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Summary: HERA Operational Implementation Guidance (CPS, COD System, EDExpress Suite)--Upcoming CPS Reprocessing

Publication Date: May 11, 2006

Author: G. Kay Jacks, General Manager, FSA Application, School Eligibility and Delivery Services

Summary: HERA Operational Implementation Guidance (CPS, COD System, EDExpress Suite)--Upcoming CPS Reprocessing

Posted on 05-11-2006

As we described in the recently-posted high-level overview, the first major event in the implementation of the provisions of the Higher Education Reconciliation Act of 2005 (the HERA), Pub. L. 109-171, is a reprocessing of certain Free Application for Federal Student Aid (FAFSA) data. This reprocessing, scheduled to occur on or about May 19, 2006, will accommodate some of the need analysis changes in the HERA, as described in Dear Colleague Letter, GEN-06-05. We expect to reprocess less than 150,000 records.

This communication provides more detail about system changes and reprocessing, including how to identify the reprocessed records. Future communications will provide further guidance on the changes to need analysis and other new processes and procedures.

Central Processing System (CPS) Changes and Reprocessing

We have modified the CPS to implement two changes to need analysis contained in the HERA provisions. The first change deletes the requirement that for a dependent student, both the student and the parent were not required to file an IRS 1040 tax return. Only the parent's type of tax return is now considered when determining if a dependent student qualifies for the Simplified Needs Test (SNT) or an automatic zero expected family contribution (EFC). The second change raises the income parameter for automatic zero EFC eligibility from $16,000 to $20,000 for dependent students and independent students with dependents other than a spouse.

When these changes are implemented in the CPS on or about May 19, 2006, all new 2006-2007 applicants will have the appropriate criteria applied to their records when determining whether they are eligible for the SNT or automatic zero EFC. However, in order to apply these changes to applicants who applied before May 19, 2006, we must reprocess records for applicants who are now eligible for the SNT or automatic zero EFC based on these changes.

Records That Will Be Reprocessed

Accordingly, on or about May 19, 2006, we will reprocess records that meet the following conditions:

  • Applicants who previously were not eligible for the SNT or automatic zero EFC because of the type of tax return filed by the dependent student and who will now be eligible;
  • Applicants who previously were not eligible for the automatic zero EFC calculation because they had an income between $16,001 to $20,000 and who will now receive an automatic zero EFC because of the increased income parameter;

Note: We will not reprocess records for students who meet the new criteria for the SNT or an automatic zero EFC but who already have a zero EFC on their latest transaction.

Records that meet these conditions will be reprocessed and a new Student Aid Report (SAR) will be sent to the student and a new Institutional Student Information Record (ISIR) will be sent to the institutions listed on the applicant's record. In the event a student now meets the criteria for both the SNT and an automatic zero EFC, only one new transaction will be generated.

How to Identify Reprocessed ISIRs

Reprocessed ISIRs can be identified in the following way:

  • Transaction Data Source Code = "5" (ISIR field #111, Position 535)
  • Transaction Data Type Code = "P" (ISIR field #111, Position 536)
  • Reprocess Reason = "01" (ISIR field #156, Positions 712 to 713)
  • Comment Code 172 (ISIR field #275, Positions 1677 to 1736) will be present
  • System Generated Message Class = IGSG07OP

SAR Comment for Dependent Students

As described in Dear Colleague Letter, GEN-06-05, individuals who are currently serving on active duty in the U.S. Armed Forces for purposes other than training are now considered to be independent students. Because we have no way of knowing which dependent applicants may be on active duty, we are notifying students of the change in the definition of an independent student as part of this reprocessing effort.

Dependent student records that are reprocessed because they meet the new SNT or automatic zero EFC criteria will also receive comment 119 on their SAR. The comment code will also be added to the ISIR.

The new SAR comment (#119) will read as follows:

"If you are currently serving on active duty in the U.S. Armed Forces for purposes other than training, you are considered to be an independent student for the purpose of receiving federal student aid. You must notify your financial aid office if you are on active duty because it may significantly affect your financial aid eligibility ."

This new SAR comment will also be added to all 2006-2007 records for dependent students who apply or correct their records on or after the date of reprocessing to alert them to the change.

School Responsibility

As always, when an institution receives a new ISIR it must consider whether any change to the student's EFC impacts eligibility for federal student aid and make any necessary adjustments to the student's award.

If an institution becomes aware that an otherwise dependent student is serving on active duty as described in GEN-06-05, it should submit a "dependency override." The EFC will be recalculated using the independent student formula.

Updated Specifications for Software Developers

To accommodate these need analysis changes, an updated version of the 2006-2007 Software Developers Specifications package was posted to the U.S. Department of Education's Information for Financial Aid Professionals (IFAP) Web site, located at and to the Department's FSAdownload Web site, located at Please refer to the electronic announcement posted on May 5, 2006 for further details.

Updated CPS test files (including application records and matching ISIRs) will be posted to the FSAdownload Web site on May 19, 2006. However, in order to provide you with these test files as soon as possible so you can begin to test your system, we anticipate posting the test files to the IFAP Web site a few days earlier. An announcement of the test files' availability will be posted to the "Higher Education Reconciliation Act of 2005 (HERA) Information" link on the home page of the IFAP Web site (

For More Information

In a subsequent communication we will provide more detail about this reprocessing, including how we will handle remaining need analysis changes for the 2006-2007 Award Year that cannot be handled through reprocessing.

If you have any questions regarding the CPS reprocessing, contact CPS/SAIG Technical Support at 800/330-5947 (TDD/TTY 800/511-5806) or by e-mail at

If you have other questions regarding the HERA, contact the Federal Research and Customer Care Center (RCCC) at 800/433-7327.

Last Modified: 05/10/2006