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Summary: Second Round of Pell Grant Administrative Cost Allowance Payments for 2001-2002 have been processed

Publication Date: August 28, 2002

Author: General Manager: FSA School Channel

Summary: Second Round of Pell Grant Administrative Cost Allowance Payments for 2001-2002 have been processed


Posted on August 28, 2002

TO: All Destination Points

FROM: Pell Grant Operations

Summary: Second Round of Pell Grant Administrative Cost Allowance Payments for 2001-2002 have been processed

The Recipient Financial Management System (RFMS) began processing the second Administrative Cost Allowance (ACA) payment for 2001-2002 on August 26, 2002. Schools will begin to see these funds deposited into bank accounts in the coming days. Please share this information with your business office. An electronic file (PGTX02OP) was sent through SAIG to affected schools. It contains a brief text message about the amount of the ACA and the number of unduplicated recipients determined to be for each school. This text file can be opened in Wordpad, WORD or Word Perfect.

Section 690.10 of the Federal Pell Grant regulations authorizes a payment of five dollars for each Federal Pell Grant recipient. These funds may be used only to defray the costs of administering the Federal Pell Grant, Federal Supplemental Educational Opportunity Grant, Federal Work-Study and Federal Perkins Loan programs. The total number of Federal Pell Grant recipients includes students with reported disbursements who subsequently dropped out of school with a full recovery of their Federal Pell Grant award, as well as students who transferred into or out of your institutional system.

Your total recipient count excludes the following:

1. Applicants determined ineligible for a Federal Pell Grant or
rejected by the Central Processing System;

2. Students for whom origination records were accepted in RFMS for but whom RFMS has not received an accepted disbursement;

3. Recipients whose disbursement record(s) were previously submitted and accepted in the first ACA payment calculation (multiple records including negative disbursements and duplicate records are not included); and

4. Students whose disbursement record(s) are rejected.

The U.S. Department of Education's Grants Administration and Payment System (ED/GAPS) forwards ACA payments electronically through the Federal Reserve Bank of Richmond, VA. If your institution has not initiated a direct deposit form (Standard Form 1199A) to establish a unique bank account for ACA payments, ED/GAPS automatically deposits these funds into your existing account. If you do not receive a payment (and you have submitted disbursement records that were accepted by RFMS) or if you need assistance in defining your proper bank account, please call the GAPS Hotline at1-888-336-8930.

In the early spring of 2003 we will make a third and final adjustment to your 2001-2002 ACA for the additional recipients at your school, including students included in item 4 above whose data you resolve and resubmit correctly. To ensure your ACA payment counts each of your Federal Pell Grant Recipients correctly, you must report an acceptable disbursement record within thirty days of paying the student.

We do not need your institution to acknowledge that you received your Administrative Cost Allowance payment but we ask that you forward a copy of this notice to your Business office.

If you have any questions, please call 1-800-474-7268 and specify the 2001-02 award year.

Last Modified: 08/27/2002