-03-05

Use of State Scholarships and Grants as the Non-Federal Share of Federal Supplemental Educational Opportunity Grant Awards.

April 2003

CB-03-05

SUBJECT: Use of State Scholarships and Grants as the Non-Federal Share of Federal Supplemental Educational Opportunity Grant Awards.

REFERENCE: This letter supplements the Campus-Based Programs Volume of the 2002-2003 Student Financial Aid Handbook.

Dear Colleague:

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 Leveraging Educational Assistance Partnership (LEAP) and Special Leveraging Educational Assistance Partnership (SLEAP) awards, are eligible funds that may be used to meet the non-Federal share requirement. LEAP and SLEAP awards, for this purpose, are defined as the Federal LEAP and SLEAP allocations plus the minimum required State matching amounts. The remaining State grant amounts are considered non-LEAP and non-SLEAP awards and therefore can be used to meet the non-Federal share requirement.

We used the information provided by the respective States concerning expected expenditures for State scholarships and grants for the 2002-2003 award year, the 2002-2003 LEAP and SLEAP allocation data, and the required matching information to compute the percentages of State scholarships and grants that you may use to provide the non-Federal share of total FSEOG awards for the 2002-2003 award year. A chart showing these percentages is enclosed. You can apply the appropriate State percentage to the State scholarships and grants your 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 $500 from the State of Delaware. The Delaware percentage of 70.05 multiplied by the grant equals $350, which is the portion of the grant that may be used to meet the non-Federal share requirement for a $1,400 FSEOG award ($1,050 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 a LEAP or SLEAP award, 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 LEAP or SLEAP 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 Greg Gerrans in our Financial Partners Channel at 202-377-3304 or the Campus-Based Call Center at 877-801-7168. We trust that this information will be useful in your administration of the FSEOG Program.

Sincerely,

Theresa S. Shaw

Chief Operating Officer, FSA

Percentages of State Scholarships and Grants Chart in PDF Format, Size 6KB, page 1

Percentages of State Scholarships and Grants Chart in MS Excel Format, Size 18KB

Last Modified: 04/16/2003